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People talk a lot about passive income. This is not a thing. Look, there's two ways to get wealthier, and passive income is
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not part of that equation, but what's really important for people is how we should spend money. Cuz I've written about money and finance and investing
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for 20 years, and I can tell you the correlation between how much you spend and how happy you are. It can exist, but
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it is not as simple as you think. Morgan Hel is the legendary financial guru, revealing that everything we've been
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told about saving and spending money could be our biggest downfall. And here's why. If you're unhappy with your
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life, it is a very easy assumption to make that if you had more money, a bigger house, a better car, whatever it might be, things would be better. And
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it's a lie we tell ourselves, of course, because here's the truth. So much of spending is a psychological itch that you're trying to scratch. And that
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manifests in so many different ways. For example, life is a competition. It doesn't matter how well I'm doing, it
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matters how well I'm doing relative to you. And the most tangible way to do that is through material stuff. I was reading some funny stats. They say
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that if you win the lottery, the probability of your neighbor going bankrupt increases.
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It's an amazing statistic. So, be careful who you socialize with because you're going to anchor to them as a
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baseline level of success and happiness. So, is it wrong to buy a Rolex? Absolutely not. But when it's controlling your personality, it's no
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different than any other addiction where it's forcing you to do things that you otherwise don't want to do. What about people who don't seem to
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spend anything? It's just as dangerous. Like there's something called post-traumatic broke syndrome and I'll talk about that. But I
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guarantee you that everyone can spend money in a way it's going to make them happier. So if I wanted to make a framework to know how to spend my money, where do I
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start? But also based on everything you know about money, if I want to get complete financial freedom, what's the
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five things that I should be thinking about? The first thing that I think that's most important is
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I see messages all the time in the comment section that some of you didn't realize you didn't subscribe. So, if you
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could do me a favor and double check if you're a subscriber to this channel, that would be tremendously appreciated. It's the simple, it's the free thing
00:01:51
that anybody that watches this show frequently can do to help us here to keep everything going in this show in the trajectory it's on. So, please do
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double check if you've subscribed and uh thank you so much because a strange way you are you're part of our history and
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you're on this journey with us and I appreciate you for that. So, yeah, thank you
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Morgan. Everybody loves to talk about investing. They love to talk about saving money.
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But I've never heard anybody emphasize the importance of spending money. You've written this book, The Art of Spending. So, it begs the question, why would someone like you who sells tens of
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millions of copies of their books when they write about something and really, really cares about the art of writing
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commit themselves to writing a book about the art of spending? when you couldn't when you could have written
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anything that you wanted to and it would have been a success. So I've written about money and finance and investing for 20 years and almost
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never had I myself said what is my spending philosophy? I could tell you how I invest. I can tell
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you how I save. I could tell you why I do those things. If five years ago if you said Morgan tell me your philosophy
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about spending in your own life I'd be like I I don't really know. And as I looked into it, there are literally tens
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of thousands of books on how to invest, how to grow your money, how to get rich, how to help your career. That top that
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topic is endless. There is virtually no book out there written about spending money. And I think the reason why is because we don't I think we intuitively think nothing needs to be said because
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the answer should be obvious. More is better, fancier is better. That's the end of the topic. But if you know
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particularly wealthier people I mean it affects everybody but particularly wealthier people you know it's not that
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simple that the correlation between how much you spend and how happy you are it it can exist everyone can spend money in
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a way it's going to make them happier but it is not as simple as you think and as I started digging into it in my own
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life of when have I been envious of other people of their material possessions why was I envious why when
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have I been jealous why was I jealous what kind of spending made me happy. What left me completely flat?
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It's it's a much more complicated topic than it seems at the surface. You know, another title for the book could have
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been the psychology of spending money because that's what this is. So, it's a look at the psychology of greed and envy
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and social aspiration and like climbing the social ladder, who you're trying to impress, whether those people are paying
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any attention to you. That's what this book is. So for someone like me who wants to improve my relationship with
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spending, I guess the question, yeah, I guess the qu first question is understanding the art of spending money, simple choices for a rich, what is it going to do for me? How is it going to
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make my life better to understand this? Why why does it matter to the person that's listening right now? I think it is a very easy assumption to
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make if you're unhappy with your life that if you had more money, those problems would go away. Sometimes it can be true. It's not
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automatically false. It's just easier to assume that that's true than it actually is. And so I guarantee you that every
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single person listening to this right now has some degree of that. If I had a little bit more money, my problems would
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go away, even if they don't necessarily know it or not. So much of spending is a psychological exercise. There's an itch
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that you're trying to scratch and that manifests in so many different ways. And so I've often thought of money, look, is
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money the root of society, the core of society? No. There's obviously a million things more important than money, but I
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do think it's the clearest window that we can look through to try to figure out what's going on in our own lives, in
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other people's lives, in society. It shows very starkly what people value, what they're scared of, what they're
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aspiring to become. There are many more elements to the puzzle. Your health, your friends, your family. We can go on
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that forever. But money is a very clear window that if you see how somebody engages with money, you're like, "Oh, I
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understand your insecurities. I understand your aspirations. I understand your self-confidence. I understand what you think of other
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people. You can learn a lot about that. It's kind of like a reflection of your your trauma. Yes. And it it manifests in very
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different ways. There's a great financial writer named name named Tiffany Alish and she's uh she grew up
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very very poor and now she's extremely successful and she calls it post-traumatic broke syndrome where even though she has a lot of money right now, she I I don't want to put words in her
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mouth. My understanding is like she's she's afraid to spend it because she's the the feeling in her head is I will never go back to that I can't ever go
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back to that poor person post-traumatic broke. And so it can manifest in very different sometimes opposite ways. And
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so the point is not like if you grew up poor, you're going to want to display it. But the point is that it's a psychological itch. It it's not just I
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want the nice car because nice cars are better. There's a social signaling you're signaling to others. You're signaling to yourself. It's a trophy for
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yourself of what you've overcome. The more I dug into it, the more it was so clear of like spending is not just on
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material stuff. It's not just I want to buy this car or this house or these clothes or these jewelry because it's
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nice. It's I'm trying to send a signal to others or to myself of what I've overcome. One of the ways I thought
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about this in my own life was if I was on a deserted island with maybe just just me and and my family, nobody could
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see how we were living. Nobody can see your house, nobody can see your car, nobody can see your clothes, nobody can see your jewelry. How would I live? For
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me, and I think most people in that exercise, you immediately gravitate away from status and towards utility like I
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would not want a Lamborghini. I probably want like a pickup truck, something that has like more util if nobody could see it. I would just want utility. I would
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not want an enormous house. I would want a house with a nice view because I'm not trying to show off to other people. I
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just want something that is calming and and serene to myself. And so once you start seeing the stark difference
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between utility and status, once you once you force yourself to see it, you're like, "Oh, it's everywhere." Is something inherently wrong with status? Is it wrong to buy a Rolex?
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Absolutely not. Particularly at certain points of your life. Okay. So, when when is it good? When is it bad? When is it in different like
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indifferent? I don't know. I don't know. It's hard to say what's good and bad in terms of a formula because everybody's different. But I would say this, my own personal
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desire to show off mater, but the reason why is because I had nothing else to offer the world. I had no intelligence. I had no wisdom. I didn't know how to love anyone. I had
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nothing else to offer friends, family, spouses, whatever it would be. And so the last remaining lever, if you're
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trying to get attention and respect, is well, look, I have no intelligence to offer. I have no wisdom to offer. maybe
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people will admire me for my car. That was why I wanted it. And now that I I hope in a in I I hope
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to today, 20 years later, I have a little bit more to offer to my wife, to my friends, to my family, to employers
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and customers, whatnot, then my desire for those things has gone down. Not to zero, but it's gone down. There's a
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great Warren Buffett quote where he says, "Success in life is when the people who you want to love you do love you." And key to that is like you have
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to ask the question like who do you want to love you. And for a lot of people the quick knee-jerk reaction is everybody.
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And so you want to have a nice car, nice clothes, nice jewelry because you think
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everyone's going to stop and stare. When I drive this down the road, people are going to be stop and say, "Look at that guy. Look, look at her. That's amaz
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I admire them. I respect them." And by and large, that is almost never true because no one's thinking about you as much as you are. They're not they're not paying attention to your car or your
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clothes or your house. They're busy worrying about themselves. Jimmy Carr, I think you've had on the show before. Is that right?
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Love Jimmy Carr. He said this a couple weeks ago, I heard it and it was one of those I had to stop and write it down because it was so profound. He said, "In
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your 20s, people worry about what other people think of them. In your 30s, you say, I don't care what anybody thinks of me. And in your 40s, you finally realized a truth, which was nobody was
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thinking about you the whole time. They were busy worrying about themselves. And look, that's not black and white. Of
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course, people think about you and look at you and sometimes judge you, but not nearly to the extent that we think. And
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that was why I get back to the exercise. If nobody was watching, how would I live? The truth is because virtually
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nobody is watching except the people who I really love and admire and they're gonna admire me for things that have
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nothing to do with the kind of car that I drive or the clothes that I wear. What's the the evolutionary basis for
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all of this stuff? Life's a competition. It doesn't matter how well I'm doing. It matters how well I'm doing relative to you. It doesn't
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matter how big my house is if I'm trying to signal. All that matters is my house is bigger than yours. That's true for
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all wealth. There's no such thing as you are wealthy once you have x number of dollars. That that does not exist.
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Everything is relative to other people. And the truth is like we live in a world of such material abundance where the
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majority of people listening this will have some sort of shelter and a car and and can buy can buy clothes and whatnot.
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And because relative to a lot of history, we live in material abundance. The competition, the arms race for
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bigger nicer things is extraordinary. And it's way more powerful and potent today than it's ever been for two reasons. One is social media. So I am now aware of the homes that other people
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live in, the cars that they drive, the clothes that the vacations that they take. I'm now aware of it in a way that we were not 15 years ago. The other
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thing is because the internet has democratized access to audience and attention. The
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ability to become extremely rich is much more powerful than it's ever been. It's
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still rare, of course, but it's it's easier today than it's ever been to become very very wealthy, even if only a small number of people are doing it because your your potential customer
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base is now the entire world. You know, a 100 years ago, if I was a businessman, my customer base was whoever lived in my
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town. Now, if you're a businessman, your customer base can be the entire world. And so, it's easier to make a huge
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fortune. And because of social media, once you make that fortune, people are probably going to know about it because
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a lot of those people who become very rich are going to say, "Look at how I'm living." And so you have this like trickle down aspiration of everyone else
00:12:00
being like my definition of wealthy. If you're a young person today, a young person's definition of wealthy
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might be a multi-billionaire with a private jet and a private island where I think 80 years ago people's definition
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of wealthy was a three-bedroom house and one car and and a and a happy family. And so we live in a world where like aspirations have inflated by such a dramatic degree that the arms race of
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spending just gets that much that much higher. I think there's something in this idea that you almost have to develop the
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skill of disconnecting your admiration from your aspirations if you want to live a good life because so many kids
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will like look up to you and say I want to be like Morgan when I'm older. um because they admire what you've done,
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but the reality is they they're just seeing the sort of shop window. Yeah. Of your life. And so I people do this
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with Elon all the time, right? And Elon has even said he's like, "You might think you want to be me, but you you don't."
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And he the clip where he did that, he pointed his head and he's like, "It's a it's a tornado up here." And I think
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that's true that for most people who are extremely successful, who are the ones that people tend to to look up to, like
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the extreme outlier successes, a lot of the reason they're so successful financially and in their career is
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because they've devoted every second of their life to that career, which most of the time comes at the
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expense of everything else. So they are very successful, made a lot of money, and that came at the expense of their
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health, their relationships, relationships with their their spouses, their children. So I make the point in the book that of the top 10 richest men
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in the world there are a cumulative 13 divorces among the top 10 richest people and it's a small sample size like you
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can't really you know say that that that much with that but this is a group that is almost universally admired
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particularly among young men you know Elon Musk Jeff Bezos Mark Zuckerberg how how amazing would it be to have that
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much money but if you dig into their actual the the their whole life not just their net worth not just the house and the jet that they have but if you look at holistically their entire
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life, you're like, I don't know. It's it's it's it's not that great. It's it's one thing to admire someone if you can
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pick bits and pieces. I want I want his house and her car and his career and his
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physique, but you can't pick bits and pieces. You have to take the whole thing. And once you take the whole thing, you realize that like a lot of
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the people who you may have been looking up to either did not have a better life than you did or it was just marginally
00:14:23
better in a way that was easy to overlook. I had this conversation with a girl in New York last week. It was a
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shoot, a client, like a brand shoot, and she sat me down to interview me for TikTok. And she said, um, she goes, "What age did you become a millionaire?"
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And I said, "About 24, 25." And she went, "Oh, I'm 24, 25 now, and I'm not a millionaire." And I remember saying to her, I was like, "Yeah, but would you would you take my trade?"
00:14:46
And I explained to her, I was like, "So, I was lonely between the age of 18 and roughly 20. I was working in call
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centers. My parents wouldn't speak to me. So I had no contact with my family really um for through that period and
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then I started shoplifting at about 18 19 to feed myself and my brother had given me this big um sort of industrial packet of oats and what I had to do is it's like powder I mix the powder with
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water and there's there's there's a photo online I think from my previous TED talk my first one where I was just drinking this this powdered water. So I
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said to her, I said, and I was a millionaire at 24, lonely, not speaking to my family, drinking powder do
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shoplifting, working night shifts in multiple call centers. Would you take the trade? And she went, "No."
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She said, "Absolutely not." She wouldn't take the trade. And I said, "So you can't you can't pick it apart because I if you want to my outcome, you have to
00:15:36
take the path that I took if you want my specific outcome." And people don't think about that. Like one of the things
00:15:41
this podcast has actually taught me is to think through the framework of trade-offs. Yeah.
00:15:46
So, think about everything as a trade-off. Think of a Zmpeek as a trade-off. There's a trade you're making somewhere. And even, you know, when you
00:15:52
aspire, you admire people. If you admire what we've done here, for example, think about the trade-off. Like, even with
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this team, the team have been working here every single day, including the weekends from morning till night for the
00:16:04
last 14 days here in New York. Every single day. Right. Do you want to do you want to do you
00:16:10
want a podcast? Like, do you want the trade? And if you do, fine. But just be informed about, as you say, both sides of the trade.
00:16:16
Another Jimmy Carr quote that I love, he's a profound individual. Not only is he hilarious, he's very smart. The quote
00:16:21
is, "Everyone is jealous of what you've got. Nobody's jealous of how you got it." Yeah. And I think it's just so easy to
00:16:27
overlook. One of the things I write in the book is what's called the reverse obituary, which is it's a very good
00:16:33
helpful exercise to write down. It's kind of morbid, but what do you want your obituary to say? kind of a weird
00:16:39
thing, but for me, everyone's different, but for me, I would want it to say Morgan was a good father, a good
00:16:45
husband, a good friend, helped his community, was a good worker. That's what I would want it to say. Never in a
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million years in that obituary would I want it to say what my income was, how big my house was, how many times I went
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on vacation, how many horsepower my car had. Like, it's ridiculous to think that that's what it would be. I would want
00:17:04
it. You instantly drift towards the things that you know you're actually you actually want in life. And of course,
00:17:10
it's going to be different for everyone, but I I I found it a helpful thing because you realize that it would be completely absurd to put the things that
00:17:18
I might be chasing in my life in my obituary. And so if in any given day, in any given year, you're like, I got to
00:17:24
earn a higher income and I want to buy a bigger house and I got to need a new car and all you see, they came out with this watch. But at the end of your life, you
00:17:30
know, that's not going to matter. What's going to matter is were you a good spouse, a good parent, a good worker, were you honest? Were you a good friend?
