One-Eyed Mama finds life lessons in Morgan Housel’s ‘The Psychology of Money’

This is part of my column One-Eyed Mama where I share the everyday miracles I encountered in my life while dealing with vision loss

On my birthday earlier this year, my investments advisor gifted me a book titled The Psychology of Money (Jaico Books, INR 399). No doubt, my haphazard balance sheets, messed-up bank balances, and general cluelessness about all things finance prompted him to take some initiative to educate me about wealth generation and management!

The author Morgan Housel is a well-known columnist and award-winning business writer based in Seattle, US. In this book of about 20 essays and a bonus postscript, he shares practical lessons in earning wealth, and keeping it.

My investments advisor, Mr RC Rawal, founder director of Imperial International, a mutual-funds distributor based in Delhi, gave me this book because, he said, “It will change the way you look at money.”

He added, “This is the very same advice I’ve been giving my clients for years, but they take it more seriously when it comes in the form of a best-selling book.” The book has sold over two million copies, and I have no doubt Mr Rawal’s penchant for gifting it to his clients on their birthdays has also contributed to Morgan Housel’s royalties!

The book’s subtitle Timeless Lessons on Wealth, Greed, and Happiness was promising enough, but I confess I didn’t open the book for many months. It only made its way into my hands when I travelled to London for retina surgery — yes, I finally decided to do something about my Monet eye (which insisted on seeing the world the way Claude Monet would have painted it, and my vision had deteriorated to 6/24).

I started reading this book on the flight, and completed it after my eye operation, even though it was a bit of an effort to read by that point. But the book was unputdownable for me.

I don’t know if the book has changed my earning and spending habits — and, in fact, the author says that our relationship with money is rooted more in our social, cultural and generational conditioning than in anything we’d ever read in a book or hear from our investment advisor — but it surely taught me a whole lot of wise lessons for life.

Housel sums up most of the book in chapter 19 with short takeaways from all the previous chapters. Without spoiling it for the reader, and while I wait for my left eye to go back to its pre-Monet days, I’ve picked three points out of these that are as much tips for a healthy life as for a healthy bank balance.

Go out of your way to find humility when things are going right and forgiveness/compassion when they go wrong.

Housel says this in the context of stock-market and other investment risks. He says luck is not something you can predict, and most big financial wins are, in fact, a product of luck and timing.

So, he says, if your stocks are doing well, be humble because they could well crash the next day for causes out of your control. For the same reason, persevere even when the chips are down — it only takes one big market correction for it all to even out.

It reminded me of the Buddha’s teaching: “A truly wise man will not be carried away by any of the eight winds: prosperity, decline, disgrace, honour, praise, censure, suffering and pleasure.”

We must be humble and grateful when things go amazingly well in our lives, and stoic when they don’t. Both phases are temporary. This too shall pass.

Less ego, more wealth.

Housel makes a very valid point: you can only create wealth if you don’t spend your income as fast as you earn it. The mistake many people make is splurging on an extravagant lifestyle — for the sake of ‘ego’ and how it makes them look to other people — even if that puts them in debt.

“Saving money is the gap between your ego and your income, and wealth is what you don’t see,” he writes. People who are truly wealthy by middle age are often those who saved and lived frugally in their younger years. Those who are content with less eventually have more.

For me, this point really carries forward from the previous one. In my Buddhist practice, they advise us to continue chanting no matter what the circumstances of our lives — whether they are good or bad. The 13th century Buddhist monk Nichiren Daishonin said, “Suffer what there is to suffer, enjoy what there is to enjoy. Regard both suffering and joy as facts of life, and continue chanting Nam-myoho-renge-kyo, no matter what happens.”

What he means is that joy and suffering are both intrinsic parts of being human, they are the very texture of this existence and, so, there’s no point in making a big deal out of either of them. What is important is developing one’s ‘life condition’, or spiritual muscle as it were.

It is also called ‘indestructible happiness’ — when outward circumstances cannot add to, or deduct from, our inner peace, strength, balance and stillness.

Less ego — less focus on outward life circumstances.

More wealth — more focus on inner life condition.

Manage your money in a way that helps you sleep at night.

Housel propagates moderate risk when it comes to investment — he says we should only risk as much as we can afford to lose. He writes, “The foundation of, ‘does this help me sleep at night?’ is the best universal guidepost for all financial decisions.”

I’d say the same goes for life. Are we living ours in a way that helps us sleep at night? Are we doing our best in our responsibilities? Are we living in tune with our conscience? Are we making the most of our moments of pleasure? Are we feeling gratitude for all this abundance we have, and indeed this gift of life itself? Are we creating value for those around us? Are we generous with our love, blessings and kindness?

My father always says, “Do your best, and leave the results to God.” It’s a simple translation of the Bhagawad Gita concept of nishkam karma yog — desireless action without expectation of outcome.

If we can live each day like that, it would not only help us sleep better at night, it would also ensure a life well lived.

Next up: One-Eyed Mama undergoes eye surgery and realises she has a ‘vision’ problem