Motley Fool Money - Why the Wealthiest People in the Room Are Often the Most Miserable — And What to Do About It

Episode Date: October 4, 2026

 After 40 years managing money for some of the most successful people on Wall Street, Matt Ludmer came to a conclusion that surprised even him: accumulating more rarely made his clients happier. Motley Fool analyst Rachel Warren sits down with Matt Ludmer — founder of Aligned Wealth Management and author of The Right Mountain — to explore the gap between financial achievement and genuine fulfillment. They dig into the three-pot portfolio strategy Matt developed after managing insurance company money that changed how his clients think about market volatility, why crossing wealth thresholds rarely reduces financial anxiety, and what it actually means to be on the right mountain. Host: Rachel Warren Guest: Matt Ludmer Producers: Bart Shannon, Lauren Budabin Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode. Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Why do wealthy people get wealthier? It's because they don't have to sell. They can handle volatility. It's not brilliance. It's organic understanding of like, well, I don't need to sell my equities because I have so much other stuff to pull from. So why don't we do that as individuals as well to the extent that we can? That was Matt Ludmer, 40-year Wall Street veteran and author of The Right Mountain,

on why the secret to building lasting wealth has almost nothing to do with being. smarter than everyone else. I'm Motleyful analyst Rachel Warren. Matt started his career as one of the first wealth managers at Morgan Stanley, and after decades sitting across the table from some of the wealthiest people in the world, he came to a startling conclusion. Most of them are miserable. He joined me to talk about what actually separates people who build wealth and relax from those who build wealth and burnout, including the three-pot portfolio strategy he developed that changed how his clients think about market volatility forever. We hope you enjoy. Welcome back to Motleyful Conversations. I'm Motleyful analyst Rachel Warren. And today I'm delighted to welcome Matt Ludmer to the show. Matt is a 40-year veteran of Wall Street wealth management, the founder of Aligned Wealth Management, and the co-author of the new book, The Right Mountain Practical Wisdom for Achieving True Wealth. Matt started his career as one of the first wealth managers at Morgan Stanley, later becoming a director there, and then, of course, launched his own firm, Align Walth Management in 2013. Matt, welcome to the show.

Oh, thank you, Rachel. Thanks for having me. Well, I'm excited to talk about your book and just dig into your experience and background. But I want to start here. You know, we live in the wealthiest society in human history, but anxiety, burnout, dissatisfaction rates have never been higher. And I wonder, after decades at the top of your craft, what led to your realization that today's definitions of wealth and success are somewhat broken, if you will? Yeah, yeah. Well, it wasn't me sitting on high

and making that observation. It was really my own personal experience. I was at Donaldson Lufkin and Jenneret around the year 2000. And I was on a, you know, one of those corporate outings that were pretty opulent in the four seasons in Scottsdale, Arizona. And they were giving out awards for the top producers.

And I remember it was like winning an Oscar while everybody was in the ballroom and they called up the fourth largest producer, the third. And I had just joined the firm from Morgan Stanley. And I had no idea these things actually went on. And then they announced the top producer with the firm, and I got the award. And I was kind of shocked.

I was like, what? You know, first of all, I didn't know that was the case. Second of all, it was, at first it felt great. And then it felt actually like the person who won, the second, greatest producer, largest producer, turned to me and said, I want your position. I'm going to get it next year. And I was like, whoa, you know, whoa.

And I just realized, I have to do this again. And I just felt like the Sisyphician rock up the hill kind of thing. I felt hollow. So I felt achievement, but I didn't feel fulfilled. So it really was that realization. And then also seeing it in my clients the same thing. And then having a father who was content in all ways and didn't really have very much.

