Show notes (Free Summary) / PDF & Infographic / Free audiobook / 🇩🇪 German / In The Psychology of Money, award-winning author Morgan Housel shares 19 short stories exploring the strange ways people think about money and teaches you how to make better sense of one of life’s most important topics.
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Do you want to be rich or wealthy? Did you know there was a difference between the two?
The Psychology of Money explains what that difference is. In this digestible book, Morgan Housel shares 19 short stories illustrating how we think about money.
He considers how past experiences can worsen our long-term financial gains. Moving the goalposts and being coldly rational can have a similar effect. Instead, set clear and sensible financial goals that don’t depend too much on how things have been in the past.
The Psychology of Money covers a lot of ground in just over 200 pages. This is the book for you if you’re looking for ways to be wealthy, not rich.
Morgan Housel is a partner at Collaborative Fund and a former columnist at The Motley Fool and The Wall Street Journal. He is a two-time winner of the Best in Business Award from the Society of American Business Editors and Writers.
Our current relationships with money are based on our past experiences. Housel uses the example of people who struggled during the Great Recession that started in 2007, and are now scared of reinvesting.
We shouldn’t judge others for their financial decisions. We have all simply had different experiences of investing. We must learn to make investment decisions based on our goals and investment options rather than experiences.
The world is always changing. Relying on your experiences means you’re basing your decisions on knowledge of a different world.
(00:00) Introduction to the Rich Man in the Car Paradox
(00:34) Subscribe for More Free Audiobook Summaries
(00:54) Overview of The Psychology of Money
(02:26) About the Author: Morgan Housel
(02:59) Unique Experiences of Investing
(03:55) Bill Gates' Competitive Advantage
(04:57) The Crazy Decisions of Rich People
(05:28) Warren Buffett and Compound Interest
(06:23) The Importance of Not Screwing Up
(08:07) The Power of Doing the Average
(08:41) The Rich Man in the Car Paradox Revisited
(09:18) Stop Judging People By Their Visible Wealth
(10:04) The Key to Financial Success is Your Savings Rate
(11:01) Conclusion and Next Steps
First published on Jan 6 2024.
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