Eurika Ad's Key Ideas from The Psychology of Money
by Morgan Housel

Sensible optimism is a belief that the odds are in your favor, and over time things will balance out to a good outcome even if what happens in between is filled with misery.

A mindset that can be paranoid and optimistic at the same time is hard to maintain, because seeing things as black or white takes less effort than accepting nuance. But you need short-term paranoia to keep you alive long enough to exploit long-term optimism.

Having a strong sense of controlling one's life is a more dependable predictor of positive feelings of wellbeing than any of the objective conditions of life we have considered.

Humility, kindness, and empathy will bring you more respect than horsepower ever will.

Wealth is hidden. It's income not spent. Wealth is an option not yet taken to buy something later. Its value lies in offering you options, flexibility, and growth to one day purchase more stuff than you could right now.

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.

Savings without a spending goal gives you options and flexibility, the ability to wait and the opportunity to pounce. It gives you time to think. It lets you change course on your own terms.

The most important part of every plan is planning on your plan not going according to plan.

The cornerstone of economics is that things change over time because the invisible hand hates anything staying too good or too bad indefinitely.

If you view "do what you love" as a guide to a happier life, it sounds like empty fortune cookie advice. If you view it as the thing providing the endurance necessary to put the quantifiable odds of success in your favor, you realize it should be the most important part of any financial strategy.

Long-term financial planning is essential. But things change - both the world around you, and your own goals and desires. It is one thing to say, "We don't know what the future holds." It's another to admit that you, yourself, don't know today what you will even want in the future. And the truth is, few of us do.

It's hard to make enduring long-term decisions when your view of what you'll want in the future is likely to shift.

At every stage of our lives we make decisions that will profoundly influence the lives of the people we're going to become, and then when we become those people, we're not always thrilled with the decisions we made.

Real optimists don't believe that everything will be great. That's complacency. Optimism is a belief that the odds of a good outcome are in your favor over time, even when there will be setbacks along the way.

Wen directly compared or weighted against each other, losses loom largee than gains. This assymetry between the power of positive and negative expectations or experiences has an evolutionary history. Organisms that treat threats as more urgent than opportunities have a better chance to survive and reproduce.

Progress happens too slowly to notice, but setbacks happen too quickly to ignore.

Growth is driven by compounding, which always takes time. Destruction is driven by single points of failure, which can happen in seconds, and loss of confidence, which can happen in an instant.

In investing you must identify the price of success - volatility and loss amid the long backdrop if growth - and be willing to pay it.