Finding Mastery with Dr. Michael Gervais - The Psychology of Money | Morgan Housel

Episode Date: February 24, 2021

This week’s conversation is with Morgan Housel, a partner at The Collaborative Fund and a former columnist at The Motley Fool and The Wall Street Journal. He is a two-time winner of the Best in Business Award from the Society of American Business Editors and Writers, winner of the New York Times Sidney Award, and a two-time finalist for the Gerald Loeb Award for Distinguished Business and Financial Journalism.Morgan recently published a book titled, The Psychology of Money, and it’s the impetus for why I wanted to talk to him.If you’ve listened to this podcast for a while, you know I live by this stance: having a philosophy for your life is imperative...What I hope you take from this conversation is that the same can be said for how you think about money.There isn’t simply one "right" way to manage your money, but it should align with the greater values you live by.At one point in our conversation, Morgan shares that he doesn’t have a mortgage on his house, that he owns it outright.I was a bit stumped at first because it would appear, especially in our current climate with how low interest rates are, that this is foolish.Isn’t there a huge opportunity cost to that?But Morgan is clear on his principles, what makes him feel secure, and what’s “enough” for him... not having to think about a mortgage is something that’s important to him.So this conversation isn’t focused so much on what to do with your money, but the importance of having clarity on the reasons why you choose to do, what you do, with it._________________Subscribe to our Youtube Channel for more powerful conversations at the intersection of high performance, leadership, and meaning: https://www.youtube.com/c/FindingMasteryGet exclusive discounts and support our amazing sponsors! Go to: https://findingmastery.com/sponsors/Subscribe to the Finding Mastery newsletter for weekly high performance insights: https://www.findingmastery.com/newsletter Download Dr. Mike's Morning Mindset Routine! https://www.findingmastery.com/morningmindsetFollow us on Instagram, LinkedIn, and X.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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stay present and engaged with my thinking and writing. If you wanna slow down, if you wanna work smarter, I highly encourage you to check them out. Visit remarkable.com to learn more and grab your paper pro today. How I think about life and goals might be different from how you think about it, different from everyone. Like money is not math where two plus two equals four for everyone. There's one right answer for everyone. This is all very lifestyle-based, philosophy-based, goals-based, generationally-based. So it's different for everyone. But for me, I do think that some people, this has been true for me, have to go through a period of time where they do not control their time to realize how valuable it is. Time and freedom

is like oxygen where you don't realize how valuable it is until it's gone kind of thing. I think that's really true for everyone, that you're never going to value independence until you go through a period, even a short period of your life, which was that was the case for me, where you don't control your time and you realize I never want to go back there. And the ability for me to wake up every morning and to say, I can do whatever I want today. And most days I want to work hard. That's what I want to do. This is not saying freedom means you can just retire early. Most days I want to work, but it's on my terms. It's doing work that I want to do. Once you taste that and you compare it to the time when someone told you when to wake up and

told you when to go to work and told you what to work on that day. Once you compare those two things, to me, it's just so clear which way I want to go. Okay, welcome back, or welcome to, if you're new here, to the Finding Mastery podcast. I'm Michael Gervais, and by trade and training, I'm a sport and performance psychologist. And the whole idea behind these conversations is to learn from people who have committed their life efforts towards mastery. And in doing so, we want to understand what they're searching for, their psychological framework, how they see the world and make sense of events in their life. And then we also want to understand the mental skills that they use to build and refine their craft. Finding Mastery is brought to you by LinkedIn Sales Solutions. In any high-performing environment that I've been part of,

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That's David, D-A-V-I-D, protein, P-R-O-T-E-I-N dot com slash finding mastery. Now, this week's conversation is with Morgan Housel. He recently published a book titled The Psychology of Money, and that was the impetus for why I wanted to talk to him. He's a partner at the Collaborative Fund, where they're really clear that they're trying to make the world a better place and make a lot of money while doing so. So they have a dual focus. I love what they're doing and their approach at it. And he also cut his teeth writing for the Wall Street Journal and the Motley Fool. So he's got chops in both writing as well as understanding how money works.

If you've listened to this podcast for a while, you know that I live by the stance that having a personal philosophy for your life is imperative. And what I hope you can take from this conversation is that the same can be said for how you think about money, your philosophy for money, if you will. This conversation isn't about how to manage money, far from it, but rather, simply put, it's the psychology of money, the title of his book, how about it? And more importantly, probably how you can align money with the values that you live by. At one point in this conversation, Morgan shares that he doesn't have a mortgage on his home, that he owns it outright. And I was actually a bit stumped at first because

it would appear, especially in our current climate with how low interest rates are, that this wouldn't be a smart move. And isn't there a huge opportunity cost to make that decision? But Morgan is really clear on his principles, what makes him feel secure and what's enough for him. Not having to think about a mortgage is something that's really important to him. So this conversation isn't so much on what to do with your money, but the importance of having clarity on the reasons why you choose to do what you do with it. And with that, let's jump into this week's conversation with Morgan Housel. Morgan, how are you?

Doing well. Thanks again for having me. Oh, for sure. So I'm stoked to talk to you about The Psychology of Money, which is the title of your book. Well, thanks. It's a topic that I feel like is not that, you know, it's not very intuitive. It's not that a lot that what's in the book is groundbreaking information. In fact, there's almost none of that. It's just that a lot of what seemed obvious once you read it is not intuitive to us moment. So a lot of the ways that we think about money and think about risk and greed and opportunity, it's obvious when you

read it. And hopefully that's why people will like the book is because when something is obvious, you don't need to spend a lot of mental bandwidth taking time to think whether something is true. It should just be obvious when you read it. But so many of these things, since they're not intuitive, you need to be reminded of the obvious things for them to really root in your head. I think that you're being kind because putting it together is actually quite challenging. And I really appreciate that you're being kind because putting together, putting it together is actually quite challenging. And so, and I really appreciate that you're like, listen, there's no magic number here. I'm not trying to fill pages and have exactly 276 words on, you know, or 276 pages in this book that you got to the point you got in, you got out, but it was a combination of really applied insights.

