Page 108 - Morgan Housel - The Psychology of Money_ Timeless Lessons on Wealth, Greed, and Happiness-Harriman House Limited (2020)

COBACOBA
That flexibility and control over your time is an unseen return on
wealth.

What is the return on cash in the bank that gives you the option of changing
careers, or retiring early, or freedom from worry?

I’d say it’s incalculable.

It’s incalculable in two ways. It’s so large and important that we can’t put a
price on it. But it’s also literally incalculable—we can’t measure it like we
can measure interest rates—and what we can’t measure we tend to
overlook.

When you don’t have control over your time, you’re forced to accept

whatever bad luck is thrown your way. But if you have flexibility you have
the time to wait for no-brainer opportunities to fall in your lap. This is a
hidden return on your savings.

Savings in the bank that earn 0% interest might actually generate an
extraordinary return if they give you the flexibility to take a job with a
lower salary but more purpose, or wait for investment opportunities that
come when those without flexibility turn desperate.

And that hidden return is becoming more important.

The world used to be hyper-local. Just over 100 years ago 75% of
Americans had neither telephones nor regular mail service, according to
historian Robert Gordon. That made competition hyper-local. A worker
with just average intelligence might be the best in their town, and they got

treated like the best because they didn’t have to compete with the smarter
worker in another town.