{"id":50481,"date":"2024-01-06T16:14:24","date_gmt":"2024-01-06T16:14:24","guid":{"rendered":"https:\/\/www.getstoryshots.com\/?p=50481"},"modified":"2024-09-11T09:19:41","modified_gmt":"2024-09-11T09:19:41","slug":"the-psychology-of-money-summary","status":"publish","type":"post","link":"https:\/\/www.getstoryshots.com\/sv\/books\/the-psychology-of-money-summary\/","title":{"rendered":"Pengarnas psykologi Sammanfattning &amp; Infografik | Morgan Housel"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Timeless Lessons on Wealth, Greed, and Happiness<\/h2>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">1-Sentence Summary<\/h2>\n\n\n\n<p>The psychology of money is the study of how our thoughts, emotions, and behaviors influence our financial decisions, often leading to irrational choices driven by cognitive biases, personal experiences, and social influences rather than purely logical reasoning.<\/p>\n\n\n\n<div class=\"wp-block-group\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p>Life gets busy. Has <a data-tool=\"Get on Amazon\" class=\"tooltip animate\" href=\"https:\/\/geni.us\/psych-free-audiobook\" target=\"_blank\" rel=\"noreferrer noopener\"><em>The Psychology of Money<\/em><\/a> been on your reading list? Learn the key insights now. We\u2019re scratching the surface in <em>The Psychology of Money<\/em> summary. If you don&#8217;t already have the book, order it <a data-tool=\"Get on Amazon\" class=\"tooltip animate\" href=\"https:\/\/geni.us\/psychology-money-book\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a> or get the <a data-tool=\"Get on Amazon\" class=\"tooltip animate\" href=\"https:\/\/geni.us\/psych-free-audiobook\" target=\"_blank\" rel=\"noreferrer noopener\">audiobook for free<\/a> to learn the juicy details.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-spotify wp-block-embed-spotify wp-embed-aspect-21-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<span class=\"kSNp2cCbBaMzO931P8jwmQfIKyWLisXTEG7Vo5FRrHAq0xuh6vl4ngU\"><iframe title=\"Spotify Embed: The Psychology of Money by Morgan Housel | Book Summary and Review |\u00a0Free Audiobook\" style=\"border-radius: 12px\" width=\"100%\" height=\"152\" frameborder=\"0\" allowfullscreen allow=\"autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture\" loading=\"lazy\" src=\"https:\/\/open.spotify.com\/embed\/episode\/2gfyePNeX0OkhOS4NqENwa?si=P6sIBOZpS9SVRDjI5jLXRw&#038;utm_source=oembed\"><\/iframe><\/span>\n<\/div><figcaption class=\"wp-element-caption\">Get the extended ad-free audiobook summary of The Psychology of Money on the <a href=\"https:\/\/www.getstoryshots.com\/\" data-type=\"link\" data-id=\"https:\/\/www.getstoryshots.com\/\">StoryShots app.<\/a> <\/figcaption><\/figure>\n<\/div><\/div>\n\n\n\n<div class=\"wp-block-group\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<h2 class=\"wp-block-heading\">Listen to the German version \ud83c\udde9\ud83c\uddea<\/h2>\n\n\n\n<iframe frameborder=\"0\" height=\"200\" scrolling=\"no\" src=\"https:\/\/playlist.megaphone.fm\/?e=PARSIDA6861544359&#038;light=true&#038;artwork=false\" width=\"100%\"><\/iframe>\n\n\n\n<h2 class=\"wp-block-heading\">Listen to the Spanish version \ud83c\uddea\ud83c\uddf8<\/h2>\n\n\n\n<iframe frameborder=\"0\" height=\"200\" scrolling=\"no\" src=\"https:\/\/playlist.megaphone.fm\/?e=PARSIDA9562778215&#038;light=true&#038;artwork=false\" width=\"100%\"><\/iframe>\n<\/div><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Disclaimer<\/h2>\n\n\n\n<p>These key insights and analysis are provided for educational purposes only. Please consult a professional before taking any action.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Introduction<\/h2>\n\n\n\n<p>Do you want to be rich or wealthy? Did you know there was a difference between the two?<br><br><a href=\"https:\/\/geni.us\/psych-free-audiobook\" target=\"_blank\" rel=\"noopener\"><em>The Psychology of Money<\/em><\/a> explains what that difference is. In this digestible book, Morgan Housel shares 19 short stories illustrating how we think about money.&nbsp;<br><br>He considers how past experiences can worsen our long-term financial gains. Moving the goalposts and being coldly rational can have a similar effect. Instead, set clear and sensible financial goals that don&#8217;t depend too much on how things have been in the past.<br><br><a href=\"https:\/\/geni.us\/psych-free-audiobook\" target=\"_blank\" rel=\"noopener\"><em>The Psychology of Money<\/em><\/a> covers a lot of ground in just over 200 pages. This is the book for you if you\u2019re looking for ways to be wealthy, not rich.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">About Morgan Housel<\/h2>\n\n\n\n<p><a href=\"https:\/\/geni.us\/morgan-housel\" target=\"_blank\" rel=\"noopener\">Morgan Housel<\/a> 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.