So seeing the contrast, seeing my own hollowness, put me on a path to understanding, well, if this isn't, I'm a wealth manager, it was one of the first wealth managers of Morgan Stanley. If this isn't wealth, if this achievement doesn't bring fulfillment, like what does? And that's what I spent the past 26 years

on a first principal basis studying. What is the three-pot portfolio strategy? So I had the real great privilege of managing money for an offshore captive insurance company in the 90s. One of my mentors invited me down to compete for business for like a large portfolio. Anyway, I didn't know anything about insurance and how they invest, but they do it differently than individuals. They don't invest like is it's one big potting and you just invest the whole thing. They match assets to liabilities. And I thought, wow, that's interesting.

And they do it over time. So when you have an insurance portfolio, you have like the working capital portfolio to take care of the insurance needs, you have the insurance reserve, and then you have surplus. The first is for short term, the second is for intermediate,

and the third is for the long-term needs for the people that are insured. And I thought, well, that's kind of, and because I was running the money, I was seeing, you know, okay, the first part is for one to five-year needs. Of course, that's going to be a more fixed income-oriented kind of portfolio.

And pot three, the last one, the surplus, of course, is all equity because it's got a long-term nature to it. And the second part was kind of a mix of the two. And I thought, wow, that's a great idea. Why don't individuals do that? There's a psychological benefit for that. And that's when it hit me, oh, that third pot is now untouching. because when I need funds, I have a first pot and a second pot to go to before I touch the third pot, the long-term pot.

And what I realized over time working with very wealthy people is that, why do wealthy people get wealthy? Why do wealthy people get wealthier? It's because they don't have to sell. They can handle volatility. It's not brilliance. It's organic understanding of like, well, I don't need to sell my equities because I have so much other stuff to pull from. So why don't we do that as individuals as well to the extent that we can? So when someone comes to me with a portfolio, this is the way I look at it now.

I say, okay, the goal of this portfolio is psychological, not just, you know, material. And psychologically, I need to hold you back from selling your portfolio when things get scary. So how do I do that? Well, let's create pot one. And pot one is, how much money do you need? You know, people say, well, for mortgages for the next few months or whatever. No, no, no, no, no.

What amount of money is going to make you sleep at night in the bank? Let's say AI starts wreaking havoc or there's a pandemic or whatever. And the market goes down 30, 50%. What's going to make you feel, oh, okay, okay, maybe nothing. But for many, it's like, if I had this much money, I know that things get solved and things do get solved relatively within a certain amount of time. and for each one of it's a different. Some of us are very conservative. We want to have a very large pot one.

Some of have every small pot one. Look, I don't think I can be fine with it. So that's your secure base and that's invested in treasuries and AAA munis. You sleep at night. You're good. Secure base comes from Dan Goldman's wife, Tara Goldman, who writes about emotional alchemy

and she calls it the secure base. In life, just not even investing. You need your children. Everybody needs a secure base before they go take. risk. Which is psychological first principle. Then the third bucket is really for 10-year-plus money, or for your IRA, your pension

plan, what you can put away that you know you're not going to need for the long-term. Why? Because we know the basics of investing are like rolling dice. If you roll it once or twice, you can get anything, but if you roll 1,000 times, you're going to get 7s. Well, if I think of the market as 7%, and if you think of the market is somewhat random, which it is, in my opinion,

then anything could happen. Okay, well, how do I protect myself from that? I keep a long-term investment horizon. So I have a lot of roles. Not 12 in 12 months, but like, you know, 120. And therefore, I almost guarantee myself by the law of numbers and the normal distribution that if history holds as it has,

for over 100 years, and, you know, corporate cash flows continue to increase, and everybody wakes up, tries to make a better world for their kids and millions of companies, and I could buy an index to capture that. I'm going to do that. And so in pot three, and I can go into different techniques, but essentially, I just want to own the whole market as much as possible and let that hold that for a long period of time. And be confident that, you know, the world is trying to solve its price. problems. And it does that. That's what the entrepreneurs do. That's why they're so great,

because whatever problems come, they're going to wake up one morning and go, I got the answer. And I'm going to put it in my company and make the cash flows and, you know, the discounted cash flow of future earnings better and better and better. So you have confidence in that and you have your secure base to protect you. And then, of course, we're not like machines. We want to have fun and we want to like make predictions and we want to like a friend who's a hedge fund manager who's like doing great and and you believe in him even if the statistics are tough in this particular pot too patu is to express yourself

and express your opinions you know it's where you may have a private investment that you do where there's no history and you're kind of taking a shot at something what I found myself personally in patu is a pretty terrible pot two investor I just get I get so excited by other people's ideas that it's like, oh, I'll do that, I'll do that. Invariably, it's more emotional than real. But I also makes me feel alive. I can't just be a full, you know, index only person.

