MORGAN HOUSEL’s THE PSYCHOLOGY OF MONEY

NO One’s Crazy

We all make decisions based on our own unique experiences that sense to us in a given moment.

Confounding Compounding

Good investing isn’t necessarily about earning the highest returns, It’s about earning pretty good returns that you Can Stick with, and which Can be repeated for the longest period of time.

Tails. You Win

Long tails—the farthest ends of the distribution of outcomes—have tremendous Influence in finance, a number of events can account for the majority of outcomes.

Wealth Is What You Don’t See

Spending money to show people how much money you have is the fastest way to have less money.

True Wealth is the money you didn’t spend.

Reasonable > Rational

Reasonable more is realistic, and you have a better chance Of Sticking With it in the long run, which is what matters most when managing money.

Luck & Risk

Risk and are doppelgangers. They are so similar that you can’t believe in one without equally respecting the other.

Never Enough

There is no reason to risk What you have and need for What you have and don’t need.

Getting Wealthy Vs Staying Wealthy

Getting money requires taking risks, being optimistic, and putting yourself out there. But keeping money requires the opposite of taking risk _ It requires humility, and that what you’ve made can be taken from you as fast.

Freedom

Control Ling your time is the dividend money pays.

Save Money

Bolding wealth has little to do with your income or investment returns, to do with your Savings rate.

You’ll Change

It’s hard to make enduring 10 decisions when your view wants in the future is likely to shift.