🆕 Listen to the NEW improved version here.

Show notes | Learn on your terms. Get the PDF, infographic, full ad-free audiobook and animated version of this summary and a lot more on the top-rated StoryShots app: https://www.getstoryshots.com

Help us grow to create more amazing content for you! ⭐️⭐️⭐️⭐️⭐️ Don't forget to subscribe, rate and review the StoryShots podcast now. 

What should our next book be? Suggest and vote it up on the StoryShots app.

If you don't already have the book, order it here or get the audiobook for free on Amazon to learn the juicy details

The Psychology of Money by Morgan Housel | Book Analysis, Summary and Rating | Free AudiobookMorgan Housel's Perspective

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. He is also a winner of the New York Times Sidney Award and a two-time finalist for the Gerald Loeb Award for Distinguished Business and Financial Journalism. Morgan has presented at more than 100 conferences in a dozen countries. 

Introduction

The Psychology of Money delves into the psychology behind our financial weaknesses. Housel considers how past experiences, moving the goalposts and being coldly rational can worsen long-term financial gains. The alternative is having clear, reasonable financial goals that are not over-reliant on historical financial performance. If you can implement these approaches, you can be financially successful in the long run. So, you will also benefit from the wonders of compound interest.

StoryShot #1: We All Have Unique Experiences of Investing

Our current relationships with money are based on our past experiences. Housel uses the example of people who lived through The Great Recession and are now scared of reinvesting. Many of us won’t have lived through The Great Recession. So, the author recommends avoiding judging others for their financial decisions as no one is crazy. We have all simply had

StoryShot #2: Bill Gates’ Competitive Advantage

Both luck and risk are an integral part of finance. Do not assume that individual effort alone will allow you or others to be successful. The author uses the example of Bill Gates. Bill Gates is highly talented and works extremely hard. But, he also obtained a competitive advantage because he attended one of the few high schools in the world at that time to own a computer. 

There are infinite moving parts within the world. This means the accidental impact of actions outside of your control often have a greater influence than your conscious decisions. So, work hard and take risks but also consider the role that luck plays in finance. Focus less on specific individuals and case studies and more on broad patterns. This should also help you develop greater humility when things are going right and compassion when they are going wrong.

StoryShot #3: Rich People Are More Likely to Make Crazy Decisions

Rich people are often the ones who make crazy financial decisions. Housel explains the goalposts seem to move the more you earn. There are countless rich individuals who have lost everything because they felt the millions they had were not enough. The lesson you can learn from these failures is you shouldn’t risk what you have and need for what you don’t have and don’t need. Saying “enough” is realizing that an appetite for more will push you to the point of regret.

StoryShot #4: Warren Buffett Is a Prime Example of the Power of Compound InterestStoryShot #5: Good Investing Is About Not Screwing UpStoryShot #6: Do the AverageStoryShot #7: People Believe Wealth Will Make Them Popular

Learn more about your ad choices. Visit megaphone.fm/adchoices