The Bossticks - Morgan Housel - How To Master Money & Never Worry About Your Finances Again

Episode Date: February 26, 2024

#665: Today, we're sitting down with Morgan Housel, New York Times bestselling author of The Psychology of Money and Same As It Ever Was. Morgan joins us for a conversation on personal finance and how psychology plays a large role in your spending habits, financial status, and overall financial freedom. We dive into how your spending habits determine what you value, why a majority of people struggle with money, and he gives tips on who you should be taking financial advice from, as well as how to own your money and avoid it owning you. To connect with Morgan Housel click HERE To connect with Lauryn Evarts Bosstick click HERE To connect with Michael Bosstick click HERE Read More on The Skinny Confidential HERE To Watch the Show click HERE For Detailed Show Notes visit TSCPODCAST.COM To Call the Him & Her Hotline call: 1-833-SKINNYS (754-6697) This episode is brought to you by The Skinny Confidential This episode is brought to you by Toups & Co Visit www.toupsandco.com and use code SKINNY for 15% off your first order. This episode is brought to you by AG1 If you want to take ownership of your health, it starts with AG1. Go to drinkAG1.com/SKINNY to get a free 1-year supply of Vitamin D3K2 AND 5 free AG1 Travel Packs with your first purchase.   This episode is brought to you by Kerastase Visit Kerastase-USA.com and use code SKINNY15 to receive 15% off your purchase. Offer valid through 5/31/2024. This episode is brought to you by LMNT LMNT is a tasty electrolyte drink that has everything you need and nothing you don't. It contains a science-backed electrolyte ratio: 1000mg sodium, 200mg potassium, and 60mg magnesium. Get a free sample pack with any purchase at drinkLMNT.com/SKINNY This episode is brought to you by Squarespace From websites and online stores to marketing tools and analytics, Squarespace is the all-in-one platform to build a beautiful online presence and run your business. Go to squarespace.com/skinny for a free trial & use code SKINNY for 10% off your first purchase of a website domain. Produced by Dear Media

The following podcast is a dear media production. She's a lifestyle blogger extraordinaire. Fantastic. And he's a serial entrepreneur. A very smart cookie. And now Lauren Everts and Michael Bostic are bringing you along for the ride. Get ready for some major realness. Welcome to the skinny confidential, him and her.

Which life would you rather have? You can make $10 million a year, live in a mansion, have a private jet, have a Lamborghini. but your spouse hates you, your kids hate you, nobody respects you, or you can make $100,000 a year, live in a modest house, drive a modest car, and your spouse adores you, your kids admire you, the community loves you. Some people would take the former, but I think the majority of people would be like, oh, when you frame it like that, it's clear what actually matters. What's actually going to make you happy in life is your family, your health,

being part of your community, not how big your house was, not how many, and I'm going to have just horsepower your car has. And you really see that starkly when you go out and buy the big house, go out and buy the fancy car, and you wake up the next morning. You're like, I feel the same. Nothing really changed. Hello, everybody. Welcome back to the Skinny Confidential, him and her show.

Today we have a phenomenal guest, somebody that I have been wanting on this show for years now. And that is New York Times bestselling author Morgan Housel. Many of you may be familiar with Morgan's work. He wrote The Psychology of Money, which is one of my favorite personal finance and psychology. books. He also just wrote a new book that's incredible called Same as Ever that I've been referencing on this show for a while now. Morgan joins us for a conversation on personal finance. I know many of you've been asking for an episode on personal finance for a long time. This one is right up your alley. It covers so many topics around personal finance, the

psychology run it, anybody that wants to be better with money and how to think about money, this one's for you. And we also talk about his new book, same as ever, which is incredible as well. So many of us are focused on the next trend or the next thing that's coming. But this book, talks about what stays consistent and how we can also plan our lives around what is not going to change. It's really an awesome counter thought process to what you typically hear in today's day and age. So this episode is for anyone that wants to think better. It's anyone who wants to manage their finances better. It's anyone who wants to be less stressed about money, which I hope is everybody, everybody who feels overwhelmed by thinking about money, but doesn't want to feel overwhelmed

anymore. Anyone who wants to tackle the topic of personal finance without feeling overwhelmed and without having a bunch of drivel with words you can't understand. This is a very digestible, applicable episode to anyone at any stage of their financial life. With that, the great Morgan Housel, welcome the Skinny Confidential, him and Her show. This is the Skinny Confidential, him and her. I have been, first of all, we're just jumping into this. I have been a fan of yours for a long time. Maybe even when you, did you used to write for the Wall Street Journal?

Yep. Okay, so maybe even then. But when I found your book, The Psychology of Money, I've recommended it so many times. I think anybody that's thinking about getting into personal finance, of course, you could read all the main ones that have been around for 100 years and you get it. But I think the biggest thing that your book did for me personally, and what I try to tell other people is it teaches you a lot about how you think about money and a lot about how you feel about it.

And I don't think, one, you're really ever taught that in school. I mean, in terms of personal finance, we're really not taught a lot. But in terms of thinking about how to feel about finance, basically nothing. And so what it did for me was it created a lot of calm in my life when I think about personal finances. And I think it'll do the same for a lot of people if you guys haven't checked out Morgan's book. So Morgan, welcome to the show. Thank you for doing this. Well, thanks so much for having me.

And that's great to hear it. And I feel great to hear that. And I think we should just end the podcast right there. It's just end on a high note right there. Thank you, everybody for listening, Morgan is now. No, so, okay, so to start, for people that may be unfamiliar, and we're going to dive into a lot of stuff here, how did you get involved with writing about personal finance, and how did you become interested in the first place,

maybe just a little background? Yeah, so all throughout college, I wanted to work on Wall Street. I wanted to be an investment banker. I wanted to work at Goldman Sachs, be a big, you know, high-powered hedge fund manager. Back in the early mid-2000s, pretty much, it was so common for young males in college to want to do that.

Finance was like the center of power, and when you're 19 or 21 years old, that's the most appealing. So I fell for that trap, and that's all I wanted to do. I graduated college in 2008, which was a terrible time to graduate and want to work in finance because that was the financial crisis. Lehman Brothers went bankrupt. The economy is a mess. Everybody's laying people off.

So nobody was hiring someone with a finance degree. And it was a terrible time. And so kind of just by pure accident, just pure serendipity, I stumbled into a job as a writer at the Motley Fool, which is a finance company that writes about the stock market. I had no interest in writing. I never wanted to be a writer. I honestly viewed it as like an embarrassing step down. Like, I'm a writer now. I'm a blogger. Back when blogger was like not a cool thing to do, it was like, oh, you don't actually have a job. But I took the job just because I needed it. I needed a paycheck. I needed to make my rent. And so I took the job thinking, I'll be a finance writer writing about the

stockmark. I'll do it for a couple months until I find a real job on Wall Street. But I ended up falling in love with it. Never in a million years would I have thought I would do that. It was never part of the plan. But I love the fact that I was an outsider. I'm not a financial advisor. I'm not a portfolio manager. I'm not an economist. I'm just a guy on the outside observing what's going on and trying to figure out what people are doing with their money and how they're thinking about money. And then if I can tell a story about it, that's more interesting than the things that you typically read about finance, which is very like math, formula, charts and data. If I can just tell a story about how people think. That's actually an interesting way that's fulfilling for me and hopefully helpful

for other people to teach them about money. This is why I was excited to have Morgan on because I think whenever I say finance to her say like, let's talk about our finances. So many people that aren't interested in personal finance or eyes glazed. We're like, oh, here we go. It's like chemistry, trigonometry is how they view it. But the truth is like this is a big problem with how finance is taught. It's taught like it's a math-based field. Like if you just have the numbers and the formula, you get the right answer. And that's not what finance. is at all. People don't make decisions in a spreadsheet. They make them at the dinner table when it's like all these emotions and hormones and like social aspirations all collide together

and then you're making a decision with your money. And it's everything from like how are we going to retire to who do we want to be today socially. Where do we want to live? How do we want to dress? What kind of car do we want to drive? That's all like social aspiration. And finance is really at the core of that. So it is kind of unfortunate. I think there's two topics that apply to everybody, regardless of whether you like them or not, which is health and money. It doesn't matter if you're not interested in those topics. Those topics are interested in you. And they're going to impact your life whether you like it or not. And since finance is so boring to so many people, they ignore it. They sweep it under the rug. And those are the people for whom it's going to impact

their life the most. When you say you observe people with money, did you actually study human nature? Like, how does one, did you observe your friends? Like, what was your research for the book? Since I'm not a journalist, I'm not, I don't have sources. I'm not out on the street interviewing people. It's literally being for the last 17 or 18 years, me sitting at home, reading as much as I can, talking to people once in a while on the phone, friends and whatnot, but it's pretty much 99% of it has been me reading and going for walks and thinking about this topic. And I think for anyone, if you devote that much time to a single topic, you'll start to uncover little bits about how people behave. So that, after doing that for 15 years or so, that's where my first book, the psychology of money came from.

So in your learnings or as you were going through this process, did you find a common denominator as to why people struggle so much with personal finance? Is it a lack of education? Is it a psychological thing? Like, what is the main reason or a couple reasons that you found that people struggle so much with this topic? I think since it is not taught in schools, and this is a different topic, but it's very difficult to teach it into schools. It's such an important topic that tends to be ignored. And then even the people who are thinking about it, the intuition of what people think they should do is the opposite of what they should actually be doing. I'll give you a really simple example of this. Whenever you have a 17-year-old who opens up a Robin Hood account to trade in the stock market, the first thing that they want to do, even if they are smart, educated, top of their class, the first thing they want to do is day trade penny stocks.

