Seven money hacks: From compounding to leverage tricks

1. 0:00 – 1:42

   Intro

   1. SBSteven Bartlett0:00

      53% of you are planning to make a New Year's resolution about money, finance, and investing this year, because you want financial freedom and financial security. So, we went through every conversation we've had about money, personal finance, and investing, and we found the most replayed and most shared moments from those conversations for you. Everything from life-changing advice on saving, spending, investing, tax, crypto, buying a house, and having a money mindset.

   2. GUGuest0:27

      The most expensive thing that all of us are paying for is the information that we don't know.

   3. So, how do you make the most money humanly possible? It's two things.

   4. Let me tell you a few key basic things about investing and money.

   5. It's gonna lead to amount of success that will literally put you in the top 5% of investors.

   6. And never have to worry about money again.

   7. SBSteven Bartlett0:45

      If you listen to this conversation, we believe your money goals will come true in 2025, so take notes. Quick one before we get back to this episode. Just give me 30 seconds of your time. Two things I wanted to say. The first thing is a huge thank you for listening and tuning into the show week after week. It means the world to all of us, and this really is a dream that we absolutely never had and couldn't have imagined getting to this place. But secondly, it's a dream where we feel like we're only just getting started. And if you enjoy what we do here, please join the 24% of people who watch this channel regularly and have hit that subscribe button. It means more than I can say. And if you hit that subscribe button, here's a promise I'm gonna make to you. I'm gonna do everything in my power to make this show as good as I can now and into the future. We're gonna deliver the guests that you want me to speak to, and we're gonna continue to keep doing all of the things you love about this show. Thank you. Thank you so much. Back to the episode.

2. 1:42 – 5:00

   Investing 101

   1. SBSteven Bartlett1:42

      So, wha- what is the S&P 500 for anybody that doesn't know?

   2. GUGuest1:46

      Yeah.

   3. SBSteven Bartlett1:46

      And what are the returns that I'm likely to get from investing in the S&P 500? I really wanna simplify this for people that are at the very start of their investing journey.

   4. GUGuest1:55

      Yeah.

   5. SBSteven Bartlett1:55

      You know because, I mean, this is what you spend so much of your time doing that... I just think about my, my team here. So, the Diary of a CEO, there's about 30 people and we started talking about money one day. And it was mind-blowing how nobody in my team's lives had ever had the conversation with them about investing.

   6. GUGuest2:12

      Yeah.

   7. SBSteven Bartlett2:12

      We all think of investing as something that rich people after the age of 40 do.

   8. GUGuest2:16

      Yeah.

   9. SBSteven Bartlett2:17

      Once you have a million dollars. Um, alt- if you don't have a million dollars, then the on- only other way to invest we're taught is to buy a house.

   10. GUGuest2:25

       Ah! This is driving me insane.

   11. SBSteven Bartlett2:27

       It's true though, isn't it?

   12. GUGuest2:28

       Yes! And that's, that's the central part of my work is that you can live a rich life, and that rich life can be richer and more vibrant and more personal than you ever imagined. If you wanna travel, you can travel for longer than you ever thought. You can travel, for me, at nicer hotels. You can, uh, spend more time with your children, with your loved ones. Whatever your rich life is, you can do that, but you've got to learn a few key basic things about investing and money. So, let me tell you what I would tell my family when they come to me. They go, "How should I start investing?" The simplest, simplest way that I advise my family is I say, "Get a target date fund." So, let me explain what that is. A target date fund is one fund, just one, and you pick it based on the year that you're going to retire. So, if you're gonna retire in 2050, if you're gonna be 65 in 2050, you go and you find that one fund. It's called a Vanguard 2065 fund or Fidelity 2065 or Schwab 2065. There's lots of brokers. These funds, it's one fund. All you do is put money into it. That's it. The fund, like a pie chart, is automatically diversified. So, as you get older, it gets more conservative, because somebody who's 75 years old should be investing differently than someone who's 25. One fund. All you have to do is set your money up to go into it every single month.

   13. SBSteven Bartlett4:00

       What is a fund?

