The Psychology of Money (Summary)

the psychology of money summary book
My beat-up copy of The Psychology of Money

I have been thoroughly enjoying my copy of The Psychology of Money by Morgan Housel. Feel like I am learning a lot of investing and life lessons.

I put together a summary of The Psychology of Money for you, leaning on the lessons you learn in the book. Before you check that out, just know that you can:

Summary of The Psychology of Money by Morgan Housel

Morgan Housel’s The Psychology of Money is an engaging exploration of how people think about, handle, and misunderstand money. Unlike typical personal finance books that focus on investment strategies or budgeting techniques, Housel emphasizes the emotional, psychological, and behavioral factors that influence financial decisions. Through a collection of 20 short chapters, he delves into timeless lessons about wealth, greed, risk, and happiness. Below is an in-depth summary of the key lessons the book offers.

1. The Role of Luck and Risk

Housel begins by explaining that financial success is often a mix of skill, luck, and risk. He uses real-life stories, such as those of Bill Gates and his less fortunate contemporaries, to illustrate how chance can play a pivotal role. While Gates had access to one of the few computers in the world, others with equal potential did not, shaping vastly different outcomes.

The lesson? Be humble about your successes and compassionate about others’ failures. Recognize that luck and risk are intertwined, and they influence outcomes more than we care to admit.

2. The Importance of Time

One of the most significant concepts in the book is the power of compounding. Housel highlights how Warren Buffett’s wealth stems not just from smart investing but from starting early and staying consistent over decades. Small, steady returns over time lead to extraordinary growth, but only if you have the patience to let compounding work its magic.

The takeaway? Time in the market is far more critical than timing the market. Start investing early and think long-term.

3. Enough: Knowing When to Stop

Housel warns against the dangers of insatiable greed. He shares the story of individuals like Bernie Madoff, who, despite having “enough,” took unnecessary risks and faced disastrous consequences. The pursuit of more can lead to ruin when we fail to define what “enough” means for us personally.

The key lesson is to set clear financial goals and recognize when you’ve achieved them. Greed often blinds people to the risks they’re taking, leading to poor decisions.

4. Wealth vs. Rich

The book makes an essential distinction between being rich and being wealthy. Rich people have high incomes and flashy possessions, but wealth is the invisible accumulation of assets that provide freedom. Wealth is what you don’t see—the savings, investments, and financial security that give you control over your time and choices.

Lesson? Focus on building wealth rather than flaunting riches. The true power of money lies in the flexibility and autonomy it can provide.

5. Saving is More Important Than Income

Housel argues that savings are the cornerstone of financial success. While increasing income is important, what truly matters is how much you save and invest. High earners can still live paycheck to paycheck if they overspend, while moderate earners who save diligently can achieve financial independence.

The takeaway? Live below your means and prioritize savings. Building wealth has more to do with discipline than income level.

6. The Value of Staying the Course

Investing isn’t about avoiding losses altogether—it’s about enduring them. The stock market is inherently volatile, and downturns are part of the process. Housel emphasizes that successful investors focus on the long-term picture and don’t let short-term fluctuations derail their strategy.

Lesson? Resilience and patience are essential for financial success. Accept that uncertainty and occasional losses are inevitable.

7. The Power of Tail Events

One of the most fascinating ideas Housel discusses is the outsized impact of “tail events.” In finance, tail events are rare, unpredictable occurrences that have a massive effect—both good and bad. For example, a small number of successful investments often account for the majority of market returns.

The implication? Understand that your overall financial journey will likely be defined by a few pivotal decisions or events. Be prepared for the unexpected and don’t bet everything on a single outcome.

8. The Danger of Over-Optimizing

While being financially savvy is important, Housel cautions against over-optimization. Trying to squeeze the last drop of efficiency out of every dollar can lead to unnecessary stress and risk. Instead, aim for strategies that are “good enough” and sustainable.

Lesson? Find a balance that works for your lifestyle. Perfection isn’t necessary—consistency and sustainability are far more important.

9. Context Shapes Financial Behavior

People’s financial decisions are heavily influenced by their personal experiences and upbringing. Someone who grew up during a period of economic prosperity may view money differently than someone who endured hardship. Housel explains that this is why many seemingly irrational financial decisions make sense within the context of an individual’s life story.

The takeaway? Be empathetic toward others’ financial choices and aware of how your own biases influence your decisions.

10. The Role of Optimism

Housel acknowledges that pessimism often feels more compelling than optimism because bad news grabs attention. However, long-term financial success requires optimism—the belief that setbacks are temporary and progress is inevitable. The growth of markets, economies, and innovation over time supports this outlook.

