Submitted By Laxmi Soni

Enrollment no 0808CB231036
Branch CSE ITCS
Submitted To Ms. Neetu Shrivas
Subject Communicative English
Session 2023 - 24
 MORGAN
HOUSEL’s

The
Psychology
of
money
By Laxmi Soni
0808CB231036
Overview
Introduction 01
Key Takeaways 02
Being Rich vs Wealthy 04
Ferrari don’t generate respect 05
Objective 06
Narrative 07
Conclusion 08
My Reading Exprerience 09
Introduction
In the Psychology of Money, Morgan Housel teaches you how to have a better relationship with
money and to make smarter financial decisions.
The book "The Psychology of Money" promises to teach us about things that do not become
obsolete with time. It was released in September 2020, has 183 pages separated into 20 chapters.
The book is an international bestseller acclaimed by journalists from The Wall Street Journal.

Why should we read it? 

If you want to understand how personal finance, investments, financial planning
and the money industry, in general, works, this book is made for you.
The summary is indispensable for people starting their journey with finance, who
want to reorganize their priorities, and also those who already have extensive
technical knowledge and would like to look at money from another perspective.
 Key takeaways

01 When it comes to earning money and building wealth, it really

doesn't matter how smart you are. Instead, what really matters
is how you behave.

02 It is not enough just to know how to do something. You must be

able to fight with internal emotional and mental turmoil in
order to make the best financial decisions.

03 Considering the lack of accumulated wisdom in terms of

modern finance, many of the poor financial decisions that you
end up making arise from peoples' collective inexperience.
 04
You must not risk what you already have and require for things
which you do not have and do not actually need.

05
Creating wealth and maintaining wealth are two different
things. Creating wealth is easy, but keeping it is very difficult.

While there are many ways to accumulate wealth, there is

06
only one way to maintain it, and that involves being frugal
and paranoid of potential losses.
 Being rich vs. wealthy
"Every decision people make with money is justified by taking the
information they have at the moment and plugging it into their unique mental
model of how the world works."

If you're rich, you have a high
current income. But being
wealthy is something different -
wealth is not visible. It's the
money that you have that's not
spent. It's the optionality to buy
or do something at a future time.
Being rich offers you
opportunities in the short-
term, but being wealthy
provides you the flexibility of
having more of the items you
want - freedom, time,
possessions - in the future.
Their view of money was
formed in different worlds.
And when that's the case, a
view about money that one
group of people thinks is
outrageous can make perfect
sense to another.
Ferraris don't generate respect
Lorem ipsum dolor sit amet, consectetur adipiscing elit.
Pellentesque luctus iaculis purus, eget pretium velit People buy mansions and fancy cars
auctor vel. Aenean pulvinar aliquam augue eget because they want respect and
pellentesque pretium.
admiration from others. What they don't
realize is that people don't admire the
person with the fancy house or car; they
admire the object and think of themselves
having that object. So buying impressive
items to gain admiration and respect
from others is a fool's pursuit - these things
can not be bought.
 objectives
“The Psychology of Money” by Morgan Housel is a book
that explores the strange ways people think about
money.

The book shares 19 short stories to illustrate this concept . . It teaches that financial
decisions are not just about mathematical calculations and data, but are
influenced by personal history, unique worldviews, ego, pride, marketing, and odd
incentives

These stories aim to help readers make better sense of one of life’s most important
matters - money

The objective is to understand how emotions and psychology affect financial

decisions
 Narrative
01
Storytelling
The storytelling narrative of the
book is engaging and thought-
provoking. It doesn’t just tell you
what to do, but helps you
understand why people often
do what they do.
02
Research
Drawing on research from
psychology, economics, and
history, the book explores
themes such as the importance
of time, the role of luck, and the
power of narrative in shaping
our financial decisions
Conclusion Housel delves into the realm of
behavioral finance, emphasizing
"The Psychology of Money" is a book that explores the complex
that financial decisions are not
and often irrational ways in which people think about and
always rational or logical.
approach money. While I can't provide a specific conclusion from Understanding one's own
the book, I can offer a summary of some key insights and behavioral biases and those of
takeaways: others is crucial for making
sound financial choices.
Housel discusses the difference
between risk and uncertainty.
While risk can be measured and
managed, uncertainty is an
inherent part of life. Being aware
of the distinction can influence
financial decision-making.
The book emphasizes the
importance of taking a long-term
perspective in financial matters.
Success often comes from patience,
discipline, and the ability to
weather short-term market
fluctuations.
The ability to adapt and learn from
financial experiences is highlighted.
Flexibility in adjusting strategies
based on new information or
changing circumstances is essential
for long-term financial success.
My Reading Experience
The book's emphasis on the emotional and psychological aspects

01
of money, and its focus on long-term thinking and humility, make it
a valuable resource for anyone looking to make better decisions
about their finances and achieve long-term financial success and
happiness.

02
While reading this book, I went through a transition phase of
viewing world with new perspectives of financial ways

No matter which background you come from but you need to

have financial skills to sustain your life

03
 THANK YOU

LAXMI SONI
CSE ITCS
First Year
#KEEP READING