The Psychology of Money - Book Summary and Review

 I completed reading the book early this year and post the summary in my Instagram account, but I think it's worth to post the summary as a blog post.

My summary:

• In Investing, it's not whether you're right or wrong that's important but how much money you make when you're right and how much money you lose when you're wrong. You can be wrong half time and still make a fortune.
• Luck and risk are doppelgangers. You are one person in a game with seven billion other people and infinite moving parts.
• A good definition of an investing genius is the man/woman who can do average thing when all those around them are going crazy.
• Financial success is not hard science, it's soft skill where how you behave is more important than what you know.
• Every decision people make with money is justified by taking information they have at the moment and plugging it into their unique mental model of how the world works.
• Had a sense of enough. There are many things never worth risking, no matter the potential gain.
• Good investing isn't necessary about earning the highest return, it's about earning pretty good returns that can stick with and which can be repeated for the longest period of time.
• Good investing is not necessarily about making good decisions, it's about consistency not screwing up.
• Freedom and flexibility which is what financial assets not yet spent can give you.
• The only way to be wealthy is not to spend the money that you do have.
• The world is filled with people who look modest but actually wealthy and people who look rich who live at the razor's edge of insolvency.
• One of the most powerful ways to increase your savings isn't to raise your income, it's to raise your humility.
• Investment return can make you rich, but whether an investment strategy will work and how long it will work and whether markets will cooperate is always in doubt.
• Do no aim to be coldly rational when making financial decision. Aim to just pretty reasonable. It works better.
• The most important part of every plan is planning on your plan not going according to plan. Give yourself a room of error.
• Endurance is the key. The trick is to accept the reality of change and move on as soon as possible.
• History when thinking about the money, the further back in history you look, the more general your take aways should be and remember the world is surprising.
• Nothing free, everything has a price, but not all prices appear on labels.
• With investing volatility is almost always a fee, not a fine. Market returns are never free and never will be, Find the price then pay it.
• Beware of taking financial cues from people playing a different game than you are.
• Pessimism just sound smarter and more plausible than optimism. Expecting things to be bad is the best way to be pleasantly surprised when they're not.
• The more you want something to be true, the more likely you are to believe story that overestimates the odds of it being true.
• Forecast may do more harm than good, giving the illusion of the predictability in the world where unforeseen events control most outcomes.
• Less ego, more wealth.
• Manage your money in a way that helps you sleep at night.
• If you want to do better as an investor, the single most powerful thing you can do is increase your time horizon.
• Save, just save, you don't need a specific reason to save.
• Avoid the extreme ends of financial decision.
• You should like risk because it pays off over time.

For me it's a good book to read, reminds you simple things on how to manage your money and as it mentioned in the book, financial success is not hard science it's soft skill.  Perfect book for your weekend. Happy Reading!