Index funds: It's less than 50 years old.

Hedge funds: They only emerged in the last 25 years.

Consumer debt: only emerged after World War II

No one would argue that luck does not play a role in financial success, but because luck is difficult to quantify, most of the time we automatically ignore the important role luck plays in success.

Luck and risk both reflect that every outcome in real life is affected by factors other than individual efforts. The essence of the two is similar, so you cannot just believe in one and ignore the other.

What investment strategies work? What doesn't work?

What business strategies work? What doesn't work?

How to get rich?

How to avoid falling into poverty?

Do not attribute 100% of the results of something to personal efforts and decisions.

Not all success comes from hard work

Not all poverty is due to idleness

The causes of extreme cases are very complex and often difficult to apply to other non-extreme cases.

Look for universal patterns of success and failure, and you're more likely to gain valuable experience.

The secret to preventing failure is: do your financial planning

Born in India, orphaned at age 10

In 2008, his net worth reached US$100 million.

In order to obtain more wealth, Gu Lejie was sentenced to jail for insider trading.

His career and reputation were completely ruined.

The most notorious "Ponzi scheme" creator.

Madoff deceived investors for 20 years before his scam was exposed.

Things get dangerous when the desire to have more grows faster than satisfaction.

Modern capital is good at creating two things: wealth and envy.

If you don’t know how to be satisfied, there will be no happiness in life

Happiness is what you have minus what you expect

The crux of the problem lies in the comparison mentality

Comparison is like a battle that no one can win

The only way to win is not to join the war at all.

Accept everything with contentment, even if it means you are inferior to those around you.

This is also the nature of the game of always wanting to be as rich as everyone else.

Contentment means knowing that its opposite—an unfulfilled desire—will push you toward regret.

If you are unable to resist the potential temptation of money, then desire may eventually consume you.

Reputation is priceless.

Freedom and independence are priceless.

Family and friends are priceless.

The adoration you hope to receive from someone is priceless.

Happiness is priceless.

The best way to keep these is to know when to stop taking risks before you harm them.

Glaciologist Gwen Schultz: The key to the formation of Earth's glaciers is not necessarily a large amount of snowfall, but the accumulation of snow, no matter how much.

Warren Buffett's success in the investment field is inseparable from the good wealth foundation he laid when he was young and his long-term persistence in investment.

Financial net worth of US$84.5 billion and US$81.5 billion earned after age 65, the annual compound interest rate is approximately 22%

Net financial assets of 21 billion US dollars. I found my own investment path at the age of 50. The annual compound interest rate is about 66%.

Jim Simmons’ net worth has grown at a compound rate of 66% per year since 1988. No one has come close to this record.

Buffett's annual compound interest rate is about 22%, only one-third of Simons's. But Simmons' financial net worth is only 25% of Buffett's financial net worth.

The secret is time

The effect of compound interest

This is an unimaginable astronomical number. The key is that these huge results are caused by small changes in the assumptions about growth.

Getting rich requires a sense of adventure, optimism, and the courage to take a chance.

Keeping wealth requires humility and awe, and you need to understand that wealth can go away just as quickly as it comes. Preserving wealth requires frugality, acknowledging that part of the wealth acquired comes from luck, and not expecting to infinitely replicate past successes.

Not growth, wisdom, vision

The most important thing is to survive for a long time and not be eliminated or forced to give up.

Survival should be the basis of all your strategies

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No gain is worth the risk of losing everything.

The power of compound interest will only emerge if you give your wealth time to grow year after year.

Not burdening myself with debt or relying on other people’s funds

Through 14 recessions, he never panicked and sold off his financial assets.

I have never done anything to damage my business reputation.

Don’t rely on a single strategy, worldview, or outdated fad.

There’s no fighting until you’re exhausted and then giving up or retiring.

As long as your wealth is safe, you know you'll always get the maximum return because compound interest works wonders if you stick with it long enough.

The most important part of every plan is to plan for the unexpected.

Only plans that can withstand the test of reality are meaningful.

A balanced mindset of staying optimistic about the future while always being on guard against the things that are holding you back from a better future is crucial.

Warren Buffett: I have held 400 to 500 stocks in my life, and most of my profits came from 10 of them.

Charlie Munger: If you take away a few top investments, the company's long-term performance is actually quite average.

