Join me and 99,000+ others on my Substack to upgrade your life.

The Best Book on Money I’ve Ever Read

by | Apr 11, 2022 | Money

Finance books suck.

They’re hard to read, full of jargon, and the author tries to sound smart. Get-rich-quick gurus write too many. So I don’t recommend most books on money.

The Psychology of Money” book changed my mind. It’s a must-read.

Here’s what you can learn from it.

The biggest lesson from The Psychology of Money

Happiness = Controlling your time

The book beat this lesson into my thick skull.

I’ve always wondered why when I got more money working a job it didn’t make me happy. Then it hit me. I don’t want money. I want time to read and write. I don’t want a dumb boss to tell me what to do.

My happiness levels went up as soon as I broke free from working a job. Control of your time acts as a dividend on your energy that keeps compounding. If control of your time were a currency then it’d be worth more than one Bitcoin.

“Use money to gain control over your time.”


  1. Invest your money to make more money.
  2. Look for passive income opportunities.

Bold and reckless aren’t too different

Being bold is a trait many people idolize. It shows courage. The book teaches us that bold can be reckless too.

It’s not hard to cross to the dark side and make wild financial decisions that can ruin your life. Look at crypto. So many have been wrecked by betting on wild dog coins.

Be bold, yes. But check yourself before you wreck yourself.

The easy way to tell is to look at how much of your money is in high-risk investments versus low risk.

If all you own is in a bunch of dog coins it’s a sign.

Rich versus wealthy is misunderstood

Many people screw this up.

You don’t want to get rich. To be rich requires you to use money to buy dumb stuff like Lambos so people think you’re rich.

The book says wealth is hidden as it’s money not spent. “Wealth is an option not yet taken.” The trick is to decline options that require money now to have better options in the future.

Having options is real wealth.

An easy measure of wealth

Many people think of their net worth based on how much money they have or their total assets.

The author Morgan Housel says a better rule of thumb is “can I sleep at night?” That’s why I don’t have any debt. Debt equals stress. I can’t enjoy life when I’ve got debt chained to my back to distract me.

Sleeping well at night equals true wealth.

Most money success stories downgrade our life

When you hear about money, the gurus will often drop names such as Elon Musk, Jeff Bezos, or Warren Buffett.

The problem with learning about money from these ultra-wealthy people is what they did doesn’t apply to most of us. Their financial success is deeply complicated and we’re unlikely to ever replicate it — or want to.

Instead of wasting your time listening to these stories, you’re better off learning from people closer to home who’ve achieved moderate wealth.

Moderate wealth equals achievable.

It’s impossible to learn from what you can’t see

If you want to learn from a wealthy person, not a fake rich one, it’s hard.

That’s why large pockets of society have no idea about actual wealth because there are few people who can show them how to get it.

When you’re truly wealthy you just want to be quiet and explore your creativity in silence. You don’t want to go on Instagram and bark loudly about your Gucci bag or Louis Vuitton backpack.

The money skill few master

When you make more money it’s easy to relax more with expenses. As your expenses rise so too does the amount of income you need.

This leaves you running on a treadmill that keeps getting faster until you fall off from burnout.

Use discipline to keep expenses flat while income grows.

Your financial habits can soften the blow of failure

A smart way to arrange your financial life is to set up for failure in advance.

Morgan Housel says we don’t understand how normal it is for most things to fail. We think our project or idea is an outlier. It’s not.

If we’re not careful we can overreact when failures do happen if we don’t remember how common they are.

Morgan thinks of it like placing bets at the casino. Most bets will lose badly and cost you money.

But a few bets will pay off.

When you save money and own assets, it allows you to cop more failures until the odds go in your favor and you can collect the payoff. The key is to stay afloat until a few of your investments — financial or non-financial — pay off.

The concept of tail events

A tailwind accelerates something. A headwind slows something down. In business you hear these two metaphors all the time.

Tailwinds are often associated with good events. Morgan Housel says tailwind events can work in reverse too.

The September 11 example in the book is a great one. The planes that hit the World Trade Center could never have been predicted, the same way no one could have predicted the March 2020 health crisis.

At the start of these big historical events, we’re likely to underappreciate the flow-on effects. This is because of compounding. Just like the returns on your investments can compound over time to make a small amount of money become enormous, so to can the after-effects of a tailwind event.

In the case of September 11 it led the US central bank to cut interest rates. Low interest rates caused everyday people to get into loads of debt to buy real estate. At the same time Wall Street bet like drunken sailors on all of this debt and turned it into a casino.

As the real estate debt got bigger so to did the housing bubble that led to sky-high, unrealistic prices. Seven years later after 9/11 the bubble then popped and caused the global financial crisis.

The jobs market then became weak. So people took out more debt to get college degrees, causing a $1.6 trillion education bubble. 10.8% of these loans then started to default.

Who would’ve thought a plane smashing into a skyscraper could lead to these historical events? No one. And who knew that the negative effects from this event would continue to snowball over the decades? No one.

We have the same situation now. The fallout from the global health crisis that locked everybody in their homes will have similar tailwind events.

We just have no clue what they’ll be.

Takeaway: bad world events can lead to huge issues in the economy. Always be prepared for the unexpected. Buy assets on discount when disaster strikes and markets fall.

The most counter-intuitive advice that changed my life

This is the first book that has beautifully linked our egos to our financial results. Many think making more money or upping their savings rates is the way to be financially smart.

The book taught me it’s better to raise your humility instead. When your ego goes out of control you create hidden financial disasters. When your ego is in check you don’t need to buy a Lambo to show off.

Many people say they can’t invest or save more. This final quote from the book explains why:

“Saving is the gap between your ego and your income.”

Closing Thought

I strongly recommend you read “The Psychology of Money.” It will change your financial life.

If you decide not to, remember that true wealth is quiet and control of your time leads to happiness.

Are You Operating With Maximum Energy?

For those who are tired of dragging through the day, who want to get back the fire they once had, who are ready to reclaim your natural energy… this is your book.

Unleash the fire within