If I could, I would, you know, but I just like, I love, I've been on Wall Street my whole life. I like, I like, you know, new technologies and what's going on. Even though I know, most of this is already priced since the prices of things and the chances of me doing well are suspect. It makes me just feel part of life. So these part one, which is one to five years, pot two, which is five to ten, and part three, which is ten plus,

is a way of structuring a portfolio, and I've showed it to a number of people who were directors of a number of the investment firms, and one or two have taken it and made very large businesses out of it. And they wouldn't matter. How could you just go out and do this? and I'm like, well, because this is great, but what does this actually do?

It allows you to invest and relax. Once you have this structure, okay, the market did this tomorrow. Okay, Mark went down 20%. Okay, your structure is guiding you, not the market. And you can have confidence in your structure. And that really matters. It's like having structure in all these views

really allows volatility to happen and volatility is part of life. But if you're prepared for it and you're structured for it, you can now turn to other things. So your question of like, what's your relationship to it? If you're trading every day

and if you're constantly doing pot two activity, you know, the stress that you can have can be really high. And in my mind, going from invest in stress to invest in, and relax is really what the whole book is about.

Because once you do that, okay, I'm not looking at my portfolio every day. What do I do? And how do I gain fulfillment? New from Nespresso. Blend wellness into your coffee routine with a coffee plus range infused with functional benefits. Choose the coffee you love with added B vitamins, like coffee plus B12 to help support immune function. and coffee plus B6 to keep your day moving. Or go with the flow and choose ginseng delight.

Our new double espresso with ginseng extract. Whatever lies ahead, don't change your morning. Let your morning change you. Discover coffee plus on espresso.com. When you're a mid-sized business, you need every competitive advantage you can get. Like an AI solution that works for you, not against you. SAP Grow is built with AI embedded at its core,

working across every system, and it's ready to go from day one so you can hit the ground running. Bring it with SAP Grow, AI Cloud ERP for any size business. You've talked about how you spent decades managing money for incredibly wealthy individuals. I wonder, did crossing certain wealth thresholds reduce financial anxiety, or did it tend to just shift the anxiety onto different variables? It's great. I write about this in the book about it's called The Wheel of Life. and the different ways we suffer. Oh, I love that.

Because when you don't have enough, you suffer some sort of poverty mentality. Like if I only had, how many people do you know who if they only had a net worth of X can then go to Florida and have the life they want? And then they're like 65, 70, and they're first starting to live. Like, no, that's not a good formula.

You know? Or someone's made it early and they're living, you know, this great life, but there's a constant dread of like it's going to go away. So there's this tightness in them that's like not able to relax because there's a constant like radar checking everything. I'm checking this. I'm checking that.

I'm checking. Like, why are you checking? What in your structure is making you check? You don't need to do that. In fact, if you are checking, you are not relaxing. Your structure should be able to handle it. And the confidence of your understanding, the view that you have is what you have confidence in.

Once you have confidence in your view, you can relax. And if you're going to have fun in life, the relaxing cannot be a phony relaxation. It has to be structural. You know what I mean? So my goal when I meet with a client is I want finances to go background for you. You should get to the point where you understand this so well. You don't need me.

Yeah. What's interesting about this is, well. I mean, you talk a lot about mind-body practices in your book, which I think is really fascinating going back to the mindset aspect of accumulating and preserving wealth. How can those be applied by, let's say, investors who are concerned about market volatility? They're watching the state of the markets. There's obviously a lot of exciting investment opportunities, but there's also a lot of hype around a very small number of businesses. So, you know, if you're an investor and you're anxious about some of the developments that you're seeing. What are some of those mind-body practices?

