King Alyattes of Lydia, now part of Turkey, is thought to have created the first official currency in 600 BC. But the modern foundation of money decisions-saving and investing is based around concepts that are practically infants.

Where It Began

People do some crazy things with money. But no one is crazy. People from different generations, raised by different parents who earned different incomes and held different values, in different parts of the world, born into different economies, experiencing different job markets with different incentives and different degrees of luck, learn very different lessons. Everyone has their own unique experience with how the world works.

Crazy Or Different 

"Our findings suggest that individual investors' willingness to bear risk depends on personal history." Not intelligence, or education, or sophistication. Just the dumb luck of when and where you were born.”

Place Time People 

Few people make financial decisions purely with a spreadsheet. They make them at the dinner table, or in a company meeting. Places where personal history, your own unique view of the world, ego, pride, marketing, and odd incentives are scrambled together into a narrative that works for you

How Decisions Are Made

Dogs were domesticated 10,000 years ago and still retain some behaviors of their wild ancestors. Yet here we are, with between 20 and 50 years of experience in the modern financial system, hoping to be perfectly acclimated.

Expectations Vs Reality 

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 or own unique experiences that seem to make sense to us in a give moment.

It's Just Who We Are

Your personal experiences with money make up maybe 0.00000001% of what's happened in the world, but maybe 80% of how you think the world works

No One's Crazy

"What you're doing seems crazy but I kind of understand why you're doing it."-uncovers the root of many of our financial decisions.

Being Understand

Doing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people. Money—investing, personal finance, and business decisions—is typically taught as a math-based field, where data and formulas tell us exactly what to do. But in the real world people don’t make financial decisions on a spreadsheet. They make them at the dinner table, or in a meeting room, where personal history, your own unique view of the world, ego, pride, marketing, and odd incentives are scrambled together. In The Psychology of Money, award-winning author Morgan Housel shares 19 short stories exploring the strange ways people think about money and teaches you how to make better sense of one of life’s most important topics.

Understand yourself and those around you.

psychology

Psychology

personaldevelopment

Personal Development

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Money & Investments

habits

Habits

books

Books

Morgan Housel is a partner at The Collaborative Fund. He is a two-time winner of the Best in Business Award from the Society of American Business Editors and Writers, winner of the New York Times Sidney Award, and a two-time finalist for the Gerald Loeb Award for Distinguished Business and Financial Journalism. He lives in Seattle with his wife and two kids.

Place Time People

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