I have good news for you your financial success does not depend on your knowledge IQ or math skills it's all about Behavior we all have different patterns of behavior we have different thoughts fears and dreams and when we hear the word money we also have completely different emotions in our heads it's not for nothing that Warren Buffett says never invest in a business you don't understand the same goes for money until you understand its psychology you won't be able to manage your finances properly but once you understand how it works and how to behave with
money you'll find that success and wealth will follow you wherever you go in this video we'll break down 12 unique lessons from the psychology of money book that will open the door to the world of wealth the knowledge presented in this work reveals human biases flaws and behaviors that are closely related to material success so watch this video Until the End because afterwards you will start your journey to wealth this is the main channel on finance subscribe and join the club of those who want to get more learn an important role for yourself the greatest
value of money is not in buying luxuries but in gaining full control over your time in life and thus gaining the highest form of freedom and perhaps the first lesson is worth starting with the author of the psychology of money states that no one is crazy people just have different views on money despite the fact that money has been around for thousands of years many of us have a poor understanding of savings Investments stocks and dividends we all do different weird things with money but we're not all crazy in fact there are two reasons why
we sometimes don't do the things we should with money the first is that we are all relatively new to the game most of today's financial and investment tools are actually quite new for example the American 401K Savings Plan was introduced in 1978 and index funds were invented in 1976. in other words these tools and concepts are relatively recent which makes us collectively inexperienced in the modern money game the second reason we do the wrong things with money is that we all think about finances differently a person born into Poverty Looks at savings and rewards for
work in a way that the child of a successful entrepreneur would never think of even if he tried each of us has a different view of how money works and that view can vary dramatically from person to person what seems crazy to you may seem like a great opportunity to your neighbor but not because one is smarter than the other or has more correct and better information we are all in different areas of life and make decisions based on unique personal experiences that seem most correct and logical to us your personal experience with money maybe
one billionth of one percent of what goes on in the world but quite possibly eighty percent of how you think the world works so don't make financial decisions based on experience alone instead do it based on your goals and objectives now let's talk about luck and risk not all our achievements are the result of hard work and not all poverty is the consequence of laziness we put too much emphasis on the skill and effort we need to achieve certain goals but often the results are more influenced by luck and risk sometimes the serendipitous effect of
actions beyond our control can have much more serious consequences than those we consciously take this lesson can be seen in the example of the famous billionaire Bill Gates Gates was very hard-working and Brilliant however he was also fortunate enough to attend one of the few schools that had computers at the time this is how Bill Gates along with his classmate Paul Allen created Microsoft Ken Evans is another person who would go on to co-found the company Evans was a classmate of gates and Allen but while still in high school Kent was killed in a mountain
climbing accident both gates and Evans were smart and computer savvy but one was lucky and the other was risky the point of the lesson is that people need to stop focusing on the accomplishments of specific people because we don't know what element of luck may have gone along with it instead focus on General patterns of success and failure the more common a pattern is the more likely it is that it can be applied to your life trying to emulate Warren Buffett's investment success is extremely difficult because his results are so high that the element of
luck in his life is likely to be widespread and luck is not something that can be replicated however Buffett's advice about the importance of time control is common enough that it's worth paying attention to and incorporating into your life take luck and risk for granted when things are going well know that you are invincible when things go badly it's not a disaster don't try to create a Bill Gates style fairy tale focus on what works for the majority and believe in your success [Music] learn to recognize when enough is enough there is a great number
of wealthy people who have lost everything because they believed that the millions available to them were not enough so the next lesson is not to risk what you have for what you don't have and don't need as people achieve their goals they begin to look at New Frontiers this is a natural process but very often it is only because we compare ourselves to other people who are superior to us when it comes to money we will always find someone who has more of it than we do realizing when enough is enough doesn't mean you have
to stop chasing financial success enough means knowing when to avoid things you will regret later many things are not worth the risk regardless of the reward these include reputation freedom family and friends and even love and happiness got the measure now for the power of compound interest this is perhaps one of the most important lessons to be aware of recognize the importance of investing making a good investment doesn't necessarily mean maximizing profits because that's usually a one-time fluke that can be repeated a more important element of investing is the ability to make good steady profits
over a long period of time look at Warren Buffett he is undoubtedly a brilliant investor but his main secret is not his investment strategy and formula Buffett's biggest secret is time unlike most people the billionaire started investing when he was 10 years old so by the age of 30 when most people just start Buffett already had a capital of one million dollars and more than half of his current wealth 81 billion Buffett managed to earn at the age of 65 years the billionaire is now 92 years old he has been investing since he was 10
