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00:00 Are you tired of working hard and yet struggling to achieve financial success do you feel like
00:10 no matter how intelligent you are, your bank account just doesn't reflect it well?
00:16 It turns out that financial success has less to do with intelligence and more to do with
00:21 your money habits, but don't worry, understanding and changing these habits is easier than you
00:27 think in this video.
00:29 I will take you through the 18 key lessons about money from Morgan Houseill's book,
00:35 The Psychology of Money.
00:36 By the end of this video, you'll know how to avoid common money mistakes, measure your
00:41 financial success, and achieve financial independence.
00:45 So subscribe to the channel and let's get started.
00:49 Chapter 1 from the book The Psychology of Money says no one is crazy.
00:54 Money is one of the most powerful forces in the world, and its impact on our lives is
00:59 undeniable.
01:00 The author says people have different views and experiences when it comes to money, and
01:06 that these differences do not make a person crazy.
01:09 This means that you have a unique perspective on money, and the way you view it differs
01:14 from others.
01:15 On the other hand, we all know that books can teach us a lot about money, but they won't
01:20 tell us everything this is, because there's a big difference between reading about something
01:25 and actually doing it.
01:27 You need to experience it to really understand it.
01:30 For example, imagine you're a lottery winner, who has been spending money like crazy for
01:36 years.
01:37 You think money can buy you happiness, security, and respect.
01:41 You have bought expensive cars, houses, clothes, and vacations.
01:46 You have given money to your friends, family, and charities.
01:49 You are confident that you are living the dream, and everyone else is jealous.
01:54 But then something expected happens, you lose most of your money in a bad investment, a
01:59 lawsuit, or a divorce.
02:01 The IRS comes after you for unpaid taxes.
02:04 Your friends and family turn against you or abandon you.
02:08 You realize that you have no savings, no skills, and no purpose.
02:12 How do you feel?
02:13 How do you explain this outcome?
02:15 How do you react if you are like most people?
02:18 You probably feel depressed, hopeless, and ashamed.
02:21 You might blame the world for being unfair, the people for being ungrateful, or yourself
02:26 for being stupid.
02:28 You might spiral into addiction, or developing thoughts that put your life in danger.
02:33 Or you might try to start over, and rebuild your life from scratch.
02:37 But what if there is another way to look at this situation?
02:40 What if you could acknowledge that your view of money was not crazy, but simply different
02:45 from others?
02:46 What if you could understand that other people had different experiences, beliefs, and biases
02:51 that influenced their perception of money?
02:54 What if you could respect their choices, even if you disagreed with them?
02:58 This lesson can help us become more open-minded, empathetic, and humble when it comes to money.
03:04 It can also help us avoid costly mistakes, such as spending more than we earn, ignoring
03:10 the risks, or being overconfident by recognizing that no one's crazy, we can learn from others'
03:16 perspectives and improve our own remember.
03:20 It is not what happens to you, but how you handle it, so always try to stay positive,
03:25 and let go of all the bad feelings, be confident, strong, and take care of all the tasks that
03:31 need to be done.
03:32 Success will follow as a result of your positive attitude.
03:36 The next topic on 18 Lessons from the Psychology of Money, Talk about Luck and Risk.
03:42 The author says that luck and risk are siblings that both have a profound impact on people's
03:47 financial journeys.
03:49 He uses the examples of Bill Gates, who was lucky to have access to a computer at a young
03:54 age.
03:55 There has been a lot of talk about luck, and how much of it plays a role in success.
04:00 Some say that luck is all we have, while others argue that hard work is the key to success.
04:06 The real difference between these two sides is the way they define luck.
04:11 Now imagine you could ask some of the most famous and successful entrepreneurs in the
04:15 world how they made it to the top.
04:18 What do you think they would say would they talk about their hard work, their sacrifices,
04:22 their humble beginnings in a car garage, and so on, of course, they would.
04:27 And I'm not saying they didn't work hard to achieve their dreams, but what I'm saying
04:32 is that there is something else that they often forget to mention the people who helped
04:36 them along the way, the people who gave them a chance, a tip, a connection, or a support.
04:42 That made all the difference, for example.
04:45 Do you know the story of Gates and Allen Bill Gates and Paul Allen were friends who shared
04:50 a passion for computers.
04:52 They met at a private school in Seattle, where the entire they had access to a computer lab
04:57 that few other schools had at the time.
05:00 They spent hours learning how to program and creating software for fun.