00:17:36
Were you funny? That's you know that's what's going to matter because that's what you want in your obituary. I think part of the reason people spend
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in the way that they do as well is linked to that which is sometimes that behavior which is also linked to the point about trauma at the start might
00:17:49
result in a savings addiction. I often wonder this cuz you know when I was younger I had this crazy spending
00:17:54
problem. And I've also seen people who don't seem to spend anything and they're just like hoarding capital. You talk about this a bit in the book. Like what is that equally bad behavior? Yeah, I think it's equally bad because
00:18:05
both of them are the exact same thing which is money's controlling you. Money should be a tool that you use to become
00:18:11
a better version of yourself to become a happier, more content version of yourself. But when it's controlling your
00:18:18
personality, it's it's it's no different than like any any other addiction where
00:18:23
you don't it's forcing you to do things that you otherwise don't want to do. And that can manifest on either end of the
00:18:29
side. Either people can't stop spending or they cannot spend enough. A lot of financial adviserss will tell you one of
00:18:34
the biggest problems that they have are clients who have saved enough money for retirement. Good job. You saved for 40
00:18:40
years. You maxed out your 401k. did everything you were supposed to and now you're 70 years old and you have enough
00:18:45
money to travel and play golf and you won't you won't do it. And I think it's because they become so accustomed to the
00:18:53
identity of I'm a saver. Every month I save and every month my net worth goes up and they cannot bring themselves into
00:18:59
switching gears and going in the other direction. And for a lot of those people, the money is in full control over their identity. It's telling them
00:19:06
how to live, what to like, what to aspire to, what to enjoy. the money is totally in control of their personality and and it's it's just as dangerous and just as just as detrimental as you when
00:19:18
you were a teenager of I can't stop spending. It's and both of those are in are they the money is like playing the
00:19:24
marionette doll of your life. It's telling you exactly what to do and when to do it. If I wanted to make a framework to know
00:19:30
how to spend my money, where do I start? Do I have to get clear on something? Do I, you know, and I guess the other
00:19:35
question which is somewhat linked to this is this overarching debate around can money make you happy, right? But I'm trying to figure out like
00:19:41
where do I start because I I want to one of the things I want to get out of today is I want to have a a clearer framework for how to spend my money.
00:19:48
Well, those two points that you just brought up, I think are very related. The first on the point of can money make you happier? The answer is yes, but
00:19:54
there's a there's a there's an asterisk next to it that we need to get to. For years, there was a big academic debate
00:20:00
of does more money make you happy? A lot of some of the studies showed yes, clearly it does. Others show studies
00:20:06
showed no, it really doesn't. and the academics, the economists were like battling for decades. It's kind of been
00:20:12
cleared up in the last just the last couple of years, this last couple of decades with some nuance, which is this.
00:20:17
If you are already an unhappy person, if you're already anxious, if you're already depressed, by and large, having
00:20:24
more money will not help you at least that much. It might help you a little bit around the margins. If you're if you
00:20:29
start as an unhappy, depressed, anxious person. If you are already a happy, content, joyful, laughing person, having more money will give you a better life.
00:20:40
So in either direction, it's just leveraging who you already were. It's not going to change you that much. It's just going to leverage who you already
00:20:46
were. Very similar to like they say this about power. Like once you gain power in politics or something, it just leverages
00:20:52
the personality that you already had. Money is very much like that. And so it's it's not a a a panacea in the sense of like oh like if if you're miserable
00:21:03
like if you had more money it's going to clear up your problems. It can make some of your problems a little bit easier to deal with. But I mean think about it in
00:21:09
these stark terms. Let's say you are overweight and unhappy. You hate your job and you're recently divorced and your kids won't talk to you but you live in a mansion that has a Ferrari in the
00:21:20
driveway and you got all kinds of fancy stuff. Is is is that a good life? If all
00:21:26
if everything else in your life sucked and you woke up every morning going, "Ah, I got to go to work today. I hate my job. I can't stand my job. I'm I'm
00:21:33
lonely. I'm miserable. I'm overweight. I can't sleep. I'm addicted to alcohol." Whatever it might be. Of course, it's a terrible life. The house in the car
00:21:39
don't matter at all. But you can flip that around and say like, let's say you live in a very modest middle class house
00:21:44
and you drive a a 10-year-old Honda Civic, but you love your job. You love your co-workers. You have a great relationship with your spouse. Your kids admire you. You have your friends over
00:21:56
for a barbecue every Friday night. Materially, it's very modest. You have what you need. You're not impoverished.
00:22:02
You're not homeless. You have the food that you want and the shelter that you want. But you would be an absolute
00:22:08
maniac to choose the miserable person in the mansion versus the content, happy person in the middle house. If your goal is to live a good life, it's psychotic to pick one of one over the other. I
00:22:21
felt this quite starkly recently because I flew to Cape Town on my own. Um I've only ever been there with my girlfriend
00:22:27
and with other friends and the first time I've only been there a few times. I've got a house there and it's a very big house and the first time I came with
00:22:33
was with my family. Second time it's with my girlfriend and my friends. This time I came on my own and I felt this deep existential feeling
00:22:42
waking up walking through that house alone thinking [ __ ] me. It was so clear to me that the point of such a such a thing is to fill it with people and you say
00:22:53
that's what I I make this point in the book of like the very simple question will a big house make you happier?
00:22:59
I think it will make you depressed if it's empty because that's how I felt. I was like I'd rather be in a studio apartment
00:23:05
alone than a big house on my own. Right. I had a similar realization to you a couple years ago when I took my my
00:23:12
my my family and I went to Maui for a vacation and I love Maui. It's my favorite place in the world. And now I
00:23:17
have kids. So I'm building sand castles with my kids on the beach in Maui. And that I remember thinking like this is
00:23:23
this is a 10 out of 10. This is like this is peak life for me. Building sand castles with my kids. Everyone's happy
00:23:28
in the sun. But then I had this realization of like if that's a 10. Playing with Legos at home on the living
00:23:34
room floor with my kids is like a nine. Like it's really close because realization was what I enjoy is like
00:23:41
quality time with my kids. And I think a lot of the reason that people like vacate, like travel is not because they
00:23:46
like getting on an airplane and flying around the world and being jet-lagged and cramped into a small hotel. What they like is uninterrupted time away
00:23:54
from work, away from all the other stresses of everyday life. That's what they actually enjoy. That's what they
00:23:59
like, travel. It's not necessarily the location. It's like what the location is doing for you. So the question of will a
00:24:04
big house make you happier? It will to the extent that it makes it easier to have your friends and family over
00:24:10
because your friends and family are the ones who are actually making you happy. And so the answer can be can will a will
00:24:15
a nice house make you happy? The answer can be yes if you're using it for the right reasons. There was this article in
00:24:20
the New York Times, this is probably 10 or 15 years ago and uh the article said two things happened to Julia Roberts this week. One, she won the Academy Award and two she found out her husband
00:24:32
was cheating on her. And so the column said, "Pop quiz, did Julia Roberts have a good week?" And it's like, you'd be a
00:24:38
fool to say yes. It was probably the worst week of her life, I imagine. Yeah. Um, but what we see from the outside was
00:24:45
doled up in a beautiful dress, accepting the highest honor of her career and saying like, "Wow, that must be
00:24:51
amazing." But it gets back to once you see the full picture, you're like, "Nah, it's not as easy as it seems." You say on page 23 of your book, a quote
00:24:57
that I loved, "Show off the inside of your house, not the outside." Right. because the inside of your house are
00:25:02
what your friends and your family are seeing. Is there like a a hack here? Like is there, you know, because you have all
00:25:09
these like internet communities that come up with these like hacks, these other ways to live. They they they step
00:25:14
outside of the matrix and they form their own little their own little cult that are like doing it differently and
00:25:19
not not abiding by the rules of the the quote unquote matrix. I very much feel like most of us are trapped in the matrix. We're trapped in this like
00:25:25
status game competing against each other, not not searching for happiness. like what is the the hack here? How do I
00:25:31
get out the matrix and what does that look like? I think if there is a formula that I I lay out in the book and I I make the
00:25:37
point that like there there's no formula for how to spend money. But if I did try to make a formula for a pretty good life and this extends way outside of money.
00:25:43
The formula for a pretty good life is independence plus purpose. If you want to say like how how can I be a happy
00:25:49
person? You need to be independent. You need to be able to do what you want to do when you want to do it with whom you
00:25:55
want to do it with. And you need some kind of purpose that is higher than yourself. And that could be a million different things. It could be friends,
00:26:01
it could be family, it could be career, it could be religion, whatever it might be. I think it is very difficult to imagine anyone having a good life
00:26:07
without those two things. If your entire life and your schedule is dictated by somebody else of you have to go to this job that you don't like, you have to have a long commute that you don't like,
00:26:18
you have to do this when you don't want to do it, it's it's hard to be happy. And if you don't have any kind of purpose that you're doing it for, it's
00:26:25
difficult to be happy. And so the idea that to me, the best thing to spend money on is independence. And I view it as purchasing. I I don't view it as saving money. I view it as purchasing
00:26:36
independence. That's how I I view I view like I'm buying independence when I save. And so to me, the biggest thing
00:26:43
that I spend my money on, and this sounds weird, but I is saving. And I view that as buying independence. I view
00:26:49
that as every dollar that I save is a little bit more independent than I was before. It's a little bit of my future
00:26:55
that I now own and control. And if if you're listening to this and you're like, "Look, I'm not financially independent. I have no I have no
00:27:02
possibility of being financially independent." Independence exists on a spectrum. And literally every dollar
00:27:08
that you save is a little bit more independent than you were before. If you have a $100 in the bank in savings, that
00:27:14
can make it so that if you were to lose your job, you have a little bit more flexibility for rent or groceries or
00:27:19
whatever it might be that you didn't before. $1,000, $10,000, any amount that you have is a little bit more
00:27:26
independent than you were before. And so when you view one of the cores of living a good life
00:27:31
as independence and any amount of saving money will buy you independence, I think that's a powerful observation for
00:27:37
people. And then the purpose part is going to be different for everyone. For me right now in my life, it's being a
00:27:43
good father. That's what I want my end my identity to be. That's my overarching goal in life is to be a good dad. I I
00:27:49
think the vast majority of parents will tell you that there was no greater joy, purpose than watching their kids thrive.
00:27:57
Can also bring a lot of sorrow and a lot of sleepless nights and a lot of anxiety and a lot of worry that comes along with it. But nothing that I've experienced or
00:28:04
any of the other parents that I know would would say that anything in their life has come before that that it's been
00:28:10
a great thing. So we got on this point because the formula is independence plus purpose. For me the purpose is being a
00:28:16
parent. That's not going to be true for everyone. But you're trading independence for that. I'm trading it's internal independence
00:28:23
that I'm giving up. I want to sacrifice for my kids. I want to like loyalty to people who deserve your loyalty is a
00:28:30
wonderful thing. Loyalty to people who don't deserve your loyalty sucks. And so if you are working, if you're giving your loyalty to a company that doesn't respect you, that sucks. That's terrible. Loyalty to people who deserve
00:28:41
it is a very fulfilling thing. So my kids deserve my loyalty. How did they earn that loyalty?
00:28:47
Just by being my kids. And there's some days where I feel like they they don't appreciate it, of course. But I I think
00:28:52
that tends to be true. People get into problems when they are loyal to people or organizations or political
00:28:58
affiliations who don't deserve the loyalty. That's when it gets dangerous. Do you think the promise of independence
00:29:03
and freedom has a secret hidden dark trade-off that people don't talk about? Because there's this culture right now
00:29:09
of like, you know, be your own boss and stand on your own two feet. And when you think about what makes humans happy, it
00:29:15
seems to be collective things. It seems to be actually in your case, as you were saying, dependence. Your kids depend on
00:29:21
you. In some ways, you depend on them. All the things that seem to like having my friends at my house made me happier than being in the house alone,
00:29:27
right? But the nar the public narrative is all about like optimizing for freedom, whatever that means. And really
00:29:33
more so optimizing for independence, not depending on someone else. But when you look at the people that seem to be the
00:29:39
most unhappy, they seem to be the most independent, right? because they're they if you picture someone like living in a by themselves in the middle of Montana with
00:29:51
no one around them or whatever it might be no family, no pets, freelance work on a laptop on their own in a in a glass
00:29:57
box in Dubai. Um no no big obligations, not not in a church. But back to the formula, independence plus purpose. Most people have no purpose. Oh yes. So I think it's I think yes, everyone is
00:30:09
going to be I'm I'm dependent on my wife, my kids. you know, there is dependency there, but I'm I'm choosing I
00:30:17
chose her as a spouse. I chose to have kids and so I I still did it on my terms. And so, you're never going to be
00:30:22
or I think you don't want to be a 100% independent in the sense that you don't rely on anyone and no one relies on you because then you have no purpose. It's choosing who you want. I think it's I think you're not independent if you
00:30:35
have to be loyal to a job that you hate, but you have to have it because it's the only job you got and you and you have to
00:30:40
do it and you're you you have to pay this exorbitant rent on an apartment that you don't even enjoy that much.
00:30:46
Like those are dependence on things that you don't want, but like I want to be dependent on my family because that
00:30:52
gives me purpose. It's like the independence to make the choice, I guess. To make the choice of who you're going to be dependent on, right?
00:30:58
Got you. And on this earlier point, you were talking about saving um and that you your favorite form of spending is
00:31:04
saving. Yeah. Someone's listening now, how much money do you think they should at a minimum
00:31:10
have saved? If you try to get technical about it, I would say what are the odds that at some
00:31:15
point in your life, you're going to lose your job and not be able to find another job for six months. The odds are not bad
00:31:23
that that will happen to you at some point. Not very comfortable to think about. Maybe it's already happened to you already, but the odds that at some
00:31:28
point that will happen are pretty good. And therefore, if you were to say like, look, a good measure of
00:31:35
some level of higherend independence, not a low level of independence, but like a a medium level of independence is
00:31:42
six is is I could keep myself going for six months. Now, for a lot of people, that's a daunting task. And I it's okay.
