A simple mental model that was able to change my circumstances and financial life

Our lives often revolve around mental models. A mental model sets the overall framework for understanding reality and making decisions. Trade and trading and investment are not excluded from this case. Knowing more about mental models can help traders and investors make better choices and decisions.

Critical and creative thinking, along with listening to different experiences and examples, helps to recognize and form the best mental model for making important decisions, including financial and investment life decisions.

This note with the help of an article by Darius Forou’s blog (Darius Foroux), one of the investors and author of several books and articles and organizer of training courses in the field of business and wealth acquisition. In this article, Furrow explains how a simple mental model has helped him in all aspects of his financial life, including investing. You are reading the rest of the text quoted by Darius Forou.

My definition of mental model

I have made many mistakes in spending. When I think about the money I’ve lost in the past, I get goosebumps! At that time, I was still unfamiliar with my current mental model about financial life and spending.

Since I am interested in the philosophy of mindfulness and prefer to “spoil the tail”, I try not to be too attached to my emotions; But I have to admit that it still bothers me to think about my wrong decisions!

For example, every winter I would buy a new regular jacket; But four or five years ago, I finally decided to pay a lot of money in one go and buy a quality jacket.

I paid twice what I would normally pay for this quality jacket; But now I had a very warm jacket that made me not even think about buying a new jacket. Therefore, I no longer need to spend my time and energy to find new jackets and spend money to buy them every year.

I call this view of the world (mental model)Spend well to save time and money. I leave In most languages, it is a proverb or an idiom that can describe this mental model in a few words. We Dutch people sayThe inspector is expensive!“; But this philosophy and mental model is also used for other things besides shopping.

In this article, I will mention 3 examples of the applications of this mental model in my personal life and explain how this mental model changed my financial life.

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The effect of mental model on book writing

In 2015, I wrote my first book; But I could not manage to present and introduce it in the book market. I called this book “Massive Life Success” and in half an hour, using a free online graphic design tool called “Canva”, I designed a funny image for the book cover, which turned out like this:

This image doesn’t even look like the cover images of my current books. I didn’t have a logo or a specific style for my book. Overall, the appearance of my book showed that I am a novice writer.

A few weeks after the book came out, I got a bad feeling about it. I liked the content and points of the book; But his appearance did not look professional; So I spent a lot of time and energy to learn how to publish successful and bestselling books.

In addition, I tried to create a certain style for all my designs. You can call it brand identity. Within a year, I was able to republish Win Your Inner Battles.

Finally, my book was published with a new title and cover design and explanation on the back cover. Also, I changed the order of the book’s chapters to make the reading experience easier.

Work with heart!

Now, seven years later, hundreds of copies of this book are still being sold every month. I also learned an important lesson from this experience. Many times you may work just to “fix responsibility” to move on to your next project faster; But this strategy is wrong!

Try not to be one of those people who do everything in a hurry. Spend enough time and energy on your projects to turn out a great work product. Do your job to the best of your ability.

The first time I did not spend enough time and money on my book. The result of my work was an average book that didn’t really grab my heart; But after that, I spent more money and time creating the best book possible. The same average book, by spending enough money and time, became a famous work that is still a source of income for me.

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The role of mental model in traveling

I hate traveling. I get bored in airports, airplanes, trains and waiting lines and I get very annoyed. At the same time, I want to travel on vacation and visit interesting places in the world.

So, I do it in a special and strange way. I have some personal rules about traveling; For example, I never fly by plane during the summer holidays; Because it is not worth the staggering crowd.

In addition, I do not use tours and travel packages. As you know, travel tours contract with some airlines and hotels. When I was younger, I went on a few trips using tours and travel packages; But that’s enough for me.

In short, I try my best to avoid traveling to popular places during busy times. For example, I’m willing to eat a bowl of nuts; But I will never travel to Paris in July. Also, not to lose my sanity, I would never travel to New York City during the Christmas holidays.

When I travel by plane, I try to get a business class ticket whenever my budget allows. I also like driving. I live in the Netherlands and have had the experience of driving to the south of Spain.

By buying a business class ticket or driving, at least I don’t have to wait in line. For the price I pay, I enjoy the entire travel experience from the moment I leave home. For me, the journey begins here.

I am a strict person when traveling; So I try not to travel much. Better to say, I’d rather experience a great trip in the best conditions than to go on several ordinary trips.

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Mental model in productivity and personal efficiency

Most people are always interested in discovering new applications, tools and methods to improve their financial and personal productivity; But I’m not like that. Years ago when I was a student, I researched personal productivity and spent years trying to find a system to make the most of my money and time.

Translator’s note: Personal productivity refers to the principles and rules that each person may apply in his life to manage his time, responsibilities, goals, tasks, tasks, and daily habits more efficiently and productively.

I spent my time and money on books, courses, apps and various tools in this field. This was a huge investment both in terms of time and cost; But now my task is clear. I no longer have to spend time and money on anything related to personal productivity.

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Now I know what are the best methods and tools for optimal use of time and money. This was something I had to work on once and now I’m simply just implementing my strategy. So I don’t go for new applications and systems anymore. Why bother building a winning team when what I’m using now works?

This is a good example of a mental model.Spend well to save time and money” Is.

If you spend well, you usually only have to spend once

Many people do not take their personal productivity seriously and do not research about it and do not take advantage of related training courses. They read a few articles or books and think they know everything; But productivity is a personal matter. You have to find a system that works for you.

If you make a good investment once, you only do it once and it will pay off for a lifetime. If you find a system that works for you, you can rely on it for the rest of your life.

Focus on decisions that can bring you good profits. life is short; So it is better to focus in this short time on the fastest way that will help you earn money.

There is no doubt that if you buy cheaper food today, you will pay less; But the reality is that this will not change your financial situation. You should live in a way that will help you become richer in the long run. Think about the big decisions you make. Will they make you poorer or richer in the long run?

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A very clear example of that is buying a car, that too by installments and conditions. You can do a million other things with just the down payment you pay to buy an installment car; So why should you sacrifice all these profitable and better jobs to sit in a luxury and expensive car?

If you focus on these big decisions, you will make life easier for yourself. Think about your future. You definitely want to be sure of the future and have a better position and position next year compared to this year.