I know you go over a lot of ancient traditions that you brought into the development of some of these in your book, but maybe you can walk through a couple of those. I'll give you one that my friend Jeff Carrera use it because if you're constantly in a mindset of problems, like, you know, people like this, like everything's a problem. We're going on a trip. Oh, we're not going to make it on time. We get there. The hotel's not good enough. You know, I just got to, you know, I just got to call for my mom and there's always a problem. So there's no space for this contentment and relaxation to occur. It just doesn't happen. So I have a friend who teaches the practice of no problem. And before people get nervous, it doesn't mean you don't have a problem. It just means you allow

yourself some time to not have one. And it's this very simple practice. And the practice starts like this. You just set a timer. Let's say you set it now. And then you just just say, okay, whatever comes to my mind, it's not a problem. You just say to yourself, it's not a problem. And then go back to just relaxing. You know, and so you set the timer, and then you do it. It's the practice of no problem. And as you sit there and try to relax,

notice what problem comes and just say not a problem and let it go. And you do that, even if you do that, like right now, if I just say, okay, for the next, you know, 10 seconds, don't have a problem with anything. And don't have a problem that you don't know how to not have a problem. Don't have a problem with that. Let's start now. Okay.

so hopefully you've had some experience of not having a problem with what's going on and as you widen that practice to five minutes to ten minutes and you're able to just sit without a problem your body you start to witness things more than actually be in them and you get a little bit of a relief so the practice is no problem which Jeff Carrera teaches and I you know I highlight him It's really worthwhile. Also, there's another just obvious one that I could just quickly show you. If you put your hands over your eyes and I ask you what you're seeing, you're just seeing the back of your hand.

But if you take your hand out, you still see your hand, but you see the full room. So when someone says, like, why would you meditate? When somebody's fretting a lot, it's essentially their hand, and they're worried about their portfolio or stock, their hands over their eyes, that's all they can see. There is no relief from that. There is no relief from that.

And you don't want to forget about it because it's on your mind, right? It's not like you can stop thinking about it. But if you give it a little bit of a space, if you pull it out metaphorically and just see it and then see like what else is going on in your life as well, it just gives it some perspective. And when we meditate,

that's essentially what we do, when we look at our thoughts. Initially, we are our thoughts, but then when you just look at them and relax, they start to move and give a little bit of distance. And I think we need, you know, we need to relax and have some distance from the maniacal pursuit of achievement,

even if it's just a relief for a few minutes. And look, Dan Goldman, if you ask him, like, what's the best method of emotional intelligence or meditations, let's say, he'd say it's the one that you'll do. And there's so many apps now. There's so many ways to learn to meditate and gain space and gain relaxation.

And if you were to, I just gave you two little ones and maybe they worked for you, maybe they didn't. But I'm just trying to motivate you to look for those methods. And then do the one you'll do. It could be just taking a walk during lunchtime. It could be, you know, just getting on the phone with a friend who talks about other things,

finance and get yourself some relief and then start walking a deeper path. You know, ultimately for me, it went way far. You know, I ended up finding, you know, I've been doing this as some 18 years old. I happened upon a great Tibetan teacher named Chugin Chumper Rimbhay, the first Buddhist teacher, one of the first Buddhist teachers in the United States at Boulder, Colorado. And I met one of his students. And I said, oh, that was the Harry Met Sally moment. It's like, oh, I want what they have because there's a contentment that comes with a meditation practice. And I like learning from lineages because it means like a first principle thing.

It's been checked out and tried and true. So, I don't know. Is this where? Yeah, no, it's fascinating. Absolutely. Also, our listeners and our viewers don't always get to have a live meditation on air. So that's also very fun. But, you know, I think it's an important point you make.