And they think that's going to be their key to making money in the stock market. If you know anything about the stock market, that's the worst possible thing. you could do. It's the equivalent of like, oh, I'm interested in health. Let's go eat a bunch of snickers. That's like, that's what it is. But that's their intuition, their knee-jerk reaction is usually the worst thing that you could do. So even people who do think about money, and unless you're really digging into it and studying it, most people's like their nature, their human nature is going to steer them in the wrong direction. You have a quote in your book that I think this is relevant for what we're talking about right now. It says financial success is not a hard science. It's a

soft skill where how you behave is more important than what you know. And this is true. like, you can have a PhD in finance from Harvard and know everything. You know all the formulas, you know all the data. But if you don't have control over your sense of greed and fear, or if you, like, your spending's out of control, you can't take a long-term mindset. If you don't have the right behaviors, none of the education matters. None of what you know matters. It's the equivalent of like if you are a doctor from Harvard and you know everything about medicine, but you're overweight and you smoke and you don't sleep and you're stressed out, none of the education matters if you don't have the right behaviors. And it's the same in finance. And you can be

a complete layperson who knows nothing about finance. But if you have the right behaviors, you're going to crush it. You're going to accumulate so much money and do so well financially. And the opposite's true. Like you can have the PhD from Harvard. And if your behavior sucks, none of it matters. So in terms of those behaviors, if you could wave Morgan House's magic wand and you could give everybody the best behaviors around money that are easy, Yeah, wave your wand. What would they be? I mean, at the very, the highest level, the most simple, basic, but also the most important,

spend less than you make, invest the difference, and be patient. I mean, it's the most basic kindergarten thing you could say, but how many people can actually do that, particularly the first, like the first, like spend less than you make and invest the difference. Though too, it's so simple, you sum it up in two sentences, but what percentage of society can actually do that, even if they want to do that and even if they try to do it? It's very, very small. So saying it is easy.

What we're actually trying to do is very simple, but it's not intuitive for people and it's harder to get there. And it's like, it's almost the equivalent of being like, oh, if you want to be healthy, eat right and exercise. All right, really simple. But then you try to do it and it's actually harder than you think because your body is wired to be like, yeah, I know I should eat right, but Reese's pieces taste really good. I'd rather do it.

I know it should exercise, but the couch is really nice. So even if you know it's so simple what you should do, actually getting there is really difficult for people. What are the differences between men and women when it come to money and the behaviors around money? Or are there no differences? No, there's definitely differences. And it's been documented in studies that women tend to do better financially. I think if I had to summarize what it is at the highest level, it's that men are much more likely to be like, I got it.

I don't need to study. I know this. I'm smart. I can do it. And women are like, no, we should actually try to learn what this is and figure it out. Which is why I think this audience is going to be great for you. Yes. So I think men bring just naturally, not all of them. Of course, this is this is generalizing, but naturally bring a little bit more ego to the table because it's embarrassing, particularly for an adult male, particularly for like a husband or a father to say, I don't know anything about finance. They want to intuitively think, like, no, like if I'm the provider of this household, I'm supposed to know. So I'm not going to admit that I don't know anything. I'm going to pretend like I know. was like women are much more likely to be aware of what they do and don't know and then attack it from a more realistic approach.

You know, it's so funny that you say that because I probably didn't learn nearly enough about personal finance until right around my early 30s or like late 20s. But before that, I had been running businesses. I had been a CEO. I had companies. But I had no real understanding of how to manage money. And if you would have met me at that time, you'd be like, man, this guy, like, don't want to spend a lot of time with him. Like it was if $100 came in, let's go spend 200. Like it was, you know, and I'm like, oh, and there was no.

I feel like you did your midlife crisis at 23. Better to do it at 23 than 47 with kids. Yeah. But what happened is I had an event where things got off the rails and the businesses weren't going on. And I realized like I had done very well from a cash flow perspective for a long time. But then at the end of it, I'm like, why is there no money? There's nothing.

Yeah. What the hell happened here? And so I knew at that time, I'm like, listen, I have to educate my. myself because I realized, even, you know, and I went to school and I went to college, just like everybody, but I realized, like, I learned all these things, but I didn't have the skill. So the first book I read was, it's like a big, dense book, but it was Tony Robbins' money master of the game. I'm like, it gives you kind of a base understanding. And then I read all sorts of personal finance books. And I, what really during that exercise taught me was,

obviously, spend more than you're making. But more important, like, I learned to look at finance and actually address the issue and face it every single day. And I would go in into the accounts. I say, okay, this is what I'm doing. This is what I'm doing. This is. spending, this is what I need to put away, and I created all these targets. I feel so many people, they get so overwhelmed, whether they're in debt or they have these credit card bills or mortgage or whatever. And their answer is, I'm not going to look at this. I'm not going to say, I got to just sweep it. I don't want to see it because it stresses me out. But for me, I found that actually by facing it now I'm completely calm about it. Yeah. And for me, what I think is so interesting about

finance, and thanks for sharing that story. One is, it's such a window into people's personalities. It's not just the numbers on a spreadsheet and like, oh, let's make a budget and look at the numbers. it's so much deeper than that because even down to like the clothes you're wearing and the car you're driving, that is a social aspiration of like you're trying to show the world that I am this kind of person. I'm not that kind of person. I'm this kind of person. And so much of it is like what people really want out of life at the highest level is respect and admiration. You want people to respect and admire you for being who you are. And money is a tool for them to do that. So a lot of times when people are driving a really nice car, living like wearing really nice clothes, really, really for you. fancy jewelry. Like, the money is a tool for them to show and to express who they want the world to

see them as. And that is so much deeper than just like, let's make a budget. So I think it's the starkest window into who you are as a person. And that's why I think once you get into how you think about money and what are your skills, like, are you spending more than you make? Are you spending less than you make? And like, generally, you tend to see people who are spending less than they make. there tend to be people who are like much more focused on the internal benchmark of like I want my spouse and my kids to respect and admire me but everyone else I could really care less and people who have like a big spending problem I think if you put them on the therapist couch and really dig into it they are desperate for people's attention they're like they're spending more than

they make because they're spending on clothes and jewelry and cars and homes and the reason they're spending it is because they want other people strangers to love them and respect them and admire them So once you dig into money, I think it's like you start pulling on that thread and all these other things about life come out of it. What's the common denominator of generations that keep money? Like when you look at someone who's done a really good job in history that's kept the money in the family, what are they doing? From a generational perspective, the one that did it the best, the generation we did it the best, are the ones who grew up during the Great Depression in the 1930s. They were so scared out of their minds and had so much. scar tissue coming out of that, not just that, but then World War II that followed it in the

1940s, that once that was over and the 1950s began, and that generation was like, okay, now we can marry and have kids and go to work. They were terrified. They had been so scarred from that. And one thing that came out of that for better or worse was they saved a lot of money and they were terrified of debt. And so that was like that generation, kind of our grandparents' generation did pretty well financially. They lived below their needs. By and large, they made a lot less money than we did just because the economy was smaller and weaker back then. So it wasn't that they were richer, but they were much more capable of living within their means. The people that we've interviewed on the podcast that have really hit it big in America, a lot of them come from communist countries,

which is really interesting. It's like they know. Or they're immigrants. They're just very grateful. It's, it's, so it kind of is in line with the, the Depression era. It's like, you're so grateful for what you have that you almost, you're smart about keeping it. Yeah. We're, We're all just mirrors of what we've experienced in the past. And every single person, me, you, everyone, we're all just products of particularly where, when, and to whom we were born, things that are totally outside of our control. So we shouldn't pretend that if you were born in 1850 in Africa, that you'd be the same person you are today.

So much of this is just the dumb luck of what we've happened to experience. And nothing is more persuasive than what you've experienced firsthand. So you and I can read about the Great Depression. can read about communist Russia, whatever it might be. But the people who actually live through it and have the scar tissue from that are going to think about it in a totally different way than we will. Yeah, well, I'll give you the perspective of what I was talking about earlier in my own personal experience. When you're a young guy and if you start to do, or girl, you start to do well and you start to believe, oh, like, I'm always going to do well. Like, this is just something that's

going to, this is my new norm, just my life. And then you have a life event that really kind of humbles you and knocks you back down. You're like, oh, wait a minute. Maybe I was wrong about that. Yeah. Hopefully you've learned something in the next. time at bat, you behave a little bit differently. At least that was the case. But so many people unfortunately don't learn that lesson and they keep repeating the same thing over and over. Where do you think that comes from? Like, people that you've studied that make it and then lose it and just keep. Yeah. It tends to be, like there's a lot of evidence that people don't learn from their mistakes with finance. That the reason you made a mistake is because you are just wired

that way. That's what your DNA is. And even if you say, I'll never do that again, when you're put in the same circumstances in the future, whether it's making more money, whatever it might be those same emotions, those same flaws are going to come roaring right back. I read this thing a couple weeks ago. This is a weird take, but you'll, you'll see where I'm going. I read that. The statistic that predicts whether you're going to cheat on your spouse the best is how many people you slept with before you got married. That is the best indicator of whether or not you're going to stay faithful or not. The takeaway being like past behavior is the best indication of your future behavior. And I think that's true for a lot of things in life. It's definitely true for the money.

