updated 1y ago
The Psychology of Money
When things are going extremely well, realize it’s not as good as you think. You are not invincible, and if you acknowledge that luck brought you success then you have to believe in luck’s cousin, risk, which can turn your story around just as quickly.
from The Psychology of Money by Morgan Housel
Don’t get too attached to anything—your reputation, your accomplishments or any of it. I think about it now, what does it matter? O.K., this thing unjustly destroyed my reputation. That’s only troubling if I am so attached to my reputation.
from The Psychology of Money by Morgan Housel
But most of the time today is not that important. Over the course of your lifetime as an investor the decisions that you make today or tomorrow or next week will not matter nearly as much as what you do during the small number of days—likely 1% of the time or less—when everyone else around you is going crazy.
from The Psychology of Money by Morgan Housel
Napoleon’s definition of a military genius was, “The man who can do the average thing when all those around him are going crazy.”
from The Psychology of Money by Morgan Housel
More than your salary. More than the size of your house. More than the prestige of your job. Control over doing what you want, when you want to, with the people you want to, is the broadest lifestyle variable that makes people happy.
from The Psychology of Money by Morgan Housel
A bit more means waiting for a good job to come around after you get laid off, rather than having to take the first one you find. That can be life changing.
from The Psychology of Money by Morgan Housel
Your personal experiences with money make up maybe 0.00000001% of what’s happened in the world, but maybe 80% of how you think the world works. So equally smart people can disagree about how and why recessions happen, how you should invest your money, what you should prioritize, how much risk you should take, and so on.
from The Psychology of Money by Morgan Housel
Spreadsheets can model the historic frequency of big stock market declines. But they can’t model the feeling of coming home, looking at your kids, and wondering if you’ve made a mistake that will impact their lives. Studying history makes you feel like you understand something. But until you’ve lived through it and personally felt its consequences,
... See morefrom The Psychology of Money by Morgan Housel
But every financial decision a person makes, makes sense to them in that moment and checks the boxes they need to check. They tell themselves a story about what they’re doing and why they’re doing it, and that story has been shaped by their own unique experiences.
from The Psychology of Money by Morgan Housel
“The customer is always right” and “customers don’t know what they want” are both accepted business wisdom.
from The Psychology of Money by Morgan Housel