The Psychology of Money: Timeless Lesson on Wealth, Greed, and Happiness by Morgan Housel

My Own Utopian Experiment #12: My step three to live simply. Reevaluate where I am with money to live simply and to have more freedom

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Past two weeks, I wrote about my journey to simple life. It started with redefining success and failure. Then relearn how to find joys and uniqueness in everyday life by finding small joys. Early stage of walking into simply life journey, I had to rebuild relationships with money. I am not speaking as someone who already figured it out but someone is trying to go in the right path. Reevaluation is important for me since my life is shifting and my needs change along the line. I have my own philosophy and values about money. I agree on many of the things the author writes in the book personally. I find it very helpful for anyone regardless of where you are.

If you want to reconsider how you spend, save and plan for the future. This is the book. This is not a book only about consumerism, saving techniques, investing and planning for the future. It is much more such as psychology behind it. It digs into what affects all. It goes deep in subconscious minds that control our behaviors and thoughts most of the times. I believe people tend to buy what they want than what they need. Our emotions also tied to how we make financial decisions. It even goes deeper into the images and beliefs tied to economic statues and egos as well. It would help to reevaluate, unlearn and relearn values around the tough topic, money.

This is the best book I have read on economics/money. What you read won’t be outdated. It is core principles, values and understand the basics along with your own subconscious minds which driving your money habits. It is also easy read by design. Each chapter has its own story to tell without a bunch of data, graphs, mathematical analysis and jargons. The stories are real examples and very interesting. I loved the part he describes the difference between luck and risk (how to look at our own and others’), wealth and rich, being wealthy and staying wealthy, healthy ambition and greed and his idea on personal “feel good and safe” strategy knowing everyone is different. I totally agree on his recommendation on how to minimize regrets when things keep changing and our lives are also constantly shifting.  I can’t agree more on his own description on what freedom means to him. I am not a serous investor but I learn a few things about investments. This book is filled with facts you can learn but also will make you to reevaluate, unlearn and relearn your thoughts about your own finance, attitudes towards how you view financial success and failure, ambitions, ricks, goals, images and beliefs you hold, consumerism, how you invest and/or save, how you make “feeling good” decisions, etc.

The book has 20 chapters followed by postscript on history of US consumerism. Please do not skip this even though it does not have its own chapter. I find it helpful and interesting. Here are the chapter lists. Without reading, you will find it interesting.

1. No One’s Crazy
2. Luck & Risk
3. Never Enough
4. Confounding Compounding
5. Getting Wealthy vs. Staying Wealthy
6. Tails, You Win
7. Freedom
8. Man in the Car Paradox
9. Wealthy is What You Don’t See
10. Save Money
11. Reasonable > Rational
12. Surprise!
13. Room for Error
14. You’ll Change
15. Nothing’s Free
16. You & Me
17. The Seduction of Pessimism
18. When You’ll Believe Anything
19. All Together Now
20. Confession
21. *Postscript: A brief History of Why the U.S. Consumer Thinks the Way They Do

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