00:31:48
You're probably not going to achieve that when you're 18. Am I it's going to take some savings to get there, but that is a level at which you can exhale to a
00:31:55
degree that most people have never been able to do before of like there's going to be some bad stuff happening in your
00:32:00
life. It's going to be uncomfortable, but it's going to be okay. And for for for most people, for most of history, it
00:32:06
was there's bad things going to happen to you and you're not going to be okay. It's going to be very traumatic. And and
00:32:11
one of the important things there is when you lose that job, the ability to go find a good job, even a better job
00:32:18
where you want doing what you want with the people who you like working with is very important. If you don't have any savings, you're going to have to by
00:32:25
default pick the very first job that you can come across, even if it's a terrible job in a location that you hate, doing
00:32:30
something you hate, working with people you don't like. And so the flexibility to give yourself time to find a job that
00:32:37
is a little bit easier and better for you, that is the purpose of savings. And that goes back to your point about independence, which is you want to building up those savings is building up
00:32:48
the independence or the freedom to make a choice about who you work with, right? If the worst were to happen, you don't
00:32:53
have to necessarily go get a job at, you know, some awful place, some some terrible place. You talk about jealousy in the book as well and um I
00:33:00
was reading some stats that quite funny stats but they they say that essentially that if you're if you win the lottery
00:33:06
the probability of your neighbor going bankrupt increases. It's an amazing statistic, right?
00:33:15
So what's what's happening there? Well, you're looking at your neighbor who won the lottery and your neighbors
00:33:20
probably bought a vacation house, bought a new car, sending their kids to private school, whatever it might be. and you
00:33:27
watching that are like, I need that for myself. It's it's unfair that they have it and I don't and I'm gonna go do any
00:33:34
reckless financial decision to get that. So much of what we think is is normal. Our definition of success is what other
00:33:41
people around us have. And so if you are watching your neighbor live a better life than you, then all a sudden your
00:33:48
definition of a good life is what they're doing. And you will do some reckless things to get it. I think that's that's what happens. And so one
00:33:54
of the takeaways there is like be careful who you socialize with because you're going to anchor to them as a
00:34:00
baseline level of success and happiness. Be very careful with what you do and who you look up to and who you aspire to. I
00:34:06
grew up in Lake Tahoe, California, and this was before tech money when it was not a wealthy area. it is now because
00:34:12
all the tech money from San Francisco came up. But Tahoe in the 90s and early 2000s was was just a out in the woods
00:34:19
and you know you could buy a house for nothing and most people in town didn't have any money. And then I went to
00:34:25
college in Los Angeles where there is a lot of wealth there are high expectations and there are Lamborghinis
00:34:31
and Rolls-Royces and whatnot. And one of my observations was people were happier in Tahoe. And I think the reason why is
00:34:38
because the definition of success in Tahoe back then was a two-bedroom house and a pickup truck.
00:34:44
That was success. In Los Angeles, the definition of success was a mansion and a and a Bentley.
00:34:50
And so it was just it was easier for people in Tahoe to be like, I'm good. I I check the boxes. Like look, I'm
00:34:56
successful. Look at look at my tiny little house and my beat up pickup truck. That's success, right? And so that was like be careful who you
00:35:01
socialize with because you're going to anchor to their level of success. I have a some graphs in front of you there. Um
00:35:07
I think one of them is the spectrum of financial independence. Yeah. Could you explain to me what that is and
00:35:14
and how how that's useful to understand and why that's useful to understand? I think it's I had this friend uh 10 or
00:35:20
10 or 20 years ago and he said, "I don't save any money because I don't see the purpose. All I'd be able to save is a
00:35:26
hundred bucks a month and what's that going to do for me?" And since I don't think it's going to do anything for me, I I might as well just go spend it. And
00:35:32
I remember thinking, no, no, that's like $100 in savings or if you do it for a year, $1,200 in savings is $1,200 more
00:35:39
independence than you had before. And again, not if, but when you lose your job or your car breaks down, you're
00:35:45
going to realize how unbelievably valuable that money is. And it's not savings, it's independence that it's
00:35:50
giving you. So the idea that independence is on a spectrum. It is not you either don't have to work or you
00:35:56
have to work. It's not that stark, but most people think of it in those terms. Why would I try to become independent if
00:36:01
I have no chance of not working? And the simple way to view it is every dollar that you save is a piece of your
00:36:08
future that you own, that you control, that is yours. The flip side of that is like every dollar of debt that you have
00:36:14
is a piece of your future that somebody else controls. It's a it's a moment in time in the future that is not yours. It
00:36:20
belongs to somebody else. And so I've always viewed it on a spectrum. When I was younger and much poorer, I was a big
00:36:28
saver. Even though like was I independent? Like no. Of course I had to work. I had to work to pay my rent and pay my groceries. Of course. But I
00:36:34
viewed it as like every $20 that I saved, every $50 that I saved put me in a better position than I was before. And
00:36:41
looking back on it, I I don't think I could have articulated that 20 years ago, but it's what I felt. A lot of that for me back then was coming from a place
00:36:47
of fear. I didn't have a lot of self-confidence in myself, in my career. So, I was like, I need to save to
00:36:53
prepare for when this all comes crashing down. Mhm. And even though it didn't come crashing down, I'm so glad that I did it cuz I'
00:37:00
I've had a sense of financial security and I've had a sense of independence financially since I was in my early 20s.
00:37:07
Not because I had saved a ton, I hadn't, but any amount that I saved, I I viewed
00:37:12
as like the cushion that that gave me a much higher sense of confidence that if or when things go wrong, I'm not going to be flailing. I'm going to have some cushion to fall back on. And what is
00:37:23
this this spectrum? Uh what are the stages of this spectrum? So let's start at the very bottom.
00:37:29
You're homeless. You're panhandling. Reliant on the kindness of strangers. As you go up from there, you can be
00:37:34
completely reliant on your boss in a job that you don't like. Now that's that's that's a that's another low level. As
00:37:40
you go up from there, you have look, I am I'm relying on my job. I'm relying on my on my paycheck, but I probably have
00:37:46
some opportunities. I could go work at another job. I could I could choose to work here. I could choose to work there. And then you go up from there. It's
00:37:51
like, yo, I I like my job and I have some savings. So, if I lost this job, I can fall back onto it from there. You
00:37:57
can go up from there to have you can live where you want. You can work where you want. You can change fields. You can
00:38:02
you can go and you can do a completely different job. You can take two months off and travel if you wanted to. Like,
00:38:08
you're working your way up all the way to the highest level of financial independence, which is I don't need to
00:38:13
work anymore. I've saved enough and I can I can I can wake up every morning and do whatever I would like to do.
00:38:19
That's obviously an aspiration that for most people will never be reached until they're maybe in their, you know, 70s
00:38:25
and they're retiring and they have social security and some other savings from there. But for most people, like a good level of independence as a good
00:38:32
goal is enough savings so that if you lost your job, if your car broke down, if you needed to replace the roof on your house, you would be able to do it without losing that much sleep. That is
00:38:43
a realistic level that I think almost anyone can achieve. based on everything you know about money if I want to get to
00:38:48
that highest level of complete financial freedom, what what what's like the the five things that I should be thinking about at just a sort of a very simple level. You know, cuz so many people
00:38:58
listening right now think, you know, my goal in life isn't to become a billionaire or a tens of millionaire. My goal in life is just to get to that
00:39:05
point of freedom as soon as I can where I can start calling the shots. And there's there was someone who I was speaking to the other day and said that
00:39:10
there's this internet movement of kids who are trying to get what do they call it it's like they're trying to get to
00:39:17
the point where they can retire early fire something financial independence retire early that
00:39:23
y like how do I get how do I get there the first thing that I think that's most important this is the first and the last
00:39:29
thing this is the most important part is that all wealth your feeling of wealth is what you have minus what you want and
00:39:36
it's so easy to ignore the latter matter. I talk about in the book my my late grandmother-in-law, my wife's grandmother, passed away a couple years
00:39:41
ago. For 30 years, she lived off of nothing but 17 or $1,800 a month in social security. Not a lot of money. By most accounts, very little money. But she didn't want anything more. She did.
00:39:54
She if she made $1,700 a month, she did not want $1,700 in one and $1. She was perfectly happy. She she found all of her happiness working in her garden, going for walks, watching the birds,
00:40:06
watching the sunrise, watching the sunset, talking to her friends, hanging out with her family. But if you asked her, you said, "You only make $700 a
00:40:12
month. You're broke. Doesn't that make you unhappy?" She'd be like, "What?" Like, "Do you think having more money
00:40:17
makes the sunset more beautiful? Do you think having more money makes going for a walk more pleasant?" And I'm not
00:40:23
saying you should live like you should be content with that amount of money, but the point is like she was content. She was totally content. And it was her
00:40:29
choice. And I think she was happier financially than some billionaires because there's a lot of billionaires who have a billion dollars but they want two. They have two billion but they want four. One of the things is that
00:40:41
happiness might be the wrong word here. The word that people want is content. When you sit here and daydream about
00:40:47
having the bigger mansion, what you're actually doing is you're imagining yourself in the mansion being content
00:40:53
with it. You imagine yourself sitting in that house and saying, "I don't want anything more than this." The feeling
00:40:59
that we are aspiring to is just being content. Happiness is always like a 30- secondond emotion. It's like laughter.
00:41:04
Like if I tell you a funny joke, you'll laugh for 30 seconds and then and it's over. Like very few times in life are
00:41:11
you happy for more than a couple minutes at a time. But what you want that is like a durable emotion is being content.
00:41:17
Just saying like I'm good. I'm good with this. I don't want anything more. I interviewed Dr. to Anna LMK and she's
00:41:22
like the the uh the scientist who's most uh renowned for talking about and writing about dopamine. Yeah. And I was wondering how much do the molecule dopamine dovetailes into this
00:41:32
because I think one of the things she said to me was that dopamine is the chemical for wanting. Yeah. And people have I think mistaken it for
00:41:38
being the the pleasure happiness. Yeah. Happiness. It's it's more more. It's like you want
00:41:44
more. And she told me this crazy study about this rat where they removed the dopamine receptor from its brain so it
00:41:49
couldn't produce dopamine and then they put food 2 in from its mouth and the rat starved to death because it it it and in
00:41:57
that I've always thought about that is like okay so that's what dopamine is. It's the motivation to go get to go get
00:42:02
to want to pursue. What role is dopamine playing here? It's huge and that's actually a good
00:42:08
realization to be like a lot of this is not something you can solve on a spreadsheet. It's not something you can
00:42:13
solve with a formula. It's chemicals in your brain. And obviously some people are going to be more susceptible to that than others. I think my
00:42:19
grandmother-in-law just had for whatever it was was was wired differently than most people. Part
00:42:24
of that was like she was a product of the Great Depress. She grew up during the Great Depression which probably like lowered her expectations. She never had
00:42:29
social media and whatnot. But of course, I think some people are wired differently than others for a level of
00:42:34
contentment. But I think just there's a big thing in psychiatry where diagnosing a mental illness is sometimes more
00:42:41
important than the treatment. If you just get a diagnosis of like, oh, you're ADHD, whatever it is, just knowing just
00:42:47
like the the fact that you can stop questioning, why am I having these thoughts? You can you can understand why you have those thoughts is more
00:42:52
important than the treatment sometimes. And I think that's true here. If if you it's easier said than done to completely
00:42:58
control your desires, but just knowing why you're doing it and realizing that it's probably not going to give you the
00:43:04
happiness that you want, that it's just like any addiction that the more you chase it, the further away it's going to
00:43:10
get, can go a big ways. And so for me myself, there's all the time there are moments
00:43:15
where I'm like, "Oh, I I should I I should get that car. Maybe I should get a bigger house." I have those feelings
00:43:21
daily. So the feelings don't go away. But I think I'm better now than I've been in the past at reminding myself of
00:43:27
like it's not going to make you happier. You know that. You've tried this before. You've tried it before and it didn't
00:43:32
make you happy. What is going to make you happy is spending time with your kids, having a good relationship with your wife and your own physical health
00:43:38
and laughing with your friends and having good times with people who you enjoy. You know that's going to make you happy and you know that's not. And I
00:43:45
have to remind myself because it's not intuitive. And I have dopamine that tells me you should want more and more more and more. So, you never get over
00:43:51
it, but I think once you've diagnosed the problem, it becomes easier at just like spotting that emotion and realizing
00:43:58
that it's telling you a story that's probably not true. I wonder if you I could trade the addiction cuz you, you know, you
00:44:03
referred to it there as being an addiction. If it's a dopamine equation, could I not shift my addiction to
00:44:08
something more productive? And would that mean that my spending would get better? So actually when I think about me as 18 years old and having that
00:44:15
horrific spending problem, maybe I just shifted the the thing that gave me dopamine to like building businesses or
00:44:22
to podcasting or to writing books or to being a great dad. I don't know. Do you know? I think it's probably true that
00:44:28
everybody without exception is addicted to something and it's just harnessing that that process for whatever it might
00:44:35
be. So some people are addicted to my wife's addicted to gardening, let's say. She she couldn't care less about about
00:44:40
investing or spending money on a nice she could not care less about her car or my car or your car. But if you have a
00:44:46
good gardener, if you you have a pretty garden, she's she's all over this. So everybody's got their thing and it's just like can you harness that for
00:44:52
productivity? I think a lot of like extremely successful people are people who took their their natural addiction and
00:45:00
harnessed it for productivity into their business. And that's that's why they're so successful. this became obsessed with
00:45:06
one thing and it's it's a good question of whether we can actually guide that addiction or if it's just kind of
00:45:12
pre-wired in itself. I think it's true for myself, someone who's written books about money for 20 years, thought about
00:45:17
money for 20 years. My mom tells a story that when I was three, I would sit there
00:45:23
and count pennies. I don't want to count seashells. I don't want to count cards. I don't want to count rocks. I want to
00:45:28
count money. And so I think I've always had this disposition towards being fascinated with money. Why? I don't know. Because I did it when I was three. I did it before I could even think through it. But I think everyone
00:45:40
has their little thing. It's always been fascinating to me. I don't think I'm obsessed with money. I don't think it controls my life. But I've had to go out
00:45:46
of my way to have a a healthier relationship with it. But I think it's definitely been true that the reason
00:45:52
that I've found myself in this career is that it's always been my thing. And I think everybody has that thing in their
00:45:58
life. You know, people talk about addictive personalities and uh I was reflecting one of my best friends who was an alcoholic, had a problem with
00:46:05
gambling, then had a problem with eating, then got obsessed with marathons and he he traded each one of those
00:46:11
things for the next thing. So now he's like obsessed with health and fitness. And so I was when I was thinking about
00:46:16
people that are struggling with money problems and even my own historical strugg struggle with money, I I think I probably just traded it for something.
00:46:22
And actually, I'm kind of happy about that because I traded it for a better addiction, one that was productive.
00:46:27
Your career? My career and um I guess doing this I'm pretty addicted to doing this, right? And but I think makes me happier than the plasma screen. It's exactly. Yeah.