05:05 They were lucky to have this opportunity, which gave them an edge over other programmers
05:10 in the 1970s.
05:11 They also had a vision for the future of personal computing, which led them to start Microsoft
05:17 together.
05:18 However, luck and risk also played a role in their partnership and friendship.
05:23 Gates was lucky to have parents who supported his decision to drop out of Harvard and pursue
05:28 his business.
05:29 Allen was unlucky to be diagnosed with cancer in 1982, which forced him to leave.
05:35 Microsoft Gates was also more ambitious and ruthless than Allen, which created tension
05:40 between them.
05:42 Gates wanted to dominate the software market and was willing to take risks to achieve his
05:47 goals Allen wanted to explore other interests and was more cautious about his investments.
05:53 Their different personalities and priorities eventually drove them apart.
05:58 Luck and risk influenced both Gates and Allen's financial success and personal happiness.
06:05 Gates became one of the richest people in the world, but also faced legal battles and
06:10 public criticism for his business practices.
06:13 Allen recovered from cancer and became a billionaire, but also struggled with addiction and loneliness.
06:20 Both men had their share of ups and downs, which were not entirely due to their own choices
06:25 or abilities in business.
06:27 By the way, if you're enjoying the video so far, and want me to create more topics like
06:32 this comment the word video.
06:35 So I know moving on to the next subject 18 lessons about money from the book, the psychology
06:41 of money says never enough in this chapter household explores the concept of enough and
06:46 how people's egos and social comparisons can prevent them from being satisfied with their
06:52 financial situation.
06:54 Let's use the examples of John D Rockefeller, the richest man in history, and Rajat Gupta,
07:00 a former McKinsey executive, to explain how even the most successful people can fall prey
07:06 to greed and envy John D Rockefeller was the richest man in history, who amassed a fortune
07:13 of over $300 billion in today's dollars from his oil business.
07:18 He was also a philanthropist who donated millions to various causes.
07:23 However, he was never satisfied with his wealth, and always wanted more.
07:28 He once said that he would retire when he had $100 million.
07:32 But when he reached that goal, he changed it to $1 billion.
07:37 He also suffered from anxiety and depression, and had poor health for most of his life.
07:43 On the other hand, Rajat Gupta was a former McKinsey executive who had a successful career
07:49 and a net worth of over $100 million.
07:53 He was also involved in various humanitarian projects, and was respected by his peers.
07:59 However, he was not content with his status, and wanted to be part of the elite circle
08:04 of billionaires.
08:05 He became friends with Raj Rajaratnam, a hedge fund manager who was involved in insider trading.
08:12 Gupta leaked confidential information to Rajaratnam in exchange for a stake in his fund, and other
08:18 business opportunities.
08:20 He was eventually caught and convicted of fraud, and sentenced to two years in prison.
08:26 He also lost his reputation, and his fortune.
08:29 Have you ever wondered how much money you need to be happy?
08:33 You might think that the more money you have, the happier you will be.
08:37 But that's not always true, sometimes, having more money can make you want even more money,
08:42 and you end up feeling unhappy.
08:45 And stressed, this is because you start comparing yourself to other people who have more than
08:49 you, and you feel like you are not good enough.
08:52 You also start spending money on things that don't really make you happy, but only make
08:57 you look good in front of others.
09:00 This is what happened to some very rich and famous people like Rockefeller and Gupta,
09:04 who were never satisfied with their wealth, and ended up doing bad things, to get more
09:09 money.
09:10 They didn't know when to say enough.
09:12 One way that can help avoid falling into this trap is knowing that having enough is not
09:17 about how much money you have, it is about how you think about money.
09:22 We should be grateful for what we have, and not let our ego, or our social status control
09:27 our decisions.
09:29 One should spend money on things that make one happy, not on things that make us look
09:34 happy.
09:35 In addition, you should have your own goals and standards, and not compare yourself to
09:40 others in conclusion.
09:41 This is the way to be happy with your money.
09:44 Next comes the confounding, compounding one of eighteen lessons about money from the psychology
09:49 of money.
09:50 This chapter is about the power of compounding, which is the process of earning interest on
09:55 interest.
09:56 Over time, Household explains how small additions over time can lead to huge outcomes.
10:03 Using examples from nature and history, he uses Warren Buffet as a case study of how
10:08 long-term investing can yield amazing results.
10:12 Warren Buffet is one of the richest people in the world because he started investing
10:17 when he was very young, and never stopped what people don't know is that most of Buffet's
10:22 fortune was made after he turned 50.
