A Beginning Investor's Reading List
Here are some good books to get you started.
If you're just starting out as a do-it-yourself investor, it can be hard to know where to start. Luckily, there are plenty of resources out there to help beginning investors who are willing to put in a little time and effort. These include a variety of articles here on Morningstar.com, including previous The Short Answer columns (all of which you can find here). Morningstar analysts have also written several books that go into more depth on how we think about investing but are still useful for beginners; these include Christine Benz's The Morningstar Guide to Mutual Funds and Pat Dorsey's The Five Rules for Successful Stock Investing and The Little Book That Builds Wealth. Of course, there are lots of other good investing books out there, some of which we've written about before. Here are a few of our favorites, with the caveat that this list is far from exhaustive.
The Only Investment Guide You'll Ever Needby Andrew Tobias
This book, first published 30 years ago and now in its eighth edition, is a classic overview of the essential things of which any investor should be aware. Writing in a witty, irreverent style, Tobias covers the basics of stocks, bonds, mutual funds, 401(k)s, IRAs, real estate, and how to save and invest prudently for the long term. If you feel totally at sea when it comes to investing, this book is a good place to get your footing.
Buffett: The Making of an American Capitalistby Roger Lowenstein
We at Morningstar are longtime fans of legendary investor Warren Buffett, and this biography by Roger Lowenstein is a good way to introduce yourself to the man and his investing philosophy. Buffett has become one of the world's richest people by investing in good businesses at low prices through his holding company, Berkshire Hathaway (BRK.B), using timeless principles that are helpful for anyone. This biography has a lot of background information that explains how Buffett got where he is today, but if you're more interested in concentrated doses of his investment wisdom, a great place to start is The Essays of Warren Buffett, edited by Lawrence Cunningham from Buffett's Berkshire Hathaway shareholder letters. Robert Hagstrom's The Warren Buffett Way is also a good overview of how the Oracle of Omaha thinks about investing.
David Kathman does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.