<\/p>\n\n\n\n<p>He is also the winner of the New York Times Sidney Award and a two-time finalist for the Gerald Loeb Award for Distinguished Business and Financial Journalism. Houzel has presented at more than 100 conferences in a dozen countries.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-us.googleusercontent.com\/rr5NQPkyF-9zPMnV66hmX7M-DZqqG1xwA-KgW3we6DhztHTjogHF71JilxHbEgyTu0kVx-KBY8OmnygujsTXQ06Wz9-TbsTYPUqbdvkRxV0SYlBnvdm9SSmbfBchvOVcI8d0UGX_I9t-5lxq8AN_rtw\" alt=\"Morgan Housel, author of The Psychology of Money\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #1: We All Have Unique Experiences of Investing<\/h2>\n\n\n\t\t<div class=\"ss-ctt-wrapper ss-ctt-style-4\" data-ss-post-id=\"50481\" data-nonce=\"e9beab50f7\">\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CHaving+a+strong+sense+of+controlling+one%E2%80%99s+life+is+a+more+dependable+predictor+of+positive+feelings+of+wellbeing+than+any+of+the+objective+conditions+of+life+we+have+considered.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-tweet\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\u201cHaving a strong sense of controlling one\u2019s life is a more dependable predictor of positive feelings of wellbeing than any of the objective conditions of life we have considered.\u201d \u2014 Morgan Housel<\/a>\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CHaving+a+strong+sense+of+controlling+one%E2%80%99s+life+is+a+more+dependable+predictor+of+positive+feelings+of+wellbeing+than+any+of+the+objective+conditions+of+life+we+have+considered.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-link\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t\t\t<span>Click to Tweet<\/span>\n\t\t\t\t<svg class=\"ss-svg-icon\" aria-hidden=\"true\" role=\"img\" focusable=\"false\" width=\"32\" height=\"32\" viewBox=\"0 0 24 24\"><path d=\"M18.244 2.25h3.308l-7.227 8.26 8.502 11.24H16.17l-5.214-6.817L4.99 21.75H1.68l7.73-8.835L1.254 2.25H8.08l4.713 6.231zm-1.161 17.52h1.833L7.084 4.126H5.117z\"><\/path><\/svg>\t\t\t<\/a>\n\n\t\t<\/div><!-- END .ss-ctt-wrapper -->\n\n\t\t\n\n\n<p>Our current relationships with money are based on our past experiences. Housel uses the example of people who struggled during the Great Recession that started in 2007, and are now scared of reinvesting.&nbsp;<\/p>\n\n\n\n<p>We shouldn\u2019t judge others for their financial decisions. We have all simply had different experiences of investing. We must learn to make <a href=\"https:\/\/www.forbes.com\/sites\/jimosman\/2023\/04\/30\/the-psychology-of-investing-how-to-avoid-losing\/\" target=\"_blank\" rel=\"noopener\">investment decisions<\/a> based on our goals and investment options rather than experiences.<\/p>\n\n\n\n<p>The world is always changing. Relying on your experiences means you\u2019re basing your decisions on knowledge of a different world.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #2: Bill Gates Had a Competitive Advantage<\/h2>\n\n\n\t\t<div class=\"ss-ctt-wrapper ss-ctt-style-4\" data-ss-post-id=\"50481\" data-nonce=\"e9beab50f7\">\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CFocus+less+on+specific+individuals+and+case+studies+and+more+on+broad+patterns.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-tweet\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\u201cFocus less on specific individuals and case studies and more on broad patterns.\u201d \u2014 Morgan Housel<\/a>\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CFocus+less+on+specific+individuals+and+case+studies+and+more+on+broad+patterns.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-link\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t\t\t<span>Click to Tweet<\/span>\n\t\t\t\t<svg class=\"ss-svg-icon\" aria-hidden=\"true\" role=\"img\" focusable=\"false\" width=\"32\" height=\"32\" viewBox=\"0 0 24 24\"><path d=\"M18.244 2.25h3.308l-7.227 8.26 8.502 11.24H16.17l-5.214-6.817L4.99 21.75H1.68l7.73-8.835L1.254 2.25H8.08l4.713 6.231zm-1.161 17.52h1.833L7.084 4.126H5.117z\"><\/path><\/svg>\t\t\t<\/a>\n\n\t\t<\/div><!-- END .ss-ctt-wrapper -->\n\n\t\t\n\n\n<p>Luck and risk are an integral part of finance. Do not assume that individual effort alone will allow you or others to be successful. Take Bill Gates. He is highly talented and works extremely hard. But, he also had a competitive advantage because he attended one of the few high schools in the world at that time to own a computer.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-us.googleusercontent.com\/WXbY1v51_Esd58M2h4tIzm8SEgjte7JsdWHZlIgON1kk_-hPzGcixBcudbwa_xtHrxkGb1HEAzVZMjrQhT8rC0sJuko_hDKYTzYtTYN2u2h6J2hfBsPhnAIFN8a1pCDc3-0t1VnFLxNMLXjwZnb-xnc\" alt=\"Microsoft building against a blue sky\"\/><\/figure>\n\n\n\n<p>There are infinite moving parts within the world. The accidental impact of actions outside your control often has a greater effect than your conscious decisions. So, work hard and take risks but also consider the role that luck plays in finance.