海角大神

A wonderful set of parents recently sent their son to me for financial advice. He was a聽聽and was about to start his first 鈥渞eal鈥� job.

Prior to this session, I drew up an outline of what I wanted to share with him 鈥� and now I鈥檓 sharing it with you. It was developed with his fresh-out-of-school status in mind but could apply to a wide spectrum of adults today.

Here are the books I suggested he read, in this order:

• 鈥淭he Automatic Millionaire鈥� by David Bach. The author鈥檚 position is that your wealth is not so much determined by your income as by your spending. He suggests automating your finances as much as possible so you聽聽without having to even think about it.

• 鈥淭he 7 Habits of Highly Effective People鈥� by Stephen Covey. This now-classic book, which has sold more than 15 million copies, suggests increasing your effectiveness through developing your character.

• 鈥淲inning The Loser鈥檚 Game鈥� by Charles Ellis. This is a guide to achieving long-term gains in the stock market.

• 鈥淭he Bogleheads鈥� Guide to Investing鈥� by Taylor Larimore and Mel Lindauer. This book outlines the investing philosophy of the so-called Bogleheads, or devotees of Vanguard Group founder John Bogle, who trumpeted the value and superior returns of low-cost聽聽compared with actively managed mutual funds.

• 鈥淭he White Coat Investor,鈥� by James Dahle. The primary audience is doctors, but its advice is useful for anyone headed into a high-income profession. (Disclosure: I鈥檓 quoted in the book and provided an endorsement printed on the flyleaf.)

Here鈥檚 a website series for basic financial understanding:

Here are two blogs to read for lessons on living within your means:

Concepts and touchstones to understand:

• Compounding
• Retirement savings: IRA, Roth IRA, 401(k), Roth 401(k)
• Medium and long-term savings: stocks, bonds, mutual funds, index funds, real estate
• Credit unions
• Vanguard
• Warren Buffett

The concepts listed here will take some effort on part of the reader to understand. The books mentioned above cover all of these items, but they鈥檙e important enough that I wanted to pull them out for emphasis.

Learn more about Jim on NerdWallet鈥檚聽.