Praveen kumar's Key Ideas from The Psychology of Money
by Morgan Housel

• As investor Michael Batnick says, “some lessons have to be experienced before they can be understood.” We are all victims, in different ways, to that truth.
• Every decision people make with money is justified by taking the information they have at the moment and plugging it into their unique mental model of how the world works.
• We all do crazy stuff with money, because we’re all relatively new to this game and what looks crazy to you might make sense to me. But no one is crazy—we all make decisions based on our own unique experiences that seem to make sense to us in a given moment..

• If you risk something that is important to you for something that is unimportant to you, it just does not make any sense.
• There is no reason to risk what you have and need for what you don’t have and don’t need.
• If expectations rise with results there is no logic in striving for more because you’ll feel the same after putting in extra effort.
• There are many things never worth risking, no matter the potential gain.

• There are books on economic cycles, trading strategies, and sector bets. But the most powerful and important book should be called Shut Up And Wait.It’s just one page with a long-term chart of economic growth.
• Good investing isn’t necessarily about earning the highest returns,because the highest returns tend to be one-off hits that can’t be repeated. It’s about earning pretty good returns that you can stick with and which can be repeated for the longest period of time. That’s when compounding runs wild.

Good investing is not necessarily about making good decisions.It's about consistently not screwing up.

• Getting money is one thing.Keeping it is another.

You can be wrong half the time and still make a fortune

• “It’s not whether you’re right or wrong that’s important,” George Soros once said, “but how much money you make when you’re right and how much you lose when you’re wrong.” You can be wrong half the time and still make a fortune.

Controlling your time is the highest dividend money pays

• The highest form of wealth is the ability to wake up every morning and say, “I can do whatever I want today.”

No one is impressed with your possessions as much as you are

• It’s a subtle recognition that people generally aspire to be respected and admired by others, and using money to buy fancy things may bring less of it than you imagine. If respect and admiration are your goal, be careful how you seek it. Humility, kindness, and empathy will bring you more respect than horsepower ever will.

Spending money to show people how much you have is the fastest way to have less money

• Someone driving a $100,000 car might be wealthy. But the only data point you have about their wealth is that they have $100,000 less than they did before they bought the car (or $100,000 more in debt). That’s all you know about them.
• If you spend money on things, you will end up with the things and not the money.

• Wealth has little to do with your income or investment returns, and lots to do with your savings rate.
• Everyone knows the tangible stuff money buys. The intangible stuff is harder to wrap your head around, so it tends to go unnoticed. But the intangible benefits of money can be far more valuable and capable of increasing your happiness than the tangible things that are obvious targets of our savings.
• Every bit of savings is like taking a point in the future that would have been owned by someone else and giving it back to yourself.

• Most people, when confronted with something they don't understand, do not realise they don't understand it because they are able to come up with an explanation that makes sense based on their own unique perspective and experiences in the world , however Limited those experience are.
• The one who's confident he knows what's happening based on what he sees but turns out to be completely wrong because he can't know the stories going on inside everyone else's head ?.....He's all of us.