00:46:39
I think what's true about a money addiction is that it tends to be the classic addiction of like you tell
00:46:44
yourself if only I get one more hit, so to speak, then I'll be satiated. Then then then that'll be enough. And the
00:46:50
answer is like no, it absolutely will not. I'll tell you like a a personal thing. I don't think this is true, but it made me laugh. My wife and I bought a
00:46:57
new house about a year ago. It's an awesome house. We love it. It's great. And my brother-in-law came over the
00:47:02
other day and he goes, "You know, you're only going to live here for 2 years before you want to buy a bigger house." And I had to laugh cuz I'm like, "God,
00:47:08
like I I I don't think that's true. I think we're going to live here for a while, but I know what you're saying is
00:47:14
right. That's the natural guide towards it." that when we bought the house, it was like, "Oh, this is going to be so
00:47:20
great. Can you imagine? We're going to get to do this and get to do that and we have these neighbors and whatnot and you become accustomed to that very quickly
00:47:26
and then your gaze shifts a little bit higher. You're like, "Yeah, but look at that house over there. That one's nicer, isn't it?" That's always the natural
00:47:33
thing. And that's dopamine at work. That is dopamine purely at work. Because the truth is our previous house was was
00:47:39
great. And our previous house used to be our dream. And and dopamine exists when there's a when there's a gap between
00:47:46
where you are and where you want to be with something. And when that gap closes, they often refer to that as the
00:47:51
arrival fallacy. Yeah. Right. Which is a really kind of what you're describing. You tell yourself once I get there, then
00:47:57
I'll be then I'll be good. Then that's enough. And it's a fallacy because you know that's not true. As soon as you get to that whatever that mountain top is,
00:48:03
there's another mountain above it. It pushes you in a way that is not easy. Like nobody should pretend that you can
00:48:09
just go do this today. But it pushes you into appreciating what you have now and
00:48:14
finding your joy, finding your happiness through other things that don't have the arrival fallacy. Never have as I as a
00:48:21
parent have I said, "Oh, if only I had one more kid." Then then then that would be great. There's no there's really no
00:48:28
arrival fallacy for kids. You just kind of be like this. Like I I I just appreciate being around you. I just
00:48:33
appreciate all the and if if anything, it's the opposite. It's you look back and you're like, "Oh, I I I miss when
00:48:39
you were younger." It was like, "Oh, I it's it's sad how fast you're growing up." If if anything, rather than like
00:48:45
looking ahead and being like, "Oh, it's going to be better then." You're looking back and you're like, "Ah, I wish I had appreciated that phase a little bit
00:48:52
more." When you talked about um one of the ways to get to early retirement and to live a better life is to want what you have
00:48:59
um and basically want less things. I go back and forward a lot with this idea because there's like the monks who say
00:49:05
that like happiness is not wanting something and then there's like the reality of life where striving for
00:49:13
things seems to make me happy and everybody describes the journey as being the most enjoyable part.
00:49:18
That's your purpose. Yeah. Yeah. So like what what how do how do I make sense of this that like the monks are telling me that not to want
00:49:24
anything cuz that's going to make me frustrated and unsatisfied and then my lived experience is striving for things
00:49:30
with a group of people makes me seems to make me happy. I think there's a there's a difference.
00:49:35
It's a subtle difference but between pursuing something that you genuinely enjoy doing which for you is this and
00:49:40
your your business and whatnot versus being addicted to something that chasing something that you don't have
00:49:46
yet. And so I imagine, you can correct me if I'm wrong, but I imagine when you're doing this, you don't tell
00:49:51
yourself, I need to work harder so that one day the podcast can be up here. I I imagine, tell me if I'm wrong, but I
00:49:57
imagine you come to work every day and you're like, I I like doing this today. I like today. I liked yesterday. I'm going to like tomorrow. And so you're
00:50:03
not chasing a false goal. You just actually enjoy doing it. Do you know what? It's a weird thing because it's it's uh I'm going to be
00:50:11
honest because it's the only useful position to take. It's it's a weird combination of both. So I say like it's
00:50:18
important for us to have some like goal but also live in the in in the total understanding that the goal doesn't
00:50:25
actually matter. Right. And it's this weird dichotomy I live in was like if we become the biggest podcast in the world
00:50:32
like set that as a goal because it gives us something to chase. I get that KPI and then like put time frames against and get excited by and focus on but then also living in the total
00:50:44
realization that it's not going to matter at all. Nothing is going to change in my life. Zilch. What am I
00:50:50
going to get? A better black shirt. It's like you know you know what I mean? But here's the truth. The reason that we live in a world with a ton of technology
00:50:56
and a ton of great businesses and great medicine, whatnot, is because virtually everybody for all of human history has
00:51:03
woken up every morning and said, "It's not enough. I need more." That's the fuel of progress. And I don't want to
00:51:08
live in a world where everyone wakes up and says, "I have all I need." Because then progress would stop that day. We
00:51:14
probably start declining that day. And so there is a paradox here of like as a whole society
00:51:20
I'm grateful and you should be grateful that people wake up unfulfilled because we live in a way better world
00:51:25
today than existed 100 or 200 years ago because of that. And the richest people in the world who
00:51:31
I think are by and large tortured psychologically have created amazing technology that you
00:51:37
and I benefit from. And the reason we're doing this podcast is because people before us who were way wealthier than
00:51:42
you and I woke up in the morning and said this is not enough. Bill Gates, Jeff Bezos, all those people, Elon Musk,
00:51:49
Mark Zuckerberg, they woke up and said I don't care if I have a hundred billion dollars. It's not enough. I need I need to create better technology and that's
00:51:55
great. We benefit from that. And so there is a paradox here that what is all and that will never change. That will
00:52:01
never change. So there's a paradox that like the more the better society becomes. I think like it's always going to be the case that as a whole society we're going to have a level of angst and
00:52:12
anxiety and not be satisfied and say it's not enough. At the individual level though I think you can recognize that game and contextualize it with your own life and say like look
00:52:25
I want more money. I I want to sell more books and have a better career. I want to save more money. I also have to go so
00:52:31
far out of my way to put it into context and say none of it's going to matter unless I have a higher purpose beyond
00:52:38
that money. So I think you can aspire for more and still go out of your way to realize what the expectations game is.
00:52:45
Even if you can't perfectly control it, it's similar to like I want to eat a good diet. Of course I want to eat
00:52:51
healthy food. I'm not going to pretend for a second that I don't want Oreos and ice cream because they're great and they're always going to taste great. And
00:52:58
so I'm never going to get to a point where I say, "I don't want a nicer house." I'm I'm a human and and so are
00:53:04
you and so is everyone else. You're always going to have those feelings. But you can recognize the game. You can recognize the voice that's talking to
00:53:09
you and realize when that voice lies to you and when it's telling you a story that is either false or just a little
00:53:15
bit incomplete. I think if you had to like say who is the happiest person in the world on average, not like naming a person, but if you had to describe the life of like who's the happiest person
00:53:26
out there, my guess is it's probably something close to a a middle-ass family that lives in a three-bedroom house and
00:53:33
has a a 5-year-old car, but they have an amazing marriage, tons of friends, they're in good health, but they are by any other statistic ordinary. and at the
00:53:45
end of their life more than the people who are very very successful that ordinary family is going to look back
00:53:51
when they're on their deathbed when they're 95 years old and be like that was good that was a good time
00:53:57
do you think um this is a very strange question to ask but do you think I could make myself like that
00:54:02
no here's the truth I think on the nature nurture spectrum most of what we believe and the feelings that we have is forged at conception and it's just we're just wired that Okay.
00:54:14
And there's not much we can do about it. Some people have different aspirations. Elon Musk was born wired very differently than you and I. And there's
00:54:20
nothing we can do about that. So, we are who we are, but I think we can put those
00:54:26
feelings into a better context. Even if we can't control having those feelings, we can choose, we can put tell ourselves
00:54:33
a more complete story about why we're having those feelings and what those aspirations will actually do to our
00:54:39
happiness. So on this point of how to retire early, the first one was about managing what you want. Is there
00:54:44
anything else there that if if I'm trying to increase the probability that I get to retire early, um I should know
00:54:50
in terms of tactics and strategies? Well, one of the things, this is a little bit different than than the question that you asked, but one of the
00:54:55
things that's important is that a lot of the people who do retire early, who they tell themselves, I'm going to save so
00:55:00
much money and I'm going to retire when I'm 32 and then life's going to be great. What actually happens is they retire at 32 and six months later
00:55:07
they're bored out of their mind and they realize that like what actually makes you happy is purpose and for a lot of people their purpose can be their career
00:55:15
or they realize they had this idea that when they retired it was just going to be a great life but the truth is all of
00:55:21
their friends are working and don't have time to go play golf with them on Tuesday afternoon and so a lot of people
00:55:26
who retire early end up going back. They realized it was not what it was meant what it was made out to be because they
00:55:32
had if the the formula is independence plus purpose. They gained independence but they kind of lost their purpose and
00:55:37
then the for and so it was incomplete. They didn't get what they wanted. What about passive income? People talk a lot about passive income. I had a friend
00:55:43
DM me the other day and say Steve I've got some debts etc. But if I could just figure out a way to create some passive income then that should solve the
00:55:51
problem. And this term passive income has become like completely overused because for example
00:55:56
a lot of people when they talk about passive income they're like oh I'm going to own real estate. I'm going to have some rentals and that's passive income.
00:56:02
If you think owning a rental property is passive income you've never owned a rental property because there's nothing passive about it. It is a constant chain
00:56:08
of broken toilets and leaky roofs and tenants who don't pay you on time and there's nothing passive. That's a
00:56:14
full-time job doing that. And so I heard someone say this recently that there's two ways to get wealthier. You can
00:56:21
sacrifice more or you can want less and that's it. And gain passive income is not part of that equation because what's the first one? Sacrifice more. Sacrifice more. What does that mean? Work harder. Work work in a job that is
00:56:34
that has a lot of downsides that might stress you out and requires you to wake up early and go to work and do some
00:56:40
things that you don't want to do and spend time away from your kids in a way that you don't want to do. Sacrifice
00:56:46
more or want less. Those are your two choices. And I think that's important in the passive income debate because I I I don't think there's but there by and large is not a thing of passive income.
00:56:57
Even if you're just like, you know, you put your money in a in a savings account that pays 3% interest. Well, you had to
00:57:04
sacrifice to earn that money and to save that money and to delay the gratification of that money. I I I
00:57:10
really think it's an ironclad formula. Sacrifice more or want less. Those are your two options.
00:57:16
It's not nice. True. People want, you know, tell me which crypto to right to invest in to get that. Of course, everyone's always going to want the easy answer. Just like for health, the answer is eat a better diet and
00:57:27
exercise. Nobody wants that. They just say, "Get what's the what's what's the secret potion? What's the secret
00:57:32
formula?" And maybe now we have Ozic. So maybe now we have it's closer to a to a secret formula. But the truth is, what's
00:57:38
the secret to better health? Sacrifice more because working out and lifting weights and running is a sacrifice. It's not fun. It hurts. that's why it's good. Or want less, be happier with your
00:57:50
imperfect body. I mean, I think that's a great analogy between health and and wealth. Often the difference between a company
00:57:56
succeeding or failing isn't down to its product or strategy. It's down to the people on the inside. After all, the
00:58:02
definition of the word company is group of people. And some of the best companies in the world have been largely
00:58:08
built by A players. Because I'll let you in on a little secret. When you hire an A player, they go on to hire more A
00:58:14
players. and it perpetuates. The challenge is finding those first few A players. I found the majority of mine on
00:58:21
LinkedIn who are a sponsor of this show. LinkedIn provides talent I could not find anywhere else. Talent with the
00:58:27
necessary skills and culture fit that I'm looking for. Whenever I've paid to promote a role on LinkedIn, I've been able to hire faster and of course
00:58:33
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free by visiting linkedin.com/doac. That's linkedin.com/doac and you can post your role for free there. Terms and conditions of course apply. How much do I need to understand
00:58:57
what's going on in the wider world and the economy in order to understand my own spending behaviors, what I should
00:59:03
spend on, how to get wealthy, how to save? Is it important to have any understanding around the macro? Because
00:59:09
most people that listen to this show will probably hear these terms being spouted out on by political commentators
00:59:15
like the Federal Reserve, interest rates, tariffs, etc. And should I understand any of this? Should does any of it really impact me in a way that matters to me and my family? I
00:59:26
don't think it's necessary. And you could point to people I've written about in my books who had no financial education, no training, did not read the
00:59:33
Wall Street Journal, could not tell you how the Federal Reserve works, but they had control of their psychology, control
00:59:39
of their emotions, they they worked hard, they saved their money, they invested it, and that that's all you
00:59:44
need. They you you so the answer is you don't need to know how this works. Just in the same way that in order to be
00:59:50
healthy, you don't need a PhD in biology. You don't need to understand how cell division works in order to be
00:59:55
in good shape. And I think it's the same for the economy. And it can actually backfire for a lot of people that once
01:00:01
they start reading the Wall Street Journal and learning a bit about finance, it increases their confidence
01:00:06
more than their ability. So they're like, "Oh, like I read the Wall Street Journal. I should go day trade crypto now
01:00:11
because I read a thing that teaches me how the Federal Reserve works. So now like I'm going to It increases your
01:00:18
confidence more than your skill." That's so interesting. And so I I I think it's important to be an informed
01:00:23
citizen and the Federal Reserve impacts your life and tariffs impact your life. So it's important to have some baseline understanding, but I think that's more about being an informed citizen and
01:00:34
informed voter than it is having financial skill. Of all of my best friends, there's like five or six of them. The one that's most
01:00:40
cri is the one that knows the least about I think he's the most rich period to be honest. He's the one that knows the least about finance and he knows the least about investing. He knows the
01:00:51
least about crypto. Well, what's the meme of like the the the tail spectrum of like the poor person drives a Toyota,
01:00:58
the middle person has a Porsche, a BMW, a Mercedes, and the rich person goes back to Toyota of like it's like whether
01:01:04
you are very uneducated or extremely wise, you tend to end up, oh, this and so I think I think it it does tend to be the truth that the people who do the best financially either have like no
01:01:15
financial education or extreme financial education. And it's a person in the middle that has their confidence is
01:01:22
increased much faster than their ability and they're like, "Oh, no, no. I I read this thing on Reddit that taught me
01:01:27
about day trading. So now I'm going to go bet my entire net worth on this company I've never heard of."
01:01:33
So funny. But so what is it that the the person on the left and right side of the
01:01:38
spectrum are both doing that is the same here? So, for anyone that can't see, I'll put it up on the screen, but it
01:01:44
just shows the bottom axis says net worth. And it basically says that people with low net worth buy a Toyota, people
01:01:50
with like in the middle, that sort of middle percentage buy Lamborghinis and Porsches and Jaguars, and then people
01:01:57
with extremely high net worths buy Toyotas. And obviously, it's a metaphor. It's not it's not it's not exactly
01:02:03
perfectly true, but I think people like a lot of comedy, you see it like it's funny because people are like, "Yes, that's true. That's how it works." I
01:02:10
think a lot of it is like the richer you become, you realize that the big house and the fancy car didn't do anything for you. It did. It didn't give you what you thought it was going to give you. And
01:02:22
then so you're like, look, I'm just going to go back to utility. Like status didn't do it for me, so I'm going to go back to utility. It can also be the case
01:02:28
that if you're successful and rich, you can gain your admiration and your attention through what the business that you built or the intelligence that you have or the the friendship that you can
01:02:41
offer others and therefore your desire to be like look at my car look how cool my car is just goes down from there. The
01:02:47
way I also interpret it is that when you're when you don't have much money or when you don't have a huge financial
01:02:53
understanding like my friend, you end up playing the really boring money games. Yeah. And when you have a huge financial
01:02:59
understanding, you probably also spend a lot of time playing the boring money games. And by boring money games, I mean
01:03:04
index funds. Yeah. And the S&P 500 versus like crypto. Yeah. I think you'll see that in
01:03:10
investing that like the absolute lay person will invest in index funds and the extremely experienced Wall Street veteran will invest in index funds as
01:03:22
well. And it's a person in the middle that just has like a little bit of intelligence, a little bit of experience, a little bit of information
01:03:27
that is trying as hard as they can to outperform the market. I kind of learned that from reading your your book, The
01:03:33
Psychology of Money, because I I think like many people thought there was some trick or hack that this book was going
01:03:39
to teach me to figure out how to trade coins at the right time or to like do forex trading or whatever. But
01:03:45
ultimately, the book, if there was one overarching lesson it taught me was that like patience and uh
01:03:53
more boring investing is is the way to get to build my wealth over the long term. and that like all other strategies have hidden trade-offs which lead you to being broke.
