Update 12.29.24: I hadn’t read The Simple Path to Wealth when I first published this, but now I have and it is definitely one of my top 5! Updated to reflect that below.

It wasn’t that long ago when I realized that retirement doesn’t just “happen” and that to be successful at it, I needed to start planning for it well in advance. It started with me trying to figure out how much money I needed to save to last the entire rest of my life (which was baffling to me at the time- because how was I supposed to save enough without knowing if I was going to live until 70 or 100?). 

Somewhere along the way, I learned that prepping for retirement doesn’t necessarily mean saving up a bunch of cash to live off of. It wasn’t family who taught me this and I didn’t learn it in school. I learned it from googling, reading blogs and books, and listening to podcasts. (side note: I’m baffled that most people need to learn this on their own vs. in school. And not everyone is lucky enough to have people in their lives who can teach them). 

Financial Independence, Retire Early concepts are vast (but easy!)

There are many ways to prepare for retirement. The core concept is that you should aim to reach a target threshold of investments, such that the interest or dividends created from that core investment will fund your cost of living each year. I learned that as long as I could reach a target amount (assuming some percentage of return every year), I could live off the returns forever as long as my standard of living stayed reasonable (and as long as I had a safety net for down markets). This blew my mind! 

Not only that, but there’s so much more to learn when it comes to retirement – like how to manage expenses if retiring before 65 (e.g., how to withdraw funds early and minimize tax implications), healthcare planning before 65 (i.e., before Medicare kicks in), surviving retirement during a bear market, and even the concept of “Coast FIRE”. Coast FIRE (financial independence, retire early) is a concept where after reaching a certain level of investments, your investments will continue to grow without any additional contributions, and you’ll have enough to retire at your target date. You’re essentially “coasting” with your existing investments and letting time and compounding work its magic. After hitting a Coast FIRE milestone, you could do things like take a lower paying job to cover just your expenses, while your investments continue to grow on their own without making any additional contributions.

It wasn’t until late 2022 that I started to learn more about retirement planning. It’s hard to not feel like I’ve fallen behind, but at the same time, since this not taught in school, sometimes I feel like I’m ahead of many. I kick myself for not understanding this topic better earlier, and also find it frustrating that it isn’t a standard part of school curricula. 

In any case, I’ve come across several books that have deepened my understanding of personal finance and the concept of FIRE. Below are my favorites so far (additional recommendations are welcome!). There’s still a lot for me to learn on this topic.

My favorite financial independence books

I’ve curated a list of my favorite books on the subject below, each of which I appreciate and recommend due to their unique perspectives and actionable insights (keyword: actionable!):

1.  I Will Teach You to be Rich by Ramit Sethi

“At last, for a generation that's materially ambitious yet financially clueless comes I Will Teach You To Be Rich, Ramit Sethi's 6-week personal finance program for 20-to-35-year-olds. A completely practical approach delivered with a nonjudgmental style that makes readers want to do what Sethi says, it is based around the four pillars of personal finance- banking, saving, budgeting, and investing-and the wealth-building ideas of personal entrepreneurship.”

This book is more on the financial independence side vs. retiring early. My first introduction into personal finance began in 2011 when a friend introduced me to this book. “I Will Teach You to be Rich” was my entry point into personal finance, laying down the basics and small steps I could take to get started.

I found this book so practical and actionable, and so easy to understand and make changes immediately, that I would recommend this book to anyone. It’s a great starting point, but even seasoned veterans of financial independence could benefit. If you can’t find it at your local library or used bookstore, purchase on Amazon.

2. The Simple Path to Wealth by J.L. Collins

““In the dark, bewildering, trap-infested jungle of misinformation and opaque riddles that is the world of investment, JL Collins is the fatherly wizard on the side of the path, offering a simple map, warm words of encouragement and the tools to forge your way through with confidence. You'll never find a wiser advisor with a bigger heart.” -- Malachi Rempen: Filmmaker, cartoonist, author and self-described ruffian

I added this on 12.29.24. Collins provides an easy-to-understand overview of everything you need to know and simplifies many important concepts that might initially seem daunting and complex. His writing is approachable, and at times entertaining! I definitely recommend and would put this right after Ramit’s book. Although I’ve been doing a lot of research already over the past few years, there are still things I’ve learned from his book that I didn’t know how I missed. For example, saving all your medical receipts where you paid out of pocket, so you can potentially reimburse yourself from your HSA funds years down the line.

If you can’t find it at your local library or used bookstore, purchase on Amazon.

3. Quit Like a Millionaire: No Gimmicks, Luck, or Trust Fund Required by Kristy Shen and Bryce Leung 

“From two leaders of the FIRE (Financial Independence, Retire Early) movement, a bold, contrarian guide to retiring at any age, with a reproducible formula to financial independence. A bull***t-free guide to growing your wealth, retiring early, and living life on your own terms

Kristy Shen retired with a million dollars at the age of 31, and she did it without hitting a home run on the stock market, starting the next Snapchat in her garage, or investing in hot real estate. Learn how to cut down on spending without decreasing your quality of life, build a million-dollar portfolio, fortify your investments to survive bear markets and black-swan events, and use the four percent rule and the Yield Shield - so you can quit the rat race forever. Not everyone can become an entrepreneur or a real estate baron; the rest of us need Shen's mathematically proven approach to retire decades before 65.”