years old that's where compound interest works wonders that's where true Financial Freedom lies give your asset time it's like planting a tree in one year you won't see much progress but in 10 years you'll see what you've done and in 50 years the results will Amaze you don't take big risks hoping to maximize your returns aim for a reasonable income that you can maintain over a long period of Time start investing as early as you can getting rich and staying Rich requires several skills let's see what the essence of this extremely important lesson is to
make money a person must take risks be optimistic and do their best while keeping what you earn requires the opposite first you have to accept understand and even be a little afraid that what you already have can disappear very quickly it's also important to recognize that at least some of what you've done was just luck and to remember that past successes won't be repeated indefinitely the ability to stay the course over time the ability not to give up even in the most difficult times is what makes all the difference this should be the Cornerstone of
any strategy whether it's investing building a career or a business the author of this book believes that financial success can be summed up in one word survival realize a few important things that will help you literally survive one more than increasing your income you want to become financially Invincible second planning is important but the most critical part of any plan is being able to deal with what doesn't go according to plan third be a reasonable Optimist know that you can be successful in spite of all the obstacles you have to overcome make money take risks
believe in yourself and work hard preserve Capital remember that it may not be there tomorrow spending wisely investing responsibly and planning ahead will keep you from outliving your assets and of course accumulate money at its core wealth is not your salary or the return on your Investments first and foremost wealth is your savings rate a person can become rich without a large income but the chances of becoming rich without savings are zero so learn to save you can spend less when you have no desire to buy something and you will want less when you stop
worrying about what others think of you you don't have to set goals for your savings you can just do it accumulating money without a specific goal gives you room to maneuver and increases your flexibility that in turn gives you the opportunity to take advantage of an interesting offer at any time so if you want to get rich do not forget to save at the same time be prepared for the worst first of all you should remember that history doesn't repeat itself we can learn from the mistakes of the past years decades and centuries but it
is necessary to always remember that in our case it will be different and for this reason one should always prepare for the worst outcome of events be ready to recover from unforeseen Financial shocks these will happen and if somewhere in the pockets you have left Yourself room to maneuver money for Force mayor you will most likely pass tough times way easier also don't forget that we all change your future self may have different goals and desires so when planning your finances remember that in five or ten years your life and Outlook may be completely different
in our younger years we may think we don't need a big house and kids so those things aren't in our plan and then it turns out that we do need kids and a big house as you develop your financial strategies accept the fact that you are prone to change what is important to you today may not be important in 10 years also bear in mind that everything has a price oftentimes falling markets going red and everything associated with failure is seen by people as a big total failure this makes most people just give up and
abandon the idea of pursuing their goals the importance of this lesson is that a person has to come to terms with themselves and see losses as the currency that was paid for on the road to success that is the trick realize that nothing in life is free and if you have lost something know that you will gain much more next time and that was just the payment for access to a successful path if you can visualize failures as paying to play rather than losing it will help you stay on course also get the right advice
on TV on the web and among friends and acquaintances there's a lot of very different advice out there and yes they may all be right but not for you only for the people giving it listen carefully to what you are being told an online investor doesn't know your income level and situation nor does your friend's acquaintance they are all judging based on their experience find the middle ground and the information you receive and only then apply it to your life despite all the setbacks a person may experience in their life it is essential to remain
optimistic also do not change your plans when things go wrong a 40 drop in one moment causes unprecedented fear and panic people get desperate and give up their goals forgetting that in six years the market goes up 140 percent fear of panic and pessimism make us Overlook what was actually showing success keep your head cool when things seem to be falling or failing what goes up and down often goes up and down focus on the long term and keep your Morella the author of the psychology of money believes that true Financial optimism is about expecting
things to go bad and being surprised when they don't and here perhaps more importantly you realize what true freedom is control of your time is probably the highest dividend that money can bring the highest form of wealth is your freedom it's the ability to wake up in the morning and say I can do whatever I want whenever I want with whomever I want and as much as I want the greatest value of money is its ability to give you control over your time get a clear picture of your financial goals and develop a game plan
to achieve them don't try to impress others impress yourself first give this video a thumbs up if you are motivated to create your wealth I'm sure we can get together at least 1 000 inspired people to achieve phenomenal results this year this is the main channel on finance subscribe and get rich foreign