01:04:05
Yeah, I think there's a truth too that like there's a there's an optimal level of intelligence that you want for
01:04:10
investing where you want to be smart enough to understand the basics but not so smart that the basics bore you. And a
01:04:17
lot of people get so smart that they're like look index funds compound interest like I'm just putting like it's too
01:04:22
boring. like I I need something really complex to satisfy the intelligence that I have. And I I there's a sweet spot
01:04:30
where like for me I'm just like, "Oh, index funds and compound interest." Like that's that's kind of as high as my intelligence goes here.
01:04:36
But I think the truth is that that is the best position to be in. Smart enough to understand the basics, but not so
01:04:41
smart that they become boring to you. Because once they're boring to you, you're just like, "Ah, sweep those away. Let's try to pull some more levers here."
01:04:49
What is going on in the world at the moment, Morgan? There's um it feels like people are more divided than ever before
01:04:56
and I feel like a lot of these subjects we talk about are somewhat interconnected. It feels like there's a
01:05:01
rise in inequality. You probably know the numbers better than I do. Um I mean there's a graph in front of you there
01:05:06
which shows I think it's is it wage growth? Yes, monthly wage growth. Monthly wage from about 25 years
01:05:13
and it appears to be going down. Well, but this is growth. So in any given year, even if the growth is 2%,
01:05:20
that's 2% higher than the previous year. So this is not wages over time. Now, it is true that if you look over a 25-year
01:05:27
period and you took the average American family, not everybody, but the median, that their wages adjusted for inflation
01:05:34
have gone up. Not not up as much as people would want over 25 years, but that that they are better off than they
01:05:40
were 25 years ago. What is also true is that the average median family would probably disagree with that statement even if it is true statistically for several reasons. One of which is their
01:05:52
expectations have gone up over the last 25 years. The other is even if you're looking at average wages average and when we talk about these statistics does not refer to any
01:06:04
specific family. This is just a statistical number. Everyone spends their money differently. So, if I told
01:06:09
you, hey, average family, you're richer than you were in the year 2000. And they're like, yeah, but I'm trying to
01:06:14
put my kids through college and have you seen the price of college? And like, yeah, that might be true because the
01:06:19
price of TVs has gone down, but have you seen the price of rent and housing? Like, at the individual level, these
01:06:24
statistics don't really mean that much and never have. I think a lot of economists get into a problem with that
01:06:30
when they're like, well, statistically X, Y, and Z has happened. But ignoring the psychology and the individuality of
01:06:37
like what's happening actually on the ground in people's heads and how they spend their money, there's a there's
01:06:42
just endless amount of nuance in here. And so I think it's it's always been true that we live in a world where over long periods of time there's good economic growth. We become wealthier. We
01:06:54
be we have bigger better things. We have more income. We have better medicine. It's equally true too that like there is
01:07:00
always something legitimate to complain about. And it's legitimate to complain about. It's not just like, "Oh, you
01:07:05
should be more grateful." It's a real thing. And so when I look at a graph like this, actually, what like if I was
01:07:11
thinking just like with my math head, I'd be like, "Oh, there's been quite a bit of growth over the last 25 years."
01:07:17
Like the growth has been gone up and down, but it's growth. You know, never in this chart is growth below zero.
01:07:24
I guess the question there is, are rich people getting richer and are the poor getting poorer?
01:07:29
It depends. I mean it's it's at the indiv are rich are the rich getting richer yes.
01:07:34
Are the poor getting poorer? Statistically no. Even adjusted for inflation. I mean it it depends what period we're talking about here. There was about a 20 or 30-year period where the answer was
01:07:46
unequivocally yes. There was an interesting trend over the last 10 years where in percentage terms the the group of of
01:07:55
wage earners who had the highest percentage growth were actually the low wage. That was true for two or three years after COVID where if you were a
01:08:02
low if you were a minimum wage worker those were in percentage terms great years for you for getting wages. It's
01:08:08
tapered off. So I the answer to your question is the rich are getting richer. The poor I think are treading water by and large. There's there's always people who are doing differently than that. But
01:08:20
when one group of society is getting richer treading water feels like you're falling. and the the specifics of how
01:08:28
people spend their money. So even if on average adjusted for inflation their wages are flat, but if your rent
01:08:33
skyrocketed or you're trying to send your kids through college or you have a long commute and you got to put gas in your tank, at the individual level,
01:08:40
things can feel very very different from what the statistics show. And what role do you think this sort of wealth inequality that is widening
01:08:47
between the very very top and everybody else is playing in everything that we're seeing play out at the moment? Because
01:08:53
in the UK it's almost like there's we're on like the verge of riots it seems. And I think last last month there was
01:09:00
millions of people in London protesting against immigrants coming over on boats and society becoming more multicultural. I'm so fascinated by the subject because you know earlier on we said that unless
01:09:12
you have immigration in the western world you have population decline and if you have and population decline sucks
01:09:18
because you have a hit on GDP. biggest problem right now throughout a lot of the world, at least one of the biggest perceived problems is immigration.
01:09:24
And the same is playing out in the United States. If I go on X, although I know I know what X is, um it's people,
01:09:31
maybe it's just my algorithm, but it's people attacking immigrants and immigration and people that are brown
01:09:36
and black and whatever else it might be. I'm wondering how all of this is intertwined and and if it if it is connected at all
01:09:43
in your view. I think as a amateur student of history across cultures all over the place all through history what you want to avoid more than anything in society is when probably a third of the
01:09:56
population wakes up every morning and says this isn't working. That's the point at which it's going to collapse
01:10:02
from there is when enough people wake up in the morning and just have this feeling of like whatever this is it's not working out for me. You want to
01:10:08
avoid that part. And so like look I'm a I tend to be a a free markets guy. I'm a
01:10:13
capitalist. I think people should be able to become very wealthy, etc., etc. You also don't want to get to a point
01:10:19
where people become so wealthy that a big chunk of society just wakes up every morning and says, "Fuck this. This is
01:10:24
not this is not going to work out for me." And I think we've got we've we're either there or precariously close to
01:10:29
there in a lot of areas in the world. Social media, that's always been the case. And social media makes it a
01:10:35
hundred times worse than it's ever been. Mhm. For example, you and I are recording this a day after Charlie Kirk
01:10:41
was assassinated yesterday. And there were who knows what number percentage it was. But and I think it was not hard on social media to find people who were celebrating it
01:10:53
yesterday. Now when Martin Luther King was assassinated, did those people exist too who celebrated assassination? Of
01:10:59
course. But because of social media, by and large, you did not hear from them unless you were part of that group.
01:11:05
Whereas today, virtually everybody yesterday saw people celebrating Charlie Kirk's assassination. And so even if those feelings existed in the past, they're much more apparent today. You
01:11:16
see them today in a way that that you did not before. So because of that, it's easy to say we're more divided today.
01:11:22
We're more extreme today. We're more pessimistic than they today. I think the nuance is that's not actually true.
01:11:27
You're just more aware of it. That those feelings always existed. They existed in the 1990s. They existed in the 1950s. It
01:11:33
was just much easier to contain those and for the average citizen who got their information from one newspaper,
01:11:40
one evening news program to feel like things were much more stable and in control and that people were much more
01:11:45
uniform in their opinions than they actually were. Before we start recording, we were talking about the Charlie Cook shooting and how
01:11:54
social media's ability to dehumanize other people at a probably a faster rate than history would have done it is pretty remarkable. And you see a lot of that. You see a lot of it taking place
01:12:06
on both sides. I think both sides describe each other as being like animals and inhumane. in one side's
01:12:12
calling the other side Nazis and then the other side is calling the other side referring to them in in animal terms
01:12:18
because of maybe the color of their skin or their behavior. We saw a lot of that when the that heinous individual killed
01:12:26
the young lady on the on the the train in in America and the way look this person is the
01:12:32
[ __ ] this worst thing on planet earth. Um but the language was very it was putting that person in a group of other people. Yes. And then making the whole group a pack
01:12:45
of animals. Right. Because in that situation too, we talked about this earlier. I I don't know that individual's name doesn't matter, but no one refers to him by his
01:12:52
name. It's them. It's they. And that once you dehumanize any group of people like that, and this has been the case
01:12:58
for all of human history, that 99.9% of people cannot kill another human, but they're perfectly fine killing them. They that group once you dehumanize, you
01:13:09
can do anything. And at the at a much lower level, everyone realizes this with road rage. I've had road rage. The person cut me off. That son of a [ __ ]
01:13:15
honked my horn, flip I I don't I don't get too extreme with it. But in things I would never do eye to eye. But once I'm
01:13:22
looking at a car, then it's it's there's no human there. And my ability to have a
01:13:28
level of anger is so much higher than it would be if we were just looking eye to eye. I had this experience a couple
01:13:34
years ago where I was pulling into a gas station and I inadvertently cut somebody off. It was an accident, but I totally
01:13:40
cut them off and he honked and threw up his middle finger at me. And um we since
01:13:47
we pulled into the same gas station, we were now like eye to eye and I walked over to him and I think he thought I was
01:13:53
like coming to like confront him and I put up my hands and said, "I just want to apologize. I didn't I didn't mean to
01:13:58
cut you off. I'm so sorry. I did." It was not on purpose. And he I think he was so surprised and he was like, "Wow,
01:14:04
thank you. Thanks for like and we had this moment of like almost hugging of just like I'm so like I hope hope you
01:14:09
have a great day." It was one of those of like once in the moment when it was you strip the humanity off it when it
01:14:15
was two cars each other both of us were like [ __ ] you once we looked eye to eye it was like oh brother like it's okay
01:14:22
it's okay and I think that was just like for me that was an individual example of what happens at society when you strip
01:14:27
the humanity off it we're capable of so much anger and hate eye to eye we're like oh that's all good and I think all
01:14:32
of us know somebody who we disagree with politically regardless of what it might
01:14:37
be and it's easy to be like oh that person's an idiot. They're stupid. They're illinformed. And actually, if
01:14:43
you sit down and talk to them, you're like, "Ah, look, we might have some disagreements here, but it's all good. Cheers. Let's have a good night." Like,
01:14:49
eye to eye, like the vast majority of people get along and get together. But social media has turned all of life into
01:14:55
road rage. Gosh. Yeah. I mean, you know that more starkly than anyone as a podcaster because I sit here with everybody of all
01:15:00
political opinions, extreme left, you know, pretty extreme right. And at this table, we get along,
01:15:07
right? We even off camera we get along. I think so many people have said this in the last 24 hours about Charlie Kirk.
01:15:13
One of the most common phrases I've heard was I didn't agree with everything he said, but at least he was brave
01:15:20
enough to have a conversation with people who he disagreed with. That was what he did by and large was going into schools and being like, I know you
01:15:25
disagree with me. Let's talk. And and he turned it from road rage into a conversation between people. And even
01:15:31
if you disagreed with him, I think he did it very right in that sense. And I think that's what's why
01:15:37
people from all over the spectrum are devastated in the last 24 hours. It was like he was one of the people who was
01:15:43
doing it right. Even when you disagreed with them, he was having a conversation face to face and bringing people together.
01:15:48
I think that absolutely hits the nail on the head, which is I think, you know, there's things that I absolutely don't agree with him on. But I actually think
01:15:55
that's just completely beside the point because I want to live in a world where there's people that I disagree with. Like I actually wouldn't choose the
01:16:01
world where everyone I encountered agreed with my opinions. There would be no intellectual growth. There'd be no understanding. there've been a real progress. Um, but also as you've
01:16:09
highlighted, the way that Charlie Kirk went about it was he would went to Oxford University and went on the
01:16:15
formalized debate panel against in an office and a pine on social media. He went face to face and said, "I know
01:16:21
you disagree with me. Let's have a Yeah. And I'll listen to what you He wasn't interrupting people all the time. He hearing out their
01:16:27
points and he was making respectful about it." And what is missing from all political discourse
01:16:32
today, it's that. It's I know you disagree, but let's talk and let's try to be respectful about it.
01:16:37
And I can't think of anyone on either side who who did that as consistently as he did, even if I disagree with him.
01:16:49
The idea that we're only going to talk to people who we agree with is what causes all the problems. I don't understand these [ __ ] people.
01:16:54
I don't understand. It's much more comfortable to surround yourself with people who
01:17:00
agree with you than to accept the nuance of life. And this is the problem with a
01:17:05
lot of political media is that it creates much better content when people say this is right, this is wrong, he's
01:17:12
right, he's wrong. To make it very explicit, binary, black and white, than it is to accept the truth, which is like
01:17:18
it's complicated. I think I was like traumatized yesterday when I watched that when I saw the video of him being shot. I think it was this
01:17:25
weird like deep sense of like like uh I've not been able to articulate what it is, but it was I don't know Charlie Kirk. I've never met him. There was a time when, you know, we were potentially
01:17:37
going to have him on the show and we were trying to figure out like, you know, who to who to have here with him cuz he's such an unbelievable debater that he would have ran [ __ ] rings
01:17:43
around me. Yeah. I was like, who can you put to You'd be like, you'd be like, fine, I'm conservative. Yeah. Yeah.
01:17:50
But there was something really surprising in how I felt when I when I both heard the news and saw um him being
01:17:57
shot. This young guy, family person who was out debating, who had ideas that many people disagreed with, but was in a
01:18:03
forum where he was having them challenged, could be executed in public on live stream in a way that his
01:18:11
children are going to watch that video when they grow up, probably multiple times. And I was like, "Oh god, what?"
01:18:16
Yeah. What does this say about the society we live in and where we're heading? You know, I know guns play a huge role in this and we have to
01:18:21
acknowledge that because it's very very unlikely that could have happened in the UK because no, we don't have guns there.