And so Charlie Munger, who was he just passed away, he's one of the most successful investors of all time. He had this saying that I thought was really interesting. He said, when you're teaching financial skills to young people, they either get it instantly or never at all. To me, the takeaway is just being like, a lot of this is nature and nurture, and it leaned towards the nature side. Like some people are wired to get it and some people are not. And I see that a lot. I think for a lot of people, they do very well financially. They're very good at saving, very good at investing.

And if you actually dig into it and say, who taught you this, the answer is like, nobody. It just seemed obvious to them. And then there's other people that can go through every financial course imaginable. They try so hard. But at the end of the day, they're compulsive gamblers. And that's where they're going to go. So I think a lot of things in life fall in that direction. To me, the most important thing there is just like, you need to be a good student of yourself

and embrace who you are. And make sure that you're setting up some kind of guardrails in your life, knowing that you are the kind of person who is either really good with money or really not good with money, and don't pretend that you can really change who you are. You need to accept and embrace who you are, rather than pretending that either you're going to learn from your past behavior or that there is just like one right answer to follow without realizing that it's so individualistic between people. Yeah, you know, when I read your book, because I told you I had read those other like, which were a little bit more like textbooks. But then when I read your book, I'm like, it really,

I mean, you talk about money, but you're not in there saying like invest. this index fund and save this way. You're really, what I think people will enjoy about it if they haven't read it, it's really an exercise into learning more about you and why you think the things you think about yourself. Yeah. Right. Like there's this quote in here that you kind of touched on a minute ago and it says you might think you want an expensive car, a fancy watch and a huge house, but I'm telling you you don't. What you want is respect and admiration from other people and you think having expensive stuff will bring it. It almost never does, especially from the people you want respect and admire you. Yeah. I mean, if you had to frame it as, which life would you

rather have? You can make $10 million a year, live in a mansion, have a private jet, have a Lamborghini, but your spouse hates you, your kids hate you, nobody respects you, or you can make $100,000 a year, live in a modest house, drive a modest car, and your spouse adores you, your kids admire you, the community loves you. Some people would take the former, but I think the majority of people would be like, oh, when you frame it like that, it's clear what actually matters. And again, like we were talking about this earlier, how much of your spending is just to seek the admiration of strangers who are by and large not even paying attention to you. And this is why a lot of people who make a lot of money and then spend a lot of money, a lot of them will say,

like, hey, this part was good, this part made my life better. But on the whole, it was kind of me. It didn't really change that much for me. I think the reason is because what's actually going to make you happy in life is your family, your health, like being part of your community, not how big your house was, not how many, no one's horse power your car has. And you really see that starkly when you go out and buy the big house, go out and buy the fancy car and you wake up the next morning. You're like, I feel the same. Nothing really changed.

The best thing about money that I think is that I can buy my time. Yes. To me is like if I had to like, the reason that I want to make money is for my time. I'm obsessed with that. I could not agree with that more. To me, that's what money does. If you're going to use money as a tool for a better life, forget about the fancy house and the nice car. I mean, get a decent one.

But if you can use money to give yourself independence and just be able to wake up every morning and say, because I have savings and wealth, I can do whatever the hell I want today. I can spend my time with whomever I want today. I can work as long as I want. I can quit whenever I want. That freedom will increase your life happiness more than anything else that you could, like, material that you could buy. A hundred percent. we jump to that, because I think it's, I think we should stay on that for a minute. For people that are listening and they're sitting there and say, easy for you guys to say, of course it'd be nice

to buy my time, but I'm sitting here, I have no savings, I'm in debt, I'm stressed about money. If you were just prescribed them, I know you can't give direct financial advice, but if you were to prescribe them a few things to start getting their financial house in order, what are things that, you know, when people come to you around the dinner table, you're saying, hey, these are things I'd really like to see you to start doing. I think when we talk about financial independence, we should acknowledge that it's a spectrum. It's not black and white. Like, okay, like, you're either dependent on others

or you're purely financial, independent, billionaire kind of thing. If you are the kind of person, if you have $0 and then you go to $100, that is a level of independence that if you were to lose your job, you see how, like any kind of buffer that you have in there is going to give you a little bit of independence. If you can increase your savings to $1,000, $5,000, $10,000, now you're at a level where if you got laid off, and it takes you a month to find a new job,

you're probably going to be okay. Like that is a level of independence that you didn't have before. So it all exists on a spectrum. And if you are the mindset that like, why should I even bother saving if it's not going to change my life until I'm a millionaire

or whatever it would be? I think you have to, that's a mindset to get out of your system. I have a lot of friends that have that mindset. They're like, I've heard the other day all save when my business starts running. Yeah. Yeah.

I think that's, I think it's a really dangerous mindset because the less money that you have, the closer to zero you are, the more that you are reliant on other people or reliant on luck. And any amount, like every bit of savings that you have is a piece of your future that you own. It's a time in the future that's yours. And by the way, debt is the opposite. Like debt is a piece of your future that somebody else owns a claim to. And so just viewing it like that, like literally every dollar that you save is a little bit of time in the future. It's a claim check in the future that's now yours.

And I think when you view it like that, like a lot of people have a view of like why save, like, why say, like, what am I saving for? If they're like, I already have a house. I already have a car. Why am I, why am I saving for? Once you view it as it's a claim check on your future time, every bit that you save is a part of your future that is yours, doesn't belong to anyone else. Then I think a lot of people are like, oh, they can kind of see the clarity of independence coming through. Yeah. I view savings as optionality.

meaning I love what I'm doing right now, but say I change my mind tomorrow. And I'm like, I don't want to do this show and I don't want to run this company. Don't worry, Carson. I'm going to run the company. But if that was my perspective, knowing that their savings now

gives me optionality to make that decision and then make the next decision without being so stressed and under the gun. Meaning, like, I wouldn't have to jump and find a job in a month. I wouldn't have a little time to think about, okay, where's the next place I want to land or the next thing I want to do?

And so I don't even think it's about looking at like, oh, when I'm 70, years old, I'm going to be able to live in retirement. It's more like maybe I'm going to be 40 years old and I'm going to want a career change and I don't want to have to make that change in a two-month period. Maybe I need a quarter to figure out. Maybe I need six months. Maybe I need to travel around a little bit to figure that out. So I look at it as optionality and I think peace of mind. Yeah. Just to not be so stressed. I mean, I feel like you get with financial constraints and especially debt, there's this constant pressure to make immediate decisions because you have to,

because you got to pay. Yeah, totally. I mean, what's really key to that, too, is that people are very bad at predicting who they're going to be in the future. So you'll see a lot of people who say, I love my job. I never want to retire. Well, when you're 62, you might think differently. You know, like, it's easy to project who you are today into the indefinite future. But everybody changes. And so that's a big part of this.

We have a younger sister or my sister-in-law, Mimi. I mean, and I literally send her compound interest calculators with savings rates in it. like every week. I'm like, hey, I wish I learned this when I was 22, 23, 24, 25, because compounding, which we can talk about is a real thing. And look what $100 a month does over 40 years. Look what $1,000. Look what $10,000 a year does. I'm like, you will be a multimillionaire without even trying or thinking about it. Yeah. And I send that to her all the time and then usually use examples of people that didn't do that. I'm like, look how much, look like how hard they're struggling and how much they're

stressing. All they had to do in their youth was like instead of buying that two drinks at the bar, like put that into fun for a minute. Yeah. It's so like I understand why if you show that data to an 18 year old and say, hey, when you're 65, you'll be a millionaire. An 18 year old cannot even fathom what 65 is like. And the difference like in their mind themselves at 65 is more of a different person than just a stranger on the street is to them. It's a totally different person. So I understand why it's hard for some people. But this gets back to the nature of nurture. I think there are some 18-year-olds who just get it instantly. And you don't even need to show them.

They just get it. They're like, yeah, of course I should do that. That makes perfect sense. And other people that no matter how much you shove down their throat, they're never going to get it. I am a big believer. And I would love to know your take on the way that you think about money. And I want to phrase this right, especially in front of you.

The way you think about money is sort of how it happens in your future. So I believe that there's a poverty mindset and a plentiful mindset. And I think, like, for me with money, even when I didn't have money, I would wake up every day and be like, I'm going to make money. When I lost money, I'd be like, it's okay, I'm going to make it again. And I think I believe that that kind of mindset, you obviously need other things with it, helps more money come to you. Yeah. Do you believe that? Yeah.

I'll give you an example here. My brother-in-law is a social worker. Works with very, very poor disadvantaged families. And he was talking to this very poor family. I believe they're homeless. And he said something along the lines of like, hey, you're getting this little money from, I don't know, Social Security, whatever it was. Like if you save it for the next week, then you'll be better. And they started laughing at him.

And they said, oh, you're a future thinker. And he kind of said, what? And he was like, yeah, you're a future thinker. People like us, the future doesn't exist. Our entire mindset is the next 24 hours. Where are we going to get food in the next 24 hours? There is not a future that exists beyond that that they can even comprehend. And I think there's like, so that's the extreme example of like,

homeless person is literally in a 24-hour bubble. Where am I going to get the next meal? Where am I going to sleep tonight? But I think there's also a lot of people that are maybe in like a 30-day bubble. And then so like when you talk about retirement, they're like retirement. I'm trying to make rent next month. Like what are we what are you even talking about here? So definitely like your natural mindset is going to really impact me. I was one of the people who at age 17, it was like, oh, I'm going to open a Roth IRA and start saving for retirement before I had graduated high school. And to me, like being able to think about age 60, even though. was completely theoretical and I couldn't imagine what it'd be like. It was a little bit easier.

