Hundreds of money books arrive in my mailbox every year, and very, very few manage to stand out.
The ones that distinguish themselves tend to do it in a bad way, by proffering snake oil: get-rich-quick shortcuts, can't-miss trading strategies, insanely complicated insurance schemes.
These get dumped without ceremony into our big blue recycling bin. I figure I'm doing my part to make the world a better place by not sending them to Goodwill, where some unsuspecting soul might get sucked in.
But every year a few really do have something special to say, and these earn a place on my bookshelf. This year's collection includes three original works and two long-overdue updates of personal-finance classics that I highly recommend, plus two honorable mentions that will be hits for the right audience.
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And the winners are . . .
- "The Difference: How Anyone Can Prosper in Even the Toughest Times" by Jean Chatzky
Chatzky, the financial editor of the "Today" show, has written other good books about money that were geared mostly toward beginners ("Pay It Down!" and "Make Money, Not Excuses" among them). But this book contains fascinating insights about who succeeds financially that might surprise even the most experienced financial hands.
The book is based on original research Chatzky conducted with Harris Interactive and Merrill Lynch, studying the attitudes, habits, education and choices of more than 5,000 people.
She divides the population into four groups: the wealthy (3%), the financially comfortable (27%), the paycheck-to-paycheck folks (54%) and the further-in-debt crowd (15%), then identifies what distinguishes the successful 30% from the rest. She also lays waste to the idea that people in debt are doomed to stay there, noting that a significant minority have risen from the bottom financial rung to financial comfort, or better.
"The Difference" is the natural successor to "The Millionaire Next Door," offering more details about what keeps you down and what gets you ahead, plus plenty of how-to advice about how to implement what you've learned.
- "Your Money or Your Life: 9 Steps to Transforming Your Relationship With Money and Achieving Financial Independence (Revised and Updated for the 21st Century)" by Vicki Robin, Joe Dominguez and Monique Tilford
The original "Your Money or Your Life" launched the simple-living movement in the early 1990s and became a must-read manual for a generation of people seeking a faster exit from the rat race. (I profiled some of them in "Retired by 50: What it really takes.")
The long-awaited update preserves the best of the original, including the nine-step plan to financial independence, while revamping the long-outdated section on investment advice.
Even if you don't opt for a simpler lifestyle, this book can help you understand the difference between making a living and making a life.
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The road to riches -- minus the guiltRamit Sethi talks about his book 'I Will Teach You to Be Rich,' which focuses on improving your finances even during an economic slump.
- "Enough: True Measures of Money, Business, and Life" by John C. Bogle
I'm a big fan of index fund pioneer Bogle, the venerable founder of the Vanguard Group of mutual funds. His common-sense advice, long-term perspective and concern for the small investor are the reasons I highly recommended his previous book, "The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns."
This small book is another home run. In it, Bogle ruminates on greed, excess and other moral failings that led to the current economic crisis. He calls for a return to "18th-century values" that somehow seem cutting edge. Among them: stewardship, integrity, leadership and character.
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Learn at an early age to live beneath your means and save the rest.
Don't pay an advisor to lose your money, anybody can do that.