But then you have some gems in there as well. And there was one that leaped out right at the beginning of the book, where you said some lessons must be experienced before they can be learned. I thought that's great. You know, some lessons must be experienced before they can be learned. And so you're talking about, yeah, you're talking about embodiment, like fully embodiment to really learn. No, I think it's important because I love history. I love reading about the experiences that people happened in the past. And a lot of it is I try to be open-minded and empathetic and try to put myself in someone's shoes who experienced the Great Depression or World War II or Vietnam,

something that I did not. But no matter how open-minded you try to become, you don't have the emotional scar tissue that someone who actually experienced those events did. And that's true for everything. It's like, there are some things that you can't understand until you've experienced it. There's a point in the book where I talk about when JFK was running for president in 1960, he was asked by a journalist what he remembers of the Great Depression, which back then was still, you know, kind of a fresh event that was on people's minds during that period. And JFK said, I'm paraphrasing here, but he said, I had no recollection of the Great Depression because my family was as wealthy as they had ever been back then. And he said, I didn't even learn about the Great Depression until he read about it at Harvard. And so that's

something where it's like he did not experience the incredible trauma and tragedy that most of the nation did in the 1930s. And that's not to say that he can't be empathetic about it, but this was a big part of the 1960 election was the fact that JFK was this rich kind of silver spoon person who could not empathize with a lot of the country. And it was a big ding on him back then. And to me, it just highlights that important point that no matter how hard you try to understand someone's experiences, until you've been in the moment, in the trenches, and have the emotional scar tissue that they do, you will never really understand it. One other part of this is I love military history, but I've never served in the military. I've never been overseas, but I love learning about

world wars and battles because there's so much emotions that goes on in there. I think there's no other greater pot of emotions, positive and negatives, that takes place during big wars. I love researching about it, but since I've never experienced it, no matter how hard I try, I will never understand is like to serve overseas, to be in the heat of the moment of combat. So I always try to remind myself of that as I'm learning about this,

that I still don't understand what this person who's writing this book is actually trying to get across. And I love that you bring that up because from us, I've never been in war either, actually trying to get across. And I love that you bring that up because from us, I've never been in war either, but I've had the honor to work with people who have been in the amphitheater in meaningful ways. And it's one of the most emotionally charged environments you can imagine. And it's confusing for many.

And some people make it really simple, compartmentalize well, but it is emotionally charging. And not that there's any comparison between that and money, but money is also, and finances are really an emotionally charged conversation, you know, because we're tapping into the safety and security of people's future. When you talk about saving money or spending money, you know, there's ego involved, there's future proofing involved, there's anxiety around both. And so as a segue, not so eloquent, between the emotionally charged environment of war and the emotionally charged decisions we make around money, can you first start with maybe providing a bit of gravity, which is how do you define wealth? Well, to me, there's various ways to define it.

One is, I'll take this several different directions. One is when most people think about money and wealth, they think about what it can buy you, your ability to buy stuff, to go out and buy clothes and a house and car, to buy material possessions. And that's a great part of it, of course. To me, there's this other part of money that is just as valuable, if not more valuable, which is the ability to provide yourself independence and autonomy and do what you want, when you want, with whom you want, for as long as you want on your own terms. And I think that degree of independence and autonomy is something that money can provide you that is incredibly valuable. And for a lot of people, will provide more lasting, enduring happiness than buying stuff will. It's not to say that I

don't like nice stuff. I like nice cars as much as anyone else. But I try to focus for myself, for my wife and my family on the independence and autonomy aspect that money and wealth and savings can provide you. So that's one definition of what wealth is. But then there's also lots of different side routes we can go down here in terms of, for a lot of people, there is a social status element to wealth in terms of being a number of how you've done in life, the scorecard of how you've done in life. I don't think that's necessarily a good thing, but it's a realistic thing that people use it as a scorecard, as a social hierarchy. What is your net worth? What is your income? What is your salary relative to the people around you? And you gauge your relative wellbeing relative to those around

you and use your wealth, your money and your wealth as, as, as a scorecard. So there's, there's that aspect to it. And then there's, you know, there's the, the, the nine, the non-financial aspects of wealth as well. Like your ability to have a good family and good friends and work that you find fulfilling and doing good in the world and having control over your time, as I mentioned before. Those are all aspects of wealth that I think are very, very important as well. And to the extent that we think about wealth in financial terms, I think if we can use financial wealth, if we can use money and income and savings as a means to have to spend more time with your friends, to spend more time with your family, to do meaningful work. That, again, is something that I think wealth can provide that is more meaningful and more official and leads to a lasting level of happiness to a greater extent

than using wealth to purchase stuff out in the world. Okay. So it sounds, I can't imagine many people disagreeing with anything you just said and going yeah it's great the new wealth or the way to think about wealth is about freedom and it's about being able to choose and to choose what you want, when you want, with who you want but there's a rat race there's a rat, there's like we've swallowed a pill somewhere that's kept us on this hamster wheel that we need more.

And there's an anxiety. Yeah, I'll say it. There's an anxiousness. I was going to say anxiety, but it's probably less than that. There's an anxiousness about like I need to have more. And because I leveled up and bought a bigger house, bigger car, bigger watch. And I leveled up again and leveled up and bought a bigger house, bigger car, bigger watch, and I leveled up again and leveled up again. And I took these risks because it feels better to have more luxury. So I feel like that's the trap.

No kidding. And then if you kind of circle us back down to origins or first principles, how do you think about why we're doing that? What's the why that sits underneath this searching for more as opposed to the searching for freedom? It probably has a lot to do with what I mentioned earlier in terms of the social signaling aspect of wealth and particularly the relative social signaling in terms of if your friends, your neighbors, your coworkers, those around you, if they are signaling X, you want to be able to signal X plus one to prove yourself in that hierarchy. So your friends,

your coworkers level up in their car, their house, and you need to always be one level above them, then you're always going to be on that race. And there's some ways that we can kind of prove this with numbers rather than just philosophies. The average median income in the United States adjusted for inflation is double today what it was in the 1950s. Adjusted for inflation, the average American is earning twice as much as they did in the 1950s. But I think we, by and large, look at the 1950s as a golden age of nostalgic prosperity in middle-class America. We view the 50s and 60s as that age when the average family had a great income and a great middle-class life, even though we're earning twice as much today. And I think the reason that is, is because even though our incomes have

doubled since the 1950s, our expectations have more than doubled. And that too, you can kind of quantify that median square footage of a new home in the 1950s was about 900 square feet. And that too, you can kind of quantify that median square footage of a new home in the 1950s was about 900 square feet. And today it's about 2,700 square feet. So that's more than doubled. And there are the willingness to go on a expensive vacation versus going camping. It's just like our expectations have grown more than our incomes have. And that's why it feels like we are worse off today, even if analytically, and just as a matter of numbers, we are twice as better off today as we were back then. So I think that wheel is very, very powerful. And when you realize that people always judge the expectations of those around them, there's this another vicious kind of fact of reality of

modern world, which is, it used to be that your view of the people around you were your neighbors, your coworkers, your family. Those are the people who you saw on a daily basis around you. But now because of social media, your circle of influence that you see is the entire world. And if you go on Instagram, you are being constantly flooded with pictures of people going on vacations in the Maldives with their private jets and have their Bentleys pick them up. That's your new view of the world that can increase your expectations to a much greater degree than it used to be before we had social media. So I think this has always been the case that we are chasing those around us in order to gain relative status. But I think it's gone supernova in the last decade as the number of people around you and the view of your world around you has just exploded to virtually everyone.

