A Quick summary of the book:
- ‘The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness is a must-read book on Personal Finance by the award-winning author ‘Morgan Housel.’
- This book offers a wide range of insights into human behavior and psychology regarding money through real-life stories.
- This book will help an Investor to tap into their rich Investor mindset.
- It will help you in understanding how humans behave with money which will assist you in avoiding the potential mistakes you can subconsciously make with money making it a worthy read.
It is not just about wealth creation the book focuses on, as it also firmly emphasizes sustaining the wealth created as a long-term goal.
The explanation of the relation between time and money makes it clear how financial freedom in the end is not about having enough money, but having enough money to do with your time as you please.
It has wonderful ideologies up its sleeve to make you live a more conscious and fuller life.
15 Key take aways from the book:
⦿ Lessons on sustaining wealth:
- Doing well with money has a little to do with how smart you are and a lot to do with how you behave.
- Getting money is one thing. Keeping it is another.
⦿ Lessons on Financial Freedom:
- Use money to gain control over your time.
- Controlling your time is the highest dividend money pays.
- Independence, to me, doesn’t mean you’ll stop working. It means you only do the work you like with people you like at the times you want for as long as you want.
⦿ Lessons on spending habits:
- Spending money to show people how much money you have is the fastest way to have less money.
- You might think you want a fancy car or a nice watch. But what you probably want is respect and admiration.
- Be nicer and less flashy. No one is impressed with your possessions as much as you are.
- Saving is the gap between your ego and your income.
⦿ Lessons on Risk Management:
- Risk is what’s left over when you think you’ve thought of everything.
- Everything has a price, but not all prices appear on labels.
- Optimism sounds like a sales pitch. Pessimism sounds like someone trying to help you.
- Progress happens too slowly to notice, but setbacks happen too quickly to ignore.
- Planning is important, but the most important part of every plan is to plan on the plan not going according to plan.
- Plan to survive reality. Future filled with unknown is everyone’s reality
It’s written neatly and crisply by co-relating personal finance and psychology using anecdotes and analogies in a total of 209 pages which also makes it a quick read.
Implementing these lessons in your financial life will help you in building financially healthy habits early on in life.
This book will be your helpful guide in letting Financial Freedom to be your ultimate goal.