01:18:26
Yeah. So, you could have thrown a rock or something, but you could have killed the guy. But it it's almost a it feels like
01:18:33
a crescendo of the moment. Yeah. Where division and algorithms and now that you know X has gone a certain way
01:18:38
and other platforms are going certain ways. And if you look at the stats, there's more social networks now that have more than 20 million active users
01:18:44
than at any time in human history. It's gone up by 50% in recent times, which means we're becoming more splined. And
01:18:50
then if you if you understand the commercial models of these algorithms, their commercial model is dependent on
01:18:55
you spending more time there. So, how do I get you to spend more time there? Well, I give you more of the things that are going to trigger your amydala, which
01:19:02
is, you know, your fear senses and and uh the things that are going to drive, you know, drive you into rage and debate
01:19:08
and engagement and these and sharing things. And so, I don't know. I I wonder if there's a way back from here. I have
01:19:15
a an optimistic view and this is not a forecast because I don't have 100% faith in this but there are so many endless examples in history when people discount how
01:19:27
powerful cycle cycles can be and so my optimistic my hope it's not even a forecast it's a hope is that 15 or 20
01:19:35
years from now we look back at this era as when things bottomed politically from
01:19:42
which we grew out of we improved And we're going to look back and be like, man, the the 2020s were so bad and we
01:19:48
were so divided, but that was also a bottom that we came out of, like a generational bottom. And that sounds
01:19:54
crazy today, but that's always been the case. If you and I were talking about the economy in the 1930s, it would have
01:19:59
been preposterous, completely insane to say the 1950s are going to be the greatest, most unbound prosperity, middle class prosperity we're ever going to have. That would have seemed insane.
01:20:10
If this was the 1970s and we just had a raft of political assassinations in the 60s, John F. Kennedy, Martin Luther King, Robert F. Kennedy, and then Richard Nixon uh is impeached and
01:20:22
resigned for Watergate, it would have been completely insane for you and I to say, "Hey, do you know what? The 80s and
01:20:28
90s are going to be an era of political stability and political faith and trust in government." Would insane like it's
01:20:34
always when things are the lowest that you feel like you're never going to recover. But if you understand how
01:20:40
cyclical things can be, it's usually the case that looking back you're like, man, it was bad. But looking back, that was
01:20:45
the bottom. And I have no idea if the bottom was yesterday or if it's going to come 10 years from now. But I would bet
01:20:52
that the most likely scenario whenever that bottom comes is that we will look 15 or 20 years back and be like that was
01:20:57
terrible. And at that moment, everyone assumed it would go on forever, but looking back, that was actually a
01:21:02
bottom. When enough people came together and said, stop, stop. This is this is too much. the forces that we've gone too
01:21:09
far in the other direction. We need to we need to come around from them. It is always impossible in real time to wrap
01:21:16
your head around that and to forecast it. It's only looking back that you're like, "Yes, that was the that that there
01:21:22
was the bottom." And you can see things getting so bad. Trust in government is so low. Polarization is so high. There
01:21:28
would not surprise me in the slightest if we look 20 years from now and be like, "Oh, things things got better." I understand that from an economic
01:21:34
standpoint. I I struggle with it because of the presence of how we like because of the the medium in which we
01:21:39
communicate now with social media. Yeah. And I was looking at the some of the stats here and it says in 1994 only 20%
01:21:45
of Americans held a very unfavorable view of the other party. By 2022 that number has jumped to 72% among Republicans and 63% among de
01:21:58
Democrats according to Pew Research. U and this is particularly pronounced in the United States. um and and the UK and
01:22:06
other parts of Europe. In this report, it says that social media um and also cable news's role has only amplified
01:22:14
echo chambers, making the divide sharper and more emotional. And I I can't especially with AI in the
01:22:20
way I go, well, AI is going to make those algorithms even smarter. Yeah. At understanding exactly what to show me
01:22:26
to increase my engagement, therefore increase their advertising dollars. So, I'm like, what what would be the the mechanism in this context?
01:22:33
I have no statistic or even strong thing to back this up with, but my gut tells me that the younger generation in
01:22:40
particular is going to be the one that looks at social media and looks at AI and recognizes the [ __ ] that can come out of it. It's the older generation. It's the boomers today on
01:22:51
social media who believe everything that they see. And I think that tends to be where a lot of the polarization comes from. Not to blame everything on the
01:22:56
older generation. But I think if you were to look at statistically who is the most gullible on social media of believing every post in their feed, it's
01:23:03
the older generation. And it would not surprise me if the younger generation is much more attuned to how quickly you can
01:23:09
be led astray into some [ __ ] rabbit hole that is not reflective of how the broader world works. I don't know if
01:23:15
that's true or not, but if you were to ask me to articulate why we're going to get around the social media bubbles, it
01:23:21
would be that the generations who have been doing this the longest are going to be the best at recognizing how dangerous
01:23:27
it can be. You're a very smart guy and you're someone that studies has studied history and understands, you know, you wrote the
01:23:33
book Same as Ever, which shows a a guide to what doesn't change through history and how things can often stay the same. So, this is a bit bit of a peculiar question for you, but in the wake of
01:23:43
what happened to Charlie Kirk yesterday, his his public murder and all that's rising from that, what should someone like me and you, who have public
01:23:54
platforms, who reach people on a daily basis, do help? I think we have to remind ourselves two
01:24:01
things about social media. One is that it's been designed by the smartest people of our generation to deliver you
01:24:07
in your feed not the best information, not the right information. Basically, what's going to give you the most FOMO,
01:24:13
the most anxiety, what's going to like pull out the starkkest reaction in you. And the smartest people of our
01:24:19
generation have gone to work at Facebook and Google and whatever and Tik Tok to make an algorithm that's going to give
01:24:25
you that. That's going to give you the the thing in your feed that's going to make you go, "Wow, like what?" Like, that's so out. And two is that even when
01:24:33
it's it's not that even when it is just people's thoughts people go on social media to perform
01:24:41
they go on like they are trying to give you and I'm trying to do this on social media as well. I don't want to give you
01:24:46
any random thought in my head. I'm going to specifically give you what I think is going to be interesting and what not. So
01:24:52
if we view social media as a proxy for the real world and I think everyone it kind of intuitively does even if they
01:24:57
when you say it out loud you're like no of course it's not the real world. But it's easy to assume that when I open up Twitter or Facebook or Instagram, I'm
01:25:04
like, I I'm just I'm just seeing a window into the world. You're like, no, these are people performing for you and
01:25:09
the smartest minds in the world ordering that performance for what's going to give you the most anxiety.
01:25:16
Are you optimistic about the the Western economy, the US economy? I could be optimistic long-term and
01:25:22
realistic about what growth means. The reason we tend to have growth in the economy and in the stock market is because it's specifically because there's short-term chaos. So, am I
01:25:35
optimistic about the next 30 years? AB: Absolutely. I know that my kids will be living a better material life than you
01:25:40
and I are. They'll have better medicine. They'll have better technology. They'll have flying cars. Whatever it is, it
01:25:45
does that. But I'm equally confident, if not more confident, that the path between now and then is going to be
01:25:51
chaos. And that's not exclus. That's not mutually exclusive. like the fact that I
01:25:56
know I'm extremely confident that there's going to be a lot of growth and that it's going to be a constant chain
01:26:02
of setback and suffering and misery between now and then. Is there anything that you see it creating a setback? I mean, there's
01:26:08
these new protagonists in the story. There's AI, there's um the declining birth rates which is going to have an impact on the population. Is there
01:26:14
anything that you think is your most focus? There's tariffs as well. Um there's Trump economics which can cause
01:26:21
some instability. Historically, the biggest risk by far has always been the thing that nobody's talking about. So when we sur you and I survey the world today, we talk about exactly what you
01:26:33
just said, tariffs, birth rate. People know about those things. There's never been a period when the biggest risk was
01:26:38
something that was knowable. It's always something like COVID, which nobody saw coming, September 11th, which nobody saw
01:26:44
coming, the Great Depression, like all these things, Pearl Harbor, all these things that were not on people's radar
01:26:50
that did the most damage. And so it's not that I don't worry about tariffs or that I don't worry about uh birth rates.
01:26:56
I do. But I would guarantee you that the the worst economic story of the next 10 years. The biggest risk is something
01:27:02
that you and I are not talking about whatsoever. It's a risk that's going to come completely out of the blue. That is not in any newspaper. It's not in any
01:27:09
podcast. That's going to be the biggest risk. Is there a particular chapter in the psychology of money which was your
01:27:14
the book that sold I I hear almost 10 million copies and had a profound impact on my life and and my family's life. Is there a particular story or chapter in this book that is your favorite?
01:27:27
I think the the chapter on reasonable versus rational which to very quickly summarize it is don't pretend like you
01:27:34
are purely rational and you're a spreadsheet and your financial decisions have to like make perfect sense.
01:27:41
Everyone is a little bit flawed, a little bit emotional, different family situations, different goals. As long as
01:27:46
your financial decisions are merely reasonable, that's good. And I think a lot of people, for me, and for a lot of
01:27:52
people, they're like, "Oh, thank you for giving me permission because I have this quirky thing that I do with my money and it doesn't make any sense, but it's
01:27:58
reasonable and but it makes sense for my personality." And like, as long as it's reasonable, like don't be unreasonable,
01:28:03
but don't think that every one of your financial decisions has to add up perfectly in a spreadsheet. You want to
01:28:09
use money as a tool for a better life and there's many different ways to do that. A lot of which might make sense to
01:28:14
me but not make sense to you or vice versa. And so that's fine. And so uh I I think that to me of just like hey this is not an exercise in a spreadsheet where I'm just trying to make sure all
01:28:25
the numbers add up. I'm just trying to use money to be a little bit happier and to sleep better and to give myself my
01:28:31
family a little bit of a better life. Even if it doesn't always make sense. This is a tool to give me a better life.
01:28:37
If money is a tool for happiness, I guess you have to get really clear, which you talk about in in your new
01:28:42
book, The Art of Spending Money. You have to get really clear on what your goal is. And I think most of us have never actually done an exercise to get
01:28:48
clear on that. Yes. Which is quite shocking. Jeff Bezos talks about this in a way that I think was really profound where he's like he
01:28:54
thought about building Amazon with what he called the regret minimization framework which was he envisioned
01:29:01
himself being 90 years old or whatever on his deathbed and looking back and he said the goal for life was to be on your deathbed and have as few regrets as possible. And he said if he started
01:29:14
Amazon and it failed he would not have regretted that. But if he never tried to start it, he would regret it. And so it
01:29:20
was an easy of of course he has to do it because he wants to have as few regrets as possible. But I just think that very simple framework of the overarching goal
01:29:29
in life. If you have like what is the base of the pyramid for how to good live a good life, you want to have as few regrets as possible. Not take as few
01:29:36
risks as you can. Just have as few regrets as possible. And I think what's hard is that people by and large don't
01:29:43
have a good concept of what they will regret. It's it's easy to do because a lot of things kind of compound slowly.
01:29:49
So, uh if you eat a poor diet or if you're like not treating your friends as well as you should, that's like a slow thing. You might regret it eventually, but you're going to look back, but in real time, you don't really understand
01:30:00
what you're doing. So, to have a good sense of what you're going to regret is a difficult thing, but to me, that's the
01:30:06
ultimate goal in life. There is a a you know I I I heard the story one time of a
01:30:12
uh of a guy who his his his last words on his deathbed were so much wasted time. Those are his last words. And I remember thinking like that's that's that's as worse that's that's as bad as
01:30:23
it comes to be on your deathbed and look back and being like man what a what a regret just filled with regrets of the
01:30:30
things you didn't do of the way that you treated people of the risk that you didn't take. And so I think that if
01:30:36
there is an overarching philosophy, it's that. And I ask myself a lot like, do I have a good sense of what I'm going to
01:30:41
regret? And for every decision that I make, do I ask myself, will I regret doing or not doing this thing? Easier said than done, but it's something I think about a lot.
01:30:54
I think it's generally just hard for us to appreciate that there will be a future self. I I was reading a study
01:30:59
where they put people in these MRI scanners and then asked them to think about themsel and then a celebrity and
01:31:05
then themselves in 10 years time and the when they thought about themselves a certain part of the brain lit up when
01:31:10
they thought about a celebrity or themselves in 10 years time a different part of the brain lit lit up which kind
01:31:16
of makes you think that we don't really our future self is a stranger. Yeah. And so we act and I think this
01:31:23
about the people that I sit here with I think probably most of the people that I sit here with learning from. If you could like distill it down to why
01:31:28
they're here, it's because they were able to think about themselves in 10 years time. They were able so they became an athlete
01:31:34
and trained or they became a CEO or they became an expert in something. They were able to like think and they got through
01:31:40
the PhD and all the I don't know just there's a great quote from Jerry Seinfeld. He says self-control is
01:31:46
empathy with your future self. M it's you are making a decision to either do or not do something today because you
01:31:54
have respect for your future self and you care about your future self. You know there's going to be a Steven 10
01:31:59
years from now and you want to do something today with compassion for that person 10 years from now.
01:32:05
I'm guessing kids help in some regard because they give you a future to think about. Yeah. Right. something
01:32:10
that's gonna outlive you and you want to teach them something and and you know push them into becoming someone that's gonna outlive you. So you're you're have like by default you're thinking about something that's going to outlive
01:32:21
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and use my code steven for 50% off a month of your replet plan. You talk in the book about trying new things and and why that is. Uh there's a chapter called
01:34:35
try something new and I think a lot of us actually get stuck in ruts in life and that ends up we get stuck in
01:34:40
routine. It's weird how as we age we like routine more but intuitively everyone would say that routine makes
01:34:46
them boring boring less less life less spontaneous less interesting less ore less wonder
01:34:53
there's a thing people realize this that summer vacation when you're 10 years old seems like it lasts forever but when
01:35:00
you're an adult summer goes by in 3 seconds and you're like what like why does why is time going faster at least one of the theories for why it seems
01:35:06
like time goes faster as you age is because when you're a child every day is something new. You're experiencing
01:35:12
something for the first time. It's a constant chain of novelty. When you're an adult, it's probably the same
01:35:18
commute, going to the same job, living in the same house, and one day blends into the next, and before you know it,
01:35:24
10 years has passed. And so, the idea of like trying something new, I think, is is is important. The point I made in the
01:35:30
book about trying something new is you don't know what your thing that you really are going to enjoy in life is. It
01:35:37
might not be intuitive. Some people value travel. By and large, I don't. Some people enjoy like spending a ton of
01:35:43
money on wine. By and large, I don't. But I do spend my money on things that you might not appreciate. Like, everybody's different. You can't.
01:35:49
There's no formula for how to do it. You have to try a million different kinds of spending before you're like, "Oh, I like
01:35:54
this. I don't like that. I want to focus more on this." And it's not intuitive what that thing is going to be. My wife and I also had this realization in the
01:36:01
last month. So many people when they talk think about money and spending, they're like, "I want to travel. I want
01:36:06
to I want to have more money so I can travel." I think by and large that's great. Travel is an amazing thing. My
01:36:12
wife and I realized that like I think we've done so much of it and because we have kids right now that we're like I don't think we enjoy it that much. And
01:36:18
it wasn't until we were looking at our summer schedule that we're like okay we got two more trips coming up that we
01:36:24
were like really and we realized the best part of the last several trips that we've taken is coming home. The most enjoyable part of the trip was coming home. And we were like, can we
01:36:35
just admit that maybe we shouldn't be doing this as much as we do. That's so fun. Even if society tells us that we should
01:36:40
do it and everyone else I travel a lot for work. So like my idea of a vacation is not not going on an airplane.
01:36:47
And but you have to realize like everyone's unique and different. Like if travel is your thing or someone
01:36:52
listening to this, awesome. Please go do it. We had to just admit to ourselves that at least at this phase of our life,
01:36:58
we want to do a little bit less of it. The idea that everyone's different is important. I think I mean I think exactly that. I
01:37:03
think what underp underpins much of your message here is this ability to cultivate self-awareness.