And this is a lot, you know, this is one explanation for what the rising tide of wealth inequality has done over the last 40 years is a small number of legitimately wealthy people have inflated the aspirations of everyone else. And then, so if you have, you know, a sliver of society that is genuinely very wealthy

and they are through their spending and their ability to send their kids to private school and buy bigger homes and nicer cars, they inflate everyone else's aspirations. Then a lot of other people, everyone below them can kind of feel like they are falling behind. And to a great degree, how a lot of those people who felt like they were falling behind because their, their aspirations were inflated. They made up that gap through debt. And, you know, they said, look, this person is driving a nice car and sending their kids to private. I deserve to do that as well, because I'm working just as hard as this guy. But the only way that I can afford that is to go into, is to have a larger mortgage, to, if I send my kids to private school, to make them

have an incredible amount of student debt. And that's where it kind of got, you know, this huge increase in household debt over the last 40 years. I think that's at least part of student debt. And that's where it kind of got this huge increase in household debt over the last 40 years. I think that's at least part of the equation. So that ability to, the willingness to be on that hamster treadmill is really powerful. And it's hard to break. I think one of the most important financial skills is getting your own personal goalposts to stop moving. But it's a hard thing to do, to have a goal in the future and have an aspirational goal. But if you meet that goal and you would instantly just move the goalpost down the field and have another goal, you're never going to have a lasting level of financial satisfaction that I think we all aspire to. And is that goalpost, are you speaking in terms of X number of dollars in

the bank? Or what is the goalpost or the goal that you're talking about that you would say is healthy? I think for most people, it's a net worth figure. And you have an aspiration of once I get $100,000, I'll be happy and everything will feel safe. And then you get there and you say, okay, now how about if I have a million dollars, that'll be great. And that game never ends. I mean, it goes all the way up to, you know, Jeff Bezos and Elon Musk are each worth one fifth of a trillion dollars. So if you're always going to be on that goalpost of looking up to whoever's ahead of you, that game is virtually endless.

And this is true. I think it's true for, you know, a lot of people in pro sports as well. I write about in the book that in Major League Baseball, you know, basically the minimum wage, so to speak, for the pros is about $500,000, which by any definition is wealthy. If you look at the spectrum of America, like 500 grand puts you at the very upper echelon of income earners. But in terms of Major League Baseball, you're looking up to your colleagues, your other players who are earning 5 million, and they're looking up to people who are making 10 million, who are looking up to people who are making 50 million. It never ends. And I think if you realize how futile that game is,

you go out of your way to try to not play it to the first extent possible. It's impossible to not play it at all. I think it's impossible for the goalpost to always stay in place. And I don't even know if I want mine to permanently stay in place. I just want it to as, as the little as possible to once I reach a goal to actually take advantage and harvest the benefit from that goal of having independence and autonomy that got me there. Finding Mastery is brought to you by Momentous. When it comes to high performance, whether you're leading a team, raising a family, pushing physical limits, or simply trying to be better today than you were yesterday. What you put in your body matters. And that's why I trust Momentus. From the moment I sat down with Jeff Byers, their co-founder and

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Just head to FelixGray.com and use the code FINDINGMASTERY20 at checkout. Again, that's Felix Gray. You spell it F-E-L-I-X-G-R-A-Y.com and use the code FINDINGMASTERY at felixgray.com for 20% off. Okay. So there's some alarming statistics, um, about percentage of people. I think want to be good to just like give some broad sweeping, um, categorization of what wealth and rich and average and poor and like what in the western in america like what are some of those um levels you know uh denoted by wealth or cash and bank or whatever or annual earnings however you want to define that but there's a some alarming stats i want to get to

is that um and i'll leave you for the exact numbers, but an alarming number of people can't afford a $600 unexpected mistake or a $1,200 trip in expenses. Can you talk about both of those just to kind of level set the conversation so it's not nebulous. Most of the stats that get people's attention is the percentage of Americans who could not afford a $600 emergency. It's more than half of Americans who, if they hit an out of the blue, unexpected emergency tomorrow, their car breaks down or a medical bill, whatever it is, would not be able to afford it with cash in the bank. Maybe they could cover it with a credit card going into debt. Maybe they could borrow it for someone else, but their ability to have that money themselves on hand, it's fewer than half of Americans.

And it's 600 bucks. This is not a huge number that we're talking about. And that's important because what are the odds that those people will hit a $600 emergency at some point in their life? 100%. The odds that they'll have that emergency in the next month are very high. And so I think it's very easy for people like me and you, a lot of people listening to this to have some level of ignorance over what percentage of the United States, not just, you know, we're not talking about the third world, but the United States of America lives in extreme financial hardship. And I think there is, you know, maybe if people like you and I are thinking about poverty in America, we're thinking about, you know, people who are homeless or can't afford food like that, those kind of tragedies. But there's a much larger group, people who are employed and have good homes and are people that you and I know who are at the razor's edge of insolvency virtually all the time.

When was that data sourced, the 50% at $600? I think that was a study from the Federal Reserve that came in either 2019 or 2020. So it's fairly recent. It's alarming. It's huge, right? It's pretty shocking. And I think this is why when COVID hit last year, the instantaneous need for stimulus checks and enhanced unemployment benefits was so great. I mean, there's a very large section of the economy that if they lose their jobs next week, they're in dire straits. We're not talking, you know, oh, if you lose your job and you can't find another for two months or three months, we're talking next week, the ability to buy groceries and pay rent.

So that's why when you have something like COVID-19, the urgency to put some safety net in there very quickly, not six months from now, but right now is really front and center. And this is why, if we make it even more concrete, it's like a car accident or some sort of sprained ankle and you got to go to the doctor or something that is unforeseen that is not out of the realm of possibility you say I can't get over it. And I think when I think of that, it's like, I can't, if I'm honest, like I can't really fathom it in a way that just gets back to what we were talking about earlier. Like I try to be open-minded. Morgan, I can't imagine the stress. Yes. I think that's so much of it.

Like I'm stressed in my life. I'm sure you go through stress in your life. And to add onto it that there's almost a level of, it's like a version of survivor's guilt when you realize that a lot of people like us and people listening to this might live in their own little bubble and through no fault of their own. It's not a character fault, but when you realize that how many other people are going through things that you can't fathom, it's humbling to think about. I think I was given a gift early.

