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How to make better financial decisions?
- Respect the power of luck and risk. Go out of your way to find humility when things are going right and forgive/compassion when they go wrong.
- Less ego, more wealth. Wealth is created by suppressing what you can buy today.
- Manage your money in a way that helps you sleep at night. Take the risk and premium that you feel comfortable
- Increase your investment time horizon to make little things big and big mistakes fade away. Investment requires patience.
- Measure the performance by your full portfolio, rather than individual investments.
- Use money to gain control over your time. The ability to do what to do , when you want, with who you want, for as long as you want to, pay the highest dividends that exists in finance.
- Be nice and less flashy.
- Save. Just save. Saving for things that are impossible to predict or define.
- Accept that uncertainty, doubt and regret are common cost in the financial world. There is no free lunch.
- Endure error. In long term Yiu can do better.
- Avoid the extreme ends of financial decisions.
- You should like risk because it pays off over time. No risk no return. Take the risk that is acceptable to you.
- Define the game you’re playing and don’t be influenced by others.
- People have vastly different goals and desires. Find those that works for you.
*:”The Psychology of Money,” by Morgan Housel
2021/11/26 The Psychology of Money Damakey