This was something that also fascinated me in your book was, as you were learning some of these Tibetan traditions and then taking it into your relationship with money and wealth management, maybe you could talk a little bit more about our listeners, about that to our listeners. How we put it together? Yeah, like, I thought I was a freak because there were just so many aspects of wealth that I was seeing that were not being used by people. I mean, my 50th birthday party, I invited my friends from the different parts of my life. And this is kind of crazy, but I'm sitting around a roundtable in the meatpacking district and we're celebrating my fifth birthday party with my best friends. And nobody knew each other. Because my life was so segmented, right?

My Buddhist friends who are meditators, were sitting next to my business friends, who are sitting next to my Jewish friends, who are sitting against my friends at home and my basketball buddies. And they all didn't know each other. And I realized, oh, part of the integration, I mean, what I'm trying to do really is is provide an integral view of wealth. Like, how do you, we don't need another,

I hate to say it, but we don't need another psychologist, meditated instruction, investment advisor, you know, social activist, sort of a professor, we need someone who can say in a modern life, how do we put all this together? How do we align it? That's why I called my firm aligned wealth.

Like, how do we align it? And it was from learning the principles of integral theory, that I was like, oh, this is how you integrate. I mean, Integral Theory was the basis of Hall Foods. It was learned by, yeah, it was a John Mackey. It was learned Tony Robbins has found great benefit from Ken Wober's work. You know, Bill Clinton learned integral theory. You know, it's like, it's funny because it has a power to it.

And once you learn it, I can give you a quick, two minutes, like, how do you make something integral? You simply ask three questions. Is what I'm doing true? Is what I'm doing good? Is what I'm doing beautiful? It's called truth, beauty, and goodness. And I tend to in Wall Street to do the true things,

you know, things I can count in way. But I want to do good, you know, I want to help other people. And the beautiful aspect is just being with my, you know, being by my, you know, knowing myself. And if I'm doing something and I know, can make it beautiful and I can do it for the benefit of others and it's true and effective. That's what holistic means, this whole holistic movement. Like if you ask somebody, what does holistic mean?

It's very few people give you a definition. To me, that's the definition. If I want to do something holistically, is it true? Is it beautiful? Is it good? New from Nespresso. Blend wellness into your coffee routine with a coffee plus range, infused with functional benefits. Choose the coffee you love with added B vitamins. like coffee plus B12 to help support immune function and coffee plus B6 to keep your day moving

or go with the flow and choose ginseng delight our new double espresso with ginseng extract. Whatever lies ahead, don't change your morning. Let your morning change you. Discover coffee plus on espresso.com. Something you also talk about in your book is this idea that so many people spend significant parts of their lives climbing the wrong mountain,

so to speak, that can be a very very important. very jarring experience. What are kind of some of the most common reasons people come to that realization? And what is the way to change that, to pivot? Well, I mean, we start climbing a mountain that it's not ours, right? We're super conditioned. I know we don't think we are, but we are super conditioned. And I only know that because I am. And it takes a lot to get unconditioned. And your parents tell you, you know, you want to be a good boy, a good girl. You want to like get the high marks, you want to do the right thing. I had two friends growing up, both who wanted to be lawyers, and one who always went, and

his only decision when, I'm going to do the best. That was his decision. I was to do the best. The other was like, I'm going to do who I am. And one went to, like, Columbia and the other went to Fordham and, you know, but what happened when you just do what the best is, it's not your best, it's other people's best. and then you find as you get older, oh, I'm on the wrong mountain

because it's not making me feel good. Whereas the person who sort of did what was good in their mind, in their gut as the right path, not always the best, but something that was good best for them, they sort of bucked the conditioning that's in the out there. Because, you know, if we all did the condition thing,

we'd be a pretty scary society. We all have our quirks in ways, and they need to be respected. And, yeah, so this other friend of mine who became my best friend, one of my best friends, he was an amazing guy. He passed, but his name was Dave Goldberg, and he was just, like, you know, truly who he was.