10:25 He also lived a long time, which gave his money more time to grow Buffet was smart about
10:30 choosing good companies to invest in.
10:33 But he also knew that compounding was his secret weapon.
10:36 He once said that his life was like a snowball rolling downhill, the longer it rolled, the
10:42 bigger it got.
10:43 However, this shows that patience and consistency are key factors for financial success.
10:49 One should never underestimate the impact of small actions over time, whether positive
10:54 or negative compounding can work for or against us depending on how we use it.
11:00 One example can be saving for retirement.
11:02 If you start saving a small amount of money each month from a young age and invest it
11:08 in a diversified portfolio, you can benefit from compounding interest and grow your wealth
11:14 over time.
11:15 However, if you delay saving or spend more than you earn, you can end up with compounding
11:20 debt that becomes harder to pay off.
11:23 Next comes "Getting Wealthy vs. Staying Wealthy" one of 18 lessons about money from the book.
11:29 The psychology of money the author says that people focus too much on building wealth and
11:34 ignore the issue of keeping it which he says requires some combination of frugality and
11:40 paranoia.
11:41 He also says that getting wealthy depends on taking risks and being optimistic while
11:46 staying wealthy depends on being cautious and pessimistic.
11:51 Have you ever heard of someone who won the lottery and then went broke, or someone who
11:55 inherited a fortune and then squandered it, or someone who made a lot of money in business
12:01 and then lost it all in a bad deal?
12:05 These are examples of people who got wealthy but didn't stay wealthy.
12:09 They didn't know how to manage their money or protect it from bad luck or bad decisions.
12:13 They thought that having more money meant having more happiness, but they were wrong
12:18 on the other hand.
12:19 Have you ever heard of someone who saved and invested their money wisely and lived comfortably
12:25 for a long time, or someone who created a successful company and shared its profits
12:31 with its employees and customers, or someone who donated their money to good causes and
12:36 made a positive impact on the world?
12:39 These are examples of people who stayed wealthy, they knew how to keep their money and use
12:44 it for good purposes.
12:45 They didn't care about showing off or impressing others, but they were happy people who get
12:50 wealthy often have different skills to those that stay wealthy.
12:54 In other words, getting wealthy is about taking chances and being hopeful while staying wealthy
13:00 is about being careful and being cautious.
13:03 A person needs both qualities to succeed financially, but we also need to know when to use them.
13:10 Therefore, it is important to avoid wasting money on things that don't really make you
13:15 happy, but only make you look happy.
13:18 The next lesson about money from the psychology of money, says Tales You Win in this chapter
13:23 Household, defines a tale as a very rare occurrence again emphasizing the role of luck or chance
13:30 in finance.
13:31 Have you ever heard of someone who made a lot of money by doing something that no one
13:36 else thought was possible or profitable?
13:39 For example, Walt Disney who created a global entertainment empire.
13:44 From his cartoons and theme parks, this is an example of a person who benefited from
13:49 tales.
13:50 This was a very rare and unexpected event that had a huge impact on his financial success.
13:56 These events are not normal or predictable, but they can change everything in an instant
14:01 to help you understand how tales work in finance.
14:05 You must understand that financial outcomes are not fair or balanced, but rather follow
14:10 a rule where a few things make most of the difference.
14:13 This means that you don't have to be right all the time to make money, as long as you
14:18 are right about a few big things.
14:20 This also means that you should be humble and curious, and not assume that you know
14:25 everything or that things will always stay the same.
14:29 The book stated that most financial outcomes are not distributed evenly, but rather follow
14:34 a power law where a small number of events account for the majority of results comes
14:40 freedom one of eighteen lessons about money from the book, The Psychology of Money.
14:46 The author tells his story how he always dreamed of becoming an investor.
14:50 He admires the wealthy and successful people who make a fortune from the stock market.
14:56 He thought that if he could join them, he would be happy and fulfilled.
15:00 He studied hard, got a degree in finance, and applied for a job at a prestigious investment
15:06 firm.
15:07 He was overjoyed when he got hired, but his joy soon turned into misery.
15:11 On his first day, he realized why investors earn so much money.
15:15 They worked like slaves.
15:16 They had to wake up before dawn, analyze endless reports, and data make split-second decisions,
15:22 deal with angry clients and bosses, and stay in the office until late at night.
15:27 They had no time for hobbies, friends, or family.
15:30 They lived under constant stress and pressure.