<\/p>\n\n\n\n<p>This should also help you develop greater humility when things are going right and compassion when they are going wrong.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #3: Rich People Are More Likely to Make Crazy Decisions<\/h2>\n\n\n\n<p>Rich people often make illogical financial decisions. The goalposts seem to move the more you earn. Countless rich individuals have lost everything because they felt the millions they had were not enough.<\/p>\n\n\n\n<p>Learn from these failures by not risking what you have and need for what you don\u2019t have and don\u2019t need. Saying \u201cenough\u201d is realizing that an appetite for more will push you to the point of regret.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #4: Warren Buffett Is a Prime Example of the Power of Compound Interest<\/h2>\n\n\n\n<p><a href=\"https:\/\/www.cambridge.org\/core\/services\/aop-cambridge-core\/content\/view\/799CB1D40CDD46F3010767BFC60F24DB\/S1357321719000254a.pdf\/the-emergence-of-compound-interest.pdf\" target=\"_blank\" rel=\"noopener\">Compound interest<\/a> can bring you financial freedom. That said, the human brain struggles to understand the power of compounding.<\/p>\n\n\n\n<p>Warren Buffett is a good example of compound interest in action. Many believe his wealth is entirely due to his knowledge of sound investments, as he has been making good investments since a young age. But compound interest plays a huge part.<\/p>\n\n\n\n<p>His current net worth is $84.5 billion, but he accumulated $84.2 billion after his 50th birthday. This shows the power of compounding. The key to compounding isn\u2019t about earning the highest returns. You want pretty good returns that you can stick with for the longest period.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-us.googleusercontent.com\/CtqOwyexaK83BxZBc6VnpueBfc27G_xxXtl-drRRmq5OEuSGxHRfiZxCaj9V9zSwn579_ISz9LS1aVYGcTac8suzbt3wzriXUc60F0C6J3ODppKqwobMegQ5ZyB6SnPbdAOXuk2IM1D3XQ54ToyrgtU\" alt=\"Piles of coins getting larger, ending in a jar of coins, each with a seedling growing out of it\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #5: Good Investing Is About Not Screwing Up<\/h2>\n\n\n\t\t<div class=\"ss-ctt-wrapper ss-ctt-style-4\" data-ss-post-id=\"50481\" data-nonce=\"e9beab50f7\">\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CMargin+of+safety+is+raising+the+odds+of+success+at+a+given+level+of+risk+by+increasing+your+chances+of+survival.+The+higher+your+margin+of+safety%2C+the+smaller+your+edge+needs+to+be+to+have+a+favorable+outcome.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-tweet\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\u201cMargin of safety is raising the odds of success at a given level of risk by increasing your chances of survival. The higher your margin of safety, the smaller your edge needs to be to have a favorable outcome.\u201d \u2014 Morgan Housel<\/a>\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CMargin+of+safety+is+raising+the+odds+of+success+at+a+given+level+of+risk+by+increasing+your+chances+of+survival.+The+higher+your+margin+of+safety%2C+the+smaller+your+edge+needs+to+be+to+have+a+favorable+outcome.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-link\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t\t\t<span>Click to Tweet<\/span>\n\t\t\t\t<svg class=\"ss-svg-icon\" aria-hidden=\"true\" role=\"img\" focusable=\"false\" width=\"32\" height=\"32\" viewBox=\"0 0 24 24\"><path d=\"M18.244 2.25h3.308l-7.227 8.26 8.502 11.24H16.17l-5.214-6.817L4.99 21.75H1.68l7.73-8.835L1.254 2.25H8.08l4.713 6.231zm-1.161 17.52h1.833L7.084 4.126H5.117z\"><\/path><\/svg>\t\t\t<\/a>\n\n\t\t<\/div><!-- END .ss-ctt-wrapper -->\n\n\t\t\n\n\n<p>Effective investing is less about making sound decisions and more about consistently not making mistakes. Financial success can be summarized by one word: survival. The most financially successful are those who have been able to stick around for a long time. You can only grow your wealth if you have given an asset time to compound.<\/p>\n\n\n\n<p>Getting money requires risk-taking, optimism, and putting yourself out there. Keeping money requires the opposite: humility. Try to make yourself financially unbreakable rather than focusing on big returns.<\/p>\n\n\n\n<p>Humility is also about planning with the expectation things won\u2019t go according to plan. This is your margin of safety and is one of the most underappreciated forces in finance.<\/p>\n\n\n\n<p>Here are a few examples of ways you can start establishing a margin of safety:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Frugal budget<\/strong> \u2013 When your income increases, still try to live below your means.<\/li>\n\n\n\n<li><strong>Flexible thinking<\/strong> \u2013 Be willing to accept new information and ideas about investing as technology and ideas develop.