I grew up surfing. And so there's a bit of an ethos about – I'm going to tell you something that you might go, what in the world were your friends about? But there's a bit of an ethos about, dude, it's not cool to have much. And I'm not saying that that's great. I don't ascribe to that anymore. I mean, there's a healthy relationship between possessions that if we go really deep is I love these conversations. But the ethos was like, don't want much, you know, like be about it and be about the experience of life and be as deep and as rich and committed to authenticity in risky, challenging surfing,

you know, environments. And I was going, I was perfectly set to travel the world and, um, kind of live out of vans and hammocks. And, um, so that's kind of part of my DNA. And when I would come back from those experiences that I was perfectly fine having, you know, my end table be milk crates and plywood with a plastic sheet over it for my kitchen table. Like I was perfectly fine with that and so it i don't live that way obviously now you know and but i don't need much and so i was given this incredible gift that i want to share with you is when it was my father-in-law that's like needs and wants what you need and what do you want and it was an exam a deep examination about like, really get clear with that. What do you need? What do you want?

And if you can live a life where your needs are met and you're not over your skis with your wants, like you will have freedom. I think it's the same thing you and I are talking about now. So that's why the 600, it's not that I have so much available resources that I can't imagine that because I lived with nothing for a long time. But my wants were very low. My wants were about experience, not possessions. So I have an equally hard time, Morgan, thinking about, oh, I like nice cars. Like you said earlier, the luxury of quality is beautiful. And the artistry that goes into quality

is compelling to me. But I get, I find myself in a loop and you've studied this more than I have, like, what is it about things? And I know you're going to say, oh, it's about comparison, but there's something else about the possession of a thing and the nicest thing, again, compared to others is important. But I feel like there's another layer to this. Can you just pull on that a little bit? I mean, definitely the huge majority of it is social comparison. I mean, that's an enormous part of it. But why else do we want more stuff?

I think there is like a trophy aspect for yourself of reminding yourself. If you wake up in the morning, most people don't log into their bank accounts and Google at the numbers that are there. But if you wake up in the morning in a nice house and you go down and you see your nice car in the garage, you're reminding yourself of what you've put into it and the suffering and the hard work that you've put into it. Maybe that's some aspect of it. And certainly the huge majority of this is the social comparison. And I think the game that I always play is if my wife and children and I lived on a deserted island, it was just us. There was no one else who has led us. There was no one else who was judging us or measuring us. What kind of house would we want? What kind of car would we want?

If I was living on that island, would I want a Ferrari? No, it's right. It's so impractical. It's awesome. It's beautiful. It's a status symbol, but I would know I would probably want a pickup truck or a Jeep or something. And what kind of house would I want? Would I want a 20,000 square foot house? No, that seems like a jet. Like that's not, it's not, it's hard to take care of. I would want a comfortable house that would, you know, served our our needs. So I think that game, if you try to play that game of if no one was watching me, if no one was looking, like with the exception of my wife and my children, just my immediate family, no one else ever looked at me. What would I want in life? And that's what I should go towards. Again, it's not something that's black and white because even if I try to play that game, you're always going to get sucked a little bit into social signaling. And social signaling is important to show other people

kind of what you value and who you are and whatnot for them to take you seriously. So there is that important aspect of it. But I'm always trying to ask myself that question of like, what actually makes a difference in terms of my happiness and utility? And I want to move more towards that away from the signal. And then, so let's talk about tactics or strategies for wealth. One is going to be about lowering your wants. You know, would you agree with that? Or being, but I'm not saying this

in like a hippy dippy doe eyed way. I'm saying, just be clear, like don't get caught in the rat race or the saturation of needing more for comparison. So maybe there's a lowering of want, but maybe you'll of course correct that. But there's certainly something about ego here that if you need something external to internally be okay, there's a problem there. And so I'd like to get into a couple of tactics. And obviously you're going to say save some money and use compound interest.

Like, yeah, let's talk about that for sure. And for some folks who have much, what do we suggest for them that have access and cash? And what are the right percentages? I want to get into tactics. But before you do that, I just want to hit on something you said. I think trophies are whack. Here's the thing about trophies. I write about this in the book. When I was in college in Los Angeles, I was working at a fancy high-end hotel. And I realized as when people would drive in, in Ferraris and Lamborghinis and Bentleys, that I was never,

you know, first I was in awe of those cars when they came in. And like every 21-year-old, I'd say, wow, look at that. But I realized that I never cared about the driver. Whenever those cars pulled in, I never looked at the guy. It's usually a guy driving in the seat and saying, wow, that guy gawk at me if I was driving the car. And it was like this light bulb moment of this irony of like, I don't care about the driver, but I want to be the driver so that other people will care about me. Like the irony there was, and once I got that, it was like, okay, okay. I get what the game is now. It's this crazy thing where everyone driving the car thinks that people are looking at them and everyone who's looking actually just wants to be the guy in the car. It's just crazy. Once you realize the game, it's easy to take a step back and say, I see the game and it's silly and I don't want to play it. And look, I love Lamborghinis. I love Ferraris, but it's so easy to overestimate how much social benefit you're going to get from those things. So it was a Ferrari conversation where this was an extraordinary, successful human from a monetary

standpoint and a life standpoint. And AJ, I'll keep his name out of it. But age 18, he sold his first business for $4 million. And this was 30 years ago. So that's pretty cool right out of high school for mill and so first thing he did was went and bought a ferrari and by the way he just sold his most recent home maybe about a year ago for 52 million like so this dude is like forget about it technology you know unicorn startup it's super smart and so anyways he goes my um a lot of people will come up to me when i drive my ferrari and go wow um look at this car that's amazing like wow this must be so much fun wow look at this car and he says some people would say what did you do to get this car and then says, the one person that asked me this very key question, I ended up bringing

on as my number two in charge for most of my companies. And so I'll tell you the question, what it was, but what do you think that that key question was to this very switched on, thoughtful person about how money works? What do you think that question was? Maybe it was something like, was it worth it? Was the sacrifice worth it? Was it something like that? Yeah, that's exactly right. That's interesting. Exactly right.

That's what I always wonder too. There's a lot of sacrifice behind that thing. And it's usually in perfect scale to the amount of luxury. You see someone with a $50 million house or a $60 million private jet, there's a lot of sweat and tears generally behind that, whether it's from you or someone who you inherited from, whatever it is that goes behind that. And maybe that's part of the trophy aspect is showing others and yourself. And I want to emphasize showing yourself that I put in a lot of sacrifice to this, and this is my reward. And having money in a bank or in an investment account in the stock market is less reward than a beautiful car sitting in

your driveway. Maybe there's some aspect to it. Well, you're changing, like you're using clever language here to actually talk about underpinning psychological rewards. So internal, external, you know, to make it overly simple is that you're saying, hey, listen, the psychological rewards, so internal, external, you know, to make it overly simple, is that you're saying, hey, listen, the external rewards, they're cool, but are they better than the internal reward of having a sense of freedom and control of your life and being able to choose who, when, why, you know, where, like you're saying the internal reward, the intrinsic and internal reward is greater than the external and extrinsic drivers. No, you're saying internal, external, as opposed to intrinsic, extrinsic.

