The Psychology of Money Everyone Should Know

What I Wish I Knew About Money Sooner

Ever since I turned 18, I’ve been deeply fascinated by personal finance.

The subject is not only intriguing but also incredibly important. It’s a shame that most people don’t give it much thought or know how to handle their money effectively.

My interest in personal finance even led me to work in the banking industry, where I discovered that the best financial practices were not commonly taught there. This was quite eye-opening and made me realize why so many people are financially uneducated. Banks often prioritize their own interests, which can lead to less-than-ideal advice for customers

In this post, I’ll share the psychology of money and personal finance principles I wish I had known earlier. These are principles I believe everyone should know.

Why Care About Money?

Being good with money improves most areas of your life.

It allows you to make better career decisions, since you are not forced to stay in a job just for monetary reasons. It betters relationships (money is a top cause of stress/divorce). It can improve health by lowering existential stress. It can change the opportunities you say yes or no to.

Most people are never taught how to manage money. They just follow what everyone else does: save a little here, spend a little there, and maybe invest when they’re “ready.”

But waiting to figure it out later is a guaranteed way to stay stressed. Worse, a lot of the advice people get comes from institutions that benefit when you don’t know better.

Let’s fix that.

“Doing well with money has little to do with how smart you are, but a lot more with how you behave.” – Morgan Housel

Building wealth is a game of mindset, habits, and time—not intelligence.

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Here’s what we’ll get into:

• Assets vs. Liabilities

• Why saving isn’t enough

• Volatility ≠ risk

• How to make compound interest your best friend

• Why index funds beat 95% of “smart” investors

• The real risk of doing nothing: inflation

• What the rich understand about lifestyle, debt, and taxes

• How to use the 4% rule to estimate your freedom number

Let’s break them down.