Introduction
The Psychology of Money by Mr. Morgan Housel, published on September 1, 2020, in the UK, explores financial understanding and behavior. It features 20 chapters, including 19 short stories about money and a concluding confession. This review delves into its content. Here we will review the content of the book The Psychology of Money.
Morgan Housel, the author, is a two-time Best in Business Award winner from the Society of American Business Editors and Writers. He is a former columnist for The Motley Fool and The Wall Street Journal and a partner at The Collaborative Fund.
Key points of the book
- The Psychology of Money emphasizes the importance, value, and potential of wealth. Chapter 1, No One’s Crazy, stresses the role of time, noting that many discuss retirement but few act on it.
- This book reveals overlooked truths, stresses the importance of saving, and reminds us that nothing is free. Chapter 2 delves into luck and risk, demonstrating that “nothing is as good or as bad as it seems“
- Many fail to achieve financial goals due to fear, uncertainty, or shifting priorities. The book emphasizes that maintaining fixed goals is the toughest financial skill.
- Chapters 4 and 5 illustrate the power of compounding and consistency, noting that $81.5 billion of Warren Buffett’s $84.5 billion net worth was earned after his 65th birthday.
- Being wrong isn’t a setback; even frequent mistakes can lead to success, as remarkable individuals often achieve greatness despite acting on flawed ideas.
- The book teaches that feeling rich comes from spending lavishly, but true wealth lies in spending within your means. Controlling your time is the greatest reward money offers.
- The pursuit of appearing rich often drives people to buy beyond their means, leading to debt and poverty. Spending money to show wealth is the fastest way to have less money.
- This book challenges your ego, urging you to evaluate if your spending is a necessity or a display of wealth. It emphasizes, The most important part of every plan is planning on your plan not going according to plan.
- Achieving wealth or financial independence is a long-term goal requiring consistent effort. Many fall short due to a lack of sustained commitment over time. Long-term planning is harder than it seems because people’s goals and desires change over time
- To summarize this book below are the few important points
- Less ego, more wealth
- Manage your money in a way that helps your sleep at night
- As a investor, the single most powerful thing is to increase your time horizon
- Use money to gain control over your time
- Avoid the extreme ends of financial decisions
Conclusion
After reading the book and with an honest review of the book; This is one of the must read book for every individual irrespective of age, gender etc. Anyone who is eager to understand how money behaves or to make most of your money, you should read this book. You could purchase this book on amazon.
Other Books Review
- Let’s Talk Money – by Monika Halan
- Rich Dad Poor Dad – by Robert T. Kiyosaki
- Think and Grow Rich – by Napoleon Hill
- Ikigai – by Hector Gracia & Francesc Miralles
- Man’s Search For Meaning – by Viktor E. Frankl
Disclaimer: The views expressed in this article are solely my own after reading the book. It is not intended to offend anyone. Any resemblance to actual persons, living or dead, is purely coincidental. This article is neither sponsored nor endorsing anyone. The link mentioned here is an affiliate link. If you’re interested in reading this book along with me, buying it through the affiliate link is a great way to support me!
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