The Art of Spending Money

Everyone knows how to save money. Not everyone knows how to spend it.

Here are some of my favorite quotes from the book The Art of Spending Money, Simple Choices for a Richer Life by Morgan Housel

        The people I look up to the most are not necessarily the richest or most successful. Almost always, they’re the freest. The most in control of their own lives.
        It took me a while to realize that. “Rich” to me used to mean having lots of fancy toys. Now it means not being hurried, spending time with my family, control over my schedule, and intellectual independence. Doing life my way.
        Independence. That’s true rich.

        Nassim Taleb says, “What matters isn’t what a person has or doesn’t have; it is what he or she is afraid of losing. The more you have to lose, the more fragile you are.”

        A great irony in finance is that the fastest way to get rich is often to go slow. You’re never in a rush, never impatient, rarely worried or influenced by others doing things differently. You know that longevity and the ability to keep something going for the longest period of time is the true magic of finance. Like so many things in life, speed gets all the attention but slow has all the power.

        It sounds trivial: Find what works and just do that. Ignore the rest. Thanks, Einstein.
        But there is so much wisdom in this strategy, and it applies perfectly to finding the thing you should be willing to spend money on.

I really like this because I can apply it to my trading. Just stick to what works instead of trying to find “interesting” trades.

        Try spending more than you currently do on food, travel, clothes, sporting events, experiences, whatever it is. But immediately stop if it’s not making you happier, just as if you were reading a bad book.
        If you do this enough, you will find, by process of elimination, the potentially weird thing that’s right for you to spend money on, and if you cut the other stuff that brings you no joy, you’ll likely have enough money to actually spend on what makes you happy.
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	Evolution, the strongest force in the world, teaches by destroying what doesn’t work, selecting what does by process of elimination. Spending money can be the same. The wide funnel only works if you have a tight filter.

	“The amount of attention a problem gets is the inverse of its importance.”
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	Remember, the opposite of a good idea can also be a good idea. They are equally important.

	The luckier you are, the nicer you should be.