The Psychology of Money (Morgan Housel)

"Timeless Lessons on Wealth, Greed, and Happiness" - This is the caption on the front cover page of the book and this is the authentic heart of this book.There is a lot of books available in the market with bits of advice on how to be rich by multiplying your money. Considerable youtube channels are also there to steer you through various instruments that propose you mega returns. In this context, I recommend you to go through this book before listening to these tips for evolving rich.


My anticipation about this book was that this book was all about guidelines on where & how to invest and as a motivational handbook for earning more money. But this book is more of a self-help book that will transform your perception about being rich. The book is not offering you any sample templates for creating wealth, rather it will facilitate you to create your own vision about the financial aspects of your life.Taking examples from history Morgan Housel has explained that it is not the returns of the investments that matter but the investor's behavior and attitude towards being rich are the prime factors of wealth creation.

The significant takeaways for me from this book were:

  • The foremost and greatest thing I realized from this book is staying wealthy is more important and challenging than getting wealthy.

  • The ultimate aim of getting wealthy is to gain control over our time. Inturn the flexibility and control over our time is an unforeseen treasure that enables you to generate wealth following your passion.

  • The premium objective of our monetary planning should be to save more, each penny not spent unnecessarily is worth investing.

  • Our investment should be always to stick on to a longer regime so that we can enjoy the benefit of compounding. Investing patterns should be personalized and diversified to face our changing needs.

  • Our financial plan should be always risk mitigated, in other words, managing money should provide you better sleep.

The words I want to share the most from this book were:

Realise that not all success is due to hard work, and not all poverty is due to laziness. Keep this in mind when judging people, including yourself.
Spending money to show people how much money you have is the fastest way to have less money.
Controlling your time is the highest dividend money pays.
Things that have never happened before happen all the time.
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.

This book is a must-read book for all who desire to be wealthier and for those who always worry about their financial status. Every page you read you will feel nurtured with so much clarity about wealth and you will be finishing the book with a new outlook on what money means. I recommend this book to all financial advisors and to those who all value your time and money.


Morgan Housel is a partner at The 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, winner of the New York Times Sidney Award, and a two-time finalist for the Gerald Loeb Award for Distinguished Business and Financial Journalism. He lives in Seattle with his wife and two kids.


 

My rating 4.8 out of 5


 

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