15:33 They sacrificed their health and happiness for money household felt cheated and disillusioned.
15:38 He had traded his dreams for a nightmare.
15:41 He wondered if he had made a terrible mistake.
15:43 He wished he could quit, but he had signed a contract and had debts to pay he felt trapped.
15:49 And hopeless, he realized that money wasn't the key to happiness.
15:53 He learned that being an investor was not a glamorous or easy career.
15:57 He understood that he had to find his own passion and purpose in life.
16:02 He decided to change his attitude and make the best of his situation.
16:06 He started to read books and blogs about personal finance, psychology, and happiness.
16:11 He discovered that there were different ways to invest not only in stocks, but also in
16:16 himself, his skills, his relationships, and his community.
16:21 He began to write about his experiences and insights on his own blog.
16:26 He found out that he loved writing more than investing.
16:29 He enjoyed sharing his stories and lessons with others.
16:33 He received positive feedback and encouragement from his readers.
16:36 He realized that he had a talent and a voice that could inspire and help people.
16:41 He decided to pursue his passion and become a writer.
16:45 He quit his job at the investment firm and started to work as a freelance writer.
16:50 He wrote articles and books about investing money and happiness.
16:54 He became a popular and respected author and speaker.
16:58 He earned less money than before, but he was happier and more fulfilled.
17:03 He had found his true calling.
17:05 He learned that happiness was not about how much money you have, but how you use it to
17:10 live a meaningful life.
17:12 He learned that investing was not only about making money, but also about making a difference
17:17 in the world.
17:18 He learned that success was not about what you achieve, but who you become.
17:24 Morgan Housel says that the most powerful asset someone can have is the ability to get
17:29 up every day and say, "I can do whatever I want when I want, with who I want, for as
17:34 long as I want."
17:36 Do you agree with this quote?
17:38 The next chapter on 18 Lessons About Money, the author named this chapter, "The Man in
17:43 the Car, Paradox Housel says that when people see someone driving a fancy car, they imagine
17:49 themselves driving it, rather than admire.
17:52 The driver, since people who spend lavishly on visible goods, may be sacrificing their
17:58 long-term financial security and happiness for short-term gratification.
18:02 We should avoid social comparisons and focus on our own goals and values.
18:08 Here is the story of Tom had always dreamed of owning a Ferrari.
18:12 He worked hard as a lawyer and saved up enough money to buy one.
18:17 He thought that driving a Ferrari would make him feel successful and respected by his peers
18:22 and clients.
18:23 He imagined that people would look at him with admiration and envy as he zoomed past
18:28 them on the road.
18:29 However, Tom soon realized that his Ferrari did not bring him the happiness and recognition
18:35 he expected, instead of admiring him.
18:38 Most people ignored him or resented him for flaunting his wealth.
18:42 Some even assumed that he was a jerk or a crook who had cheated his way to riches.
18:48 Tom also felt stressed about maintaining his expensive car and paying for insurance repairs
18:53 and parking fees.
18:55 He worried that someone might scratch or steal his precious vehicle.
18:59 Tom also noticed that his Ferrari did not make him happy.
19:03 He enjoyed driving it for a while but soon got used to it and took it for granted.
19:08 He started to look at other cars and wonder if they were better or faster than his.
19:13 He felt dissatisfied with his Ferrari and wanted to upgrade to a newer or more exclusive
19:18 model.
19:19 Tom realized that he had made a mistake by buying a Ferrari.
19:23 He had wasted a lot of money on a status symbol that did not bring him any real value or joy.
19:29 He wished he had spent his money on something more meaningful and fulfilling like traveling,
19:34 learning new skills, or donating to charity.
19:37 He decided to sell his Ferrari and buy a more practical and affordable car.
19:43 He also vowed to stop comparing himself to others and focus on his own goals and happiness.
19:49 The next lesson, about money from the book, The Psychology of Money by Morgan Housel says
19:55 "Wealth is what you don't see in today's society where we are constantly bombarded
20:00 by images and messages of instant gratification, social comparison and materialism.
20:07 We live in a culture where we want everything now, and some people are willing to pay any
20:13 price for it.
20:14 We are influenced by the media and social media, where we see the glamorous and extravagant
20:19 lifestyles of the Kardashians, celebrities and influencers, some people envy them and
20:25 want to be like them.
20:27 Some think that they are happy and successful because they have a lot of things, but we
20:31 don't see the whole picture.
