Elevated Path's Key Ideas from The Psychology of Money
by Morgan Housel

People's ability to save is more in their control than they might think.

"Building wealth has little to do with your income or investment returns, and lots to do with your savings rate."

The secret to investing is the power of compound interest.

Be patient and enjoy the compound effect.

"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"

Understand your own game, create your own strategy.

Your needs are different.

"Beware taking financial cues from people playing a different game than you are."

Luck and misfortune are part of life.

Don't get carried away with one and be prepared for the other.

"More important is that as much as we recognize the role of luck in success, the role of of risk means we should forgive ourselves and leave room for understanding when judging failures."

Uncertainty, doubt, and regret are common costs in the finance world.

But you have to view them as fees (a price worth paying to get something nice in exchange) rather than fines.

"Sometimes it rains at Disneyland. But if you view the admission fee as a fine, you'll never enjoy the magic. Find the price, then pay it."

"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 Imake a fortune."

Predicting what you'll use your savings for assumes you live in a world where you know exactly what your future expenses will be, which no one does.

"The most important part of a plan is having a plan for when the plan is not going according to plan."

"Long-term planning is harder than it seems because people's goals and desires change over time."

Sunk costs - anchoring decisions to past efforts that can't be refunded- are a devil in a world where people change over time.

• Try to show how rich you are
• Be greedy
• Risk everything
• Invest like a Pessimist

How much money you have is the fastest way to have less money.

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

"Saving is the gap between your ego and your income."

Your best shot at keeping what is invaluable is knowing when it's time to stop taking risks that might harm them Knowing when you have enough."

"Enough is realizing that an insatiable appetite for more will push you to the point of regret.

You should like risk because it pays off over time. But you should be paranoid of ruinous risk because it prevents you from taking future risks that will pay off over time.

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

"Pessimists extrapolate present trends without accounting for how reliably markets adapt."

"Save like a pessimist and invest like an optimist."