01:37:08
Yeah. And I think a lot of what throws people off with money is chasing a lifestyle that is right for somebody else but not right for them. And that it can be very a hard thing to do because
01:37:21
you're like, man, this person over here, he's working this hard and and she has this house and they're living this lifestyle and it looks like they're pretty happy. And then you try to do it and you're like, but I'm not happy. And
01:37:32
the truth may have been that working that hard and spending money on that was right for that person, but it's not
01:37:37
right for you. That's what we don't understand. You and I had Jeff Bezos's ambition, Elon Musk's ambition, I think we I I' I'd drive we drive ourselves absolutely crazy. It's right for them,
01:37:48
it might not be right for us. And so when we view it as it worked for them, so I should do it, too. No, no,
01:37:54
no. It doesn't work like that. You have to figure it out for yourself. But also the inverse, right? It didn't work for them, so it won't work for me.
01:38:01
is also incorrect, right? I think it's immature for people to say, I like this thing and therefore
01:38:07
you should too. Or the reverse, this didn't work for me and therefore nobody should do it. This is the whole work life balance.
01:38:13
That's not how life works. Right. Right. And this is what you see raging on LinkedIn is one group of people saying
01:38:18
that amount of work and sacrifice is toxic. You should do it or or which is you're
01:38:24
lazy. You have you have to hustle. You're lazy if you don't live the life that I do. And both sides are wrong. Yes. It comes from a sense of immaturity
01:38:30
that everyone else should enjoy life in the exact same way that I do. I think there's a few psych
01:38:36
psychological forces at play here. One is if you're looking at a bunch of people
01:38:42
working really hard and you're not, it's in a weird way holding a mirror up to you and implicitly sort of like
01:38:47
indirectly saying that you're not enough. Yeah. And then maybe on the other side there's some other force going the other way. But I think both sides are kind of like
01:38:57
misunderstanding that everybody is not them. Yes. And I can pick apart elements of
01:39:05
your life. Say, "Wow, Stephen, his podcast is is this and he's got homes here and he's doing this." But there's a
01:39:11
million different components of your life in my life and everybody's life that are invisible. And most people
01:39:17
because of self-preservation or because they're trying to get ahead in life will not disclose what the bad parts of their
01:39:24
life are. Of course, everybody does this. I I do this. You probably do. Everyone does that because either they
01:39:29
don't want to admit them to themselves or they don't want to talk about it because they think other people are going to judge them for the bad parts of
01:39:36
their life. So, it's very easy to look at other people's lives and have a sense of like, oh, well, theirs is better than
01:39:42
mine because all you can see is what they are advertising. And uh and and and because of that, it's
01:39:48
very easy to be jealous or envious of people and say, "If only I had their life, things would be better." And part
01:39:54
of it is good. It's part of it is good for me to look at be like, "Man, Stephen's been so successful doing this kind of content. Maybe I should do
01:40:00
that's motivation." But once I say their life looks better than mine, and if only I had what they had, I would be happier is is a very treacherous path,
01:40:11
treacherous path to go down. Jack is the producer on the show. He's he's done the show with me since the the very beginning of us launching on
01:40:17
YouTube. And so he understands the intricacies of my life very well. He understands my business. He understands,
01:40:23
you know, the this what it takes and the trade-offs. So, Jack, would you want my life? Absolutely not. [Laughter]
01:40:34
No hesitation there. There's there's no world where like I could even imagine being in your world.
01:40:40
The amount of people that are bidding for your attention on a daily basis is mind-blowing to me. the podcast is like such a huge part of your life, but the fact that I barely hear from you on like
01:40:52
a weekly basis can probably put into a little bit of perspective how much you have on your plate. I just like couldn't imagine having the magnifying glass on me that much
01:41:04
that the whole world is kind of looking at me and thinking like has an opinion on you.
01:41:10
Mhm. And you run lots of businesses, so you almost have to perform a little bit. And
01:41:16
I think I see the worst of you and I actually take that a huge compliment because you can be yourself around me. I
01:41:21
remember the time when you had to schedule your lunch. Oh, I still schedule my lunch. It
01:41:26
doesn't happen but I schedule it. You schedule it cuz you like don't get time for your lunch. Like you went out of here, you went to
01:41:32
the toilet and people are asking you questions in between going from here to the toilet. It's stuff that needs to be
01:41:38
asked, but it's that is your life. That's the kind of thing that you've um gone into.
01:41:44
And I don't know if that kind of answers your question. I could probably go on for a long long time, but I've got you should do a whole episode to do I've
01:41:52
got last question then. So ask two more questions. The next question is do you think that I do you think I'm happy in
01:41:58
my life? Uh yes. I don't think you're content. Mhm. I think you're happy, but I don't think you're content. Yeah. And what do you mean by content? Like what do you mean by content? you're
01:42:10
always trying to chase the next thing and I'm not sure why. Like you could so easily just do this podcast and it would do so well for you. Like it does do so well for you. Uh you could spend all
01:42:25
your time doing this and I think you're super happy when you do do this. But then there's also other stuff that clearly makes you happy that you want to
01:42:32
do, but then you'll come to me and you're like, "We should start this new YouTube channel."
01:42:37
And I'm kind of like, yeah, great idea, but I don't know why you want that extra effort. To your core, you're a
01:42:42
businessman, so you're constantly trying to build and scale, but on like a personal reflection of how much extra
01:42:49
toll that takes on you. And also for Mel, I know your relationship with Mel, you don't see her that much.
01:42:55
So, I think that's quite an interesting one. But yes, I do think you're happy, but I don't think you're content.
01:43:01
And last question, what would you like from my life? What would I like from your life? Yeah. So you said you wouldn't want my
01:43:07
you would want my life because and you talked about the downsides. Yeah. What elements Yeah. of my life
01:43:12
would you like? That's actually quite interesting cuz I was I think I was talking to Jim and Coy
01:43:18
about this last night. Your life is so engineered to be super efficient. Yeah. So you have someone books your cars for you, someone books your flights for you. You you basically, as far as I'm aware,
01:43:29
I don't think you do much kind of normal admin that I would do. No, I don't even pick what I eat.
01:43:35
Yeah. Exactly. I like I get the surprise. I walk out here and it's there and I go, "Okay, well, I'm having broccoli today."
01:43:40
And I think so much of like the joys of what comes from life is the little messiness of life.
01:43:46
Yeah. And I actually think Morgan kind of touched on this at the start, that simple kind of family that just
01:43:52
they're not like super ambitious, but they're super happy. Like that messiness of life is kind of there's so much like
01:43:57
beauty in that. I know you asked me what you would want from your life, but I think on the surface I probably would like that stuff, but I understand and
01:44:03
appreciate the beauty of doing those. I ask the question around um um do you think I'm happy? Because even though you heard all of that stuff and you go, "Fuck me, this guy like he
01:44:16
he doesn't have much time and he's he's always working." And like we took a toilet break, which the audience probably won't know, but yeah. As I
01:44:23
walked out of there, two different team members came up to me two different issues. They said, "Someone's wants to come on the podcast tonight. I've got
01:44:29
this huge meeting in New York City tonight with this major investor for 4 hours." That then they asked me in the hallway. They said, "Do you want this
01:44:35
major guest to come on the show tonight or to cancel this huge meeting with this investor to make the decision in 4 seconds?" 4 seconds. So you saw me sit down and go
01:44:41
tell the team yes. I I did which was me making that executive decision and I was on my phone for two and a half seconds trying to make the
01:44:47
decision. But it also means that date night is if impacted with my girlfriend. He's So like that that was a little
01:44:53
representation of my life. And I I um I asked Jack if he thinks I'm happy because my opinion and I could be living in a delusion is
01:45:03
that I am happy. And I the way that I would hazard a guess that I'm happy is I am not unhappy and I don't have unhappiness. My guess too is that you if you said I'm
01:45:18
going to quit the podcast, quit all this, close the business down, you would be beside yourself with anxiety and depression. And so it's less about like is doing
01:45:28
this does doing this make you happy? I think the better answer is not doing this would make you miserable. Yeah.
01:45:34
But that's who you are and that's how and I again I'm so grateful that people like you exist because I get to benefit
01:45:40
from the sacrifices that you made. It's not a sacrifice to me. Yes, I I I I get that. But what from my perspective would be a sacrifice I get to benefit from because you make great
01:45:51
content that I listen to and whatnot. And so I like living in a world where most people wake up in the morning and
01:45:56
say this isn't enough. And I I I think I do that too. I want to write more books, better books, and but
01:46:03
if you don't have some capacity to say, look, I have ambitions. I have goals that I want to achieve. I want to work
01:46:09
hard to achieve those. I want to sacrifice to achieve those, but I'm never going to have a good life unless I can take a step back and be like, man,
01:46:15
like look what I have right now, even if it's not that much. There's a very good book written by a gerontologist named
01:46:21
Carl Pillmer. He wrote a book called 30 lessons for living where he interviewed a bunch of elderly Americans who were
01:46:27
like 90 to 100 years old. And he just said, "Tell me the secret to a good life. You've experienced a lot of life
01:46:33
you know." And he has a section where he says, "Of the thousand people who we interviewed, not a single person looking
01:46:40
back at their life said,"I wish I made more money." Not a single person said, "I wish I would picked a career that paid more
01:46:47
money." Not one, but almost every single one of them looking back at their life said, "I wish I was nicer to people. I
01:46:53
wish I was more helpful to my friends. I wish I spent more time with my family." That was universal. So, if you want to talk about like regrets, what are we
01:46:59
most likely what are you and I most likely to regret when we're 90? It's not making more money. It's spending time
01:47:05
with the people around us that we love and appreciate. I find myself switching between states
01:47:10
and sometimes it's because of a thought, but I find myself switching between these states of being like in a moment and a in in a mode of gratitude. So last
01:47:17
night I did the Jimmy Fallon show here in New York. My team were there. It was this really wonderful moment. My, you know, I woke up this morning feeling
01:47:23
incredibly grateful. Last night I was like listening to some of my favorite music. I felt incredibly grateful and really happy. And then I know that I'm
01:47:30
gonna switch into the lack of contentment that Jack's referring to. Happiness is always a five minute emotion.
01:47:36
Yeah. And and like today I'm I'm back to business and it's like build build bill build. And then I have this moment last
01:47:41
night where I was I was making the Instagram post to announce that I've been on Jimmy Fallon and I noticed my
01:47:46
girlfriend next to me in bed had fallen asleep. And this thought comes through my head all the time now, probably from doing this podcast, which is exactly
01:47:53
what you said, which is I am gonna regret not spooning her and cuddling her while I have the chance,
01:47:59
especially I think cuz Charlie Kirk had just been shot and I'd seen the his family. Maybe that's why it was front of mind
01:48:05
for me. And I remember putting the phone down and thinking the thing I'm going to regret is not cuddling her.
01:48:10
And so I put the phone down and cuddled cuddled her. And so, yeah, I I I'm I'm strange, I think, because I I I flock
01:48:18
between these states and sometimes on an hourly basis, sometimes on a daily basis, sometimes on like a minute-by-minute basis.
01:48:24
The fact that you're just merely aware of those states and the the false story that those states can tell you puts you way ahead
01:48:31
of most people. I think that I think to some extent that there there's a there's an interesting book called 10% Happier
01:48:37
and it's about meditation and the point the title came from everyone's like oh can meditation change your life and his
01:48:44
point was like it can make you 10% happier but like that's pretty cool and I think that's true for money as well of
01:48:49
like can it completely change your life and turn you into a much better person and way happier like I kind of feel like
01:48:56
no but like it can make you 10 maybe 20% happier in life I think that's that's probably right but just Being aware of
01:49:02
its limitations like is a huge relief. I say I think be like no if you want a happier life you're going to have to
01:49:08
find it through your purpose and your friends and your family and your health and your other philosophies of life that
01:49:14
have nothing to do with money. It can help. It can make you 10 20 maybe 30% happier but understanding its
01:49:20
limitations and what it's not going to do for you is pretty important. That lack of contentment I think I
01:49:25
sometimes feel guilty about because I sit with so many people especially like people that are monks and such and they
01:49:31
tell you that wanting will make you despair and make you unsatisfied but I find myself as being one of those people
01:49:37
that you describe that constantly wants to chase and pursue and pursue and I think that I do have like am I supposed
01:49:43
to feel guilty about that? Is that something like wrong with me? No, I mean I think that's how humans have evolved is to because at the core of it is
01:49:50
competition like where you have that I think drive everyone has that drive is not necessarily because you want to build another business or build a grow
01:50:00
your podcast. It's competition with others who might be doing that better than you or who might take your place if
01:50:05
you were to step back that gives you the anxiety. I think that's what everything has as its core. And that's why I like
01:50:11
asking the question, if nobody was watching, what would you want to do? If nobody was watching your podcast,
01:50:19
would you still want to do these interviews? If nobody could see your house, would
01:50:24
you still would you buy a house that was as big as the one you did? Sometimes the answer is yes. The answer might be yes
01:50:30
to both of those questions. But it's an important question to ask of are you doing this because it actually fulfills you or because you are competing with
01:50:36
other people and you think you're gaining their attention by doing these things. I think everyone who is answering
01:50:42
honestly would say for most of the decisions in their life especially the big ones the answer is both.
01:50:48
Yes. So like choosing Harvard versus the other university which might have been better but it's Harvard or buying the
01:50:55
house where you bought it or that watch that you bought or the Apple Watch instead of the whatever and signaling is important. You can't
01:51:00
just discount it because if you want you know to attract the right the right friends, the right spouse, the right
01:51:06
employers, there's a signaling aspect. A college degree is signaling. It's not the education you obtained. It's you're
01:51:12
showing employee you're giving a signal to an employer that for four years I showed up and did the material and got
01:51:18
the right answers. It's a it's signal like signaling can be very very important. It's not to discount it but
01:51:24
there's a right and a wrong kind of signaling. There's a right kind of like I'm I'm doing this. I'm dressing in a way and displaying myself and cutting my
01:51:30
hair in a way that's going to attract the right friends and the right mates, the right boyfriend, girlfriend, whatever it might be. There's also
01:51:36
signaling of like, I'm going to aspire to buy this car that's a huge pain in the ass and I actually hate driving, but
01:51:42
I think strangers are going to look at me and pay more attention to me. That's the wrong kind of signaling. I think this is the thing that both
01:51:48
sides misunderstand in the debate is that someone who is a workaholic, believe it or not, can be happy.
01:51:55
And someone who does no work or works one day a week can be happy. And this is like a really difficult
01:52:01
concept for either side to understand about the other side. And that's why as well I asked the question about Jack like do you think I'm happy? Because
01:52:07
Jack would know that if I'm like if I walk out of here and he sees me as this depressed person who never smiles, never
01:52:13
laughs and has no joy in my life, doesn't have mo, you know, then I would very much fit the stereotype of like the
01:52:18
tortured workaholic or whatever. But it's uh yeah, it's surprising. It's surprising.
