Book Rating: 7/10
This book is very easy to read and focuses more on psychology than the complicated finance terms and strategies usually associated with money. He talks about how human beings are highly irrational and how wealth is not connected in any way to income. There are countless stories of people spending way more than they make to keep up with appearances.
Here are some notes I took:
- Wealth is not what you see. Fancy cars or houses are not an accurate indication of wealth. A sports car only means, “Oh that guy just spent $100K.” It’s hard to get good wealth mentors because they’re not obvious and showy. So a lot of people tend to get mentored by people who make a lot of money, but are bad at managing it.
- Most people purchase luxury products or goods to impress other people. They want others to respect and admire them. But typically – that is not how others learn to respect you. Focus should instead be shifted to other values to garnish true respect
- Compounding is everything. Instead of focusing on being a good investor, focus on not being a bad investor. The difference is patience. A good investor requires picking the right stocks and selling at the right time. Not being a bad investor means never stopping the compounding process. Warren Buffet said that’s the first rule of investing: Don’t stop the compounding process unless you absolutely need to. Because your money will double every few years and compound, unless you prematurely withdraw your money
- Nothing is ever as good or as bad as it appears. Keep a neutral view of circumstances