THE PSYCHOLOGY OF MONEY

I have never heard of author Morgan Housel before I got hold of this book and that’s saying something for I have devoured books of all subjects since I learned how to read.

I expected this book to be a heavy read since it's a money topic and one that for me, requires focus and total concentration. Surprisingly, it is one of the easiest books to read and digest. It’s so light that you can easily finish it in a day or two. It’s also very informative and well written so that those who are not into investment matters will still be able to understand it.

The Psychology of Money made me realize why people differ in how they view money and investing and the most probable psychology behind it. I agree with the author wholeheartedly that most of the time, people’s decisions regarding money are not logical at all- even with those who are supposedly very knowledgeable and money savvy. It also reminded me of the fact that people are more inclined to follow how they feel than what is known as facts. We follow our gut feeling, even when contrary to historical figures and future forecasts.

Our psychology of money is of course also different from everyone, even from the same family. Our parents' mindset would be greatly influenced by the happenings of their time while we will also be more inclined to decide based on our present experiences.

This of course is no excuse for us not to prepare for our future. The two things I learned from this book that left indelible imprints in my psych are the following. First, that we should invest as early as possible and consistently, no matter the state of the economy or the movement of the market. Two, we should invest only up to the point or amount we can actually let go of. That whatever happens, we have enough funds to sustain us, especially for things or events that we cannot foresee.

One nugget of wisdom I will never forget from this book- the best dividend money can give us is independence. It is the freedom to be able to do the things we want to do at any time we want to. That should be the goal and it finally gave me the right reason and the push to pursue the journey.

What are you waiting for? Grab a copy now. This would certainly help us live the life we always wanted. At least help us point the way and start getting there.