Hi guys!
Welcome to the new blog and a new day. Thus the blog is a review of one of my favorite books, The Psychology of Money.
I wanted to do a review of this book for the last few months but was caught up with academic and other work. Sad ya! Anyways back to the topic.
Psychology of Money is my favourite book and I will recommend all the readers to read this book. It will teach you to become Wealthy.
It will help you manage and grow your finances.
Some of my favorite tips that this book taught me are-
Money is important but time is much more important than money. You can earn loose money but the the invention of the time machine is impossible in the current tech world.
I mean you cannot bring the lost time back.
So, Can You earn money without spending time or spending minimum time?
You should know your value and then decide on the work.
Ex. If you are doing graduation and someone is paying you Rs.1000/month for 4 hrs/day work, should you accept?
Remember, never overestimate yourself. No one is going to spend on it if you do not have any skills.
You may work on your skills. Skillshare is one of the best platforms for learning new skills. A small investment will help you to get good returns.
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2. Motive
Know yourself. If you want to earn, just be clear about the motive of your life.
Do you want to flex your belonging or do you want to make yourself wealthy?
Remember not to be a miser else you will miss people from your arc.
You can follow this table to manage your finances.
Explanation
Before your 30s (before marriage) invest more in stock, insurance, and mutual fund. Save for your wants. Make expenses on your need.
After your 30s(when you have a wife and children), your need will increase which will decrease your wants and investment.
After 65 (retirement), you may redeem almost all of the insurance and investment. You might not have any source of income but will have a good amount of money to live your life.
3. Use the money to save time
Like I have told you earlier time is more important than money.
Use your money to save time. Always keep in mind to minimize expenses and increase income. If you think you can do the work yourself, then go with your choice.
4. Know what is enough
This is something you must know. Before even starting earning you should know your wants. Many people say that want is never-ending. But this statement is wrong. I can prove it too. Take a pen and paper and write the things that you need.
Besides that write the name of the money that is required to buy that thing.
When I did this exercise, I got to know that just need Rs. 43 Crores ($7M) to fulfill all my dreams.
6. Factor of Luck
Never leave luck. Luck may be an external factor. Luck is a probability game. To increase the probability you have to take any chances.
Ex- In the game of Ludo. The more chances you will take, the more will be the more probability of getting six.
In short, Try ten things and one might work out of them.
7. Never earn respect
I believe that respect is a permissible good. You may work hard to earn respect but one small mistake can mess up all your respect.
That's why never waste your money and energy in earning respect.
8. Money-Needs-wants relationship
As your income increases, your wants will start converting into needs. Which will result in growing more wants.
You should reduce wants and increase needs.
With this, I will end the blog. Comment down your learning and conclusion.
Shubham
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