Having a strong sense of control over your life is a more reliable predictor of positive feelings like happiness than any objective life condition we have ever considered.

It’s not the salary, the size of the house, or the quality of the job, but the ability to control what you want to do, when you want to do it, and who you want to do it with.

The greatest intrinsic value of money is the ability it gives you to control your time.

The wealth you accumulate gives you greater control over what you can do and when you do it.

This means that even if you take a few days off when you are sick, you won’t be able to make ends meet.

This means that you can wait calmly for better career opportunities after losing your job, without having to rush to grab the first life-saving straw that comes your way.

It means you won’t be walking on eggshells when it comes to your boss, because you know your life won’t be in trouble even if it takes time to find another way out.

You can freely choose your retirement time without having to struggle to make a living even when you are old. Wealth gives you more time and options.

You may think you need an expensive car, a fancy watch, and a big house.

The point is not to give up on your dreams of wealth or luxury cars.

"Having money" is related to your current income level.

Income that is not spent becomes wealth.

Investment may indeed make you rich, but there is always an unknown as to how long the returns will last, and all results are shrouded in uncertainty.

Personal frugality and saving practices are the part of the money equation that you have more control over, and are 100% effective.

Wealth is the accumulation of what is left over from income after expenses have been deducted. Even if your income is not high, you can still accumulate wealth, but if your savings rate is not high, you will never be able to accumulate wealth.

If you view building wealth as a process controlled by your own frugality and efficiency, your wealth prospects will become clearer.

My annual return is 8%

Your annual return is 12%

Material needs → comfort

Comfort → more pursuit

If you want to increase your wealth, you must be humble

Spend less and your savings rate will naturally increase

As desires decrease, expenses will naturally decrease

Stop caring about what others think of you

Your desires will naturally decrease

You can definitely save money for the sake of saving money. In fact, you should do it, everyone should do it.

If you have enough time, you can wait for a better opportunity to come. This is an intangible return that savings brings.

Greater control over time and choice has become one of the most valuable currencies in the world today.

Making reasonable decisions in most situations is better than pursuing absolute rationality.

You are not a spreadsheet, you are a person, a person with all kinds of emotions and desires, and often a confused mind.

When making investment decisions, don't try to be absolutely rational, but make choices that make sense to you, that is, which are more acceptable to you.

In the real world, this mathematically optimal solution may not necessarily be popular.

There are social factors in investment behavior, but if investment is viewed from an absolutely rational financial perspective, these factors are often ignored.

People are neither absolutely rational nor irrational.

In the financial field, what people often overlook is that some solutions are completely correct in theory, but in practice they are contrary to human nature.

The cornerstone of economic theory is the principle that "things change over time" because the invisible hand of the market does not want to see things that are too good or too bad continue.

The most important driving force behind anything related to money is people's rationalizations for various phenomena and preferences for goods and services.

As social culture changes and generations grow up, this change is happening all the time and will continue.

We always have an excessive admiration for those who have achieved financial success, but experiencing certain specific events does not mean that you have the ability to predict the future.

The most important events in history are often major, unprecedented and unexpected events. These events had a fundamental impact on the economy and stock markets. The Great Depression, World War II, the Internet bubble, the "9·11" incident, etc. These unexpected events played an important role in the development of history because they subsequently had an impact on many unrelated events.

The interesting thing about investment history is that the further back in time you go, the less applicable the patterns you see apply to today's world. Studying the history of money can be helpful in developing this understanding. How you specifically manage your wealth is in a continuous evolutionary process.

A famous concept proposed by Benjamin Graham. The purpose of a margin of safety is to make forecasting unnecessary.

In a world governed by probabilities rather than certainties, a margin of safety—you might also call it “fault tolerance” or “redundancy room”—is the only way to be safe.

Tolerance allows you to tolerate a range of possible outcomes: with this tolerance, you can wait long enough to increase the probability that low-probability rewards will occur.

One has to take some risks to get ahead, but risks that can bankrupt you are not worth taking.

If your financial assets were reduced by 30%, could you survive it? Judging from the data alone, you may not be in dire straits - as long as you can still afford your daily expenses and maintain a positive cash flow.

But can you guarantee that your mentality will be stable by then? Data tables can accurately tell you the increase or decrease in assets, but they cannot reflect the kind of emotions you are struggling with. The gap between theoretical tolerance and emotional tolerance is a margin for error that is often overlooked.