But I think a lot of people are trapped in their own little short-term mindset. And I think a lot of that, particularly at lower levels of income, is hard to get out of that. Because as my brother-in-law, for people, if you're really thinking about where is dinner going to come from, then the idea of saving for even next week is like, why even bother? It's completely out of sight, out of mind. If your money got taken away tomorrow, all your money, what's the first thing you would do? hug my wife and kids and hope they still love me. No. What would I do? I would, I don't know if I would change that much because core to my identity is not, is not money. It's, well, it's, it's husband and father. And if I woke up tomorrow was zero dollars, I would say, do I have the ability to keep

providing for my family? And it would be, I would have way more incentive to be like, I got to go figure this out right now. Like I got to, even if it's starting a new career, whatever it be, maybe I'd have the same career, but I think if there's anything, it would change in me. It's like my, it's not my identity as person who has money. It's my identity as provider for my family. What is it like being married to you? What's your wife like when it comes to money? She is analytically test scores everything smarter than me.

And she wants nothing to do with money. So are you one of those people that's like talking about money in bed? No, because we've been together for 18 years. And, you know, we had merged our finances before we got married. So, like, it's always been a big part of, like, a level of trust. And, like, it's been my career and my life for the whole time that we've known each other. But she wants nothing to do with it. And it's gotten to the point where, like, once a year, I need to sit her down and be like, this is our net worth.

This is where it's located and whatnot. And it's so interesting because in every other area of life, whether it's health or raising kids or even just, like, putting things together, like physical stuff, she's so much better than me and so much more capable of me. But we were talking about this earlier. I think a lot of couples do lean towards a household CFO who's in charge of things. And I have seen a lot of couples who are like, our financial, the household's budget is 50-50. We make decisions together. He's responsible for this. She's responsible for that.

You can kind of get into some, like that is the most likely to lead to an argument. It is, I have seen in general, not all the time, but people tend to have more, like, like sane, calm financial households when it's like, that's his or her responsibility. And I do do other things. So I do think it tends to work. I mean, it's true like in any company. You need one CEO who and the buck stops there. Like it's their decision to like make these decisions. And if they screw up, it's their responsibility. I do think when you merge, when you like split these things, not with everybody. Some people have made it work very well. But I think you're more likely to run into financial debates when it's perfectly like each person is responsible. And

I think this is most extreme when you have a married couple that has perfectly split finances. This is my money. That's your money. That's like that. And a lot of people do that. That tends to be a big like cause for later financial problems with people. Yeah. For people wondering, Lauren and I did the same thing.

We got, we've been together forever. Money's not been an issue. We basically like we put it all together. I probably lead the household financial decisions. But the conversations we're having is I'm always saying like, this is where it is. This is where you get it. There's like, you know, there's no like, ask permission, but like this is what, you know, this is the budget. We got to follow that kind of

conversation. Like, I never want her to not have the information. Yes, totally. I think, like, obviously one of the biggest issues with finances with couples is one, one partner discovers a secret from the other, secret debt that you never told me about, secret spending you never told me about. That's a big issue. And for a lot of couples, they even, they will put that up with, like, infidelity. If you find out that your husband or wife has $25,000 in credit card debt that you never told me about, that's a big problem. That's a big. I think, why, you're that is, like we've been saying, like money is so core to your social identity that if you're hiding a big part of that, it's like, man, do I even know you? Like, that's, that's, that's a big,

that's a, that's a big problem with people. I think the other thing with, with my wife and I is then we've always lived so far below our means and had such a high savings rate that, like, we never have a budget. We never have to think, like, can we afford this? Because the truth is, like, we don't really want that much. It's never, like, we're so far from pushing ourselves over the edge that it's been like we don't really need to talk about it that much. There's there's really never been an issue. One thing that I have incorporated into my skincare routine, wait for it, is organic grass finished beef tallop. It's so good, you guys. It's also known as liquid golds. The one and the brand that I like is by Toops and Co. This entire skincare and makeup line is

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Like a little manipulation, like maybe at like a book or like a show they could, something that they can just show them. Here's what I think is interesting, is that there are a lot of people, like I said, health and money impact everybody, whether you like it or not. And I know a lot of people, particularly guys who are so into health, and they're at the gym all day. And they're like diet. They're like, they got everything. Their health is so dialed.

If you ask them why they do it, they're like, I want to respect my body. I want to be healthy in the future. I want to live it a long time. I want to be able to hold my grandkids when I'm 70. But then their financial mindset is like the complete opposite. They're like, ah, it's just like a yolo mindset of like, who cares, whatever, let's do it. And if you flip that around, if you told that person that in the financial aspect, they're, are the equivalent of an obese smoking, like the kind of person. That's what you are financially.

Like I think that framing has gotten a lot of people's attention. That's a good framing. And I do think too that if you have no financial background and you're like, I know nothing about it. I really want to get into this. Find something that's going to teach you a financial story. Don't jump into a book that has charts and data and formula because 99% of people will read three pages and be like, this is not for me. I'm not going to do that. But everyone on earth has been impacted by money. And if you can find resources or talk to people who are like, let me tell you my story about money. I'm not going to give you any data. And I'm not going to tell you what to do because there's so many charlatans in finance, but just like, let me tell you how it impacted me.

I think that's a good way because a lot of people will realize that, oh, this fear that I had that I thought was like unique to me, actually almost everyone else is scared about this thing too. Like once you open up about your finances, you realize that everyone has their story. Everyone has their fear. And once you open up about it, it's really comforting to know, like, how many other people are just like you. Are you dying at all the financial quote-unquote gurus that are on social media? Oh, it's terrible. I mean, with very few exceptions, all of them are charlatans. Who's your favorite person that you think is an exception? Yeah, I mean, there are a lot of people who, like, have, maybe they've written books or they do interviews. But once you have your core

identity is like, I'm a, I'm a financial guru and I'm out to tell you what to do. That's the problem. The biggest issue is that advice that's good for me might be terrible for you and vice versa. Very similar to health of just like, you're like, should you take this cancer medicine? You're like, I don't know. Do you have cancer? Do you not have cancer? It's like there's no one size fits all advice for people. So when you have someone online who says, this is what you should do, you're like, well, you don't know me. Are you talking to a 17 year old or a 95 year old widow? You'd think the advice is the same for both those people. So anyone who makes, who is like online saying should do this run for your life because they don't know you. It's, you know, it's why, like,

people have, they keep writing and say, can you do more like me, me do a finance episode? And my sentiment is exactly what you. The stuff that I would say is probably very redundant and very repetitive and not very unique and also not that exciting. And it's like, get out of debt as quick as you can. That means you got to live below your means or change your lifestyle. Live below your means, you know, spend less than you make. It's like very, very boring stuff. create a savings. Like I have some maybe more granular things. Like maybe create a savings account or an investment account that's hard to get to, like, meaning like you can't just wire the money or transfer areas. Like you have to like write a check or go in. But my stuff is not that exciting.

And I think that the best like to your point, like you don't really have to be a guy on Wall Street. You know, you're not, you're not day trading. You're not, you know, you're not running a hedge fund. Like all you have to learn how to do is live below your means and save consistently. Yeah, it's really, I think this is another problem that the financial industry has given to society. Like a bad thing that they've done is convinced you that unless the person is like wearing a suit and went to Harvard and has letters after their name, that they shouldn't be telling you that they can't teach you anything about money. So much about money is just like it's common sense. You could learn from your grandmother. You don't need to hire a fancy financial advisor.

And almost to the opposite of that, a lot of the fancy financial advisors in very nice suits are the people who are out to swindle. you the greatest. I mean, there is so much money to be made giving financial advice that it is attracted to so many people who figured out every trick in the book about how to separate you from your money. And even though there are rules and regulations in place to like, kind of weed out like the flagrant crooks from the system, there is so much advice that looks good and sounds good that would be terrible advice for you. And it's really hard to parse out which is which, particularly if you're a layperson. Now, it's not like that. I mean, it's kind of like that with medicine, where you have people selling supplements and whatnot. That's all BS. And it's like, there's

advice out there that's like, yeah, but that's not really what you should do. But by and large, if you're talking to a doctor who has MD after their name, like, by and large, for the most part, you can trust it. Like, this person knows what he's talking about and they're going to give me good advice. And in finance, that really doesn't exist. And there are some, you know, CFA credentials and whatnot to where you'd be like, oh, this person knows what they're talking about. But you don't need to prove that you know what you're talking about to give financial advice. And that's why there's so much bad stuff out there. You know, one of my favorite things you said in the book is maybe something you're not expecting.

But I think there's so many people online, especially financial, like quote unquote financial experts that are, that's cash is trash. Don't hold cash. You never want cash. You're losing money. Everyone knows who these people are. But I was reading your book and there's this part where you say, if having a little more cash on hand enables you to not have to sell your assets in a down market, cash becomes worth way more than the inflationary cost that you're paying on that cash. You know, for years, I probably, since I started saving, I probably keep more cash per se

than what a quote unquote financial advisor would say is necessary. But for me, what it does personally, I'm just talking about a unique experience, it gives me a peace of mind where in a down market, if a COVID happens, if whatever happens, I don't have to think about selling my savings assets. I can just say, okay, and I know that it's not, quote, unquote, the best investment in terms of the cash, I'm sure, is losing some value. But if that enables me to not sell the things I don't want to sell during a bad time, that cash just became way more valuable to me and personally makes me feel much more comfortable.