This is another easy to read and practical book that outlines the process this couple followed to get to where they are.

While I didn’t start thinking about financial independence in my 20s like the authors did, the advice is still sound no matter what age you are. 

If you can’t find it at your local library or used bookstore, purchase on Amazon.

4. Work Optional: Retire Early the Non-Penny-Pinching Way by Tanja Hester 

“A practical action guide for financial independence and early retirement from the popular Our Next Life blogger.

In today's work culture, we're expected to hustle around the clock. But what if you could escape the traditional path and get on one that doesn't require working full-time until age 65? What if you could wake up every day without an alarm clock and do the things you love most?

Tanja Hester and her husband Mark left their crazed careerist lifestyle to live their dream life in Lake Tahoe, retiring early from high-stress careers. Now Tanja will help you map out a customized plan for freedom and make it easy to succeed, whether you're good at math and budgeting - or not! Work Optional is more than just a financial plan: it's a plan for your whole life-designed by you, not by an employer or clients. Tanja walks you through envisioning your dream life, accounting for variables such as health care and children, protecting yourself from recessions and future unknowns, and achieving a purpose-filled early retirement, semi-retirement, or career intermission with completely doable, non-penny-pinching steps.

You can live a happier, more meaningful life, free from the daily grind. Regardless of where you are in your career, Work Optional will get you there.”

This book emphasized that retirement without the right design and purpose will not be successful. 

It still covers the financial side of things, but more importantly helps you think about and develop your intention and purpose for a work-optional life. In many of the books and interviews I’ve read/listened to, a common theme from retirees is that they often go into retirement feeling lost, bored, or grief at the the loss of this prior life. It seems like it’s common to develop some sort of identity crisis (so much of our identity can be tied to our careers) or even depression or anxiety. Having a plan and understanding of one’s purpose for retiring can help mitigate or lessen these feelings.

The book begins with an introspective exercise to craft a mission statement and visualize what you want by identifying common themes throughout different times in our lives. I read and went through this exercise while on vacation and it was really satisfying and enlightening. I would love to reread this book and go through the exercises every few years to make sure I’m on track and have a good plan. Hester’s book is an easy read, and again- practical and actionable!

If you can’t find it at your local library or used bookstore, purchase on Amazon.

5. Die With Zero: Getting All You Can from Your Money and Your Life by Bill Perkins

“A common-sense guide to living rich . . . instead of dying rich

Imagine if by the time you died, you did everything you were told to. You worked hard, saved your money, and looked forward to financial freedom when you retired. The only thing you wasted along the way was . . . your life.

Die with Zero presents a startling new and provocative philosophy as well as a practical guide on how to get the most out of your money—and out of your life. It’s intended for those who place lifelong memorable experiences far ahead of simply making and accumulating money for one’s so-called “golden years.” In short, Bill Perkins wants to rescue you from over-saving and under-living. Regardless of your age, Die with Zero will teach you Perkins’s plan for optimizing your life, stage by stage, so you’re fully engaged and enjoying what you’ve worked and saved for.

You’ll discover how to maximize your lifetime memorable moments with “time-bucketing,” how to convert your earnings into priceless memories by following your “net worth curve,” and how to navigate decisions about whether to invest in, or delay, a meaningful adventure with your “fulfillment curve” and “personal interest rate.”

Using his own life experiences as well as the inspiring stories and cautionary tales of others—and drawing on eye-opening insights about time, money, and happiness from psychological science and behavioral finance—Perkins makes a timely, convincing, and contrarian case for living large.”

I was hesitant about picking this book up because the author is a wealthy and successful hedge fund manager, so of course he can spend down his money and “die with zero” because he’s got so much of it. 

Many of the podcast interviews I listened to would reference this book such that I caved and gave it a shot. I’m glad I did. The book helped me think differently. It introduced me to the concept of “net fulfillment” in each stage of life (e.g., the more active, and less “luxurious” activities need to happen earlier in life). I now think slightly differently about my finances and consider the concepts from this book as part of spending decisions from time to time. 

The book also got me thinking more often about investing in experiences (“memory dividends”). Memory dividends are just as, if not more, valuable as investments to have throughout a lifetime. 

Like anything though, decisions have to be balanced. There’s a risk vs reward for any number of scenarios that we could encounter. We don’t know what emergencies will happen such that perhaps we’d regret not saving more. On the flip side, if our time is short – perhaps we’d regret not investing more in experiences, all the while saving a bit less.

If you can’t find it at your local library or used bookstore, purchase on Amazon.

Additional books I read 

Below are additional books I read which were interesting, but not as standout as the above.

• More straight talk on investing: lessons for a lifetime by Jack Brennan
• The Bogleheads’ guide to investing by Mel Lindauer
• Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence by Vicki Robin and Joe Dominguez
• How To Retire Early: Your Guide to Getting Rich Slowly and Retiring on Less by Robert Charlton and Robin Charlton
• Purposeful Retirement: How to Bring Happiness and Meaning to Your Retirement by Hyrum W. Smith

Thanks for reading and happy FIRE-ing!