In this book, Morgan Housel shares 19 short stories exploring the strange ways people think about money and proposes advices to how to make better sense of one of life’s most important topics. Here are some selected quotes from this book:

On social comparison

  • There is no need to risk what you have and need for what you don’t have and don’t need
  • The ceiling of social comparison is so high that virtually no one will ever hit it

On patience in investing

  • $81.5 billion of Warren Buffet’s $84.5 billion net worth came after his 65th birthday. Our minds are not to built to handle such absurdities
  • Good investing is not about making good decision. It’s about consistently not screwing up
  • Building wealth has little to do with your income or investment returns, and a lot to do with your saving rate
  • If you want to do better as an investor, the single most important thing is to increase your time horizon. Time is the most powerful force in investing. It makes little things grow big and big mistake fade away. It can’t neutralize risk and luck, but it pushes results closer to what people deserve

On happiness

  • Control over doing what you want, when you want to, with the people you want to, is the broadest lifestyle that makes people happy
  • Man in the car paradox: No one is impressed with your possessions as much as you are

On contentment

  • Past a certain income, what you need is what sits below your ego
  • A secondary benefit of maintaining a lifestyle below what you can afford is avoiding the psychological treadmill of keeping up with the Joneses

On planning & progress

  • The most important part of every plan is planning on your plan not going according to the plan
  • Progress happens too slowly to notice, but setbacks happen too quickly to ignore

On psychology

  • The end of history illusion: The tendency for people to be keenly aware of how much they have changed in the past but to underestimate how much their personalities, desires, and goals are likely to change in the future
  • Our goal isn’t to be coldly rational; just psychologically reasonable  
  • The more you want something to be true, the more likely you are to believe a story that overestimates the odds of it being true
  • There are many things in life that we think are true because we desperately want them to be true

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