Yeah, it totally makes sense. I'm just like that too. And it's easy to look at the cash you're holding and to be like, this is a terrible investment. It's not going anywhere. And then once or twice a decade, you wake up and realize that it's the most valuable asset you have, whether it's the stock market crashes, but because you're you have cash, you're not forced to sell, or you lose your job.

And because you have cash, you're like, we're going to be okay. I think one of the worst things any parent will ever have to do or any spouse could do is to come home and look your spouse and look your kids in the eye and say, I lost my job and we're going to have to move. We're going to have to sell our house or we're going to get kicked out of our apartment, whatever it can be. That could be so psychologically traumatizing for an adult to do that. And if your ability to have a little bit of cash on the side says, hey, so therefore you can

come home and say, I lost my job, but we're going to be fine. We're going to live here. I'm going to go out, start looking for a new job tomorrow. We're going to be okay. The ability to do that will change your life. Psychologically traumatizing for the person who's saying it or the child who hears it. Both, both. Absolutely both. That's interesting. And almost in equal parts, too. I mean, what children want, not that I'm a parenting expert or child expert, but I think what kids want is stability from their parents. And if you come home and say, hey, this place where we've lived where you've got friends next door, we have, we have

to move. We don't want to move, but we have to do it for financial reasons. That is so in like instable for that child that's gonna leave them. Now kids are resilient. They'll eventually recover from that. But I think kids really just want stability at home. Yeah, I think the reason that I and I've thought about this a lot as I talk to people in our own life. Like why people don't like to talk about personal finances. It's this thing. It's like, okay, that'll be 30 years. I'll deal with that. So that's number one. But they're not correlating it to what we're discussing here, which is back to optionality. If I lose my job today and I don't have a paycheck, but I have a little bit of cash savings and then I can

stay in the house and think about the next move. Just that psychological stability right there alone for myself and for the family is worth, it's going to pay dividends on that savings. And it's not, this is not like, oh, I need this at 75. It's like, I might need this in a month. I think we're really bad at predicting shit that can go wrong. Yes, that's exactly. And we can't plan for it. If you list, make a list of 10 bad things that could happen, recession, divorce, can't cancer, like make a list of things like that, the odds that at least one of them will happen to you and everybody is almost 100%. Nobody goes through a long life without having some really bad things happening to them. But it's so painful to accept that and think that that people just want to be

like, I don't even want to think about it. But then when that happens to you, I mean, not to get too grim about this, but I've often thought like the psychological exercise of what if I was on my deathbed tomorrow? Would I regret the fact that I've been a big saver? Like, would I regret and be like, I should have bought on a nicer car. I should have done more travel. To me right now, the answer is absolutely not. Because if I were on my deathbed tomorrow, I would take so much pleasure in knowing that my wife and kids are going to be okay financially. They're going to lose, she's going to lose her husband. She's going to lose her dad. But the houses, they can stay in the house. I'm going to take all the money on my deathbed. I'm going to be like, sorry. I took all the money. You guys are

going to have to figure it out. The last week is going to be really fun. It's okay. But I think that's the way to think about it is like, you know, take those like that extreme and be like, and I think that's a good litmus test for whether you're saving too much or not enough is to be like, if something really bad happened, would I look back with a sense of regret or be like, no, I'm actually pretty glad and proud that I made those decisions? I want to teach my children the importance of finances. What are some things that you do with your kids that you think will really help them be smart with money in the future? How old are your kids?

Four and two. Mine are four and eight. And I think what's important, every parent will know this is that I think the answer to that is you don't necessarily need to teach them because they're watching already whether you know it or not. Oh, great. They watch everything, don't they? I mean, there's this study I saw years ago that was so interesting, which is that your political beliefs, like 80% of them come from your father's political beliefs. You just kind of watch what you're like definitely, particularly your father. You overheard him saying things at the dinner table.

But by and large, he did not sit you down for the most part and say, this is why you should vote Democrat and push you in that direction. You just picked it up subconsciously. And I think finance is the same. Like even if you're not sitting your kids down and saying, I want to teach you about money, they watch you when you go to the store and you say, no, we can't afford that. They watch what you're buying. They watch what you're wearing.

They watch over here you and your spouse talking about money at the dinner table. So by the time your child is a teenager, they already know a lot about you financially. And I also think particularly teenagers have such a natural tendency to rebel that if you sit them down and say, I'm going to teach you about compound interest. That's in one ear out and out the next. So that's not a cop out to say you can't, you shouldn't teach them anything. And then the other thing about people being very individualistic is so our four kids are young. And I don't know whether my four-year-old daughter is going to be, does she want to be?

want to be a corporate lawyer when she grows up or does she want to work for Greenpeace when she grows up? Like, I have no idea. So I don't want to steer her in one direction and say, you should definitely do this. This is the lifestyle you want to live because the lifestyle that I and my wife live might not be right for her. That might not be her the best life that she could live. So it gets kind of dangerous to be like drill into them. Like, this is what you need to know. I think the best you can do is lead by example of just like, look, this is how your mom and I, you're your dad and I manage our money. And like, whatever works for you is going to work for you.

I'll give you an example of this. My parents have been vegetarians for 50 years. They've been married for 48 years, something like that. When we, my, when myself and my two siblings were growing up, my parents said, this is how mom and dad eat. But if you want to eat meat, go do it. We're not going to force you. So about a time that my brother and sister and I were like 10, and we went over to a friend's

house and I tried steak and I was like, oh, that's good. That's some good stuff. we eventually all started eating meat. And my parents were totally fine with it. No issue whatsoever. And I think that's a good way to think about money as well. Is like, hey, this is how mom and dad do it. I'll tell you why we do it.

I'll tell you some of the pros and cons of why we do it. But you got to figure out what works for you. The other thing is that this is specific for high income parents, is that your kids got to make their mistakes on their own. If you're just shoveling money at them and bailing them out at every direction, their kids are completely screwed. You have to let them fail on their own. they need to learn the power of a dollar.

And the only way to learn that is to experience the power of its scarcity of like needing something but not being able to afford it. I'm obsessed with the way that your parents parented. That's exactly. I've never been able to articulate what that is. But it's like, we're a vegetarian, but you can be whatever you want. I love that energy. I don't know what it's called.

Non-judgmental. But you see, that word judgmental is the most important because when my siblings and I started eating meat, my parents never looked down upon us. I love that. They never criticized us. They never, there was no side eyes ever. Very involved. It's always just been, this is what we do. That's what you do to each their own. I love that. I think you can apply that to anything. We're entrepreneurs, you don't have to be. We like to be on television or film. You don't have to, like, I think you can use that with every single thing. And I think a lot of angst and young adults comes from, my parents wanted me to be to be this person, but that's not who I am.

It's so many people. And they feel bad that they're not, they didn't live up to the expectations of their parents. Totally. And also they feel bad, they feel bad that their parents aren't accepting them. It's a whole, like, shame. Totally.

And I think that leads to a lot of depression or a lot of, like, broken relationships between parents and, and their children. Yeah. I want to stay on the note around psychology here when it comes to finances. And one of the things you talk about

is the difference between rich and wealth. And I think, did you say rich is what you, what you see wealth is what you don't see. Is that from yours? Yeah. Yeah. So rich by my, I'm making these definitions up. Sure. It's just my own definition. But I think this is really interesting topic. Rich in my definition would be you have enough money to pay your bills. You can pay your credit card bill and your car lease payment and your mortgage payment. Like, you're actually making it work. Wealth, by my definition, is very different. Wealth is what you did not spend. It's the cars you didn't buy. It's the house you didn't buy. The jewelry you didn't buy.

It's money that you didn't spend and therefore you saved. You accumulated it. Maybe you invested it. And that's what wealth is so important is because wealth is what gives you independence. Like the ability to make a car lease payment, it might be great and it might give you a lot of fun and pleasure in life. Or you might have a car that you're struggling to pay, but it looks like maybe it's a, you know, a sports car and it looks very rich, but like you're struggling every month to come up with the payment. You're struggling to make it, which is the opposite of independence. Like at that point, the money owns you. You don't own it. It owns you. And so I think most people, not everybody, everyone's different for everyone, but most people want

whether they know it or not, they want to be wealthy. They don't want to be rich. They want to be wealthy. They want to have independence. They want all the monkeys on their back that are giving them so much stress and anxiety today. They want those monkeys gone. And they're going to do that when you have independence, when you can wake up and say, look, I actually hate my job.

I'm going to quit it. I actually hate the city. I'm going to move somewhere else. You have the independence to do that because you have money that you did not spend. It's wealth. It's not rich. It's wealth. I think it's a really important thing.

People use that term, fuck you money. is my language. And I think that they think that it's this astronomical number. To me, fuck you money means you have enough to live the life you want to live specifically to you. And you could tell anyone to F off because you have enough as it is to live exactly how you're living. And that doesn't mean you have to have a billion dollars or hundreds of millions. It just means having enough for you to be happy. Yeah.