Sorry for being technical there, but I mean, definitely been said before, right? Like, but the way that you're saying it is like, really think about it. Like really think about it. I mean, it's interesting. Here's the, now that we're talking about cars, here's what I do as well. My, my wife and I drive a decent car, but nothing fancy whatsoever by choice. But, but there's times when I'll be traveling for work and I'm renting a car and you come to one of the fancy car rental places and you can, you can rent a really nice car. Then a couple of times I've done it and it's like, look, just because of our lifestyle philosophy, we don't own a nice car, but if I'm gonna rent,

like if I'm on a trip, I'm gonna rent one, let's rent an awesome car. And every time I've done it and I'm so excited, like, ah, I'm renting this really cool car. And within five minutes of driving, and I know this because I valeted for so many years and I drove every car, within five minutes of getting it,

it's like, eh, whatever. It doesn't, it's not doing anything for me. And so much of the job of these things is the anticipation. It's when you are cranking at the office and you're about to sell your company, you're thinking about what it's going to be like to buy the Ferrari, to have the $50 million house. And then once you get it, you kind of shrug your shoulders, but the anticipation was awesome. And I think that's what keeps us going. That's what keeps us on the treadmill is like the anticipation is what gives us the most amount of dopamine for these things that keeps us there. But then once you get it, you shrug your shoulders and it's not that big a deal. But even if we know that, and it's easy for me to say that it's hard to control the amount of like,

it's hard to control the influence of dopamine. Dopamine is a very influential voice in your head. So to get away from that is much easier said than done, which is why whenever I rent the fancy car and I'm so excited, I know I'm going to be disappointed in 10 minutes. I know it, I know it, but I still make myself go through that again and again to remind myself. Finding Mastery is brought to you by Cozy Earth. Over the years, I've learned that recovery doesn't just happen when we sleep. It starts with how we transition and wind down. And that's why I've built intentional routines into the way that I close my day. And Cozy Earth has become a new part of that. Their bedding, it's incredibly soft, like next level soft. And what surprised me the most is how much it actually

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And there certainly can be some sort of dashboard that you're working from that is unique to you and your life and your purpose and all that. So once I get kind of into that right direction, what do you do with money? I mean, to me, the first answer is that it's very different for everyone. How I think about life and goals might be different from how you think about it, different from everyone. Money is not math where two plus two equals four for everyone. There's one right answer from everyone. Like money is not math where two plus two equals four for everyone. There's one right answer for everyone. This is all very lifestyle based, philosophy based, goals based, generationally based. So it's different for everyone. But for me, I do think that some people, this has been true for me, have to go through a period of time where they do not

control their time to realize how valuable it is. Like time and freedom is like oxygen where you don't realize it and how valuable it is until it's and freedom is like, is like oxygen where you don't realize it and you know, how valuable it is until it's gone kind of thing. I think that's really true for everyone. That you're never going to value independence until you go through a period, even a short period of your life, which was that, that was, that was the case for me where you don't control your time and you realize I never want to go back there. And the ability for me to wake up every morning and to say, I can do whatever I want today. And most days I want to work hard. That's most, that's what I want to do. This is not, you know, saying freedom means you can just retire early. Most days I want to work,

but it's on my terms. It's doing work that I want to do. Once you taste that and you compare it to the time when someone told you when to wake up and told you when to go to work and told you what to work on that day. Once you compare those two things, to me, it's just so clear which way I wanna go. And so that was one aspect for me. And then to me, the other tactic for me, and again, this is different for everyone, was my experience as a valet and viewing all these people who were very wealthy

when I was very not, and just thinking about what I actually thought of them. And did I actually admire them? Not really. And then I had this angst of like, well, then why am I trying thought of them. And did I actually admire them? Not really. And then, and then I had this angst of like, well, then why am I trying to chase them? I was, you know, in college at the time. So in theory, I wanted to become them. I wanted to go into finance and work hard to become who they were, but I didn't even admire them that much. And this was like

this existential angst of like, well, then what am I trying to do here? And for me, that moment was not okay. I should then just, just go become a surfer. If I don't want to be rich, I don't want to do this. I should go do something else. It doesn't require me to work so hard in finance. But then I slowly realized that the answer was no. I want to be successful. I want to earn a lot of money. I want to be rich, but I want to use that wealth for something that's not material because that's what's going to actually make me happy. And the other part of this was having a deep conversation and deep thought about who do I really admire in the world? Who do I really genuinely look up to? who, because they had control over their time, were able to live great lives and spend time with their family, spend time with their kids, spend time with their spouse in really meaningful ways because they were not shackled to their desk and become slaves to their work. Those are the people who I really admire the most and that I aspire to become. And you get into the psychology of

optimism, pessimism, fear quite eloquently. And you talk about like the allure of pessimism, which I think is a fun way to think about it, you know, and you give, tap your hat to John Stuart Mill, who talked about, you know, what he observed around pessimism. And, and maybe you can pull on that thread and talk about the naivete of optimism. I talk a lot about optimism and the value of it, both from a performance standpoint, but a mental wellness and emotional wellness standpoint. Optimism is very important to stay in it. And it's a trainable, learned skill. So is pessimism. And so can you talk a little bit about the rational optimism, naive optimism, and then the allure of pessimism. And so can you talk a little bit about the rational optimism, naive optimism,

and then the allure of pessimism? There's this great quote from a historian named Deirdre McCloskey that I like, where she says, quote, for reasons I have never understood, people love to hear that the world is going to hell. And I think what she means by that is pessimistic news, pessimistic headlines get so much more attention than optimism. And there's part of it that is just biology. Like through evolution, we're more trained to react with greater attention to threats than opportunities, just in our ability to stay alive or need to stay alive. So part of it makes sense. But I also think there's a sense, particularly in finance and money and economics, where pessimism sounds like someone trying to help you. It sounds like, hey, there's a threat in front of you and I'm trying to help you avoid it. Whereas optimism

sounds like a sales pitch. Optimism is like, hey, I got this great stock that's going to go up. Do you want to hear about it? It sounds like a sales pitch. And a lot of people's BS detectors go off and they say like, no, that's not something I'm interested in. But if there's a threat, if something's going to threaten me and my family, I want, I'm going to clear my schedule and hear about that immediately. So that just, just that disparity between how we think about these things is really important. But what's interesting is that if you know, economic history and investing history, you should be an optimist. Like our ability as a, as a species to solve problems and become more productive for that productivity to lead to profits that are going to accrue to you as an investor, for the economy to grow over time is extraordinary. And we've grown so much. The

