Learn the key ideas of the book by Danielle Town

Invested

A method to help learn to manage your savings

Working as a lawyer for several startups, Danielle Town was earning enough money to not have to worry too much about her immediate future, but how would she manage financially when she had to retire? As the daughter of Philip Bradley Town, investor and author of two very successful books on investment, it was relatively easy for her to write Invested: How Warren Buffett and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money, (with a Little Help from My Dad), as it was also easy to create an effective method for anyone who wants to learn to manage their money and savings by themselves.

Invested
Read in 13 min.
Listen in 17 min.

Many useful tips to:

  • Learn to take control of your money management yourself.
  • Learn the key secrets of the world’s most successful investors.
  • Master the technique to help take control of your emotions.

The author of the book:

A graduate of New York University and a company lawyer for several successful startups, Danielle Town is the daughter of the investor Philip Bradley Town, and together they developed a technique designed to help beginners manage their money, which she teaches in her manual, in her blog and in her podcast, InvestED.
IDEA CHIAVE 1/8

Achieving financial freedom guarantees us the life we imagine for our future, whilst also offering us the opportunity to live the life we desire today

Financial freedom has a meaning which is personal to each of us, which depends on the kind of life we dream of, and the objectives we set ourselves. Someone might wish for a debt- and mortgage-free future, while others might dream of reducing their working hours, or having the opportunity to transition from employee to employer. One thing that we all have in common, is the fact that we need to have ‘binocular’ lenses, one lense through which we can see what we are like today, in our current life, and another that can help us see how we will be in the future, in the life that we imagine for ourselves. Both these scenarios can be guaranteed by learning to manage our money.

Being capable of investing one’s own money does not only mean not having to pay a consultant, it also means breaking free of the misconception that saving is a (very conservative) form of investment. Inflation is the greatest enemy of saving: if we do not ensure that our savings increase at the rate of inflation, we are losing money without even spending it.

Encouragement to save money cannot be limited to simply not spending it: inflation makes the cost of living higher in the future, even if our habits don’t change between now and then. This means that if today we enjoy eating a meal in a good restaurant, and can afford to do so, it is not necessarily true that we will be able to continue doing so in the future: our money will certainly be worth less, so we will need more of it to be able to keep doing the same things.

On a macroeconomic level, inflation is considered by economists to be a positive force. According to studies conducted by the International Monetary Fund, a low and stable inflation rate creates a virtuous cycle of consumption, salaries and jobs; more jobs are created and salaries go up. However, if inflation increases beyond a certain level, buying power decreases, consumption falls and jobs are lost. This is where the value of our savings can erode. As far as the stock market is concerned, an increase in inflation has the opposite effect: stock prices generally increase with inflation because revenues and profits tend to increase.


  

The key ideas of "Invested"

01.
Achieving financial freedom guarantees us the life we imagine for our future, whilst also offering us the opportunity to live the life we desire today
02.
The alternative to financial freedom is using money managers, knowing them means recognising their limits
03.
Investing requires courage and above all practice
04.
Investing means committing your money to a mission, which should be chosen according to the important values in your daily life
05.
Creating the story of each company we would like to invest in serves to set the parameters with which we will be able to monitor it over time
06.
Buying and selling shares requires a fundamental attribute: patience
07.
Quotes
08.
Take-home message
 
 
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