I think there are people with driving Honda Civics that have fuck you money. Yeah. Because their ability, like they're doing exactly what they want. And there's people with Lamborghinis who are struggling. to make that next lease payment. And that to me is like, that's its own form of poverty. It's a weird form of poverty because you're driving a Lambo, but it is very much a sense of poverty because that car owns you.

It has got you by the tail and there's nothing you can do about it. Yeah, like I always think it's such a tragedy. Like if you frame it in the way that you are broke and living in stress and discomfort because it was more important to live in a big house and drive a nice car to impress somebody that does not give a shit about it. Like that is such like that is such a mess to be in because, it's avoidable, meaning you did not need to make that decision. You don't need to drive that car. You don't need that bigger house. You don't need that handbag or those nicer clothes or that watch, whatever.

You're doing it for an external event that's probably also not manifesting. Yeah. See, and that's important. I do have a lot of sympathy for people in that situation because a lot of them, the reason that they have such a strong desire to live in a mansion and drive a Ferrari is getting back to it. They want respect and admiration. And they're not getting it from their marriage. They're not getting it from their career. They're not getting it from their children or their community or their friends. So then they then resort to, well, if I have a fast car that goes room, room, maybe people will like me then because they don't like me for anything else. So I think a lot of it does come from this source of pain in their life. And I think the people who are the most flashy tend to be, not all

of them, but tend to be some of the most broken and people who are in the most pain. And they're willing, their desire to be like, look at my diamonds, look at my car, look how great my house is. comes from this deeper internal pain of like, I don't get respect for anything else, but maybe you'll like this part of me. What is it like to write such a gnarly book that is a bestseller that everyone's reading? I mean, I've seen this book everywhere

and then have this pressure that you then are going to write another book. I think about that all the time because even with my product line, when I create a product that I'm just like, this is it, and then it launches. And then the next day I'm like, okay, I have to go do it again.

Again, it's a lot of pressure. What does that gap look like for you? I think in some sense, yes, there was a lot of pressure. And I know I needed to keep my expectations lower and like and whatnot. I think you just, for me, it was just like, look, I'm, I'm proud of my second book. The second book is amazing. You hit it. Thank you.

I just wonder what it looks like before it's this. Yeah. To tell you the truth, I don't think I thought about it that much. I've always had this weird quirk in my career where I always say I'm a selfish writer. I write for an audience of one, which is me. I don't think about other people. And I think it's a great way to write because you get the best writing when you're just like, let's pretend no one's going to read this. Let me just dump my soul on the page and like give you everything I've got. I think if you're too worried about what are people going to think of this, everyone's going to

have really stale boring writing. You're not going to take any risks. And so I've always, I've often done a good job about being like when I write or when I'm thinking about the next book. Like, let's just pretend no one's going to read it. Like just write a, book that I want to be written, that I would want to read myself. And then maybe there's a leap of faith that if I like it, other people might as well. What's so interesting about this one is it's such it's such an interesting observation. How did you start observing what you wrote about in this book? Tell us when like the epiphany came. Yeah. For people that aren't familiar in Morgan's second book, same as ever a guide to what never change is phenomenal. But yeah, dive into it. I'm an amateur student

of history. I love reading history. And to me, what's always so fascinated about history is not to read about something that happened in the past and realize how different it was in the past. What's way more interesting to me is to read about something that happened 100 years ago and be like, that's exactly what people do today. Hasn't changed whatsoever. It's the same thing. And I think when you start looking for it, it's everywhere. You can read about what people were doing a thousand years ago

and their sense of greed and fear and willingness to cling to their tribe, it's never changed. And there are so many behaviors that have not. never change, and therefore they will never change in their future. They're just innate parts of how people work. And those things that never change, I think, are the most important things to study. A lot of this, too, came from my career as a finance writer, and I just got kind of disgruntled at how bad everyone was at forecasting. Like, when's the next recession? What's the stock market going to do next? Nobody has any idea. Nobody can do it with any consistency. Everyone sucks at it.

So then you can say, like, you can become a cynic and just say, nobody knows anything. Don't even try to forecast. Or you can say, well, rather than trying to guess what's going to change in the future, can we just study what never changes and know that regardless of what happens in the future, these kind of behaviors are going to be a part of it. So that's really where this came from. I'll tell you one specific example of why, like a lightball moment for me. No, I'm not going to do nerdy about this. There's a book called The Great Depression, a diary. And it was written by this bankruptcy attorney in Youngstown, Ohio during the Great Depression. He just kept a personal diary. Just for himself.

Michael's buying it on Amazon tonight. I can already see his eyes. If you're a history nerd, wonderful. You've got to send him all your books. You love history. To clarify, this guy's just writing his thoughts as the days ago about. Just his personal diary for himself. He doesn't think anyone else is going to read this.

And he was a bankruptcy attorney. So he had this incredible window into what people were going through financially during the Great Depression in the 1930s. His son published it in 2010. And it is inadvertently, in my view, the best finance or economic book ever written. Because this guy who was writing, in the 1930s, he didn't know how it was going to end. Every other history book, the author knows how it ends.

And that's going to color what they write about it. This guy writing in the 30s has no clue what's going to happen. And what's his energy? Lots of it. So he was okay himself. He was a bankruptcy attorney, so he actually had a lot of business for himself. But he was a very keen observer of what other people were going through. And one of the things that stuck out from this book is I was reading a diary entry from,

I think, 1932. And it dawned on me. I was like, if you change. the dates in this diary entry from 1932 to 2008, everything fits in. What he was talking about back then perfectly fit into 2008. And then like two pages later, he says, he says, if you change the dates from 1932 to 1894 when they had another recession, everything fits in. So it's like it's the same thing over and over again.

Like the details change, but it's the same movie over and over again. It's fine. Lauren and I got asked to speak at CES, which we went it and it was a marketing thing. And it was a tech concept. But everybody keeps out like, what do you guys forecast is the next trends? Like, what's happening on TikTok? And I actually referenced your book. And I said, you know, in our business, it'd be nice to be able to predict the trends.

I don't know anybody that can. What I see is the people that are on a trend, it's like they kind of fell into it, right place, right time. They didn't see it coming. And they're just like, they're the right person for that or they made the trend. Yeah. But the businesses that try to chase the trends and keep up, they're always a step behind. Yeah. So what I was telling was like what we focus on on this show is like, what is still.

going to be, like this conversation, I think is still relevant 10 years from now. I was, I used to be a writer for the Wall Street Journal and something that drove me crazy. And all press media does this. It's not specific to Wall Street Journal. But they would, I would write a piece and an editor would say, what does this have to do with this week's news cycle? And I'd be like, it doesn't. And that's why I think it's relevant. I, I always thought that if I was writing an article that was going to be stale next week, it wasn't relevant at all. I wanted to write something that would theoretically, if you read this, years from now, you would benefit from it. And so I think that idea of like what never changes,

let's just focus on that rather than getting sucked into the hype cycle or like the ignorance of thinking that you know what is going to change when nobody does. I think it's really important. The Skinny Confidential, him and her podcast is sponsored by Better Help. Let's talk about online therapy. If you've been paying attention and listening to this show and you've heard all of the incredible people that have come on, so many of those incredible people have, one thing in common, and that is that many of them utilize therapy to share their ideas, to get thoughts off their chest, to work through issues, to feel better, to work through any kind of sadness or to work through any kind of anxiety or just anything that's troubling them

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BetterHelp.com slash skinny. Lauren and I have a weekly newsletter now where we send our favorite resources. And one of the things that I put in the newsletter this last week was Element. We have been talking about Element on this show for a while now. What I love about Elements so much, especially after we've moved to Texas, is that this keeps you hydrated. So many of us are running deficient when it comes to our electrolyte balances, and this causes headaches, cramps, fatigue, brain fog, and weakness. For those you that aren't familiar with what Element is and have not been listening to this show

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individualized packs that you can just dump in very easily. If throughout the middle of the day, you start to feel a little slow sluggage, I just put it in a glass of water, drink it down and feel much better. And like I said, it's just going to help you stay way more hydrated. I know many of you are now using sauna. This is something that I also carry into the sauna and drink throughout the sauna session as well or even after. So check it out. Of course, we have a special offer for you, go to drinkelement.com slash skinny to receive a free element sample pack with any order when you purchase through our URL. Try it totally risk free. If you don't like it, give it away to a salty friend and they'll give you your money back. No questions asked.

There are very low return rates and high reorder rates. You can feel confident that you're getting a great product. So again, visit drinkelement.com slash skinny. This podcast is brought to you by Squarespace. Squarespace is the all-in-one website platform for entrepreneurs to stand out and succeed online, whether you're just starting out or managing a growing brand. Squarespace makes it easy to create beautiful websites, engage with your audience, and sell anything from products to content to time, all in one place, all on your terms. I have been talking about Squarespace for years now, and I've also been talking about how important it is to own your brand, your platform, your online footprint. We live in an age where we give all of our information, all of our data,

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It has all sorts of tools for anyone trying to create any kind of online presence. So head over to Squarespace.com for a free trial. And when you're ready to launch, go to www. www. Squarespace.com slash Skinny to save 10% off your first purchase of a website or domain. Again, that is Squarespace.com slash skinny to save 10% off your first purchase of a website or domain. Speaking of the news, I think this is very relevant. There's a chat. chapter in the book, I can't remember the exact name of the chapter, where you talk about the difference between the news we see now compared to the news people used to see. Yeah. And you talk a lot about back then, if you were reading, it was mostly local news,

whether it was a local paper or a local news station or TV station. And so, and tell me if I'm wrong, as I'm saying this, a lot of the time you would see a lot of really good news. Yeah. And every once in a while, you would see some bad news because the chances of something bad happening in a small town were rare. Yeah. But then if you expand that to city, you see there's a greater chance for bad. If you expand it to state, greater chance. You expand it to country even greater. And if you expand it to the world,

there's 100% chance you'll see something bad. And I think the point you're making is the world actually maybe hasn't gotten as bad as we think it has. It's just we're exposed to only the bad stuff all the time. Exposed to it. Like the local news writes about the high school football game and the new bakery down the street that just opened. Global news writes about terrorist attacks and plane crashes and wars.