Since the 1870s, U.S. stocks have returned an average of 6.8% annually, adjusted for inflation. When planning your retirement savings, you'll feel like you have similar returns with a diversified portfolio.

But what if future returns are lower? The impact of this series of "what ifs" is that you won't be able to retire on time as you planned. When estimating your future earnings, allow room for error.

It means that people are keenly aware of the changes that have occurred in themselves compared to the past, but it is easy to underestimate the changes that will occur in their personality, ideas and goals in the future.

We should avoid extreme financial planning goals

Slowly accept the fact that your thoughts are changing all the time

The answer to this question depends on who "you" are.

In the first few years of the 21st century, the bursting of the dot-com bubble reduced U.S. household wealth by $6.2 trillion.

After the real estate bubble burst, more than $8 trillion in American household wealth evaporated.

The destructiveness of bubbles in the financial sector to society can never be overestimated. It has ruined too many people's lives.

Why does it keep happening?

No one really loses their mind about money. People often make financial decisions without sufficient information and logic, only to regret them later.

One of the reasons it’s so hard to learn from bubbles is that, unlike cancer, there’s no way to get a definitive diagnosis and warning from a biopsy.

Competition for investment returns is fierce, and at some point in time, someone will want to pocket someone else's wealth.

No one wants their financial assets to be overvalued. And when the dust settles, we're more likely to cynicize rather than learn from the results.

A true optimist is not one who believes that everything will turn out great.

Not only is pessimism more common than optimism, it also sounds more sensible.

Looking for reasons for the economic downturn makes it easier for people to discuss and worry about it. It also makes it easier for people to look to the future and weave pessimistic stories-the contents of these stories are often similar.

It’s easy to predict that bad conditions will continue, and such predictions are persuasive because they don’t require us to imagine how the world will change.

A person's reputation takes a lifetime to build, but a small email can destroy it. In the arena of public opinion, the short-lived pain of pessimism prevails, while the powerful pull of optimism goes unnoticed.

Many things in life seem true to us because we desperately want them to come true.

Many investment ideas in the financial field have this characteristic: once you follow them and choose a certain strategy or method, you will make a dual investment both financially and psychologically.

One side is what you hope to achieve, and the other side is what you actually need to achieve to achieve an acceptable result. The greater the difference between the two, the less likely you are to believe attractive investment stories.

We cannot think in our own cognitive blind spots, so it is easy for us to use the limited knowledge system we have to explain the world.

Neil Kahneman said: Hindsight, the ability of people to interpret past events, gives us the illusion that the world can be understood and that it has its own principles. , even when it’s actually a mess. This is an important reason why we make mistakes in many areas.

When things are moving in the right direction, stay humble.

Luck and risk are real and difficult to judge, so keep these words in mind when evaluating yourself or others.

Be understanding or compassionate when things go in the wrong direction.

How much money you can save depends on the gap between your need to express yourself and your income, and wealth exists precisely in places you can't see.

Nothing is as good or bad as it seems.

This is not the same as striving for the highest return on investment or putting a certain percentage of your income in the bank.

Use wealth to gain control over time, because the most serious and common deduction for happiness in life is the lack of freedom of time.

If you want to increase your return on investment, the simplest and most effective way is to increase the time. Time is the most powerful force in investing.

No one else cares as much about how rich you are as you do yourself.

You can get half of it wrong and still build wealth, because it's a few things that determine the overall outcome.

Just save it.

You don’t need a specific reason to save money.

Avoid setting extreme financial goals. Everyone's goals and desires change over time.

Identify the price of success. Then be prepared to pay, because nothing of value is free.

Be clear about the nature of the game you are playing. Make sure your actions are not affected by players from different games.

There is a distance between what might happen in the future and what you need to meet in order to perform well.

In the world of financial investment, smart, knowledgeable, and thoughtful people can disagree. What suits you is the best.

How does my family view savings?

How does my family view investing?

A partner of The Collaborative Fund, a well-known financial website "Jester" and a columnist for the Wall Street Journal.

Twice won the "Best Business Writing Award" from the American Society of Business Editors and Writers and the "Sidney Award" from the New York Times, and was twice shortlisted for the "Gerald Loeb Award for Outstanding Business and Financial Journalism" ".