Doing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people.
Money―investing, personal finance, and business decisions―is typically taught as a math-based field, where data and formulas tell us exactly what to do. But in the real world people don’t make financial decisions on a spreadsheet. They make them at the dinner table, or in a meeting room, where personal history, your own unique view of the world, ego, pride, marketing, and odd incentives are scrambled together.
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.
Lots of solid advice, and yet somehow forgettable? I guess this is the essence of good finance: it's boring, it's obvious, it's uncontroversial. But you know what? Everyone needs a reminder every once in a while. If you haven't thought about your financial plans in a while, be it to pay off all your bills, or retire in luxury, maybe now is a good time to have another look.
I love Morgan Housel’s blog (at collabfund). Housel tells engaging stories with sharp writing. And this book reads like a collection of his lean, insightful blog posts—which I enjoyed.
But it had a dearth of actionable tips on spending, investing, and saving.
Although, what little advice it does offer aligns with all my biases, which is always a nice feeling.
I think for most investors, dollar-cost averaging into a low-cost index fund will provide the highest odds of long-term success.
– Morgan Housel, The Psychology of Money
The title refers to how individuals differ in their approach to money. Housel insists that judging people for their relationship to money is unfair. It’s individualistic, based on their goals and timelines—and, sometimes, their unique blind spots.
The author cites studies showing that people are forever traumatized by the market early in life. If the stock market was crummy in your 20s, you …
I love Morgan Housel’s blog (at collabfund). Housel tells engaging stories with sharp writing. And this book reads like a collection of his lean, insightful blog posts—which I enjoyed.
But it had a dearth of actionable tips on spending, investing, and saving.
Although, what little advice it does offer aligns with all my biases, which is always a nice feeling.
I think for most investors, dollar-cost averaging into a low-cost index fund will provide the highest odds of long-term success.
– Morgan Housel, The Psychology of Money
The title refers to how individuals differ in their approach to money. Housel insists that judging people for their relationship to money is unfair. It’s individualistic, based on their goals and timelines—and, sometimes, their unique blind spots.
The author cites studies showing that people are forever traumatized by the market early in life. If the stock market was crummy in your 20s, you tend to avoid stocks forever.
I found the insight that history is the study of outlier events novel. And that the most crucial part of a plan is what happens when the plan fails.
This was a short, lively read filled with fascinating anecdotes and some modest financial advice. Of course, all advice appears alongside caveats to everything.
