Same as Ever: A Guide to What Never Changes

Two, realize that if you’re only preparing for the risks you can envision, you’ll be unprepared for the risks you can’t see every single time. So, in personal finance, the right amount of savings is when it feels like it’s a little too much. It should feel excessive; it should make you wince a little. The same goes for how much debt you think you s

A lot of it comes from the gap between what you believe and what you can convince other people of.

Same in investing. I wrote in my book The Psychology of Money: “More than I want big returns, I want to be financially unbreakable. And if I’m unbreakable I actually think I’ll get the biggest returns, because I’ll be able to stick around long enough for compounding to work wonders.”

Something I’ve long thought true, and which shows up constantly when you look for it, is that people who are abnormally good at one thing tend to be abnormally bad at something else. It’s as if the brain has capacity for only so much knowledge and emotion, and an abnormal skill robs bandwidth from other parts of someone’s personality.

People tend to have short memories. Most of the time they can forget about bad experiences and fail to heed lessons previously learned. But hard-core stress leaves a scar.

Surprise has six common characteristics: • Incomplete information • Uncertainty • Randomness • Chance • Unfortunate timing • Poor incentives

Something that’s built into the human condition is that people who think about the world in unique ways you like almost certainly also think about the world in unique ways you won’t like.

The more precise you try to be, the less time you have to focus on big-picture rules that are probably more important. It’s less about admitting that we can’t forecast, and more about acknowledging that if your forecast is merely good enough, you can invest your time and resources more efficiently elsewhere.

There’s an investing quip that it’s better to be approximately right than precisely wrong.