<\/li>\n\n\n\n<li><strong>Loose timeline<\/strong> \u2013 Avoid ditching investments impulsively if they drop in price. If you start with a loose timeline, you are better able to ride the downswings and benefit from the upswings.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #6: Do the Average<\/h2>\n\n\n\n<p>The most successful, rich, and famous people are there because of a one-in-a-million event. As most of our attention goes toward these huge events, it can be easy to forget their rarity. Try to avoid underestimating how rare and powerful these events are.<\/p>\n\n\n\n<p>Investors can be wrong half the time and still make a fortune. An investing genius is someone who can do the average thing when all those around them are making rash decisions.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #7: People Believe Wealth Will Make Them Popular<\/h2>\n\n\n\n<p>Consider <a href=\"https:\/\/fourpillarfreedom.com\/rich-man-in-the-car-paradox\/\" target=\"_blank\" rel=\"noopener\">the Rich Man in the Car Paradox<\/a>. If we see a nice car, we may daydream about having that car and everyone thinking we\u2019re cool. The paradox is that we\u2019re not thinking about the driver of the nice car we spotted, yet we believe that if we had such a car, everyone would be thinking about us.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-us.googleusercontent.com\/jOhdwrpCoIAt1JhDDRuWTYgRp-GqtLZwSOBpefo3fxI_hk40cVyW3oXPK5tUOPPWRRwPMqy696c1B5HBRzYA5ZHeP8V5ZLUigYEtAw7ZZtcPFZIiQDAuALG6Uc7UgjuoyhdJmLuUZd809UJYpUQewZ8\" alt=\"Close-up of front of a red Ferrari\"\/><\/figure>\n\n\n\n<p>We can apply this more broadly to wealth. People acquire wealth because they believe it will make them liked and admired. But others just use wealth as a benchmark for their desire to be liked and admired.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #8: Stop Judging People By Their Visible Wealth<\/h2>\n\n\n\t\t<div class=\"ss-ctt-wrapper ss-ctt-style-4\" data-ss-post-id=\"50481\" data-nonce=\"e9beab50f7\">\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CFinancial+success+is+not+a+hard+science.+It%E2%80%99s+a+soft+skill%2C+where+how+you+behave+is+more+important+than+what+you+know.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-tweet\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\u201cFinancial success is not a hard science. It\u2019s a soft skill, where how you behave is more important than what you know.\u201d \u2014 Morgan Housel<\/a>\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9CFinancial+success+is+not+a+hard+science.+It%E2%80%99s+a+soft+skill%2C+where+how+you+behave+is+more+important+than+what+you+know.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-link\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t\t\t<span>Click to Tweet<\/span>\n\t\t\t\t<svg class=\"ss-svg-icon\" aria-hidden=\"true\" role=\"img\" focusable=\"false\" width=\"32\" height=\"32\" viewBox=\"0 0 24 24\"><path d=\"M18.244 2.25h3.308l-7.227 8.26 8.502 11.24H16.17l-5.214-6.817L4.99 21.75H1.68l7.73-8.835L1.254 2.25H8.08l4.713 6.231zm-1.161 17.52h1.833L7.084 4.126H5.117z\"><\/path><\/svg>\t\t\t<\/a>\n\n\t\t<\/div><!-- END .ss-ctt-wrapper -->\n\n\t\t\n\n\n<p>Some people use newfound wealth as an opportunity to show off. We should stop judging people\u2019s wealth by what we see. Those who decide not to buy something now and to buy something later will stay wealthy for longer.<\/p>\n\n\n\n<p>Being rich is based on current income, while your wealth is hidden and is the income that isn\u2019t spent. Wealth\u2019s value lies in offering you options, flexibility, and growth to one day purchase more stuff than you can right now.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #9: Your Savings Rate Is Key<\/h2>\n\n\n\n<p>Your income or investment returns are less important than your savings rate. Your value of wealth should always be relative to what you need. A high savings rate means having lower expenses than you otherwise could. Having lower expenses means your savings go further than they would if you spent more.<\/p>\n\n\n\n<p>Your savings rate is the financial decision you have the greatest control over. When you define savings as the gap between your ego and your income, you realize why many people with decent incomes save so little.<\/p>\n\n\n\n<p>Savings in the bank that earn 0% interest might generate an extraordinary return if they allow you to take a job with a lower salary but more purpose. They may also give you a greater return by letting you wait for investment opportunities that come when those without flexibility turn desperate.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #10: Being Rational Is Draining<\/h2>\n\n\n\n<p>Being <a href=\"https:\/\/www.ncbi.nlm.nih.gov\/pmc\/articles\/PMC4128497\/\" target=\"_blank\" rel=\"noopener\">coldly rational<\/a> with your financial decisions will lead to burnout. You\u2019re better off being reasonable and realistic about your financial decisions. Adopting a financial plan you can stick to over the long run is more important than being completely rational about every financial decision.