The Art of Spending Money (Book Review)

One of the best books I have read in 2025 was Morgan Housel's "The Art of Spending Money." This book is not so much a book on spending money as it is about how to have a centered and well-balanced life. He is not prescriptive on how to spend money (if it were, then the book would be titled "The Science of Spending Money"); however, he teaches about how to become the right type of person for which money works for you, not how you work for money.

Part of the reason I loved this book so much is that it aligns so well with something I have been trying to focus on in 2024 and 2025, which is how to be a better, happier, and more centered person. If you are looking for a David Ramsey-style book, a list of dos and don'ts, this book is not for you. If you are looking at becoming a better person for which money can empower your life, get this book. This book works whether you have a lot of money or no money at all.

Most of us are terrible at spending money. When (if) we review our spending, usually we are left with regret and buyer's remorse. A lot of our decisions on where to spend money, whether conscious or not, are meant to impress other people. We need to spend money on things that increase our  contentment, not to show off or gloat.

Maybe we don't know what we like well enough to know what to spend money on. One of the takeaways from this book that I have found myself using repeatedly is to "Cast a wide net, but have a narrow filter." He talks about how we need to figure out things we like; we should get a lot of differing experiences in life and narrow it down to a few things you like. Once you find out the things that you like, it is okay to spend money on those things.

He is critical of those who spend money that they don't have, and conversely, he is also critical of those who pinch every penny and die with a fortune. He does not advise spending money you don't have, but tracking all of your finances in a spreadsheet and being able to account for every cent will not make you win with finances. Rather, become self-aware first, then the spending will follow. This book is all about balance.

The other major lesson he repeats is how to set the right expectations in life. If we can manage our expectations, then we can dramatically increase our satisfaction and  sense of well-being in life. This book is really a book about how to achieve a good life at the end of the day;  fulfillment and how to use money as a tool to help achieve greater  satisfaction. If we can keep our expectations rising slower than our income, we will not be disappointed when it comes to money. Unfortunately, we are really good at spending (or wanting to spend) money that we do not have.

One fallacy that I tend to fall into is "work hard now so that I can make more money and work less and be happy tomorrow." In his book, he disputes that school of thought. Become someone who is  content today while working. Be the person today and do the things you want to do now in retirement. Learn to enjoy yourself now. If you cannot learn to do it now, you probably won't do it later when you retire early.

There is a section on his book jacket that sums up what this book is really about: "This book isn't about getting rich. It's about getting the most out of what you already have — and learning to want what's worth wanting." This is the perfect way to describe the book.

I am a big fan of Taleb. One of his books, Skin in the Game, talks about how actions are louder than words. Instead of asking someone what to do, look at what they do and copy them (if you want those results). When it comes to book recommendations, instead of asking what book someone recommends, I think a better question is what books do you re-read (you learn how much they value reading if they do not have a re-read list). This book instantly made my re-read list.