economy has grown 200-fold since 1900, like an amazing amount of growth. But at every point in time during that period, the pessimists got the most attention. There's always something to worry about. And they were worried about realistic and reasonable things. There's always a recession or a bear market or a war or a pandemic or an assassination. There's always something in the news that is genuinely bad and bad news there. But the nuance that's hard to understand is that a lot of chaos and bad news and pessimism in the short run does not preclude long-term growth. That even if the short run is a continuous chain of bad news, things can still improve greatly over time. That's not a very intuitive thing to think about, but it's what happens. I mean, there's this idea that I use in the book to take it a completely different way about baby brain development,

which is that for most of your young life, from about age 2 to age 25, the number of synaptic connections in your brain are declining. And by the time the average person is 25, they have fewer synaptic connections, less density of the knowledge in their head than they did at age two. It's called synaptic pruning, where you go through a lot of your life

getting rid of these connections in your brain that are inefficient and redundant and unnecessary and miswired. But the most important part about this is that even though what's going on inside your head is loss and chaos and unnecessary and miswired. But the most important part about this is that even though what's going on inside your head is loss and chaos and destruction, you're getting smarter. A 20-year-old is much smarter than a two-year-old, even though the number of connections in your brain, the density of connections is declining. And I think that is also explains how the economy works and the stock market works and a lot of things in life work,

that even if what's going on in the short run is chaos and loss and destruction, it's amid this backdrop of improvement. And if you're only focusing on the constant chain of bad news, you're going to miss this backdrop of improvement over time. So much of this is that there are no overnight miracles, but there are a lot of overnight tragedies. September the 11th or Pearl Harbor or COVID-19 happened very quickly. Sometimes they literally happen overnight. But good news, like our ability to, you know, the improvements in heart disease or the improvements in cancer treatments, those things take place slowly over decades. So they're much easier to ignore and dismiss because they don't happen very quickly.

But even though the things that happen slow are much more powerful and much more meaningful because they compound over time. Whereas these things that come out of the blue, the overnight tragedies are just like a car accident that you can't look away from. So I think that disparity between optimism and pessimism is really powerful with money as well. And it leads people to always be thinking about the bad news, even if they are over you know, over, over a longer period of time, over 10 or 20 or 50 years are missing out on this incredible growth that takes place. So that's why pessimism is just not only so much more, so much more, you know, we'll, we'll, we'll, we'll catch our attention in better ways because it's so much more alluring, but it's just more prevalent and more common because it happens so much quicker. It's complicated the way you describe

it. I appreciate the complexities and nuances that you have in there because at the surface, optimism, pessimism is an interesting dance to talk about because people already have an informed decision. But the way you're describing it is that it's the lens this is how i think about it too it's a lens that we're making decisions about what's possible and the big bang not the big bang like you know the origin origin of time but like the flash bang where it grabs our attention that is potentially something catastrophic, it registers in our brain so much more. So we become hyper for survival. So we become hyper attuned to those flashbangs to stay alive. And so optimism is tougher, especially in a world where our brains

are geared to exactly like you said, to find the catastrophic so that we can avoid it. But we have to understand it. That's one of the reasons we're compelled. And in your book, you also give ode to Daniel Gilbert, a psychologist out of Harvard, talking about how we are, I don't know, surprised by the decisions that we make in our life. And every decision we make is leading us somewhere. And over time, those decisions become habits. And at some point, they've influenced who we become today. And when we do an examination of who we are right now,

sometimes we don't like it. And so it's like this surprise that, wait, you know what? It's a bunch of micro decisions that led me to now, not actually just like one bad or one good decision. So it's so much more complex than a simple framework. It's like exercising that framework over time. I think that you speak to that beautifully. And so much of this too is that since optimism is a long-term thing and pessimism is a short-term thing, your ability to experience optimism and benefit from optimism in the long run requires that you can survive and stick around and stay in the game long enough to enjoy the long run. And so that's why to me, like one of the most important investing philosophies and things

I think about is just endurance. It's not like, what are the best returns can I earn this year? It's how can I make sure that I can be an investor and stay in the game for the next 50 years? That's really what matters because that's where the compounding and the optimism comes from. So much of it, if you are to think that you are, if you look at someone and you say, oh, you're very conservative financially, you don't have a lot of debt, your investments aren't very risky, you look like you're being very conservative, which a lot of people would say to me when they look at my finances. And I just don't think that it's actually being conservative. What I want to

be is I want to be durable and have endurance because endurance is what lets you enjoy and benefit from compounding over the long run. What happens in any given year or any given five years or even in any decade is it's usually not that exciting in investing, but what can happen over 20 or 30 or 50 years is absolutely extraordinary. That's just how compounding works. So all I want to think about as an investor is how could I stick around? How can I stay in the game for 50 years and let my money compound? Because that's where the biggest optimism and the potential for growth really sits. And the only way that I'm going to get there is if I recognize that the short-term pessimism and the bad news is something that

I have to put up with and endure and able to get the long-term reward at the end. What does your profile look like? Percentage cash, percentage real estate, percentage stocks and bonds, something more high risk in something more high risk and, and startup entrepreneurship, like what does your profile look like? So if you look at my investing portfolio, it's, uh, okay. So let's look, let's take total net worth. Uh, you know, house is, is a big chunk of it. I write in the book, we don't have a mortgage because I want to be durable. Uh, so, so, so how house equity is a big chunk of our net worth. And then if you look at our investments, it's probably about 10 to 15% cash and the rest broad US equity based. I don't own

a lot of international equities because most US companies do so much of their business overseas anyways. And even if you own US equity, if you own US stocks, you're getting a lot of international exposure there. So it's very simple. It's like 10% to 15% cash. And then if you're looking at our investment portfolio, the rest just broad-based US stocks, and then our house, and that's it. I write in the book that our entire net worth is a house, a checking account, and some index funds. And then that's it. There's nothing else involved. And I just don't think it needs to be more complicated than that. I think there is an allure that the more complicated your financial situation is, the better you're going to do. Because that's the case in most fields. And in most fields, the more effort you put into something, the better you're going to do. And so people look at a very simple financial situation like mine.

I have three assets, basically, and they think it's not going to do well, but there's really no connection whatsoever between complexity and results in investing. The more simple it is, the better I can understand it and wrap my head around it. Right now, with interest rates being so low, you still advise and you would advise people now to not take advantage of that low interest rate because of the compound interest that you're paying over the life of the compound interest that you're paying over the life of the mortgage or the loan? It's definitely not something that I would recommend to others because everyone's different. So this works for my wife and I because we value durability and independence so much. But it's not necessarily something I would recommend for others.