<\/p>\n\n\n\n<p>A rational investor makes decisions based on data. A reasonable investor makes decisions in a conference room surrounded by co-workers who can offer advice. Investing has a social component that\u2019s often ignored when viewed through a strictly financial lens.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #11: Stop Focusing on Historical Data<\/h2>\n\n\n\n<p>A mistake some investors make is believing the Historians as Prophets Fallacy. This mistake is an overreliance on historical data to predict future financial interest. The reality is that innovation and change are integral to finance.<\/p>\n\n\n\n<p>Because the world changes, basing your investments solely on past performance is a bad decision. History can be a misleading guide to the future of the economy and stock market. It doesn\u2019t account for structural changes relevant to today\u2019s world.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh7-us.googleusercontent.com\/HPmEyto-itTPGjMn-sjVeR2biP9d7U00G1L_5gnWrIy5ttf6EZ-Ua5uy8joqHWX0Aqi41TKVmPpAgG3OMXpUrpwzzDxm7ZQ9in1QxKThrTpYp2pI3aFejrrPJRS6ylR5_oxKs_npOF7wcWjNwM1C1q0\" alt=\"Hand holding a pen over a sheet of financial figures and a calculator.\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #12: Leave Room For Error<\/h2>\n\n\n\n<p>You should always leave room for error when estimating your future returns. Housel calls this \u201cplanning on your plan not going according to plan.\u201d He assumes his future returns will be one-third lower than the historical average. This simple decision means he saves more than he usually would. This is his margin of safety.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #13: Avoid the Extreme Ends of Financial Planning<\/h2>\n\n\n\n<p>People\u2019s goals and desires change over time and you are no different. This makes long-term financial planning difficult. Our inability to predict our future selves is called the End-of-History Illusion.<\/p>\n\n\n\n<p>If you look back, you can visualize how much you have changed. That said, you will probably underestimate how much you will change in the future. To counteract this, avoid the extreme ends of financial planning (assuming you\u2019ll be happy with a very low income or overworking to achieve extreme wealth). Accept you will likely change your mind in the future.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #14: Market Volatility Has a Fee<\/h2>\n\n\n\n<p>Everything in life has a price. The key to a lot of financial matters is figuring out what that price is and being willing to pay it.<\/p>\n\n\n\n<p>However, the price of investing isn\u2019t immediately obvious. You should view any <a href=\"https:\/\/www.forbes.com\/advisor\/investing\/what-is-volatility\/\" target=\"_blank\" rel=\"noopener\">market volatility<\/a> as a fee rather than a fine. If you can do this, you are more likely to stay in the game long enough for investment gains to work for you.<\/p>\n\n\n\n<p>The trick is convincing yourself the market\u2019s fee is worth it. That\u2019s the only way to properly deal with volatility and uncertainty. Work out whether it is an admission fee worth paying, as there\u2019s no guarantee it will be returned.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #15: Find Your Personal Financial Identity<\/h2>\n\n\n\n<p>Speak to knowledgeable friends or read books from financial experts to develop your understanding of finance. Avoid taking financial advice from people with different quantities of money and end goals than you.<\/p>\n\n\n\n<p>Discover your personal financial identity, then listen to those who complement this identity.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #16: Be a Financial Optimist<\/h2>\n\n\n\t\t<div class=\"ss-ctt-wrapper ss-ctt-style-4\" data-ss-post-id=\"50481\" data-nonce=\"e9beab50f7\">\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9COptimism+sounds+like+a+sales+pitch.+Pessimism+sounds+like+someone+trying+to+help+you.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-tweet\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\u201cOptimism sounds like a sales pitch. Pessimism sounds like someone trying to help you.\u201d \u2014 Morgan Housel<\/a>\n\n\t\t\t<a href=\"https:\/\/twitter.com\/intent\/tweet?text=%E2%80%9COptimism+sounds+like+a+sales+pitch.+Pessimism+sounds+like+someone+trying+to+help+you.%E2%80%9D+%E2%80%94+Morgan+Housel&#038;url=https%3A%2F%2Fwww.getstoryshots.com%2Fsv%2Fwp-json%2Fwp%2Fv2%2Fposts%2F50481&#038;via=storyshots&#038;related=storyshots\" class=\"ss-ctt-link\" data-title=\"Click to Tweet\" rel=\"nofollow noopener\" target=\"_blank\">\n\t\t\t\t<span>Click to Tweet<\/span>\n\t\t\t\t<svg class=\"ss-svg-icon\" aria-hidden=\"true\" role=\"img\" focusable=\"false\" width=\"32\" height=\"32\" viewBox=\"0 0 24 24\"><path d=\"M18.244 2.25h3.308l-7.227 8.26 8.502 11.24H16.17l-5.214-6.817L4.99 21.75H1.68l7.73-8.835L1.254 2.25H8.08l4.713 6.231zm-1.161 17.52h1.833L7.084 4.126H5.117z\"><\/path><\/svg>\t\t\t<\/a>\n\n\t\t<\/div><!