I want to understand how I decide about money
Library · Reading path · 4 books
Who it is for
For people who want to understand why they make poor money decisions while knowing the good ones.
What you will learn
The biases that affect saving and investing, the role of luck and how to think about risk more clearly.
Why this order
It starts with the most accessible book applied to money, continues with behavioural economics and ends with the two densest reads: the underlying research and randomness.
The Psychology of Money
Morgan Housel. Reading: Easy. Finance level: Beginner.
The easiest way in: behaviour, time and luck applied to personal money.
Misbehaving
Richard H. Thaler. Reading: Moderate. Finance level: Intermediate.
How behavioural economics was born and how it affects the way you spend and save.
Thinking, Fast and Slow
Daniel Kahneman. Reading: Demanding. Finance level: Advanced.
The underlying research on biases. It is dense, but the previous books help.
Fooled by Randomness
Nassim Nicholas Taleb. Reading: Demanding. Finance level: Intermediate.
Ends with randomness: how to tell skill from luck in your results and other people's.
If you already know some of it
If you have already read The Psychology of Money, start at step 2.