The Art of Spending Money by Morgan Housel
Why it’s important to make financial choices that align with values and priorities.
I’ve read a lot of books about money, many of which are included on my notes page, but The Art of Spending Money is my favorite. I gave a copy to my uncle, and he summed it up perfectly: it’s funny how the advice is more about happiness itself than about money strategies at all.
Housel’s central idea is that money is a tool, not the end goal. He argues that happiness depends far more on understanding your personal values and spending intentionally than on income alone. Rather than chasing societal expectations, you should identify what truly brings fulfillment and make choices aligned with that understanding. Because fulfillment looks different for everyone, money is more art than science (hence the title).
Another key theme is that expectations shape happiness as much as circumstances. Housel illustrates this with the story of his grandmother, who lives in a small house with no other income besides Social Security. Thanks to the success of his books, he’s spoken with multiple billionaires, and he claims he can confidently say his grandmother is happier than all of them. She had everything she needed: family, a garden, and a deep sense of contentment.
Here’s an included parable I enjoy:
A businessman visiting a seaside town meets a local fisherman. He’s shocked to learn the fisherman works only a few hours a day.
“What do you do with the rest of your time?”
“I sleep late, hang out with my family, read, take naps, and play guitar with my friends.”
“I have an idea,” the businessman says. “You should work all day. Save money, buy another boat, hire more fishermen. Then you can save more money, buy more boats, and make so much that you could retire in ten years.”
“That sounds great, but what would I do after I retire?”
“Why, you could sleep late, hang out with your family, read, take naps, and play guitar with your friends.”
The 5 Types of Wealth revisits this story with an important twist. Neither the businessman nor the fisherman is inherently right or wrong — it all depends on what you want from life. The fisherman chooses the “lifestyle” path, living in the present and enjoying the journey, while the businessman delays gratification to build something that will outlast him. The only real mistake is drifting into either path by default, without consciously deciding what you want your life to become.
I recommend reading these two books together. Both explore how to design your life intentionally, rather than letting societal defaults — like building your identity entirely around work — make decisions for you. It’s a refreshing perspective, especially in modern America.
I’ve always liked Housel’s writing style. I’ve included his other books on the blog, The Psychology of Money and Same as Ever, and they share the same approachable, easy-to-read feel. He uses short chapters and clear explanations rather than dense blocks of text, using stories to drive his points home.
I’ll definitely keep recommending The Art of Spending Money. In today’s world, it’s hard to talk honestly about happiness without mentioning money. Before diving into specific investment tactics or tax strategies, it’s essential to understand your relationship with money and the role it plays in your life — whether you obsess over it or avoid it. Without that foundation, it’s easy to spend years chasing the wrong things.
