I was surprised when I realized this 2020 piece by Morgan Housel was never brought to my attention despite selling 7 million
copies already and being endorsed by public thinkers I follow, such as James Clear, Tim Ferriss, Chris Williamson, or Daniel Pink.
Now that I read it, I join them by proclaiming:
The Psychology of Money is the single most important book everyone should read for thinking about their own and others' financial decisions.
It's short, to-the-point, and covers a broad range of relevant concepts for better understanding our relationship with money.
In it, Housel explains many of the lessons of Nassim Taleb's Incerto (that I wrote about
recently)
and makes them more easily approachable.
After I landed my first job, I thought about what to do with my savings. That was quite frightening to me,
since I felt, I now had to learn all about stocks and markets and follow the news all day.
At least that's what the finance experts do to get the optimal value from their investments, right?
Luckily, I soon came across "Fooled by Randomness" by Nassim Taleb. It brought me to believe the best strategy for me
was to simply set up a savings plan on a broad low cost ETF and try not to check its performance. To me, this was both revelation and
liberation! Who would have thought that the best way is so easy!? Taleb also made me aware of the psychological factors -
hence the tip to not check the performance.
For me, "The Psychology of Money" arrives at the same conclusion and sums up so many lessons in only a few pages
while being written for a broad audience. So when friends start to think about how best to save money, I now
recommend this one.
It's phenomenal success speaks for itself so get a copy already!