• People who have different backgrounds, different knowledge of money and different degree of luck, and different priorities can make different decisions with the same amount of money. People do crazy things with money which makes sense to them but not necessarily to you.
• If you buy crypto today and it remains the same in another 10 years, you might have made a bad decision, or you made a decision with a 90% chance but that 10% ruled over and made it unfortunate. In the real world, the result is guided by forces i.e. luck or risk other than the effort you make.
• While making money-related decisions always focus on the patterns rather than an individual case. The idea is to have a financial plan that doesn’t end when a couple of investments go bad so that you can remain in the game as long as your luck strikes.
• Social Comparison is a problem when setting financial goals. You compare yourself with someone who is successful, and when you reach that level you might start comparing yourself with a more successful person. You may never reach your financial goal because the comparison keeps increasing. It’s never enough. When the risks you are taking financially may affect your reputation, friends, family, freedom, and happiness, you need to stop.
• Understanding the concept of compounding is vital in the financial world. Higher returns on investment may be tempting but they come with equal risk. Compounding helps you to earn a good steady return with lower risk. The money increases exponentially over time. Warren Buffet started investing when he was 10 years old, he had $1 million ($9.3 million with adjusted inflation) by the time he was 30. In his mid-60s, he had a net worth of $84.5 billion. This amount didn’t appear overnight but as a result of investing over time.
• Earning money and keeping money are two different skills. You have to take risks, and be optimistic to earn money. In contrast, you have to be a pessimist to keep the money. You have to fear that everything you have earned can just be gone and the luck you had in the past earning money may not be the same if you try today. You need a survival mentality to keep the money.
• You need to be financially unbreakable for bigger returns. You need to be able to stick around to see the magic of compounding. You need to be optimistic about earning money and pessimistic about keeping money to be unbreakable.
• If you search the progress for a stock or economy of a country over 15 years or more time, you will see an upward trend, but if you zoom into smaller periods there might be recession or depreciation.
• We often look at the result of the events i.e. success events, which might be rare. Anything that is successful is a result of multiple events.
• You might put a continuous effort into something, but only a few of that events might generate success. You might make a dozen of videos on YouTube and one particular one will generate all the success.
• Everyone wants to earn money to become wealthier and happier. People’s definitions of happiness can be different but having control of your life is a common happiness factor for everyone.
• Money gives you the ability to control your life. If you have six months of emergency expenses, you don’t need to fear losing a job when you hate the boss, you can resign and find a better one. But if you have very little money with you, you will have to think twice or thrice before making a sick call.
• People generally use the money to buy fancy things just so they can be liked and admired by others. But often, kindness, empathy, and humility will bring more respect and admiration than those fancy things.
• We often judge people based on their appearance. There are people who appear modest but are actually wealthy and others who look rich and live at the edge of insolvency. You should always have this in mind while judging another person. The goal should be to be rich not to look rich.
• You don’t need reasons for saving. After you achieve your basics (same for everyone), there is spending on comfortable basics and on entertainment. Saving can be made just by lowering your expense i.e. lowering desires.
• Why save? Saving can be your saviour when life presents you with the worst cases at the worst moment. Saving provides you the ability to have control of your time and life. You can have the flexibility of waiting till you find the desired opportunity in terms of your career and investment.
• Be reasonable rather than rational with money. If you invest your money into a company you don’t care about, you will enjoy it until profits come your way but when you start losing it becomes a burden. If you invest in a company you love, when it goes into loss you will feel you are part of something you believe in and this can prevent you from giving up or moving on.
• You can’t predict the future economy based on what happened in the past. The world we live in, circumstances, and things around us are constantly evolving. So, you shouldn’t hope for specific trends that happened in the past to repeat. You should rather look at the history and get general takeaways like how people behave when there is stress, how the incentives increase with increased time, or people’s relation with greed or fear.
• Your financial plan should always have room for error. It allows you to stick long enough for luck to fall in your favor. It protects you from unpredictable troublesome events.
• It’s always good to have a long-term financial plan, but with the changes in the world around you, both the goals and desires change. We need to accept those changes and adjust the plan accordingly.
• Everything has a price and so does investing. The volatility and uncertainty are the prices of investment for growth over time. If you ignore and avoid the price like shoplifting you may end up paying double.
• Your financial goal may be different from that of another investor. You might have a different time horizon, may start investing at different times, both may look for different factors of investment and so the prices of stock may make sense to you but not the other investor. You both might have different games. Identify the game you are playing. There is no single right answer or way of investing, just what works for you.
• Growth is the result of compounding which happens over time but failure can be due to a single event and can happen within minutes. So, expect your financial plan to go bad and you will be surprised when it doesn’t, or if it does go bad you will have a plan for it.
• Always have a plan for the worst-case and learn to be okay when things go wrong.

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