After this lesson, you might feel better about what you do with your money, and even less judgmental about what other people do with theirs.

But do you know that people do crazy things with their money? And you have to remember that no one is crazy.

The issue is that people are from different generations, raised by different parents who are entitled to different incomes and hold different values, in different parts of the world, born into different economies, and their job markets differ too with different degrees of luck, and equally they learn different lessons.

This means, —- everybody has their own unique experience of how the world works. So what you’ve experienced is more of a knowledge than what you learn second-hand.

Dear Brethren, this is to tell you that all of us – you, me, everyone – go through life with a certain kind of view about how money works which varies wildly from person to person.

That is why what seems crazy to you might make real sense to me. As you know some things about money that I don’t, such does not mean that one of us is smarter than the other, or is better informed.

It is a fact that we’ve had different lives shaped by different and equally persuasive experiences. One funny thing about humans is that we think we know how the world works.

Without knowing we’ve all only experienced a tiny sliver of it. Just like this investor Michael Batnick says “Some lessons have to be experienced before they can be understood.”

So the truth should be, that we are all victims in different ways. According to research made by different economists, they stated and I quote: “Our findings suggest that individual investors willingness to bear risk depends on personal history.”

This shows that it does not depend on intelligence, education, or sophistication. Should I say it’s just the dumb luck of when and where you were born?

Let’s take STOCKS as a narrative here: Assuming you were born in 1970, the S&P 500 increased almost 10-fold in this period and adjusted for inflation during your teens and 20s. Which is an amazing return.

Then if you were born in 1950, this period, the market went literally nowhere in your teens and 20s and adjusted for inflation.

In this scenario now, two groups of people are involved which are separated by chance of their birth year. Can’t you see how they both experienced life with a completely different view of how the stock market works?

People can be misinformed, that is why every decision they make with money is justified by taking the information they have at the moment and plugging it into their unique mental model of how the world works.

This might be some persuasion coming out of rotten marketing. Most times, they have no idea of what they are doing and hence misjudge the consequences of their actions.

No doubt about it, every financial decision a person makes, makes sense to them in that moment so far it checks the boxes they need to check.

And we are fond of telling ourselves suiting stories of the reason why we are making such financial decisions. And these enticing stories are shaped by our own unique experiences.

Money as a topic influenced by emotion versus fact, poses a big problem.
Because of this posting problem, we don’t always do what we are supposed to do with money.

Truly we all do crazy things with money because we’re all relatively new to this game of money and what looks crazy to you might make sense to another.

But remember, no one is crazy – that is why all our decisions are based on our own unique experiences which seems to make sense in that given moment.

So let me ask you, what do you do with your money?

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