20:33 We don't see the hard work, the sacrifices, the struggles, the failures, the risks and
20:38 the costs behind their success.
20:40 We don't see the stress, the anxiety, the depression, the loneliness and the emptiness
20:45 behind their happiness.
20:47 We don't see the lies, the scams, the frauds and the fakes behind their authenticity.
20:51 We don't see that some of them are not really wealthy, they are just rich.
20:56 Some try to imitate their lifestyle, by spending more than they earn, by taking loans that
21:01 they can't repay, by buying things that they don't need or enjoy.
21:05 They try to fake their wealth by showing off their things to others.
21:09 They try to fake their happiness by pretending that they are satisfied with their lives.
21:13 They try to fake their success by lying about their achievements and credentials.
21:19 But this is a dangerous game.
21:21 It not only puts their finances in jeopardy, but also their health and life.
21:25 They end up in debt, in bankruptcy, in legal trouble, or in jail.
21:29 They end up with health problems, mental problems, addiction problems, or become self-destructive.
21:34 Additionally, they end up losing their friends, their family, their reputation or their dignity,
21:41 in some cases.
21:42 Some of them end up realizing that they were chasing the wrong things for the wrong reasons.
21:47 They end up realizing that they were not really living, they were just surviving here.
21:53 Are some questions to reflect on.
21:55 How do you define wealth and happiness for yourself?
21:58 What are some of the things that you spend money on, that you don't need or enjoy?
22:02 What are some of the things that you save and invest money for, that you do need or
22:07 enjoy?
22:08 How do you resist the temptation of buying things that you can't afford, or that don't
22:13 make you happy?
22:14 How do you avoid comparing yourself to others, who may seem rich, but are actually poor?
22:20 How do you balance your present needs and wants with your future goals and dreams?
22:25 How do you use your money to buy time and options, instead of stuff and status?
22:30 Moving on to the next topic on 18 Lessons About Money from The Psychology Says Save
22:35 Money, this chapter is about how saving money is the most important thing you can do to
22:40 build wealth and happiness.
22:42 Have you ever wondered how much money you should save?
22:46 You might think that it depends on how much money you make, or how much money you invest,
22:50 or how much money you spend.
22:52 But the author says that there is something else that matters more, how much money you
22:56 keep saving money, is the best way to build wealth and security, because saving money
23:02 is certain and safe while making money, or investing money is uncertain and risky.
23:08 Additionally, saving money is not just about numbers, but also about attitudes and emotions.
23:14 On the other hand, saving money is easier if you are humble and confident, and harder
23:20 if you are proud.
23:21 And insecure now saving money is not about depriving yourself of happiness, but about
23:27 choosing what makes you happy for example.
23:30 Let's say you have a friend who likes shopping, she buys a lot of clothes, shoes, accessories
23:35 and gadgets.
23:36 Every month, she thinks that shopping makes her happy and confident, and that she deserves
23:41 to treat herself for working hard.
23:43 She doesn't save much money, because she thinks that she doesn't need to, or that she can't
23:48 afford to.
23:49 She is trying to make money by spending money, and being proud now imagine that you have
23:54 another friend who likes to budget.
23:57 She tracks her income and expenses every month, she buys only what she needs, and occasionally
24:02 what she wants.
24:04 She thinks that budgeting makes her happy and confident, and that she respects herself
24:09 for being responsible.
24:11 She saves a lot of money, because she thinks that she needs to, and that she can afford
24:16 to.
24:17 She is trying to keep money by saving money, and being humble.
24:20 The author says that building wealth is not about how much money you earn, or how much
24:25 money you make from your investments, but about how much money you save.
24:29 The next Lessons About Money from The Psychology of Money says you and me, "This chapter shows
24:34 how we compare ourselves to others in money and success, how Sells says this is natural,
24:40 but also harmful and wrong since we use relative measures of wealth and happiness like income,
24:46 net worth, or status, not absolute ones like health, freedom, or relationships.
24:51 The problem is this can cause envy on happiness and false hopes.
24:55 The thing is we compare ourselves to those who are better off than us, not those who
25:00 are worse off or different from us.
25:02 To avoid this, one should focus on their own growth and values, not on what others have
25:08 or do this chapter challenges us to rethink our definition of success and happiness.
25:14 It reminds us that money is not the only or the best indicator of how well we are doing
25:19 in life.
25:20 It also urges us to be more aware of our own biases and emotions when we evaluate ourselves
25:27 and others, and we should be more grateful for what we have, and more respectful of what
25:33 others have.