-- END .ss-ctt-wrapper -->\n\n\t\t\n\n\n<p>Finance has a knack for bringing out the pessimist in everyone. According to Housel, pessimists often extrapolate present trends without accounting for how markets adapt.<\/p>\n\n\n\n<p>True financial optimism is expecting things to be bad and being surprised when they\u2019re not.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">StoryShot #17: Appealing Fictions Affect Our Investments<\/h2>\n\n\n\n<p>The more you want something to be true, the more likely you will believe a story that overestimates the odds of it being true. For example, after World War I, few believed there would ever be another world war. The reality is that another was just around the corner.<\/p>\n\n\n\n<p>Housel calls these events we want to be true \u201cappealing fictions.\u201d Crucially, these appealing fictions have a significant impact on our investments.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Final Summary and Review<\/h2>\n\n\n\n<p><em>The Psychology of Money <\/em>is a collection of tips from a two-time winner of the Best in Business award. This book highlights the importance of noticing the difference between being rich and being wealthy. Rich people often make risky decisions based on historical data. Wealthy people realize that protecting their money by avoiding mistakes is the key to success.<\/p>\n\n\n\n<p>The book is relatively short but packed with fun and timeless financial lessons on how to deal with money. The title of the book may lead some readers to believe it\u2019s a deep dive into the behavioral economics and decision analysis of all aspects of money. They may find it a rudimentary take (albeit an insightful one) on these topics.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Rating<\/h2>\n\n\n\n<p>We rate<em> The Psychology of Money<\/em> 4.5\/5.<\/p>\n\n\n\n<p>How would you rate Morgan Housel&#8217;s book based on this summary?<\/p>\n\n\n\n<div class=\"wp-block-yet-another-stars-rating-visitor-votes yasr-vv-block\"><!--Yasr Visitor Votes Shortcode--><div id='yasr_visitor_votes_9f6bd9ec06249' class='yasr-visitor-votes'><div class=\"yasr-custom-text-vv-before yasr-custom-text-vv-before-50481\">Click to rate this book!<\/div><div id='yasr-vv-second-row-container-9f6bd9ec06249'\r\n                                        class='yasr-vv-second-row-container'><div id='yasr-visitor-votes-rater-9f6bd9ec06249'\r\n                                      class='yasr-rater-stars-vv'\r\n                                      data-rater-postid='50481'\r\n                                      data-rating='4.2'\r\n                                      data-rater-starsize='32'\r\n                                      data-rater-readonly='false'\r\n                                      data-rater-nonce='e8e475e81a'\r\n                                      data-issingular='false'\r\n                                    ><\/div><div class=\"yasr-vv-stats-text-container\" id=\"yasr-vv-stats-text-container-9f6bd9ec06249\"><svg xmlns=\"https:\/\/www.w3.org\/2000\/svg\" width=\"20\" height=\"20\"\r\n                                   class=\"yasr-dashicons-visitor-stats\"\r\n                                   data-postid=\"50481\"\r\n                                   id=\"yasr-stats-dashicon-9f6bd9ec06249\">\r\n                                   <path d=\"M18 18v-16h-4v16h4zM12 18v-11h-4v11h4zM6 18v-8h-4v8h4z\"><\/path>\r\n                               <\/svg><span id=\"yasr-vv-text-container-9f6bd9ec06249\" class=\"yasr-vv-text-container\">[Total: <span id=\"yasr-vv-votes-number-container-9f6bd9ec06249\">39<\/span> Average: <span id=\"yasr-vv-average-container-9f6bd9ec06249\">4.2<\/span>]<\/span><\/div><div id='yasr-vv-loader-9f6bd9ec06249' class='yasr-vv-container-loader'><\/div><\/div><div id='yasr-vv-bottom-container-9f6bd9ec06249' class='yasr-vv-bottom-container'><\/div><\/div><!--End Yasr Visitor Votes Shortcode--><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Infographic<\/h2>\n\n\n\n<p>Get the full infographic of The Psychology of Money on the <a href=\"https:\/\/www.getstoryshots.com\">StoryShots app.<\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">The Psychology of Money PDF, Free Audiobook, and Animated Summary<\/h2>\n\n\n\n<p>This was the tip of the iceberg. To dive into the details of <em>The Psychology of Money<\/em> and support Morgan Housel, order the <a data-tool=\"Get on Amazon\" class=\"tooltip animate\" href=\"https:\/\/geni.us\/psychology-money-book\" target=\"_blank\" rel=\"noopener\">book<\/a> or get the audiobook <a data-tool=\"Get on Amazon\" class=\"tooltip animate\" href=\"https:\/\/geni.us\/psych-free-audiobook\" target=\"_blank\" rel=\"noopener\">for free<\/a> on Amazon.