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Book Review: The Chimp Paradox

The Chimp Paradox is a simplified yet amazing insight in to the inner workings of the mind. The book is written by Professor Steve Peters who has worked with some of the top sports stars in the UK and has been credited as the man behind the success of the British Cycling team and helping Ronnie O'Sullivan win his last two world snooker titles.[1]

My personal opinion is that everybody should read this book at least once. The book does an amazing job of simplifying the mystery of the inner mind by referring to the emotional instinctive thoughts as coming from the chimp and the more rational logical thoughts from you, the human. Creating this mental model allows you to separate your fears and feelings such as anxiety as unhelpful suggestions coming from your chimp and understanding that you must sometimes push the chimp out of the way (or box your chimp) and do things that it would rather you didn't. Learning a few of these techniques really can change your life for the better.

So how does this relate to money...

Mindset and money are completely interlinked, especially when it comes to investing where it is so easy to let emotional thinking sabotage your strategy. Think selling at the bottom. The same self destruction happens with gambling too, trying to make up losses and believing more in skill than luck.
It's also the new car that you must have but can't afford, the chimp wants to fit in and doesn't care about the part where it comes to a double digit APR and kicking the can down the road. The human however sees things with a long term mindset. Will this matter in a year or two? Would it be better to save this money rather than have the latest must have? The human understands that delayed gratification is the key to a successful life and if you tame your chimp you can have a better life than you imagined was possible. Enjoy the now by all means but the future will happen whether you like it or not.

  1. Source Wikipedia: https://en.wikipedia.org/wiki/Steve_Peters_(psychiatrist) ↩︎