25:34 Let's use the story of Jim Carrey the famous actor and comedian.
25:38 As an example in this chapter Carrey grew up in poverty, and struggled to make a living
25:43 as a stand-up comic.
25:45 He became a star after appearing in movies like Ace Ventura the Mask, and Dumb and Dumber.
25:51 He earned millions of dollars, and achieved fame and recognition.
25:55 However, he also faced personal challenges such as depression divorce, and the death
26:00 of his ex-girlfriend.
26:02 He realized that money and fame did not bring him happiness or fulfillment.
26:06 Carrey once said, "I think everybody should get rich and famous and do everything they
26:11 ever dreamed of, so they can see that it's not the answer."
26:15 He started to explore spirituality and art as ways to express himself, and find meaning
26:21 in life.
26:22 He seems to follow the advice of this chapter by questioning his own assumptions and expectations
26:28 about success and happiness, and by seeking what matters to him personally, rather than
26:33 what others value or admire.
26:36 Next comes a surprise one of eighteen lessons about money from the book, The Psychology
26:41 of Money.
26:42 This chapter is about how you can never know what will happen with money and investing.
26:47 The author says that there will always be things that surprise us, and shock us.
26:52 This chapter is inviting us to be humble and cautious when it comes to money and success.
26:58 In addition, it shows us that we cannot control everything, and that one should expect the
27:04 unexpected.
27:05 It also encourages us to be resilient and resourceful when facing challenges and setbacks.
27:11 People should not be too attached to their goals or strategies, but rather be willing
27:16 to adjust and adapt as circumstances change.
27:20 One example that makes sense with this chapter is the story of the COVID-19 pandemic, which
27:26 disrupted the global economy and society in 2020.
27:30 The pandemic was a surprise event that no one saw coming or prepared for.
27:35 It caused millions of deaths, infections, lockdowns, job losses, business closures,
27:41 and market crashes.
27:42 It also created new opportunities and innovations such as vaccines, remote work, e-commerce,
27:48 and digital entertainment.
27:50 The pandemic tested people's financial plans and resilience, and forced them to adapt to
27:56 a new reality.
27:58 It illustrated the importance of having a margin of safety diversifying one's income
28:02 sources and being flexible and adaptable in the face of uncertainty.
28:08 Next comes Leave Room for Error, one of 18 lessons about money from the psychology of
28:14 money.
28:15 The author says you are not your investments.
28:17 The concept of separating one's personal identity from their investments is important.
28:22 This means that you should not let your investment returns define who you are.
28:27 Sometimes one gets too emotionally attached to his investments, and makes decisions based
28:33 on feelings, this can lead to poor investment performance for example.
28:37 Let's say you invest in a stock that you believe in, but it starts to perform poorly.
28:43 If you let your emotions take over, you might panic.
28:46 And sell the stock at a loss, this is not a good financial decision, and can hurt your
28:51 overall investment performance.
28:54 To avoid this emotional attachment, it's important to remember that your investments
28:58 do not define who you are as a person.
29:02 Your worth and intelligence are not determined by your investment returns.
29:06 Instead focus on setting clear investment goals, sticking to a long term plan, and diversifying
29:12 your portfolio goal.
29:14 Another point is to avoid borrowing too much money, or putting all our eggs in one basket.
29:19 One should always have some extra money saved for unexpected events, or emergencies the
29:25 idea here would be to focus and make a plan for the things you can control.
29:30 Additionally, one should think about how it would feel if he lost money, and how it would
29:34 affect his life, and then aim for financial security and peace of mind, not just wealth
29:41 and status.
29:42 Moving on to the next lessons about money from the book, The Psychology of Money is
29:46 You Will Change, Housel, explains that people tend to underestimate how much they will change
29:52 in the future, and how that will affect their financial needs and preferences.
29:57 This means that we are not the same person throughout our lives, and how we should not
30:02 expect our financial plans to stay the same, either.
30:06 It is like a journey where we start from one point, and end up at another, but we also
30:11 explore different paths and destinations along the way.
30:15 One should not stick to the same route or map that we made when we were younger.
30:20 Because we may discover new places and experiences we want to try, additionally a person should
30:25 not assume that we know where we will end up, or what we will want in the future.
30:31 Because we may change our minds, or encounter surprises this lesson is inviting us to be
30:36 flexible and adaptable, and not be afraid to change our plans or goals, be true to yourself,
30:44 not following others or society, who may have different values or expectations than you,
30:50 for example.