Lesson? Stay optimistic and focus on the long-term potential of your investments and goals.

11. Money’s Ultimate Goal: Freedom

Perhaps the most profound idea in The Psychology of Money is that money’s ultimate purpose isn’t to buy things—it’s to buy freedom. The ability to wake up and decide how to spend your day is a luxury that money can provide. Wealth should be a tool to create options and opportunities, not just a means of consumption.

The lesson? Use money to build a life that aligns with your values and gives you control over your time.

12. Adaptability is Key

Housel stresses the importance of adaptability in financial planning. Life is unpredictable, and no plan is foolproof. By maintaining flexibility and a margin of safety, you can navigate unexpected challenges without derailing your progress.

Takeaway? Prepare for uncertainty by diversifying, saving, and avoiding overconfidence in specific outcomes.

13. The Importance of Stories

People make financial decisions based on stories they tell themselves about money. Whether it’s the dream of retirement, a desire to provide for family, or the thrill of speculation, our narratives shape our actions. Recognizing and reframing these stories can lead to better decisions.

Lesson? Be intentional about the story you’re telling yourself about money. Make sure it aligns with your goals and values.

Conclusion: A Personal Approach to Money

The Psychology of Money emphasizes that personal finance is just that—personal. There’s no one-size-fits-all solution, and the best financial decisions are those that align with your unique circumstances, goals, and values. Housel’s insights encourage readers to focus on behavior, patience, and humility rather than chasing shortcuts or trends.

By understanding the psychology behind money, you can approach it with greater clarity and confidence. Whether it’s saving diligently, investing wisely, or simply defining “enough,” the lessons in this book are invaluable for anyone looking to achieve financial peace of mind.

Thank you for reading. Remember that you can listen on Audible, Blinkist or be like me and have a real copy of the book.

Cheers!

-Mike

Stock Journal: Waiting To Invest

Moon rising through trees and over a dead end street
The Moon rising over my street the other night (nothing to do with the post really, just adding something)

I will not have the cash to buy into any stock, until Friday (hellooo, payday!)

While it sucks, it gives me time to plan.

I want to add a new investment and add to any existing ones. I will add to any existing investments the are dipping on Friday (buy when red, yeah?). If that play is closed out for the day, I might add a second new investment, if I find the right one.

But what are the two possible new picks? How will I find a new company to buy?

  • Watch what the people I trust on Public.com are buying this week and do some research on those.
  • Read the blogs and websites I follow to see what they are talking about.
  • Listen to some of my favorite money and stock-based podcasts.
  • Watch some videos from my favorite finance YouTubers.

This is the habit I am trying to forge for when I don’t have money to spend: research. research. research!

One of the YouTubers I follow:

Stock Journal: A Clean Account

I have abandoned all of my dividend stocks. That goes for my (now) previous holdings and for my currently watching companies.

For dividends to be impactful you need a lot invested in the company. I don’t have a lot of cash. I believe in being dividend-focused for long term, but I was just spinning my wheels and going nowhere with so little invested. 

Time being, I am more focused on stable growth. One day when I have more cash I will get back into dividend companies & ETFs because they are awesome, just not for broke people like me 🤣.

So with that theme of stable growth, I also dumped my two risky but possible high-reward plays: AGRI (Agriforce) and SLI (Standard Lithium). Too much volatility and stress so I chucked them.

I still think those two will do well someday, but I am favoring a more mellow portfolio for the moment.

Now I have a less stress, lean & mean portfolio:

The only tension now is wanting more cash to dump into those six.

Thanks for reading. Good luck to you and your investments this week.

Top 5 Reasons to Protect Your Digital Life with VPNs and Monitoring Tools

Let us take a brief break from picking stocks and talk about online security.

In today’s interconnected world, our lives revolve around the internet. From remote work to online shopping, every click, search, and login leaves behind a digital footprint. But how safe is your personal information? With rising cyber threats and increasing digital dependency, using tools like NordVPN and SentryPC is no longer optional—it’s essential.

Here’s why safeguarding your digital life with VPNs and monitoring tools is more critical than ever:


1. Guard Your Online Privacy with VPNs

Imagine browsing the web at a café or hotel Wi-Fi. Without a Virtual Private Network (VPN), you leave the door open for hackers to intercept your data. VPNs like NordVPN encrypt your connection, hiding sensitive information like passwords, credit card details, and browsing history.