And just because, so, like, people want to, there's an attraction to pest, pessimism because you have to be able to like it's natural to pay more attention to bad news than good news because you have to be able to survive the bad news in the order to benefit from the good news. So people are way drawn. They're drawn much starker to bad news and good news. And yet once you expand it from local news to national news to global news, all you're going to hear about is bad news. I think it's left people more pessimistic than they should be because they turn on the news. They read the news and it's bad news, bad news, bad news, bad news, bad news.

And they miss that they're actually living in a world that is way better and safer and more prosperous than it very likely was in your parents' generation, in your grandparents' generation. But you don't know that because every day you turn on the news and it's more bad news. And so I think just when we went from local news to national to global news, it totally shifted people's mindsets of their perception of the world. How do you consume the news? I read lots of different news. I don't pay too much.

I think if you get a tribal affiliation with any news organization, whatever it would be, that's a recipe for disaster. I try to read as much as I possibly can from a dozen different news sources. And I would also say that I read more books than I read news articles because I'm more interested in like what's never changed. So yes, there are things like I want to know what happened in the world today. And I want to know like is there a big, is there war like things with the presidential election? I want to stay current on what's going on. But mainly what I want to learn about is something that was relevant

100 years ago as it is today. And so I'm much more likely to read a history book than the news. And I think that actually gives you a much better perception of what to pay attention to in the news if you have a more keen sense of history. There's a great quote that I love,

which is, everything seems unprecedented if you haven't engaged with history. Which is like, if you're not a student of history, everything seems like this is the first, time it's ever happened. And I'm like, this is really bad. This economy is really bad. This election's really bad.

If you're a student enough of history, you're like, no, it's been like this forever. Michael's literally popping a boner right now. This is his favorite. Literally, this is his favorite. You guys should be in a book club together. It sounds like he's speaking. He loves things. In another life, and I joke about this, I would have been a history teacher.

Yeah. Because I love history and I love reading about random things. But I love in your book, what you even wrote about the pandemic. because I think you said something, and again, like, I'm just trying to recall from the memory banker, but I think you said something like,

in the past, this may have been like one page of a textbook. This happened in the early 1900s because it happened so often. Pandemics all the time back then. But because we haven't seen them for so long,

and because, again, even if people don't want to believe this, life has improved so much, especially from medical advancement standpoint, this was so far removed from what people are used to dealing with when in the past is like, oh, another pandemic's here.

Like, here we go. Plague, sick. And so we freaked out and we behaved in a manner that our ancestors would have just been like, oh, it's just like another day. If COVID happened at any point before 1900, the people living at that time would have been like, yeah, you got a pandemic and millions of people died. Like, welcome to the real world. But because we got so good at preventing pandemics with vaccines and whatnot that when COVID happened, everyone was like, holy shit, what is this. Like, this might kill me. This is, like, it was such a rare thing.

And I think it's probably true for wars as well. For most of history, there's a lot of wars all the time. And it's going to impact you. It's not overseas. It's in your backyard. Or raiding or whatever it may be. Yes. And now that we've gotten to be a more peaceful society, when there is a war that happens,

it's a much like, oh my God, like the world's coming to an end kind of thing. So I think a lot of things that have improved life, we're healthier and we're safer, it means that when you do have a bad event, people don't know how to respond to it. Yeah, I worry about that all the time that we've created such big safety. levels that the most minor adversity, and I'm not saying COVID was minor, but I'm saying adversities that would not have been maybe as adverse to our ancestors are so significant for us that we just don't know how to deal with them because we're so, I mean, when I tell some of our younger sisters that the world is actually improved and that we're actually

safer and that our circumstances have actually gotten better, they look at me like I'm a nut. I'm like, well, if you're reading bad news all the time and you're consuming bad content and you don't know any history. And you don't realize that it was likely that some raider showed up in your backyard and chopped off your head and raped your wife. This is very extreme. Like this could happen. It happened all the time. Like you don't, you can't contextualize how good you have it if that makes sense. And I would, I would rather live in a world in which I'm shocked and scared of COVID because I've never experienced. Of course. Then live in a world in which four of my five kids die before age five. And so even if like, even if living in a safer world means we live in a safety bubble.

it's still preferable, even with all the psychological crap that comes from that than to live in the old world. It's why I think it's so important that people read history, though, just to get the context of the perspective. Like maybe you don't have to be a history buff, but just to be like, oh, these other things happened. And like, we actually have it pretty good. I just think it puts you in a greater mindset to be more grateful for the time that you're in. There's a book by Adam Smith. And I think he's talking about the 1700s in England. And he's talking about, like, out in the country, not in the city.

And he said, it's paraphrasing me, he said, it's not uncommon to meet a woman who's had 20 kids and 18 of them died before age five. And that was what life was like not that long ago. That's probably an extreme example, but maybe it's not too. Maybe it's 10. You had 10 kids and seven of them died. Oh my gosh. It's been common in a lot of cultures to not name your child until they're three or six months old because the odds that they were going to die before three or six months was so high that it's like, don't even get it. Don't even give it a name yet because it's not going to stick around.

That's most of history. And so I think that's where, like you said, it. If you become a student of that and then you think about what people are worrying about and scared about and pissed off about, you're like, do you know how good we have it today? Like, nothing is better at giving you perspective than reading history. I also, on this note, and I shared this chapter with Lauren when I was reading it when I was reading your book, people for some reason, and maybe it's television, they look back on the 1950s as like this glorious age, white picket fence, everybody's living happy.

Yeah, that was a good one. Like everybody says, oh, life was so much better. 50, even people that are like our age that you weren't even alive in the 50s. It's like the nostalgia for it. Leave it to beaver. Leave it to beaver. And it's like this perfect family with like, you know, husband, wife, two kids, picket, like white picket fence, dog name spot. Like everything looks perfect. Leave it to beaver is like the perfect example of it. And what's always so interesting about the nostalgia for that is if you look at the numbers, they were not better off back then. They were not wealthier or making more money. They did not

have more job security. They were not living like, by almost any metric, people are better off today than they were back then. So then it's a question of like, well, where did that nostalgia come from? Why do we think it was so good if it wasn't? And there could be like so many answers for that. One of which is just before the 1950s was World War II and the Great Depression, which sucked. So any prosperity that you had in the 50s by comparison of what you just lived through felt amazing. But the other that I think is really interesting is that the 50s were this very unique period where for a very short period of time, like 10 or 15 years, there was very little wealth inequality. The gap between rich and poor just collapsed. A lot of that was just like an echo

from World War II of like how companies managed. Like it wasn't proper during the war to pay your executives millions of dollars. You couldn't do it. And kind of that just stuck around in the 1950s. The top marginal tax rate was 91%. You're paying 91% federal taxes back then. So if you're rich, like the government just took all of it anyways. And for better or worse, I'm not saying that was a preferable system. But for better or worse, what it did is it created this mindset where it was very easy to keep your expectations in check. There's like there's no such thing as an objective level of wealth. Everything is just relative to other people. It's just how much money do I have relative to that person that I'm looking at across the street? And in the 50s, most people looked at their

neighbors and their coworkers and their siblings. And they're like, relative to them, I'm doing pretty well. We make about the same amount of money. And our homes are the same size. And we're going on the same vacations. We're wearing the same clothes. Everyone felt like relative, if I look around my city, I'm doing pretty well relative to other people. And therefore, like, your small homes and your small paycheck and you're camping for your summer vacation felt great because everybody else did it. And I think what happened over the last 70 or 80 years is our incomes doubled and we're living longer. We're retiring earlier. Like all these statistics are like, hey, we're richer and doing better, but our expectations rose by even more. And social media makes it like just,

dumps gasoline on this fire. Because now the people who you're comparing yourself to, it's not your neighbors and your coworkers. It's a curated highlight reel on Instagram of people who are giving like the fakesest view of their life. And so no matter how you're doing, everybody on Instagram looks happier, richer, and prettier than you. And therefore, like, I think the younger generation, this is not, you know, I think a lot of people agree with this. Their ability to let their expectations spiral out of control is so much greater than even ours was. Like if you grow up with TikTok and Instagram and Snap, like you are anchoring, like your version of success and your version, your expectations of beauty and money and happiness is so much higher than it was for us. Yeah. When I was growing up, the richest people would see is like we would go, I'm not going to say the person's name, but there was one house that everyone would go, like, ooh, we can get a king size snicker bar.

Yes. And they live in like a house that's double the size of our house. The owner of Schmickdwanald. Yeah, yeah. But anyways, the point is, is. We would see like something like that and that was like... We used to trick or treat together at 12. But to your point, like we were, you know, Lorne and I didn't get smart phones. I graduated in 2009, so it was similar.