30:51 Going back to school, is a decision that can affect our financial situation and happiness,
30:57 but it is also a personal decision that depends on our passion skills, opportunities and dreams.
31:03 We should not go back to school, just because we made a plan when we were younger, or because
31:09 everyone else is doing it, you should go back to school.
31:12 Because you want to learn something new, or pursue a different career additionally.
31:17 You should also be prepared to adjust your budget and lifestyle to accommodate your education
31:22 costs and benefits.
31:24 You should not worry about what others think or say about your decision.
31:28 Be proud of yourself for following your interests and ambitions.
31:33 This chapter invites us to be open minded and adaptable, and not to lock ourselves into
31:39 rigid commitments or expectations, and this also warns us against being influenced by
31:45 peer pressure or social norms, which may not suit one's changing circumstances, or desires
31:51 the next lesson about money from the book, The Psychology of Money, says nothing is free.
31:56 The author talks about how investing in the stock market involves paying a price losing
32:01 money on poor investments.
32:03 This means that investing is not easy or free, but it requires paying a price in terms of
32:08 money and emotions.
32:10 It is like a roller coaster ride that goes up and down, sometimes making us happy, and
32:15 sometimes making us sad, but we should not give up, or get too excited, because the ride
32:21 is not over, until we reach our destination.
32:24 We should enjoy the ride, and learn from it, but also be prepared for the bumps and twists
32:29 along the way, and always be careful not to follow the crowd or take too much risk.
32:35 Because that can lead us to crash, for example.
32:38 Buying a house is a big investment that can have many benefits such as providing shelter
32:43 comfort and security, but it also comes with a price such as paying a mortgage, taxes,
32:48 insurance, and maintenance.
32:50 Sometimes the house can increase in value and make us happy, but sometimes it can decrease
32:56 in value or need repairs, and make us sad you should not buy a house just because everyone
33:02 else is doing it, or because you think it will make you rich quickly, you should buy
33:06 a house that suits your needs and budget, and that you can afford to keep for the long
33:11 term, and also be ready to deal with any problems or surprises that may arise along the way
33:17 next comes reasonable rational.
33:20 One of 18 lessons about money from the psychology of money, I would say that this chapter teaches
33:26 us to be independent and critical thinkers when it comes to money and investing, it shows
33:31 us that there is no one size fits all solution for financial success, and that we should
33:37 not blindly follow others, or assume that they know better than us.
33:42 It also encourages us to be honest and realistic about our own situation and needs, and to
33:48 find the best strategy for ourselves, rather than for someone else.
33:53 One example that makes sense with this chapter is the story of Mark Zuckerberg.
33:58 The founder and CEO of Facebook Zuckerberg is one of the richest people in the world,
34:03 but he has a different approach to money and investing than most people.
34:08 He has not sold any of his Facebook shares since 2012.
34:12 Even though he could diversify his portfolio and reduce his risk, he also does not spend
34:18 much on luxury items or status symbols, but rather on philanthropy and innovation.
34:24 He has pledged to give away 99 of his Facebook shares to charitable causes during his lifetime.
34:30 He seems to follow the advice of this chapter by having his own vision and values, rather
34:36 than following conventional wisdom or social norms.
34:39 The next topic on 18 lessons about money from the book, the psychology of money, is the
34:45 seduction of pessimism.
34:47 This chapter is about how pessimism can be tempting and convincing, but also wrong and
34:53 dangerous.
34:54 It is like a trap that lures us in with its logic and evidence, but then snaps shut and
35:00 hurts us.
35:01 We should not fall for the trap of pessimism, because it can make us miss out on the opportunities
35:06 and rewards that come from being optimistic.
35:10 On the other hand, one should not ignore the problems and risks that exist.
35:14 But we should also not exaggerate them, or assume that they will ruin everything.
35:19 Instead, we should recognize that things can get better, and that we can overcome challenges.
35:25 It is also important to be careful not to listen to pessimistic media, or experts, who
35:31 may have their own agendas or perspectives.
35:34 For example, let's say you are planning to invest in the stock market, you've done your
35:39 research, and have a diversified portfolio.
35:43 But you keep reading news headlines, about how the market is going to crash this negative
35:48 news can be seductive, and lead you to make fear-based decisions like selling off your
35:54 investments or avoiding the stock market altogether.
35:57 However, this knee-jerk reaction may not be the best for your long-term financial goals.