And to me, that's true wealth. succeeding on what other people think is best, I question. I question that. So the book starts with the question, are you on the right mountain? Because, like I said, initially it's healthy to follow the path of others, but a certain point you've got to make your move. And you'll be surprised. I remember when I left Morgan Stelry to do this,

one of the people at Fidelity, he was a great counsel for me. He said, said that every person who's moved said to me, why didn't I do this sooner, you know? But why didn't I create my own thing first? When I went to DLJ from Morgan Stanley, I loved the firm. And in a way, things had changed a bit. So when I went, it was because I knew it was a good place for me to go.

And it was just a gut instinct. do it for money. I did it because I thought it was a good thing. So these were risky moves when you move businesses for either no money or for a different view. And don't remember, I loved Morgan Stanley. I am still great friends and I'm still working with Morgan Stanley in certain ways. Because, you know, there's still that, that I still have friends who are part of the initial culture. And I don't know what things are like now, but it's really fantastic. So, yeah, I don't have a negative view pretty much of much except when things get unhealthy. I wish we had more time to talk today, but one final question I wanted to ask you before we wrap up today's conversation, you know, for investors who might be listening and wanting to develop a healthier relationship with growing wealth, with their relationship to money.

What are a few of the, you know, mindset traits that we can cultivate? I'm sorry, what's the profile of that person? So let's say a retail investor who's listening to our conversation today, they're building out their portfolio, we have a broad investor audience. But I think those mindset traits that you've discussed are so applicable across the board to a wide range of investor profiles. What's a good starting point to cultivate a better mindset trait when it comes to money? I think the first thing is to just understand the mountain range, you know, what mountain you want to be on. You've got to understand the range before you start journeying. It's good to have the full map. And to start seating, you know, look, you start from the basics, right?

You start from the things you need to focus on. You know, the positive mindset, building a career that you're excited about, being lit up about waking up in the morning and going to work, and having your revenues greater than your expenses. That's really step one, because that's the healthy ground in which you build. And then once you've got that, you could then start looking at the full map,

which, you know, if I spent 26 years writing out and just saying like, what part of this map do I need so that when I'm done with my path, I could look back and go, oh, I'm on the right mountain. I have a great financial abundance and work. I'm lit up about work. I'm psychologically okay and have a spiritual path. I have connected with other people and I'm helping other people.

And I understand how the world works. These are the four dimensions of true wealth. And we don't have time to go into these, but I write about them. And when you look at these four dimensions of wealth and you have a full functionality in them, not like you don't have to be perfect in fact trying to be perfect that all these things will harm you you want to be functional in all this

I find people who make a certain amount of money and want to have the ultimate amount or who are super mindful and want to just be like you know the best meditator which is kind of a strange thing or somebody who's connected to people they want everyone to love you know they're just going to create nothing but a huge community

and like perfection all these makes you too serious and it's no fun So being functional in all these four areas, what I call true wealth, can lead to fulfillment. And isn't that what we all want? You know? The last thing I will just put a little bit of a seed in that the seventh essential is where you go from fulfillment to essentially even further, which ultimately is a sense of feeling free. And it's kind of a full path that laid out where you go from unhealthy version of wealth.

to, you know, this sense of functional wealth and then essentially to a more profound way of enjoying it. It's a full path kind of thing. And I think knowing the full view and then concentrating where you want to do things, but without the full view, you can get lost. Well, to those who are listening to today's episode are watching, check out Matt's new book,

The Right Mountain Practical Wisdom for Achieving True Wealth. Matt, it's been wonderful to speak with you today. Thank you so much for joining me. Thanks, Rachel. I really enjoyed it. Thank you for the opportunity. To see the full interview, go to our Motley Fool Conversations YouTube page. As always, people on the program may have interests in the stocks they talk about, and the Motley Fool may have formal recommendations for or against,

so don't buy ourselves stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. For the Motley Fool Hidden Gems Investing team, I'm Rachel Warren. Thanks for listening, and we'll see you next time.