But we didn't get smartphones or social media really till we got out of college. And so our perception, whether it was in school or in college or when we were kids, was what were our neighbors doing? What were the other kids in school doing? What were the other families doing? And relatively at all kind of, like, of course you would see some doing better than others. Maybe that family had a nicer car or they would take a nicer trip. But like the kids now, they will log on social media and they will see maybe they live in what would be considered just a regular normal middle class home.

But then they're seeing somebody on social media flying off in a massive jet to get on a boat, totally. Whatever. And that's their measurement now. That's their benchmark. And if they're learning that benchmark when you're seven years old, like that's a tough thing to overcome. Similarly, like when I was a kid in the 90s, rich people drove new pickup trucks and poor people drove old pickup trucks. That was the difference between rich and poor. And my son, who's eight, he watches a lot of Mr. Beast.

Are you familiar with Mr. Beast? I actually think he's an awesome guy and he does a lot of good. But his schick on YouTube is like, let's give away a million dollars in the most frivolous way we can. So my son, who's eight, watches a lot of this. I think he rounds every amount of money less than a million to zero. Like if any amount of money is less than a million, like it doesn't really matter. Not because of how we live, just because of that's the media he consumes. And once you get into, there's a psychologist named Jonathan Haid from NYU who's done a lot of research on this.

Teenage, depression, anxiety, and suicide had been like trending down for years. In 2012, it skyrockets. It doesn't trend up. It explodes higher in 2012. And is that way? What happened in 2012? Facebook mobile. Because now every high schooler is now they come home from school and what do they do?

They flip on Facebook or now Instagram or whatever. And they're looking at people who are prettier, happier and richer than me. Do you think the pendulum's going to swing, though? For me, I find because of all social media now, that I crave thinking time, walking, meditation. Like, I crave all these things that I don't know that I would necessarily crave if we did not have social media. Yeah, I think you crave it. But for most people, including me and maybe you, like, even if you're craving that walk, how much time do you spend scrolling Instagram? Like, a lot. Like, those companies are big and successful and worth a trillion dollars. and Mark Zuckerberg is one of the richest men in the world because it works, because it is so addictive to sit there and scroll through.

And what the smartest minds of our generation have done. They didn't go to NASA to build spaceships. They went to Facebook to figure out how to get your attention. And like, what is a post that is exactly going to trigger the most amount of dopamine in your brain so that you're going to keep flipping, keep flipping, and they're so good at it? If you were to predict the future with all of this, what is never going to change in 20 and 30 years. I think there's a really good chance that our grandkids are twice as rich as us. They're living way longer. They're living in a more peaceful world. By any metric, the world that

they live in is better. And they're not any happier. If not, they might be a little bit less happy than we are. I think that's what it is. Like, it's always been the case that your expectations rise with your circumstances. That's always been the case. But it's so much more potent today because of social media. So they're going to look back on us and be like, God damn, those nostalgic leave it to beaver. And I think that's exactly right. They had it all. And they'll live in a world where the median wage is $150,000 a year and they feel broke kind of thing.

Because they live in a world in which unless you have three Mercedes, you're not doing well. So if you only have two Mercedes, you feel like you're falling behind. It's just like, so in the 90s it was new pickup truck versus old pickup truck. In the future, it's going to be like massive car collection versus, oh, you only have one BMW, you like poor little you i think that's that's where it's trending it's just a world in which expectations can explode to degrees that we really haven't seen this podcast in your book is going to be one of those things that they look back on like you're looking back on the depression book yeah no but it's like as we've gone through i mean both of your books i think a common theme is

having lower expectations and being happy with what you your current circumstances and not believing that by chasing more that's going to make you happy it's like it's like it's In a lot of ways, it's like chasing less actually makes you happy. It's very true, but it's also much easier said than done. Sure. Like, people are wired to want to do better than other people. Like, from an evolutionary perspective, it makes sense. It doesn't matter what resources I have.

I just have to outcompete you. If we're competing for money and land and mates, like, it doesn't matter how much you have, just as much as you can outperform the other person. And even if you have a ton of resources, if the other person has more, he wins. And so it's always going to be the case that even if you are getting wealthier, if other people are getting even wealthier than that, you're going to feel like you're falling behind in relative amounts. A person living in poverty in the United States today has access to technologies and medicines

that would have been indistinguishable from magic to the richest person in the world 100 years ago. John D. Rockefeller was the richest person to ever live, adjusted for inflation who's worth almost half a trillion dollars during his day. He never had Advil, he never had sub. He never had sunscreen. He never had penicillin. He never had blood pressure medication. All these things that even low-income people can take advantage of today.

He never had. But low-income people don't wake up feeling like they're richer than Rockefeller. Wow. Because those new technologies, those new luxuries, become necessities, like in the blink of an eye. So you can easily imagine a world in which in 50 years, let's say, I'm just making this up, we have eradicated cancer. When you and I think about that today, it's like that is such a dream world because I, and I'm sure you and everyone else, know someone who's died from cancer and the tragedy that that left on their family.

Let's imagine a world which that's just removed from society. Well, the people living 50 years from now won't even know, they'll move on to some different work. It won't even be an issue. It's like it's dying from an infection from a finger cut is not a thing anymore. In the same way that we have virtually eliminated polio from society, which even in our parents' time, when our parents were children, they and our goals, they and our government, they and our grandparents were terrified of polio and they should have been. It was ruining lives left and right.

And we don't even think about it. It's not that we wake up grateful for it. It's just completely out of sight out of mind. We never even think about it today. And so you can imagine a world in which things get so much better, but people don't really realize it. Yeah, it's funny. I'll even catch our parents, and I know we'll go up against time here, but I'll catch our parents talking about how great things used to be. And then I'll also see them comparing themselves to their current circumstances now to other people that are, you know, maybe further along, because they're on social too. Yeah. So it's like maybe their vision of what used to be is also warped because they just didn't see

that there's always been people further along. Yeah. They didn't know about it. The other thing is, you know, I mentioned from the book, the Great Depression in the diary, when he was writing it, he didn't know how it was going to end. He didn't know that the depression was going to end. I think there's a lot of that when you have nostalgia about the past. Like today we look back at the 1950s and be like, oh, it was so great.

But if you were living in the 1950s at the time, you, like, the biggest fear at the time was nuclear war, that the Soviets were going to launch a nuclear missile. And that was a very realistic fear. Like, people were living with a great sense of dread and fear. But now today, we know that didn't happen. There was no nuclear war. So we kind of just, like, push that out of the way. So, like, that's where a lot of nostalgia comes from. Like, in the moment, when you don't know how the story is going to end, there's so much to worry about.

But you look back in hindsight, and you're like, oh, no, it actually should have been a great time. I always hear, like, the parents say, oh, the 80s. The 80s. I'll give you a really stupid example. The 80s were so great. Yeah, yeah. I'll give you a stupid example here that the younger listeners, I'm like, what the hell are you old people talking about?

I was taught, we were training the other day in the gym. And I said, do you remember when there was like those off brand no name MP3 players that, you know, you could get and figure out how to get on limeware and Napster? That's how you could figure out one or two songs. Like people don't realize now the effort it took to take a song from a computer, find it. Put it on a device if you were lucky enough to get it on and then listen to one to 10 songs. What about your VHS porn? Yeah, well, that's a whole other.

That's a whole different thing. Everyone had like the big black binder of CDs. But Disney movies. And you had your mix and they got scratched and then they skipped and like, yeah, yeah, it's so much better today. I had like a personal story here. My wife and I, 12 or so years ago, we lived in this amazing apartment in Bellevue and the suburbs of Seattle. It overlooked the lake. It was right downtown.

We didn't have kids. And this was just a couple months ago. I was like, man, life was so good. That was our peak living. no kids, living on the lake, everything was great. And she reminded me, and she was right. She said, Morgan, you were the most anxious, depressed, saddest that you've ever been when we live there.

But the crazy thing was I had this nostalgia for how great life was. And I think I look back and I'm like, it should have been good. Like if I piece together like how I was living, it should have been good. But at the time, in the moment, I had all these other things to worry about. So that like sense of nostalgia, I think really impacts people. And it makes them more pessimistic about the current world. Because when you look back and you're like, the past used to be good, but it's not anymore, then like you're bummed out about that.

I think almost all nostalgia is false. Not everybody, but for most people, most of the time, things get better. Morgan Housell, same as ever in the psychology of money. Where can everyone find your books and your Instagram? Well, everyone buys books from Amazon. That's where it is. But it's ever. The guide to what never changes.

We're going to Amazon. If you're an old school and you're still going to Barnes & Noble, it's there too. And then I spend most of my time online on Twitter where my handle is Morgan Housel. You know what I am nostalgic for, though, going into Barnes & Noble and just perusing the shelves when there was no Amazon. The smell in there. Yeah. I do miss that. I still do it.

They're still around. They're making a comeback. There's one here. They're doing well. We should go this weekend. We should get the toys out. Morgan, where can everyone find your Instagram? I don't post much on Instagram.

You'll find pictures of my kids on Instagram. My handle is Morgan Housel. You can go check it out there. Twitter? Same thing. Handles Morgan Housel. Amazing. Thank you so much for coming on. Thank you. You know what's not same as ever. It is now X. See, I'll never fall for that. I'm always going to call it Twitter. Sorry. Thank you, Morgan. Appreciate you doing this.

Thanks.