I write in the book that not having a mortgage is the worst financial decision we've ever made because of what you just mentioned. You can get a 30-year fixed rate mortgage for like two and a half percent these days, and we can invest that money elsewhere and earn a better return. So it's been a very bad financial decision, but I think it's the best money decision that we've ever made because it has more than anything else we've done, given us a level of indents and autonomy and security and durability than any other thing that we've done with our money. So from that sense, even if we can't explain it on a spreadsheet, and I've had a lot of people say like, walk me through the numbers, try to rationalize this to

me. And I always say like, no, no, no, there's no, I can't rationalize it. It doesn't make sense on a spreadsheet. But when my wife and I high five, like when we paid off our mortgage three years ago, the high five, like, oh my God, we did it that we got from that, like exceeded anything else we've ever done with money. And even if it's the dumbest thing we've done on paper. So I would not, I would recommend that people think about it. How about that? And if you're capable of doing it, then like, think about what it would be like to have that level of independence and autonomy to realize that basically any financial hurricane you get hit by after that point, like you're probably okay. Like your baseline expenses after that

are probably pretty low. And then whatever happens in your career or whatnot, or if you want to take time off, whatever, you have autonomy that gives a lot of happiness. I think even if on a spreadsheet, it makes no sense. But look, there's a lot of people for whom if they did that, they would be kept up at night realizing how much money they left on the table for all that home equity that they could have invested in the stock market and earned a way better return. And that would drive them crazy. My wife and I are not susceptible to that FOMO at all, but a lot of people are, and I, I don't look down upon them. It's just a different philosophy. Did you say 15 and 15 for For? For the cash and stocks?

So if you look at our investing portfolio, it's about 15% cash and then 85% stocks after that. Oh, 85% stocks. I thought that you were 15 and 15. I was trying to get my head around that. So is that by definition is what you're choosing? You're much more indexed in stocks than your cash. And to me, the level of cash that we have is a raw number. I want X dollars of cash. And then as my investment portfolio, as my stocks grow, the percentage of cash is going to,

is going to decline from there. So rather than saying, I want to be 15% in cash, what I, what I say is I want X dollars because those are like, how many dollars do I need for my emergency fund for me to sleep well at night? So I hope over time, I hope if you and I talked in 20 years, I would say I'm 2% cash because it's the same dollar amount that I've always wanted. And if you think about cash as just like an airbag in your life, then the percentage of your net worth shouldn't, you know, you know, should change. That should not be a stable thing over time. It's just like, how much insurance do you need? And then hopefully your stocks grow and lower that percentage over time. And that's a function of your needs and your wants once your house is paid for, right? But

not even once it's paid for, but it's, that's a balance between needs and wants to kind of bring it back full circle. And that number, the dollar amount has changed over time because once I have kids, then my ability to have more security grew from there. And then we had another kid and it's like, and then my wife stopped working. So like that number has changed. Like how much airbag do I want to sleep well at night? That number is not static, but I don't think of it as percentage terms of our net worth. It's just the dollar figure that I want.

Okay. That's cool. So one is an absolute and the other one is a variable off of that as a tactic. Okay. Okay, cool. So I think just kind of, this is more timely, but what do you think about our stock market right now and kind of all the conditions that are taking place, the political reorganization, COVID, like how are you just thinking about the markets? I mean, if you think about the last year, when in the last 12 months, 20 million people lost their jobs, it is with no exaggeration, the worst economy since the Great Depression. And yet the stock market is not only at an all-time high, but tech stocks were up

40% last year, which is something that you would see like out of the 1990s. So it's hard to square those two things. The economy is so bad and the stock market is so good. So that confuses a lot of people. And I think the confusion is fine. Like most of the time, what happens in any given year doesn't make a lot of sense. Sometimes the economy does really well and the stock market is very poorly and vice versa, like we saw last year. So I think trying to explain why the market did what it did in any short period of time is something that's bound to confuse you. Now, there's a lot of confusion right now. If you did try to explain in rational terms, like why is the stock market doing so well right now if the economy is so poor? I think there's two things to think about. One is that most of what

has happened with COVID on the economy has hit small mom and pop businesses, like the local dry cleaner, the local dry cleaner, the local restaurant. Those are the businesses that have really been bludgeoned hard by what's happened with COVID-19. The big corporations that make up the stock market have much greater access to capital and credit, have a much more diverse earnings base. They're in more geographic regions. So those companies are doing by and large much, much better than your local mom and pop business on the ground. And that's why you have this big discrepancy between the economy is so bad, the stock market is doing so well, just because

the makeup of the stock market is not indicative of the makeup of the whole economy, of course. The other thing that's going on right now that people know about, but it's so important, is just the amount of stimulus from Congress and the Federal Reserve. I mean, one way to think about this is that the amount that we've spent on government stimulus in the last 12 months is adjusted for inflation more than we spent fighting World War II over four years. Just a staggering amount of money has been spent to combat COVID-19, trillions upon trillions of dollars. And it's like, once we're talking about, you know, $6 trillion in stimulus, it's just hard to contextualize how much money that is, but it

is an absolutely epic amount of money. And even though we had a year when 20 million people lost their jobs, the amount of cash in checking accounts is by far and away at an all-time high right now. And debt was paid down last year. The level of household debt relative to income is the lowest level it's been in 40 years. So when we have this period where so many people lost their jobs, you would think, oh, those people drew down their checking accounts and they have to rely on debt. And actually the exact opposite thing occurred because you had this period last summer where anyone who lost their job, if you made less than $50,000 a year, you made more money on unemployment than you did at work.