01:52:24
I think we all just want contentment. So like we I think we get into a lot of trouble when we chase happiness when what we're actually going for is
01:52:30
contentment. We actually just want to get to an area where we're like, I'm good. I'm all set. What's the most important thing or the
01:52:37
most interesting thing in your book that you can remember that we didn't talk about that maybe we should have talked about?
01:52:43
I think the relationship between money and kids is is a is an interesting one where every parent wants to use their
01:52:49
hard work. What money they might have. It doesn't have to be a ton. You don't have to be rich, but they want to use
01:52:54
their hard work in order to give their kids a better life. When a lot of times what the kid needs to do is learn on
01:52:59
their own. and they're going to learn vicariously the values that you have about money. They're going to learn just
01:53:05
by watching. You don't need to sit your kids down and say, "Let me teach you how to budget. Let me teach you how to save.
01:53:10
Let me teach you how to invest." They're going to figure they're going to watch you and figure it out. And so, you have to just lead by example with those kids.
01:53:17
You cannot lecture values into them. They're just going to watch how you spend, what you value, how you save, how
01:53:23
you judge other people and talk about other people, and they're going to form a philosophy of money based off of that.
01:53:30
I often think about money in terms of like attachment styles. You know, in like dating psychology and romance, they
01:53:35
talk about anxious, avoidant, um, and then the what's the middle person called? They're like a basically
01:53:42
neutral. But I think I had an avoidant money attachment style. I think money was the like the third parent in my household. And I learned that money
01:53:55
causes problems. That it doesn't come around as much as we would like. That it's really why we argue in the
01:54:02
household. That it's the reason why I am embarrassed when we pull up in that terrible car and I try and get my I hope
01:54:08
the traffic lights change in a certain way so that I can be dropped off further away from the school so no one sees me. Like my relationship with money was
01:54:15
established at such a young age and it was it's almost like a I had like a unhealthy like they say relationship.
01:54:21
Yeah. like an attachment style to it. Um, and I just wonder like is that a useful frame to think through that you have this Yeah. like this romanticesque
01:54:34
relationship with this thing and in order to change that you need to unlearn the lessons. I think a lot of like the lessons that we learn about money when we're younger
01:54:46
are because like I said earlier, it's because you when you're young, particularly you're a teenager, you're in your early 20s. Most people in that
01:54:52
situation have very little other skills to offer the world. Yeah. Humor, intelligence. Some some people
01:54:58
more than others, but in that situation, you're always going to gravitate towards if only I had a nicer car when I was
01:55:03
being dropped off at school, then they would pay attention to me. But the truth is, if you were the funniest kid in class, it doesn't matter if you're
01:55:09
dropped off in a dull junky car. people still respect you because they're like, "Man, he's a star of the football team." That kid's hilarious. Doesn't matter
01:55:16
what kind of car he's driving. You gain your attention and your respect from something else. But if you're not the star football player, if you're not
01:55:22
funny, if you have nothing else to offer, then you seek your admiration through, "Oh, he's dropped off in an
01:55:27
escalade. He's cool." That's where you want your attention to come from. Is there anything else we should have talked about that we haven't talked about, Morgan?
01:55:33
For people that are trying to get a grip of their life, be happy, make better money choices. to me like the common
01:55:40
denominator between all three of those books that you're holding is the idea that we talked about quite a bit on all
01:55:46
the shows we've done together which is that there is no formula for it and that's very disheartening for a lot of
01:55:51
people to hear. There's no formula for here's what I want you to go out and do, which is a lot of what people want out
01:55:58
of content, whether it's a book or podcast, like just tell me what to do. And the answer is like I I can't because
01:56:03
I don't know you and you don't know me. We're all different. But I think that's actually the biggest like relief. That's actually the best news that you don't
01:56:10
have to follow somebody else's playbook. You can do it your own way. And it's easier to do it your own way when you
01:56:16
come to terms with the fact that nobody is paying as much attention to you as you think they are. You can do it your
01:56:21
own way free of judgment and other people, you know, making fun of you or judging how you're living life because they're too busy worrying about themselves. You have to figure out what works for you and do it. And that's as
01:56:34
close as we can get as a formula for living a better life. It's funny because the book is called The Art of Spending Money, but much of
01:56:40
the throughine throughout the book is really about happiness. And I guess that's really what money is for many people,
01:56:45
a tool tool to become happier. A tool to become happy. No, I remember when I interviewed Mo Gorda, he wrote a book um about happiness. He
01:56:52
said to me a line that's always stayed with me. He said, "Happiness is when your expectations of how your life is supposed to be going are met."
01:56:58
Yes. And so with through that lens, I look at everything. I look at like the food that you're given in a restaurant and if you
01:57:04
expected it to be this and it doesn't come like that, there's unhappiness. Even if it's like a fivestar a A5 Wagu
01:57:09
steak or whatever. Um and then your relationships, all of my arguments I've ever had with my girlfriend, all stem back to unmet
01:57:16
expectations. Expectations. I was saying if if you ride the Amtrak train from like New York to Washington DC, on every train they
01:57:21
have what's called the quiet car. And in the quiet car, you're not supposed to talk at anything above a whisper. No phone calls, no talking with your
01:57:27
friends. It's the quiet car. And people go there for peace and quiet and serenity. And the irony is that people
01:57:33
are so uptight in there because if if they hear one peep out of everyone, they're like, "Would you shut up? We're
01:57:39
in the quiet car." They're so frustrated about it because your expectation is, "I'm going to get quiet." And if it's
01:57:45
anything other than quiet, you lose your mind. And it's like at that point, that's when your high expectations are
01:57:50
actually working against you. And people are actually calmer in the normal car where there's chaos all around them because that's what they
01:57:55
expect. So that's the unhappiness cart, right? You're like your expectations are a debt that has to be repaid.
01:58:03
That gives us a controllable element to our happiness, doesn't it? Your expectations because your expectations are more in your control
01:58:10
than things like what the economy or the stock market's going to do next. Like I have no nobody has any control of what
01:58:15
the stock market's going to do next. But you have you do have more control over your expectations of how much money do you expect to make next week? What do you expect out of the stock market? What do you expect out of your career? What
01:58:26
do you expect out of your spouse? Like that is more in your control than influencing other people's behavior.
01:58:31
And this is probably why all these eastern traditions talk about gratitude because gratitude is the very realization that expectations I once had
01:58:37
are currently being met. Yeah. And it just even when you start to think about dreams you once had that you
01:58:42
are now living out for me it makes me feel yeah that feeling of contentment it makes me feel really really good inside.
01:58:48
So like even yesterday where I took a moment and I was on the Jimmy Fallon show and it's like this crazy thing to me that I could never have imagined someone like me doing and I took a
01:58:54
minute to just like think about how far beyond my expectations this stuff was. Yeah. It you feel overwhelmingly good about it. But but the truth was relative if
01:59:06
you just thought about yesterday you expected to go on the Jimmy Fallon show you that that that that met your
01:59:11
expectations for the day if you looked at your calendar for the day it was I need to go to Jimmy Fallon I need to perform I need to say the right things
01:59:17
but over the longer scope that's off the charts of your expectations and that's the zooming out is where we see right
01:59:23
the gratitude you know fills us up right and it's it's very difficult to say this without sounding ridiculous but
01:59:29
you can even zoom out and be like god I'm so grateful to live in a world with antibiotics Advil. Like it sounds crazy because we
01:59:35
expect them. Whenever we take penicellin, we're like, "Yeah." Like it's just a thing that exists. But can you imagine living in a world without
01:59:42
99% of humanity did before us? Like it's it's impossible to think of like the most basic things that we take advantage
01:59:48
of. But that's where gratitude like you have to zoom out to become more grateful to these things. And you're not going to be content until you can exercise that
01:59:54
level of gratitude. You said something earlier which dubtales into this where you said that um at different levels people will
02:00:00
aspire. You know, the billionaire wants two billion. And I was reading a study many years ago that said roughly all the way up the income wealth spectrum,
02:00:06
people want like three times more than they have now is what seems like the amount that's going to keep you happy. So if you have $10,000, people are like,
02:00:13
"Once I have 20, then I'll be good." And if you have $20 million, people are like, "Ah, 40 seems like the right
02:00:19
amount." It's always two or three times what you have. And that's just the intentional creation of an expectation gap. It's like
02:00:26
creating misery for yourself. Yes. It's this idea that like if only I had a little bit more money, then these
02:00:31
problems that I have, this anxiety, this unfilled hole that I have will finally be filled. And it's a it's a lie we tell
02:00:38
ourselves, of course. And everyone listening right now has that. Everyone has a number in your head where you think if I got there,
02:00:44
then it'd be I I have that. You have that. We all do. And if you and I have met that number, previous versions of
02:00:50
that number, it's the same thing. We're like, "Okay, but double would be great. Double double would be awesome." I met
02:00:56
someone the other day whose income, annual income is almost exactly 2x mine. We were being very open with you. Gee,
02:01:02
he's a good friend of mine. And the instant feeling I had, I didn't say this, but the instant feeling I had was like, "Okay, if I had that, everything
02:01:08
would be great." And it's it's absurd. We do that all day. And I'm sure if my friend met someone whose income was 2x
02:01:14
of his, he would be like, "That's the level. That's the one." Because your overheads go up, but then
02:01:20
your competition comparison group also increases. So you're now poorer in a different class of comparison. Like Yeah. You're like when you bought that new house you just bought.
02:01:32
Yeah. That must have moved you to a new neighborhood. And there's houses in the neighborhood nicer than ours.
02:01:38
My wife and I talk about them. Really? It's absurd. Now I I think I'm I think because I write about this stuff, I
02:01:44
think I'm a little bit better at catching myself in those moments, but I won't pretend that I don't have those moments. They're almost unavoidable.
02:01:50
What has worked for you? Is there anything that has actually worked for you in terms of
02:01:55
detaching you from comparison and what people think? Is there anything at all that's worked? I like this term humble bubble. I want
02:02:00
to live in a humble bubble. It has to be humble because I don't want to live in a bubble where I I don't have empathy for other people. I want to take in the
02:02:08
experience of others so I can try to understand the world that I live in. But I want to live in a bubble in the sense
02:02:13
of like I want my expectations not to leave my own house. Easier said than done. But when my expectations don't leave my own house, I'm like, I want good health for myself. I want happy
02:02:24
kids. I want a good marriage. And those things don't leave my roof. Once my expectations leave my bubble, my once
02:02:32
once they expand outside of my house, I'm like, "Oh, look at his house. I want It's like I just wanted I always think
02:02:38
about that humble bubble of like the only thing that's going to make me happy exists underneath my roof." And I know
02:02:45
that. And as soon as my aspirations are for are leave that, I know it's just going to spin out of control. I I I try
02:02:52
to think about that a lot. And as I mentioned before, the idea of if nobody was watching, what would I care about?
02:02:58
That's that's the most powerful exercise to me. If nobody could see anything that I was doing, what how would I choose to
02:03:05
live? I've always wanted to counter um this point with some thinking which is but if I put myself in a higher status position I'm going to get more opportunities which means more money
02:03:16
which is then going to better allow me to focus on utility. Not that that's how it ever plays out for anybody.
02:03:22
Yeah. But the thinking is well actually status does equal revenue. Yeah. In a lot of the world and revenue can give you independence.
02:03:28
Yeah. The the I think that's right. I think to many extent that's been my goal. How can
02:03:34
I be successful in my career so that I can make enough money to not have to work in the career anymore? Like it's
02:03:39
not that stark, but it's kind of like that. The flaw in it is that I like writing. You like podcasting.
02:03:46
And so if we get more successful like I I'm not I'm not chasing success so that I can stop doing what I'm doing. I just want to do things that I enjoy.
02:03:54
We have a closing tradition where the last leaves a question for the next as you know. Um do you have major regrets in life? Then it says, "They prove no
02:04:02
real purpose. Do you still have regrets?" Nothing huge. There are some regrets. I was thinking about this the other day. My wife and I, we have two kids and we're done having
02:04:14
kids. And there's part of me that's like, what would have life been like if we had four kids, three kids? We if we done that,
02:04:22
like each both of my kids have given me so much meaning and purpose. And I wonder what a life would have been like if I just had fed more. And I I can't imagine having just one kid. I can't
02:04:35
imagine just having zero kids, but there's an alternative life in which I had four or five kids. And you know, life gets crazy at that point. And
02:04:41
that's not a regret, but you realize like once you've kind of closed that door on your life, you're like, man,
02:04:47
what would have life been if I had done it if I had done it differently because it's given me more purpose than anything
02:04:52
that I ever could have imagined and I could have had more. And maybe it would have been worse, but I I I wonder what
02:04:59
that would have been. I think it's not until you've we've chosen to close that door, that chapter of our life, that
02:05:05
we're like, man, what if we had what if I had done it a little bit differently. Do you wish you had frozen embryos?
02:05:10
No. Because that would have kept the door open theoretically. Not really, because I think there is a point of like you want you need youthful
02:05:17
energy to be a parent. I I I couldn't imagine having a newborn at 50 or 60. I just I think you need the energy of a 30-year-old or 25 or a 30-year-old to do that. And it's not a regret because I'm
02:05:30
very satisfied with the the family that I have now. But it's one of those things of like you realize you're there's an
02:05:36
infinite number of paths your life can go down and we could have had no kids. We could have had four kids. We chose
02:05:42
this path, but it's one of just one. It's one of multiple paths that it could have gone down.
02:05:48
Morgan, thank you. Thank you for doing what you do. You're my favorite author of all time and I think I've told you
02:05:55
this before, but it's the way that you write. I find it so unbelievably engaging. You the message within your book is a profound one. All of your
02:06:01
books are profound ones, but it's actually the way that you tell the stories. And if anybody's listened to you speak today, they'll understand
02:06:06
exactly what I mean. Your books are a mirror of that. Um, the psychology of money, as I told you before, is the book
02:06:12
that changed my financial life. The one book my brother, who's a very smart person, told me to re to read. And
02:06:17
there's no wonder that it's one of the bestselling books of all time. I think it might be the bestselling book of all time in its category. Um, and your new
02:06:23
book, The Art of Spending, continues on the same trend. Incredibly accessible, incredibly engaging, incredibly human,
02:06:30
but within there, there's a profound lesson that stands the chance of changing our lives for the better. So, I highly recommend everybody goes and gets
02:06:36
this book, The Art of Spending Money, which comes out tomorrow, October 7th. October 7th. So, I'm going to link it
02:06:43
below for anybody that wants to grab a copy of this book. book. And if you're someone that does want a happier life, it is a book about spending, but it's
02:06:49
also more broadly a book about happiness and regret. And it tells stories that allow you to make better decisions in
02:06:55
your life. And it's through stories, not through frameworks alone or data that I think we're most influenced. And you can
02:07:01
probably relate to this if you're listening to this. You probably have heard stats before. You probably know you should save. But it's sometimes
02:07:06
hearing real stories from real people that stick into your amygdala and create that behavioral change. And that's exactly how Morgan writes. He writes through the context of great stories that stand a chance of changing your
02:07:18
life. So, it's a wonderful, wonderful book to read and I highly recommend you do. Thanks so much for having me. Thank you so much, Morgan. Hope to see
02:07:23
you again sometime soon. Likewise. [Music] [Music]