<\/p>\n\n\n\n<p>Did you like the lessons you learned here? Comment below or share to show you care.<\/p>\n\n\n\n<p>New to StoryShots? Get the PDF, free audio and animated versions of this analysis and review of <em>The Psychology of Money<\/em> and hundreds of other bestselling nonfiction books in our <a href=\"https:\/\/go.getstoryshots.com\/free\">free top-ranking app.<\/a> It\u2019s been featured by Apple, The Guardian, The UN, and Google as one of the world\u2019s best reading and learning apps.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Editor&#8217;s Note<\/h2>\n\n\n\n<p>This piece was first published in 2021. It was carefully revised and updated in January 2024.<\/p>\n\n\n<div id=\"rank-math-faq\" class=\"rank-math-block\">\n<div class=\"rank-math-list \">\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">What is the Psychology of Money?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The Psychology of Money refers to the study of how people&#8217;s attitudes, beliefs, and behaviors impact their financial decisions and management of money.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">How does the Psychology of Money influence our financial decisions?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The Psychology of Money plays a crucial role in our financial decision-making process as it encompasses various factors such as emotions, cognitive biases, risk tolerance, and societal influences that can affect our choices regarding spending, saving, and investing.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">What are some common psychological biases related to the Psychology of Money?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Several psychological biases affect our money-related decisions, including loss aversion (the tendency to fear losses more than we value gains), anchoring (relying too heavily on initial information), and the endowment effect (overvaluing what we already possess).<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">Can understanding the Psychology of Money help improve our financial well-being?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes, understanding the Psychology of Money can enhance our financial well-being. By recognizing our biases, emotions, and behaviors surrounding money, we can make more informed decisions, develop healthier financial habits, and work towards achieving our long-term financial goals.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">How does the Psychology of Money relate to financial literacy?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The Psychology of Money complements financial literacy by focusing on the psychological aspects that influence our financial behaviors. While financial literacy provides knowledge and skills, understanding the Psychology of Money helps address behavioral obstacles that may hinder the application of that knowledge.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721386847138\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \">Are there any resources available to learn more about the Psychology of Money?<\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes, there are various resources available to deepen your understanding of the Psychology of Money. Books like The Psychology of Money by Morgan Housel and Thinking, Fast and Slow by Daniel Kahneman offer valuable insights. Additionally, online courses, articles, and podcasts dedicated to this topic can provide further knowledge and practical tips.<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\">Related Book Summaries<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/the-intelligent-investor-summary\">The Intelligent Investor<\/a> by Benjamin Graham<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/same-as-ever-summary\/\" data-type=\"post\" data-id=\"93662\">Same As Ever<\/a> by Morgan Housel<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/the-snowball-summary\">The Snowball<\/a> by Alice Schroeder<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/I-will-teach-you-to-be-rich-summary\">I Will Teach You to Be Rich<\/a> by Ramit Sethi&nbsp;<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/mastering-the-market-cycle-summary\">Mastering the Market Cycle<\/a> by Howard Marks<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/secrets-of-the-millionaire-mind-summary\">Secrets of the Millionaire Mind<\/a> by Harv Eker<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/you-werent-supposed-to-see-that-summary\/\" data-type=\"post\" data-id=\"96134\">You Weren&#8217;t Supposed to See<\/a> That by Joshua Brown<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/total-money-makeover-summary\">The Total Money Makeover<\/a> by Dave Ramsey<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/how-to-get-rich-summary\">How to Get Rich<\/a> by