The Psychology of Money Quotes
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The Psychology of Money Quotes
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“Sunk costs—anchoring decisions to past efforts that can’t be refunded—are a devil in a world where people change over time.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Pessimism just sounds smarter and more plausible than optimism. Tell someone that everything will be great and they’re likely to either shrug you off or offer a skeptical eye. Tell someone they’re in danger and you have their undivided attention.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Here’s the thing: 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.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Moritz: There’s a lot of truth to that … We assume that tomorrow won’t be like yesterday. We can’t afford to rest on our laurels. We can’t be complacent. We can’t assume that yesterday’s success translates into tomorrow’s good fortune.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Compounding only works if you can give an asset years and years to grow. It’s like planting oak trees: A year of growth will never show much progress, 10 years can make a meaningful difference, and 50 years can create something absolutely extraordinary.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“What’s the saying? You plan, God laughs.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Wealth is the nice cars not purchased. The diamonds not bought. The watches not worn, the clothes forgone and the first-class upgrade declined. Wealth is financial assets that haven’t yet been converted into the stuff you see.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“The most powerful common denominator of happiness was simple. Campbell summed it up: Having a strong sense of controlling one’s life is a more dependable predictor of positive feelings of wellbeing than any of the objective conditions of life we have considered.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“There is a name for this feeling. Psychologists call it reactance. Jonah Berger, a marketing professor at the University of Pennsylvania, summed it up well: People like to feel like they’re in control—in the drivers’ seat. When we try to get them to do something, they feel disempowered. Rather than feeling like they made the choice, they feel like we made it for them. So they say no or do something else, even when they might have originally been happy to go along.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“30 Lessons for Living, gerontologist Karl Pillemer”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“In his book 30 Lessons for Living, gerontologist Karl Pillemer”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Your kids don’t want your money (or what your money buys) anywhere near as much as they want you. Specifically, they want you with them,” Pillemer writes.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“One came in late 1942, when a German tank unit sat in reserve on grasslands outside the city. When tanks were desperately needed on the front lines, something happened that surprised everyone: Almost none of them worked. Out of 104 tanks in the unit, fewer than 20 were operable. Engineers quickly found the issue. Historian William Craig writes: “During the weeks of inactivity behind the front lines, field mice had nested inside the vehicles and eaten away insulation covering the electrical systems.” The Germans had the most sophisticated equipment in the world. Yet there they were, defeated by mice.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“I’ve come to realize that someone else’s failure is usually attributed to bad decisions, while your own failures are usually chalked up to the dark side of risk. When judging your failures I’m likely to prefer a clean and simple story of cause and effect, because I don’t know what’s going on inside your head. “You had a bad outcome so it must have been caused by a bad decision” is the story that makes the most sense to me. But when judging myself I can make up a wild narrative justifying my past decisions and attributing bad outcomes to risk.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“A mindset that can be paranoid and optimistic at the same time is hard to maintain, because seeing things as black or white takes less effort than accepting nuance.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“One, financial outcomes are driven by luck, independent of intelligence and effort. That’s true to some extent, and this book will discuss it in further detail. Or, two (and I think more common), that financial success is not a hard science. It’s a soft skill, where how you behave is more important than what you know.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Take a simple example: lottery tickets. Americans spend more on them than movies, video games, music, sporting events, and books combined. And who buys them? Mostly poor people. The lowest-income households in the U.S. on average spend $412 a year on lotto tickets, four times the amount of those in the highest income groups. Forty percent of Americans cannot come up with $400 in an emergency. Which is to say: Those buying $400 in lottery tickets are by and large the same people who say they couldn’t come up with $400 in an emergency. They are blowing their safety nets on something with a one-in-millions chance of hitting it big. That seems crazy to me. It probably seems crazy to you, too. But I’m not in the lowest income group. You’re likely not, either. So it’s hard for many of us to intuitively grasp the subconscious reasoning of low-income lottery ticket buyers. But strain a little, and you can imagine it going something like this:”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Take retirement. At the end of 2018 there was $27 trillion in U.S. retirement accounts, making it the main driver of the common investor’s saving and investing decisions.5 But the entire concept of being entitled to retirement is, at most, two generations old. Before World War II most Americans worked until they died. That was the expectation and the reality. The labor force participation rate of men age 65 and over was above 50% until the 1940s:”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Singer Rihanna nearly went bankrupt after overspending and sued her financial advisor. The advisor responded: “Was it really necessary to tell her that if you spend money on things, you will end up with the things and not the money?”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Rich is a current income. Someone driving a $100,000 car is almost certainly rich, because even if they purchased the car with debt you need a certain level of income to afford the monthly payment”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Exercise is like being rich. You think, “I did the work and I now deserve to treat myself to a big meal.” Wealth is turning down that treat meal and actually burning net calories. It’s hard, and requires self-control. But it creates a gap between what you could do and what you choose to do that accrues to you over time.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Learning to be happy with less money creates a gap between what you have and what you want—similar to the gap you get from growing your paycheck, but easier and more in your control.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“A high savings rate means having lower expenses than you otherwise could, and having lower expenses means your savings go farther than they would if you spent more.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Evans was as skilled with computers as Gates and Allen. Lakeside once struggled to manually put together the school’s class schedule—a maze of complexity to get hundreds of students the classes they need at times that don’t conflict with other courses. The school tasked Bill and Kent—children, by any measure—to build a computer program to solve the problem. It worked. And unlike Paul Allen, Kent shared Bill’s business mind and endless ambition. “Kent always had the big briefcase, like a lawyer’s briefcase,” Gates recalls. “We were always scheming about what we’d be doing five or six years in the future. Should we go be CEOs? What kind of impact could you have? Should we go be generals? Should we go be ambassadors?” Whatever it was, Bill and Kent knew they’d do it together. After reminiscing on his friendship with Kent, Gates trails off. “We would have kept working together. I’m sure we would have gone to college together.” Kent could have been a founding partner of Microsoft with Gates and Allen. But it would never happen. Kent died in a mountaineering accident before he graduated high school.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Bill Gates experienced one in a million luck by ending up at Lakeside. Kent Evans experienced one in a million risk by never getting to finish what he and Gates set out to achieve. The same force, the same magnitude, working in opposite directions.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“But investing is not a hard science. It’s a massive group of people making imperfect decisions with limited information about things that will have a massive impact on their wellbeing, which can make even smart people nervous, greedy and paranoid”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“More than 2,000 books are dedicated to how Warren Buffett built his fortune. Many of them are wonderful. But few pay enough attention to the simplest fact: Buffett’s fortune isn’t due to just being a good investor, but being a good investor since he was literally a child.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Harvard psychologist Daniel Gilbert once said: At every stage of our lives we make decisions that will profoundly influence the lives of the people we’re going to become, and then when we become those people, we’re not always thrilled with the decisions we made. So young people pay good money to get tattoos removed that teenagers paid good money to get. Middle-aged people rushed to divorce people who young adults rushed to marry. Older adults work hard to lose what middle-aged adults worked hard to gain. On and on and on.48”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“All of us,” he said, “are walking around with an illusion—an illusion that history, our personal history, has just come to an end, that we have just recently become the people that we were always meant to be and will be for the rest of our lives.”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
“Every job looks easy when you’re not the one doing it.” Every job looks easy when you’re not the one doing it because the challenges faced by someone in the arena are often invisible to”
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness
― The Psychology of Money: Timeless lessons on wealth, greed, and happiness