The Art of Spending Money Quotes

“Spend less than you make. Quietly compound. Money serves you, not the other way around. No one is thinking about you as much as you are. Independence is wealth. Health is wealth. Aim to be a good ancestor. Love your family.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Recall the fascinating finding from behavioral finance that having more money is more likely to make you happy if you were already happy before you had more money.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Every few years there’s a story of a country bumpkin who has no education and a low-wage job but manages to save and compound tens of millions of dollars.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Enduring happiness is found in contentment, so those happiest with money tend to be those who have found a way to stop thinking about it. You can value it, appreciate it, even marvel at it. But if money never leaves your mind, it’s likely you’ve found yourself with an obsession, where it controls you. The best use of money is as a tool to leverage who you are, but never to define who you are.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Happiness is complicated”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Status Anxiety, Alain de Botton”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“If you’re fortunate enough to live in a prosperous region, in a prosperous era, surrounded by the ability to learn about the world and express who you are—a beneficiary of the accumulated efforts and wisdom of the one hundred billion people who came before you—the more you should go out of your way to appreciate what money can’t buy. Realize that having money might highlight or magnify an incredible life, but it cannot create it on its own. Understand that people who have made different decisions than you, and ended up with a different outcome than you, can be just as smart, funny, insightful, and worthy as you. They do what makes sense to them, and they’re trying to find their way in a complex world. You do what makes sense to you, and you’re trying to find your way in a complex world.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“This is an important part of greed: People justify their actions, even when in hindsight those actions were clearly excessive or crazy. It’s different than knowing your actions are reckless and harmful but doing them anyway. That’s psychopathy. The common form of innocent greed is extrapolating with enthusiasm what worked in the past. It tempts you to do the same thing as before, but with twice the appetite.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“In a rational world, we’d try to calculate how much of what we did influenced the reward we received. We’d recognize that if you did this and then that happened, there are a million other variables you have no control over that also could have influenced that outcome. But that’s not a natural way to think. The default assumption when you’re rewarded for doing something is to assume that you doing this caused that to happen. If you’re looking for an answer to why that happened, it is the path of least resistance. Because, after all, your views are right and deserve to be rewarded. So of course the reward was caused by the thing you did. Others believe this as much as you. People watch you get a reward and—because they imagine how they would feel if they got a reward—they get excited by your achievement. Praise. Attention. Admiration. And yes, jealousy and envy. It all feels good to you, and reinforces the idea that you got rewarded because your views and actions were right. And you want more of it. Success makes it easy to say, “I was right before, so now I’m going to double down.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“If you have accurate views, you’ll make good decisions, and those decisions will be rewarded by your peers with admiration, your bosses with pay raises, and your body with health. It’s such an appealing, attractive thought. It’s hard to make it through the day admitting you don’t know how the world works. So almost no one does it. We tell ourselves that our beliefs are correct, and correct views will be rewarded. The conviction that whatever you believe is right, and you deserve to be right because you’ve put in so much effort to form those beliefs, and correct beliefs will be rewarded by the world, is such a common and innocent idea.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“I don’t think these two points contradict each other. Remember, the opposite of a good idea can also be a good idea. They are equally important.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“The point is that when you understand how quickly small expenses compound into enormous lost returns, you view the world differently. You realize that building a long-term fortune has less to do with big, brilliant decisions and more to do with small, consistent decisions compounded over a long period of time.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Warren Buffett was so obsessed with compounding at an early age that he measured current expenses by what that amount would be worth in the future if he instead invested it and let it grow. A haircut, in his mind, cost $30,000—that’s what the few bucks would be worth in the future if he instead let it compound. An expensive suit cost millions in forgone future investment returns. A car wash wasn’t worth it under this logic; it would cost tens of thousands of dollars in future money to remove some dirt. “I’m not sure I want to blow $500,000 that way,” Buffett would tell friends when pondering whether to spend a few bucks.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Author Kevin Kelly writes, “Tend to the small things. More people are defeated by blisters than mountains.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Jonas Salk, inventor of the polio vaccine, was once asked what his main aim in life was. “To be a good ancestor,” he replied.