diff --git a/options-manager.js b/options-manager.js
index 440688f7..32e8f752 100644
--- a/options-manager.js
+++ b/options-manager.js
@@ -124,10 +124,6 @@ function buildConfig(opts) {
 		config.baseConfig.extends = ['xo/esnext', path.join(__dirname, 'config/plugins.js')];
 	}
 
-	if (opts.parser) {
-		config.baseConfig.parser = opts.parser;
-	}
-
 	if (opts.rules) {
 		Object.assign(config.rules, opts.rules);
 	}
@@ -136,6 +132,10 @@ function buildConfig(opts) {
 		config.baseConfig.settings = opts.settings;
 	}
 
+	if (opts.parser) {
+		config.baseConfig.parser = opts.parser;
+	}
+
 	if (opts.extends && opts.extends.length > 0) {
 		// TODO: this logic needs to be improved, preferably use the same code as ESLint
 		// user's configs must be resolved to their absolute paths
diff --git a/readme.md b/readme.md
index 873c8a83..7286a474 100644
--- a/readme.md
+++ b/readme.md
@@ -180,12 +180,6 @@ Override any of the [default rules](https://github.com/sindresorhus/eslint-confi
 
 Please take a moment to consider if you really need to use this option.
 
-### settings
-
-Type: `object`
-
-Anything you put here gets passed to `settings` in the ESLint configuration; some of the ESLint plugins use this. For example, to configure the `import` ruleset to use the webpack configuration for determining search paths, you can put `{'import/resolver': 'webpack'}` here.
-
 ### semicolon
 
 Type: `boolean`<br>
@@ -211,11 +205,18 @@ Type: `Array`
 
 Allow more extensions to be linted besides `.js` and `.jsx`. Make sure they're supported by ESLint or an ESLint plugin.
 
+### settings
+
+Type: `Object`
+
+[Shared ESLint settings](http://eslint.org/docs/user-guide/configuring#adding-shared-settings) exposed to rules. For example, to configure the [`import`](https://github.com/benmosher/eslint-plugin-import#settings) plugin to use your webpack configuration for determining search paths, you can put `{"import/resolver": "webpack"}` here.
+
 ### parser
 
 Type: `string`
 
-Tell ESLint what parser to use, e.g. `"babel-eslint"` if you are using language features that ESLint doesn't support yet.
+ESLint parser. For example, [`babel-eslint`](https://github.com/babel/babel-eslint) if you're using language features that ESLint doesn't yet support.
+
 
 ## Config Overrides