candid discourse
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The Psychology of Money
by Housel Morgan
Goodreads Shelf
My takeaways
- Compounding creeps up. The idea of "compounding interest" is unintuitive to humans - we are very linear thinking creatures.
- Consistently unwavering investments are critical to your financial survival during tail events (major economic downturns) in the long run.
- You don't need a reason to save your money - there are always going to be unplanned catastrophic events and having the money to sustain yourself during those times gives you enough leeway to say no to a desperate, sub-optimal next-step.
- There is always a chance of your plan not going to plan, so your job is to balance risk, luck and skill. Even if a potential profit is crazy good, but if the risk will wipe you out - then it is not a risk worth taking.
- What is enough for you? Learn to stop moving your goal post. Otherwise you will be constantly chasing, and indefinitely unhappy.
- Wealth is what you don't see. More spending to show people what you have = less money.
- Wealth gives you more control of your life decisions - you are not forced to get the next available job in a field you don't like, with people you don't like. It gives you leeway to pick and choose, but also allows you to make more mistakes without wiping you out.
- It's hard to always be rational with money, we are only humans. It's enough to be reasonable.
- "Controlling your time is the highest dividend money pays".
- "Your personal experience with money make up maybe 0.00000001% of what is happening in the world, but maybe 80% of how you think the world works."