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Using price as a measure of how much joy you’ll get out of a purchase can miss one of the most important lessons in business history: Premium prices are often found on branded products, and the purpose of a brand is not to signal quality. It’s to signal consistency. An important feature of life in the United States before 1850 is that most people never traveled more than a few dozen miles from their birthplace. Life was local. You ate food grown in your town. Your house was made of local lumber. Your clothes were sewn by a local seamstress. You knew the person who made them. That person was often yourself. The industrial revolution and the Civil War changed that. Millions of people and soldiers were suddenly on the move, and railroads provided a way to transfer goods farther and faster than ever before. Robert Gordon writes in his book The Rise and Fall of American Growth: “As America steadily became more urban and as real incomes rose, the share of food and clothing produced at home declined sharply…. Many American men had their first experience of canned food as Union soldiers during the Civil War.” This was one of the biggest breakthroughs in history. But it posed a problem. For the first time, consumers were disconnected from the person who made their food. For most of history, a bad product was either your own fault or could be taken up face-to-face with a local merchant. But canned food came from dozens of suppliers, none of whom customers knew or could identify. Without accountability, quality was horrendous. Harper’s Weekly wrote in 1869: “The city people are in constant danger of buying unwholesome [canned meat]; the dealers are unscrupulous, and the public uneducated.” No one knew who to trust. The William Underwood Company solved this problem. Underwood was one of dozens of canned meat suppliers. Recognizing that canned meat had a reputation for inconsistency, Underwood created a red devil logo consumers would recognize. It added a tagline: “Branded with the devil, but fit for gods.” The logo re-created the familiarity that face-to-face commerce had achieved for most of history. No matter what part of the country they were in, consumers who saw the devil logo knew they were getting a specific product made by a specific company under specific quality standards. They were happy to pay more for Underwood meat because it reduced the gamble they would otherwise take with an unknown product.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Author Ramit Sethi has advice that I love: You should spend extravagantly on the things you love as long as you mercilessly cut the things you don’t. His specific example: He loves clothes, but isn’t a car guy. So he dresses like a rich man and drives like money’s tight.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“When finding a new book to read, my strategy is to have a wide funnel and a strong filter. I want to start reading as many books as possible, but finish few of them.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Lots of brilliant minds work like this. Albert Einstein once said that his main scientific talent was his ability to pore through thousands of papers and experiments, find the few that were important, and ignore everything else. It sounds trivial: Find what works and just do that. Ignore the rest. Thanks, Einstein.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“I love the concept of mental liquidity. It’s the ability to quickly abandon previous beliefs and strategies when the world changes, you change, or when you come across new information.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Charles Darwin once noticed that some animals have traits that hinder their survival—peacock feathers that attract predators, or huge antlers that hinder maneuverability when being chased. Why didn’t evolution find a fix? It was simple, Darwin reasoned: Some traits are beneficial for reproductive success even if they pose a long-term risk. There are so many examples of this in nature, with evidence that a particular gene related to reproductive success in humans is also linked to Alzheimer’s disease. Nature is very good at promoting one behavior even if it comes with some harm down the road.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Investor Paul Graham has a saying: Keep your identity small. “The more labels you have for yourself, the dumber they make you,” he writes. “If people can’t think clearly about anything that has become part of their identity, then all other things being equal, the best plan is to let as few things into your identity as possible.” Anytime in life you say, “I am a…”—regardless of what it is—you’ve formed an identity. And identities are so important that people will often go to absurd lengths to defend them. Let me share the most common financial identity that can harm people in ways they never imagined. “I am a saver.” It seems like such a good trait, and it sounds so innocent. And of course both are true. But a lot of financial planners will tell you that one of their biggest challenges is getting clients to spend money in retirement. Even an appropriate, conservative amount of money. Frugality and saving become such a big part of some people’s identity that they can’t ever switch gears. I call it frugality inertia. It’s what happens when a lifetime of good saving habits can’t be transitioned to a reasonable spending phase. I think what many people really want from money is the ability to stop thinking about money. To save enough money that they can stop thinking about it and focus on other stuff.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Money is like gasoline during a road trip,” says author Tim O’Reilly. “You don’t want to run out of gas on your trip, but you’re not doing a tour of gas stations.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“A focus on personal independence over social dunking. Once you do things quietly you become selfish in the best way—using money to benefit your life more than you try to influence other people’s perception of your life. I’d rather wake up and be able to do anything I want, with whom I want, for as long as I want, than try to impress you with nice stuff.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“My friend Brent Beshore says, “I am 100% happy to watch you get really rich doing something that I have no interest in doing.” You can apply that philosophy to how people spend and save their money too. We’re all different. Life isn’t zero-sum. Live and let live.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Christopher Morley said, “There is only one success—to be able to spend your life in your own way.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“I’ve found it helpful to always ask, “Would I be happy with this result if no one other than me and my family could see it, and I didn’t compare the result to the appearance of other people’s success?”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Nature is not in a hurry, yet everything is accomplished,” said Chinese philosopher Lao Tzu.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Not needing wealth is more valuable than wealth itself.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life

“Level 13: Your assets and their reasonable return expectations cover above-basic living expenses. You can live the lifestyle you prefer and have something left over for family or charity. “Above-basic” expenses can be defined however you want. It varies by person. Just be careful about unnecessary lifestyle creep that can pull this independence down like gravity, and remember what comedian Chris Rock says: “If Bill Gates woke up with Oprah’s money he’d jump out the window.”
― Morgan Housel, The Art of Spending Money: Simple Choices for a Richer Life