If you flipped to the back cover of the book, The Psychology of Money, the first thing that would glare at you is this, "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".
This is extracted from page 2 of this book, and the author is duty-bound to share lots of insightful points in the proceeding chapters. Today, I'll dwell on the premise or preamble of this book while we leave the next ten (10) days to chat about the remaining 10 chapters.
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Morgan seeks to show how ordinary folks do can do better with money and not because of their intelligence but based on a few behavioral skills that they learned to cultivate over the years. The life of Ronald James Read for example is portrayed and discussed in the first few pages. You get to learn how he was a humble Janitor but died as a philanthropist because of his positive behavior toward money. Another person whose relationship with money was shared is Richard Fuscone who had a rather detestable behavior towards money and filed for bankruptcy.
What the two characters displayed were patience and greed respectively. While James stayed patient, worked two jobs, and invested in blue chip companies, Richard prided himself as the best in his financial field and borrowed heavily to build a place that required $90,000 a month to maintain.
Which begged the question? In which industry does someone with no exceptional educational skills and training outperform someone with the best of skills, training, and connections?
The answer is the Money Industry.... where Personal finance, investing, corporate finance, business planning, etc., is taught albeit shockingly as a math-based field instead of emotions and behaviors.
All the training we have gotten in school or probably in life may not have prepared us for how to deal with debt, save for a rainy day, or make better investment decisions. But this is something that glares at us every day and yet we find it difficult to learn the ropes and become better at managing our finances.
Greed, insecurity, and fear of the unknown are some of the factors that affect your decision-making process when it comes to your finances.
I can tell you for sure that reading the Psychology of Money will help find your lost self when it comes to your finances. I have read this book more times than I can remember because I keep going back to it for guidance.
In the next few days, we will read the remaining chapters together and I'll be here to share the author's thoughts and my takeaways too.
Today, understand that the reason why you are struggling with your finances isn't that you do not have the biggest financial certificate or work with the most successful people. It is exclusively because of your behavior towards money and I am sure we will find solutions together as we uncover the mystery hidden in the book, The Psychology of Money by Morgan Housel
Stay tuned.
Reference: The Psychology of Money.