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The fear of losing money is real. Everyone has it. Even the rich. But it’s not fear that is the problem. It’s how you handle fear. It’s how you handle losing. It’s how you handle failure that makes the difference in one’s life. That goes for anything in life, not just money. The primary difference between a rich person and a poor person is how they handle that fear.
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Loss Aversion is the idea that people hate to lose things more than they like to gain them. There are very few relationships that psychology is able to quantify, but this is one of them: people respond twice as strongly to potential loss as they do to the opportunity of an equivalent gain. If you look at your investment portfolio and notice that it’s increased by 100 percent, you’ll feel pretty good. If you notice that your portfolio went down 100 percent, you’ll feel horrible.
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Although losing is never fun, there is a certain satisfaction that can be found on the other side of losing — but only when you give your all. To lose with half effort offers no pleasure in the moment and no peace in the long run. But if your ambitions were full and your attempt was genuine, after the sting of losing wears off you'll be left with something resembling contentment. The reward is not always in winning, but in striving.
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