The Psychology of Money - Morgan Housel (Review by Dian Martha Nurrul Amanah)

Most people do various things related to money without much consideration. Whether it's spending money, making money (working), doing business, or investing. Many decisions are made unwisely, just looking at what other people generally do. Known as FOMO, fear of missing out.

We easily label someone "rich" just based on their outward appearance, their lifestyle. What they wore, what vehicles they brought, and which places they visited. Finally, the true definition of rich becomes blurred. Instead of becoming millionaires, we are trapped in social demands that force us to "look" rich. Many of us buy things without paying attention to financial adequacy. Like (sorry) buying things on credit. Excessive debt to satisfy endless desires.

"Finally, the true definition of rich becomes blurred. Instead of becoming millionaires, we are trapped in social demands that force us to "look" rich."

Then to boost the huge economic needs, we work until we run out of time. Worried about not being able to pay the bills that always haunt you every month. Our lives become like someone else's, under the control of the company on which we depend on our fate. In fact, the highest level of happiness is when we can take full control of our own lives. Free to do what we like.

The same thing happens in investment and business. We take steps without preparing ourselves carefully. Dare to invest large sums of money, just by seeing the success of the crazy rich. We are busy admiring how Warren Buffett is able to thicken his wallet, without noticing that he once miscalculated world oil prices when he bought Conoco Philips shares. We praise how Walt Disney is known to the world today, without ever knowing that his first animation company was bankrupt and heavily in debt.

We often look at investment and business only from a material point of view, a short-term focus. Just busy thinking about profit. We have trouble seeing things in a logical way. Whereas psychologically, we are not ready to accept the fact that success must be passed with many ups and downs. Our mentality is not strong enough to deal with failure. Like climbing a mountain without sufficient physical preparation.

"Because saving money is the gap between your ego and your income, and wealth is what you don't see."

In essence, this book by Housel is a very educative reading. The idea of marrying psychology and finance is absolutely brilliant. It's a bible that every people should hand. This book can also be a mirror for readers in evaluating their financial decisions. So that in the future not many people are enslaved to money. Because saving money is the gap between your ego and your income, and wealth is what you don't see. Instant five stars to the book, with no doubt!