36:03 Another example that emphasizes this chapter is starting a business.
36:07 You may already know that starting a business can be a risky and difficult endeavor, that
36:12 can have many benefits such as creating value-solving problems, and generating income, but it also
36:19 comes with many challenges such as competition regulation, and uncertainty.
36:24 The thing is, you should not start a business just because you are optimistic or naive,
36:30 you should start a business because you have a vision and a plan, and you are willing to
36:35 work hard, and learn from your mistakes.
36:38 One should also avoid being pessimistic or cynical, because that can make us give up
36:43 or miss out on opportunities in short be hopeful, but realistic, and acknowledge that success
36:49 is not guaranteed or easy, but rather possible, and rewarding next comes when you'll believe
36:55 anything.
36:56 One of 18 lessons about money from the psychology of money hustle, explains that stories are
37:02 powerful and persuasive, but also incomplete and misleading.
37:07 He says that people should be skeptical, and curious, and not take stories at face value.
37:13 This chapter is about how we tend to believe what we want to believe, and how we ignore
37:18 what we don't want to believe.
37:20 It's like a filter that lets in only the information that matches our views and opinions, and blocks
37:26 out the information that challenges or contradicts them.
37:30 One should not rely on the filter of our beliefs, because it can make us miss out on the truth,
37:36 and the reality, do not trust everything you hear or read, but you should also not dismiss
37:42 everything you don't like or agree with one should be open minded and curious, and try
37:47 to understand different sides of the story.
37:51 In addition it's also good to be aware of our own biases and motives, and not let them
37:56 cloud our judgment.
37:57 Be careful not to listen to people who tell us what we want to hear, but who may have
38:02 their own interests or agendas.
38:05 For example, choosing a diet is a personal decision that can affect your health and well
38:10 being, but it is also a controversial decision that can spark many debates and arguments,
38:16 do not choose a diet just because it sounds good, or because it is popular, or trendy
38:22 choose a diet that is based on scientific evidence, and that suits your needs and preferences.
38:29 One should also be willing to change his diet if he finds out new information, or if he
38:34 experiences negative effects, never ignore or reject the facts, or the feedback that
38:40 may challenge your diet choices.
38:43 Avoid like people who promote or sell certain diets, who may have their own profits or beliefs
38:48 in mind by the way.
38:50 If you are interested in the book "The Psychology of Money" use my link in the description section,
38:56 and sign up for a 30 day free trial, to listen to the audio book, or any other audio book
39:02 of your choice for free.
39:04 With that said, let's move on to another subject in the book, "The Psychology of Money" Morgan
39:10 Houseel reveals how our emotions biases, experiences, and values shape our financial choices, and
39:18 outcomes.
39:19 He challenges us to question the common sense and assumptions that often guide our money
39:24 and investing decisions us, that money is more than just numbers and logic, it is also
39:29 a reflection of our psychology and personality.
39:33 This amazing book can help you to become more aware of your own mental traps, and how to
39:38 overcome them today.
39:40 I have shared 18 lessons that explain different aspects of the psychology of money, such as
39:46 when it comes to money, psychology is more important than math and finance.
39:51 This means that how we think and feel about money, affects how we act with money, and
39:56 how we act with money determines how much money we have, and how satisfied we are with
40:01 it.
40:02 However, experience and observation are the best teachers of money, you can learn a lot
40:07 from the stories and examples of other people who have dealt with similar financial situations
40:13 as you, and from your own successes, and failures time is the ultimate measure of financial
40:19 success money is a tool that can help you buy more time for the things that matter most
40:24 to you, the more control you have over your time, the more successful you will become.
40:30 Furthermore, I discussed how saving more, and spending less is the best way to achieve
40:36 financial independence.
40:38 We also see how saving is the difference between our ego and our income, and how spending is
40:44 the difference between our income and our aspirations, the bigger these differences
40:49 are the more we save, and the less we need to work, humility and adaptability are the
40:55 best ways to avoid financial mistakes, we should admit that we don't know everything,
41:01 that we can't predict the future, and that we can't control everything, however, we should
41:06 be ready to change our mind when new information or circumstances arise, and to learn from
41:13 our mistakes.
41:14 Now if you want to know rules of money you need to master to become rich, I recommend
41:19 you watch this video next.
41:21 Do not hesitate to share this video, it may help someone subscribe to the channel, and
41:27 share your thoughts on today's video.
41:29 Thanks for watching, and I'll see you in my next one foreign.
41:32 [Music]