Frum Finance Bookshelf: 3 Must-Read Money Books

May 3, 2021

Planning & Saving

Simcha Shternen respected his father but knew there was one thing he needed to not emulate: running household finances. Even when Simcha was a young bachur, his father’s financial ineptitude was obviously a real problem. Things always cropped up—ominous IRS correspondence, uninsured home damages, and even the occasional bankruptcy. This parental shortcoming wasn’t a youthful misconception; Simcha’s father had told him as much when he was a chassan. “Do some research,” he’d said. “Educate yourself so you don’t make the same mistakes I did!”

What books contain the crucial financial information that every adult should know?

After I got married, I took my new role seriously, so of course I took multiple trips to Home Depot and stocked up on a wide variety of tools. I quickly learned, however, that a hammer, screwdriver, and drill cover the duties most yungeleit/handymen can reliably undertake on their own. But just as every family needs basic hardware to keep their physical home tight and secure, couples need at least some financial tools under their belts too. The following three classic books cover must-know personal finance—the hammers, drills, and screwdrivers in the world of money.

1. Personal Finance for Dummies

Don’t let the name fool you. This best-selling book, written by Eric Tyson, covers the gamut of financial topics—financial goals, managing credit, debt, home-buying, investing, taxes, insurance, and much more. Each volume in the popular “For Dummies” series assumes that readers are beginners who require very clear guidance on a new topic. Personal Finance for Dummies is therefore very logically organized, speaks in simple language, and provides the most important core of financial knowledge. Tyson isn’t just spouting theory; his know-how stems both from his extensive education and lengthy experience as a financial advisor to everyday people.

Tyson’s book is importantly unbiased—there are no sales leads or hidden agendas in the book. On the contrary, readers learn how to avoid industry pitfalls and seek good advice and investment products without getting ripped off. As an investment guy, I also like that the book’s section on growing wealth doesn’t pigeonhole readers—stocks, bonds, mutual funds, real estate, and even small business are all covered in this comprehensive guide. You can read this excellent book cover to cover, do a deep dive on just a relevant chapter, or keep it as a reference guide via its detailed index.

2. Your Money and Your Life

Reading just the aforementioned book will provide an outstanding overview of personal finance. However, it is difficult, bordering on impossible, for someone outside of our community to fathom the unique circumstances and perspectives of frum life: kollel, large extended families, tight communities with extensive chessed networks, simchos, tuition, Shabbos, seminary, our bitachon and attitudes about what’s important in life. This isn’t a criticism of Tyson or the other authors in the field. But clearly, the frum world needs its own foundational book about personal finance. That’s where another classic book, Your Money and Your Life, comes in.

I love this book, put out by Mesila, an organization whose mission is helping frum families achieve financial stability. The volume touches on everything financial, but from the perspective of a frum family—balancing bitachon and hishtadlus, budgeting for kollel families, saving for simchos, shalom bayis and money, and much more. The book’s format is similar to that of this column, with each chapter answering about half a dozen related questions, making it an easy and engaging read. While I don’t agree with every single word, this book is a masterpiece. Count on it to flesh out the nuance missing from Tyson’s expert but secular perspective.

3. The Millionaire Next Door

The final crucial financial book in the “toolbox” is any volume that pounds home the message that thriving financially requires discipline and planning. Many need a real knock in the head to deprogram from a culture of debt and conspicuous consumption. Some books focus more on the aseh tov—building a drive to gain financial independence, and others on the sur mei’ra—avoiding excessive, unsustainable consumption. To a large degree, the message that appeals most will be a matter of taste as the lessons here are primarily attitudinal, not technical. The timeless words of Mishlei and Pirkei Avos on these topics may be enough for you.

One book I found to be a real eye-opener was The Millionaire Next Door. The authors are professors of marketing who undertook deep academic research into the characteristics of America’s wealthiest families. Despite the common misconception, most millionaires are self-made businessmen or professionals who live frugally for years as they build themselves up. The “Prodigious Accumulators of Wealth” also tend to focus on investing, lowering their tax bites, and educating rather than indulging their children. The primary determinant of wealth, they found, was frugality in the pursuit of long-term growth, and this thriftiness often carried over long after the subjects became exceedingly wealthy.

Going Deeper?

These three books provide an outstanding financial foundation for any frum family—offering savvy advice that is probably beyond the scope of 80 percent of the American population! Absorbing the knowledge of basic finance will help you avoid the significant pitfalls, itself a significant accomplishment. But, of course, within each category covered in basic terms, there’s much more to learn. Tyson spends a lot of time discussing how to find further sources of accurate financial information and includes a short list of other book titles to consider.

Become an Educated Consumer

Some may question: “Why do I need to read at all? I’ll just hire someone else to take care of my financial issues.” Besides the costs involved, finding the right professionals to manage your investments, taxes, and insurance is no easy matter. What services do you require? Whom should you trust? How do you find, interview, and hire them? A basic financial education includes learning enough to be able to properly delegate to others. To paraphrase the now-defunct Syms clothing chain: “An educated consumer is a good customer.”