So a lot of these people lost jobs and got a raise because we had so much, you know, these unemployment benefits got enhanced to, you know, they added on an extra $600 a week. And then, so like all that makes a big difference and can create this discrepancy of the economy's doing very poorly, but a lot of big corporations are still pulling in tons of money right now. One last thing, and not to get too wonky about this, but the composition of the stock market is heavily skewed towards the largest companies. It's called market capitalization weighting. So when you talk about the quote unquote stock market, it is heavily skewed towards Amazon, Facebook, Apple, Microsoft, Google, just a handful of companies. And those big tech companies that make up a disproportionate

share of the stock market are doing very, very well right now. Because even with COVID, everyone's going on Facebook, everyone's still using Google, et cetera, et cetera. So that's part of why the stock market has done so well over the last year. But there's also this thing about, look, any metric that you look at, any reasonable, well-established valuation metric, the stock market is very, very expensive. Maybe it's not quite 1999, but it's not that far away from that. Now, no one knows how long that can last. That's always the thing. Just because you see something that's unsustainable doesn't mean you know when it's going to revert. So could the market stay at these levels for another two, three, five, 10 years? Yes. But by any

measure, it's expensive, which just means, I think the only takeaway from that is just level setting your expectations. We've had this incredible run over the last decade and the last several years that is probably front-loading the returns that you're going to earn over the next 10 years. And just keeping your expectations in check that earning 25% a year on your stock investments that a lot of people have done in recent years is not normal. That's not a normal thing to do. Normal in the stock market would be something like 5% to 7% per year. There are a lot of new investors who, if you told them that, they would shake their head and say, 5%, I earned 80% last year. What are you talking about? And so that's where just

understanding the broader history of the stock market and leveling and anchoring your expectations to that versus the recent history becomes so important. And if you've got a kid, you know, just going into the workforce, I mean, young, like 15, 16, 17 years old, like in that young, what would you suggest? Obviously, financial literacy and having a philosophy to live by, you know, the needs and wants and freedom versus, you know, things. But what would you do? Or what do you do for your kids? Do you start with a little nest egg where they're earning the 2%? What is a savings account? Is it 2%? Less than that. And sometimes it's 0.2% these days. Both of my kids are too young. My kids are one and five. So even my son who's five, we have a very small allowance for him that if he behaves,

he can get his allowance. It's all very basic right now. But I do think there is a broader philosophy of like, the only way that you can teach your kids about money is for them to experience the power of money scarcity. That's the only way that they're going to learn to value a dollar is to experience the scarcity of a dollar. So I get kind of uncomfortable when I think about big allowances or here's kind of the angst that my wife and I have. My wife and I both were fortunate enough to go to private university and graduate with no student loans. And we want to, of course, pass along that to our children as well. So we save a ton for their college and whatnot. And I always have this kind of angst of like, no, actually, maybe I want them to feel, you know, to have some skin in the

game. Maybe they should have to pay for their own, or maybe they should go to state school because it's, it'll ground them more. So I think like every parent, I have some skin in the game. Maybe they should have to pay for their own, or maybe they should go to state school because it's, it'll ground them more. So I think like every parent, I have that angst of like balancing what looks like spoiling your children and wanting the best for them to on one, to on the other hand, like I want them to learn the hard way about like money is scarce and valuable. And if you, unless you go through a period of your life where you don't have everything that you want, or sometimes even things that you need, you're not going to appreciate how valuable $1 is. So I always think, and I don't know if I have a good answer for this because my kids are so young so far, but I always think about how I'm going to teach them and talk to them about it when they are old enough to really start getting it. I don't know if I have a good answer for that. Part of that is because everyone is so different. My brother and sister and I grew up in the same house with the same parents, but we're so different. I think that's true for most siblings. Even if you grow up with the exact same, the same house with the same parents who give you

the same philosophies, people grow up so differently. I don't know what son and daughter are going to be like by the time they're 15, 16 years old, but whoever they are at, you know, the nuances of their personality by then will impact that. I think like for myself, no one, I think my parents instilled a lot of good values in us, but they never sat down and told us, here's how much you should save.

Here's how you should invest. There was none of that for us, but myself and both my siblings just kind of figured it out and learned it on our own, which I think was really valuable. Rather than having our parents force us into this way, we just kind of figured it out on our own, which was valuable too. Because I think for a lot of teenagers, the natural inclination to rebel against your parents is so strong. Even for good kids, that inclination is really strong. So I think if you're 16 and your parents say, I want you to do this, here's the right way to do it, your inclination to rebel against that is going to be really powerful.

And therefore, at that age, learning those lessons on your own rather than having them force-fed you by your parents is so powerful. There's an athlete that I spent some time with and he retired and I saw him in Los Angeles and I said, hey, how you doing? He said, good. And I said, how are your kids? He said, you know, they're good. But I can't give them the one thing that I got. I give them the best shoes, the best camps, the best coaches, the school, but I can't give them the one thing that made all the difference for me.

What's that? Nothing. I had nothing. And I'll tell you what, I'm so glad I know what nothing feels like. And so to your point, yeah, I think that it is the, it's the thing that I think about a lot, you know, is that my first job, I, there's many of my friends, they're like, no, no, no, our kids are not going to have jobs. Like we're going to have them volunteer and we're going to have them, you know, be custodians of the community. And, and, you know, okay. Wow. That's, I never had that thought. i grew up in a different way like i worked in a gas station that was my first job and so um little red towel hanging out you know my back pocket and so i mean i think i would have had an earlier advantage if my job was to volunteer

but i would have lost it another massive advantage which, which is, Hey, I had to work. It was, I think it was like six bucks an hour or something. It was crazy like that. Like I had to work, um, two hours to go on a date, you know, and I'm talking about like barely affording the French fries, you know, like, like, so I don't know. I'm confused about it too, but. Yeah. I know there's, I know like Joe Kennedy wanted to become rich so that his kids could devote their entire life to politics. And they did it. They were very successful at it. So that's one philosophy. I also like this philosophy from Warren Buffett, who of course, he's worth $90 billion. And he said he wanted to leave his kids enough money that they can do

anything, but not so much money that they could do nothing. And I love that philosophy when I think about my kids. I want to provide a great education and be, I think a safety net so that when they fall on their face, it's not going to be too tragic. Like you're never going to be homeless. You're never going to be hungry. Like parents will be there for you, but I'm not going to give you so much that you can do nothing. You got to go out and do it yourself. I'm never going to let you fall too hard, but I'm going to make it work. I think that's, that's, it's a really I think it's easy to say that, but I think finding that balance in real time is very difficult. But that's the balance that I strive for.

Listen, Morgan, thank you for your time. Thank you for writing a book that regrounds some first principles about the true drivers, the external versus the internal drivers drivers and some strategies to think about taking care of yourself from a financial literacy standpoint, but not bogged down with a bunch of numbers, just enough to scare me. And I just, I want to say thank you. Well, thanks very much. Thank you for reading. Thank you for having me today. It's been fun. And where can people find you? Where do you want them to go? So my blog is at thecollaborativefund.com slash blog. Most of where I spend my time is on Twitter.

My handle is Morgan Housel, my first and last name. And the book is The Psychology of Money. Yeah, there you go. Housel, H-O-U-S-E-L. Correct. I love it. Okay. Very cool. Appreciate you, Morgan. Thanks so much. Thanks so much. This has been fun. All right. Thank you so much for diving into another episode of Finding Mastery with us. Our team loves creating this podcast and sharing these conversations with you. We really appreciate you being part of this community. And if you're enjoying the show, the easiest no-cost way to support is to hit the subscribe

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