Naval Ravikant<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/freakonomics-summary\">Freakonomics<\/a> by Stephen Dubner and Steven Levitt<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/rich-dad-poor-dad-summary\">Rich Dad Poor Dad<\/a> by Robert Kiyosaki<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/you-are-a-badass-at-making-money-summary\">You Are a Badass at Making Money<\/a> by Jen Sincero<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/money-master-the-game-summary\/\" data-type=\"post\" data-id=\"95\">Money Master The Game<\/a> by Tony Robbins<\/li>\n\n\n\n<li><a href=\"https:\/\/www.getstoryshots.com\/books\/rich-dads-cashflow-quadrant-summary\">Rich Dad\u2019s Cashflow Quadrant<\/a> by Robert Kiyosaki<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Tidl\u00f6sa l\u00e4rdomar om rikedom, girighet och lycka 1 mening Sammanfattning Pengarnas psykologi \u00e4r en studie av hur v\u00e5ra tankar, k\u00e4nslor och beteenden p\u00e5verkar v\u00e5ra ekonomiska beslut, vilket ofta leder till irrationella val som styrs av kognitiva f\u00f6rdomar, personliga erfarenheter och sociala influenser snarare \u00e4n rent logiska resonemang. Livet blir upptaget. Har The Psychology of Money varit...<\/p>","protected":false},"author":1,"featured_media":91043,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","_kadence_starter_templates_imported_post":false,"_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"right","_kad_post_sidebar_id":"sidebar-primary","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"yasr_overall_rating":0,"yasr_post_is_review":"","yasr_auto_insert_disabled":"","yasr_review_type":"","footnotes":""},"categories":[4649,4504,4478,4527,4491],"tags":[],"class_list":["post-50481","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-books","category-business","category-investing","category-new","category-psychology"],"acf":[],"yasr_visitor_votes":{"stars_attributes":{"read_only":false,"span_bottom":false},"number_of_votes":39,"sum_votes":163},"taxonomy_info":{"category":[{"value":4649,"label":"All Books"},{"value":4504,"label":"Business &amp; Economics"},{"value":4478,"label":"Investing"},{"value":4527,"label":"New"},{"value":4491,"label":"Psychology"}]},"featured_image_src_large":["https:\/\/www.getstoryshots.com\/wp-content\/uploads\/The-Psychology-of-Money-Summary-1024x536.png",1024,536,true],"author_info":{"display_name":"StoryShots - Free Book Summaries","author_link":"https:\/\/www.getstoryshots.com\/sv\/books\/author\/storyshotsadmin\/"},"comment_info":6,"category_info":[{"term_id":4649,"name":"All Books","slug":"all-books","term_group":0,"term_taxonomy_id":4649,"taxonomy":"category","description":"","parent":0,"count":95,"filter":"raw","cat_ID":4649,"category_count":95,"category_description":"","cat_name":"All Books","category_nicename":"all-books","category_parent":0},{"term_id":4504,"name":"Business &amp; Economics","slug":"business","term_group":0,"term_taxonomy_id":4504,"taxonomy":"category","description":"","parent":0,"count":57,"filter":"raw","cat_ID":4504,"category_count":57,"category_description":"","cat_name":"Business &amp; Economics","category_nicename":"business","category_parent":0},{"term_id":4478,"name":"Investing","slug":"investing","term_group":0,"term_taxonomy_id":4478,"taxonomy":"category","description":"","parent":0,"count":34,"filter":"raw","cat_ID":4478,"category_count":34,"category_description":"","cat_name":"Investing","category_nicename":"investing","category_parent":0},{"term_id":4527,"name":"New","slug":"new","term_group":0,"term_taxonomy_id":4527,"taxonomy":"category","description":"","parent":0,"count":88,"filter":"raw","cat_ID":4527,"category_count":88,"category_description":"","cat_name":"New","category_nicename":"new","category_parent":0},{"term_id":4491,"name":"Psychology","slug":"psychology","term_group":0,"term_taxonomy_id":4491,"taxonomy":"category","description":"","parent":0,"count":59,"filter":"raw","cat_ID":4491,"category_count":59,"category_description":"","cat_name":"Psychology","category_nicename":"psychology","category_parent":0}],"tag_info":false,"_links":{"self":[{"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/posts\/50481","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/comments?post=50481"}],"version-history":[{"count":49,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/posts\/50481\/revisions"}],"predecessor-version":[{"id":96145,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/posts\/50481\/revisions\/96145"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/media\/91043"}],"wp:attachment":[{"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/media?parent=50481"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/categories?post=50481"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.getstoryshots.com\/sv\/wp-json\/wp\/v2\/tags?post=50481"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}