There’s a simple reading rule that Warren Buffett asserts: Read 500 pages a day. He soaks up everything he can get his hands on, and that leads to a massive amount per day. Buffett contends that by reading this voluminous amount of information, you’re effectively investing in yourself – “knowledge builds up, like compound interest.”
The Oracle of Omaha has been doing pretty well for himself these days; reportedly, he’s making an average $37 million a day. His company, Berkshire Hathaway, has skyrocketed in share price in recent years. For him, all that reading means smart investments and terrific paydays.
When I was in high school, I avoided books like they were laced with smallpox. I’d read Sparknotes and research the main topics of books on the web; ignoring the censures and recommendations of astute instructors, pleading that I actually read the assigned novels. When I remark on my primary education, I cannot remember a single assigned book I read cover-to-cover.
Nowadays, I read voraciously. I cannot get enough; albeit, I’ve not reached 500 pages per day – that’s insane. The following are 3 must-read books for the future financial guru in you! Isn’t it time you unleashed the Buffett in you?
1. Confessions of a Street Addict by Jim Cramer
There was one book I remember from high school, and it wasn’t assigned to me. When I was a junior and senior, I thought I might pursue a career in business. The world of investing and finance was tantalizing – I dreamed of getting a job on Wall Street. Those ideas were born from a thorough and repetitive reading of Jim Cramer’s Confessions of a Street Addict.
Despite Jim Cramer taking a beating by popular media types such as Jon Stewart, the man started from fairly humble beginnings and worked tirelessly to make a career on Wall Street. For some time, he lived out of his car and was uncertain about his financial and vocational future. Cramer was educated at the best of Harvard’s schools and went on to manage his own hedge fund that was quite profitable.
This book is less about advice than a thorough look through the eyes of a financial guru. Confessions of a Street Addict is a terrific read – well written – and nasty at times. Cramer does not paint the business world in a pretty light; rather, he shines a spotlight on some of the craziest parts of finance.
2. I Will Teach You To Be Rich by Ramit Sethi
When I got to college, I realized I needed to balance my budget and better understand my cash flow. I was spending money like there was no tomorrow. Living in the moment led me to outspend my budget and eventually into a significant debt load. Ramit Sethi’s I Will Teach You To Be Rich is a wonderful primer for understanding a variety of financial principles.
The book takes readers on a journey of lessons and financial changes. Sethi teaches people how to automate finances and easily control spending. Likewise, the book suggests a variety of personal finance checking, savings, and investment accounts that will help to maximize your interest rates and side income.
Filled with practical tips, this is perfect for millennials that may be starting their financially frugal journey. I refer back to this book quite frequently to recall what steps I should be taking to maximize my return on investments.
3. The Big Short by Michael Lewis
There’s not a lot of fact and depth in the news surrounding the most recent financial meltdown. If you’ve been paying attention, you probably have heard of credit default swaps, bad mortgages, and some of the leading banks being targeted by federal inquiries. Unfortunately, little has changed since the catastrophe, and we may see this happen again.
Michael Lewis is the now famous author for Moneyball, after the book was turned into a movie. Lewis is a gifted researcher and writer, weaving fact and intrigue into effortless stories. Suddenly, complex financial instruments are fascinating concepts that are fairly easy to understand.
The Big Short is one of Lewis’ best books, and a must-read for people that want to better understand the meltdown and see who actually profited off the mess. Surprisingly, there was an elite group of mathematicians and investors that bet in the opposite direction and made millions/billions off the downfall.
I don’t know if I believe this. Even at a quick pace this would be 10 hours of reading every day.
Scott,
I’m in complete agreement with you. It’s a crazy amount of reading. The origin of the quote and 500 pages a day idea came from a student-led question to Buffett:
“One of the students asked what he could do now to prepare for an investing career. Buffett thought for a few seconds and then reached for the stack of reports, trade publications and other papers he had brought with him.
‘Read 500 pages like this every day,’ said Buffett, or words to that effect. ‘That’s how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it.'”
From: http://www.omaha.com/article/20130428/MONEY/704289987
While I’m inclined to believe the authenticity of the claim, it seems like a serious amount of time spent reading.
Thanks for the comment,
Sam
My personal finance principles are found in Walden. 🙂
Kurt,
How are you writing this comment then??? 😉
I love Thoreau’s take on simplicity, minimalism, and enjoyment of nature. I’d say he influences a lot of what I write about.
Thanks for the comment,
Sam
I am sure these are great to read having been written by people who worked their way to get where they are now. I just wish though that there is indeed a Buffett in me. Dear heavens, let there be!
Thanks for this! I am now planning to buy I Will Teach You To Be Rich by Ramit Sethi. I hope this is a good choice among the three. 🙂
It’s definitely one of my favorites! Good choice. Hope you enjoy it. 🙂
Happy holidays,
Sam
I am actually trying to read a book a week. That’s my goal in 2014. I’ll have to add these to my list!
Ramit’s book was the first personal finance book I read cover to cover about 4 years ago. I’m actually re-reading it now and it still is great. I’m not sure what to feel about Cramer since his show is so over the top and looney and he is one of those media people who we shouldn’t be listening to. But he’s been through a lot so I’m sure he has some wisdom that we can use. Thanks for the reminder to keep on reading!
I probably read about 50-100 pages a day if I combine my book reading and blog reading. I can’t imagine doing much more, unless I’m just devouring a book.
I’ve never even heard of The Big Short – I didn’t pay much attention when Moneyball came out, maybe I should’ve. I suppose 500 pages a day is doable if you’ve mastered speed reading, but I really don’t see how it’s attainable otherwise. Granted, it would not surprise me if Warren Buffett were a speed reader at all.
Mel,
The big short was absolutely fantastic! I highly recommend it. 500 pages a day is pretty difficult, but if you count all the text you may be exposed to online, maybe it adds up! 😉
Thanks for this list! I’ll have to add these to my never ending list of books to read.
500 pages a day is extremely impressive. Maybe I’ll start with a more attainable goal and work my way up 🙂
Nice list of books! I’m hoping that I can read “I Will Teach You To Be Rich” before the year ends. 🙂
These books look really interesting! I really want to check out “I Will Teach you to be Rich”. Thanks for creating this list with us!
I had a friend from Ireland visit and recommend a few Micheal Lewis books to me. I’ve written the names down and will be reading them. I have to get around to Ramit’s book too. It’s been on my list for a while now.