How a VPN Works:

  • Encrypts your internet traffic, making it unreadable to third parties.
  • Masks your IP address to protect your identity.
  • Allows you to access geo-restricted content (e.g., streaming platforms).

Whether streaming Netflix abroad or working from home, NordVPN is one of the most user-friendly options available, offering blazing-fast servers in over 60 countries.


2. Protect Your Family with Monitoring Tools

While VPNs shield your connection, tools like SentryPC monitor and manage computer usage, making it perfect for families and employers.

Key Benefits of Monitoring Tools:

  • Monitor children’s or employees’ online activities.
  • Restrict access to harmful websites or time-wasting apps.
  • Track productivity metrics for business efficiency.

SentryPC is an all-in-one solution that empowers parents and managers to create a safer and more productive digital environment.


3. Stay Ahead of Evolving Cyber Threats

Cybercrime is no longer a niche concern—it’s a global epidemic. By 2024, cyberattacks are expected to cost businesses trillions annually. Both NordVPN and SentryPC address different aspects of this growing problem:

  • NordVPN: Blocks malware, phishing attempts, and harmful websites.
  • SentryPC: Identifies misuse of devices and alerts you to potential insider threats.

For anyone serious about cybersecurity, using both tools together creates a comprehensive shield.


4. Improve Workplace Efficiency and Remote Security

The shift to remote work has been a game-changer. However, it’s also brought new challenges in maintaining security and productivity. Here’s how NordVPN and SentryPC help:

  • NordVPN: Securely connect to corporate networks and access sensitive data without risking a breach.
  • SentryPC: Monitor remote employee performance, ensuring accountability even from afar.

By combining these tools, you get both security and efficiency, critical for any business navigating the new normal.


5. Affordability and Ease of Use

One of the biggest myths about digital protection is that it’s complicated or expensive. Services like NordVPN and SentryPC prove otherwise:

  • NordVPN: Affordable subscription plans start at just a few dollars per month, with discounts for long-term plans.
  • SentryPC: Scalable pricing based on the number of devices, making it accessible for both households and businesses.

Both platforms offer intuitive user interfaces, making them perfect for beginners and tech-savvy users alike.


Frequently Asked Questions

Q: Can’t I use free alternatives to NordVPN or SentryPC?
A: Free VPNs and monitoring tools often come with severe limitations, including slower speeds, data caps, or questionable privacy policies. For full-featured protection, premium solutions are worth the investment.

Q: Is SentryPC legal to use?
A: Yes, as long as you use it ethically and follow applicable laws. For employers and parents, transparency is key.

Q: What’s the difference between a VPN and antivirus software?
A: A VPN encrypts your internet connection to protect data and privacy, while antivirus software detects and removes malicious programs. They work best when used together.


Conclusion: Secure Your Digital Future Today

Your digital life is invaluable. Whether you’re a parent, business owner, or individual user, investing in tools like NordVPN and SentryPC is a small price to pay for peace of mind. From online privacy to device monitoring, these services offer robust protection tailored to modern needs.

Ready to take control of your online security?
👉 Try NordVPN now with a special discount!
👉 Explore SentryPC’s assets today!

-Mikey

Alert: In case you couldn’t tell, NordVPN and SentryPC are affiliates of Buy When Red. But don’t let that take away from the fact that we need to secure our stuff online.

Pouring a New Investing Foundation

I keep having to sell every damn thing because I end up needing the cash. It has messed me up too many times. Just when I think I have got things figured out, I have to sell all my holdings so I can pay the mortgage.

I just had to do this. Almost went to zero. Only a handful of Agriforce (AGRI) and Standard Lithium (SLI) remained – I had to keep some sort of skin in the game.

Today, I am getting back in, even though it’s with only $100. I am finding out that when you have super limited cash to put in the market, you tend to focus more. These are the companies I am buying into to start a new investment foundation:

Yes, I am late on all of these. And I don’t care where they are at, I am going to buy them, DCA style, and just do it – even Benzinga knows Palantir is still hot for a reason. Normally I have a rule of only buying when the stock is at its lowest of the week, but not this time.

I am pretty excited about this because I haven’t had much going on since I had to rob my portfolio. But today begins the slow climb back and I will keep you updated.

Good luck with your portfolio today and thanks for reading.

-Mikey

P.S. Lately, I have been learning how to be a no-code developer on Make.com and if I can do it, you can too: check out Make.com. Cheers!

Why You Need a VPN in 2025: Protecting Your Privacy in the Digital Age


In 2025 or whatever year, protecting your privacy online has become more critical than ever. With cyber threats continually evolving, government surveillance increasing, and data breaches making headlines, it’s no wonder more people are turning to VPNs to safeguard their digital lives.

Whether you’re browsing at a coffee shop, streaming your favorite shows, or working remotely, a Virtual Private Network (VPN) is essential for staying secure and private. Here’s why a VPN like NordVPN should be on your list of must-have tools this year.

Heads up to Buy When Red readers: This is a sponsored post I put together for NordVPN. I will do these from time to time so I can keep the lights on and continue to provide stock-investing entertainment. Plus I like NordVPN.

1. The Rising Threat of Cybercrime

The cybersecurity landscape has changed dramatically over the past few years, and unfortunately, not for the better. Today, cybercriminals employ advanced techniques to intercept data, infiltrate devices, and steal personal information. In fact, according to recent reports, cybercrime is projected to cost the world a staggering $10.5 trillion annually by 2025.

How a VPN Protects You:

A VPN shields your data with encryption, making it nearly impossible for hackers to view or steal it. NordVPN, for example, uses advanced encryption protocols to scramble your data as it travels over the internet. Even if cybercriminals intercept it, all they see is encrypted information — no usernames, passwords, or browsing history.

2. Safeguard Your Data on Public Wi-Fi

Public Wi-Fi networks — think coffee shops, airports, or hotel lobbies — are notoriously insecure. Hackers can easily access these networks and monitor users, gathering personal details from unsuspecting individuals. A common technique, called “man-in-the-middle” (MITM) attacks, allows hackers to intercept data exchanged over these networks.

How a VPN Protects You:

When you connect to NordVPN, your device establishes a secure, encrypted tunnel between your device and the VPN server, keeping your data safe from prying eyes. So whether you’re checking your bank balance, sending work emails, or browsing social media, you can do so with confidence that your information remains secure, even on public Wi-Fi.

3. Evade ISP Tracking and Throttling

In many countries, Internet Service Providers (ISPs) are legally allowed to track your online activity. This means they can collect information about the websites you visit, the files you download, and even the time you spend on different platforms. To make matters worse, some ISPs throttle (or slow down) your internet speed when they detect data-intensive activities like streaming or gaming.

How a VPN Protects You:

With NordVPN, your online activity is hidden from your ISP. Since the VPN encrypts your traffic and routes it through a remote server, your ISP can’t see what you’re doing online, nor can they interfere with your connection. This allows you to enjoy unrestricted, full-speed internet without interruptions or slowdowns.

And yes, you can use NordVPN with your cell phone:

4. Bypass Geo-Restrictions and Access Content Worldwide

Ever tried to watch a show on Netflix only to find that it’s unavailable in your country? Streaming services, news websites, and other online platforms often restrict content based on the user’s location — a practice known as geo-blocking.

How a VPN Protects You:

NordVPN lets you virtually “travel” to any country by connecting to servers around the world. This means you can access a wider variety of content no matter where you are. Want to watch a show only available in the UK? Simply connect to one of NordVPN’s UK servers and enjoy your favorite shows without restriction.

5. Combat Growing Government Surveillance

Government surveillance has become a growing concern in recent years, with many countries monitoring citizens’ online activity for security purposes. While regulations vary, some governments can access internet logs from ISPs, putting your online privacy at risk.

How a VPN Protects You:

NordVPN’s strict no-logs policy ensures that no browsing data, IP addresses, or connection timestamps are stored or shared. This commitment to privacy, combined with powerful encryption, means that even if your government requests data, there’s nothing to provide. With NordVPN, you can browse freely without fearing that your personal information is being monitored or stored.


Why NordVPN? A Trusted Choice for Security and Speed

With so many VPN options available, choosing the right one can be overwhelming. NordVPN stands out by offering:

  • Military-grade encryption to keep your data secure.
  • Over 5,500 servers worldwide, providing a fast and reliable connection.
  • Double VPN and Onion Over VPN features for maximum security.
  • 24/7 customer support for any questions or issues.
  • A 30-day money-back guarantee so you can try it risk-free.

Start Protecting Your Privacy Today

As we move further into the digital age, securing your online privacy is no longer optional. A reliable VPN like NordVPN provides the peace of mind you need by safeguarding your data, granting access to unrestricted content, and helping you browse the internet without fear of surveillance.

Ready to take control of your privacy? Try NordVPN risk-free today and enjoy a more secure, unrestricted internet experience. I am an affiliate for NordVPN and I think you should know that.

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