   14. GUGuest4:02

       A fund is, uh, uh, a set or a basket of stocks and maybe bonds. So, we've all heard of, you know, companies like Microsoft, Google, whatever. A fund owns lots of these. Right? And that's important because we've heard diversification, like you should have diversified your investments. Okay, well, how do I do that? You don't need to go and buy 20 stocks and then figure out how much of each to do. That's too much work. And honestly, most people are not good at that, even professionals. You buy a fund which automatically owns lots of stocks, like hundreds of them. And over time, all you, the individual investor, like me, have to focus on is putting money into it automatically.

   15. SBSteven Bartlett4:49

       So, a fund essentially, I've got £100 that I want to invest.

   16. GUGuest4:52

       Yup.

   17. SBSteven Bartlett4:52

       Um, I find a fund. Where do I find these funds?

   18. GUGuest4:55

       You can go to Vanguard, Schwab, or Fidelity. All those are great companies. Uh, what you're looking

3. 5:00 – 6:41

   Should I Use Investing Apps?

   1. GUGuest5:00

      for, regardless of what country you're in, is you're looking for a low-cost brokerage firm.

   2. SBSteven Bartlett5:05

      So, but there's also apps and stuff that I can, I can use.

   3. GUGuest5:07

      You can use apps. I don't like a lot of the apps because they gamify you to try to invest.

   4. SBSteven Bartlett5:13

      Right.

   5. GUGuest5:13

      They want you clicking and trading. I hate traders. Trader- you do not wanna be a trader. Traders lose money. Investors treat investing like watching paint dry. That's how sexy it is. Trust me, I'm not getting my entertainment from investing. I'm going out, go watch a movie, go watch Netflix. But investing is boring and automatic. That's how it should be.

   6. SBSteven Bartlett5:38

      I used a, a, a c- company called Hargreave Lansdown in the UK who have an app when I first started investing.

   7. GUGuest5:44

      Mm-hmm.

   8. SBSteven Bartlett5:44

      Um, a- when I first started investing in funds. They, they had a very ugly app, so I wasn't very compelled to use it. I think it's better now, but I would use, just do it on desktop which, I do get your point because you don't wanna, you don't wanna be game, you don't wanna screen-

   9. GUGuest5:56

      Yeah.

   10. SBSteven Bartlett5:57

       ... all of that notifications.

   11. GUGuest5:57

       I like ugly.

   12. SBSteven Bartlett5:58

       Yeah, yeah, yeah.

   13. GUGuest5:58

       It should be ugly.

   14. SBSteven Bartlett5:59

       And you don't want it to be too accessible.

   15. GUGuest6:01

       Correct!

   16. SBSteven Bartlett6:01

       As in, I don't wanna be able to check it every day. (laughs)

   17. GUGuest6:03

       No, look, on my phone, you will see no investing apps.

   18. SBSteven Bartlett6:06

       Yes, nah.

   19. GUGuest6:06

       There should not be.

   20. SBSteven Bartlett6:07

       Yeah.

   21. GUGuest6:08

       Why do you need to log in and check it every day? What's the point?

   22. SBSteven Bartlett6:10

       Yeah.

   23. GUGuest6:10

       In fact, I log, you know, w- most people should check it.... every three to six months. And here's how you check it. You log in on your desktop. "Wow, it's up. Wow, it's down. Okay, bye." You're not tweaking anything. It's like making Thanksgiving dinner. Once you've put the turkey in the oven, just let it sit. Do not fiddle with it, 'cause you're only gonna mess it up, and in this case, you're letting the turkey cook for decades.

   24. SBSteven Bartlett6:39

       And that fund, so I've got a hundred pounds.

4. 6:41 – 9:28

   How to Invest With $100

   1. SBSteven Bartlett6:41

   2. GUGuest6:41

      Mm-hmm.

   3. SBSteven Bartlett6:41

      I go on a website or whatever-

   4. GUGuest6:42

      Yep, Vanguard, Fidelity, Schwab, whatever they are. I have no alliance to any of them.

   5. SBSteven Bartlett6:46

      Neither do I. Um, there's various ones in the UK. I actually do recommend Hargreave Lansdown just because it's quite simple, and I think investing in funds, there's no fees. There's no fee associated with the investment itself. Obviously, they take a... You know, they might take a percentage depending on which fund you're investing in.

   6. GUGuest6:59

      Mm-hmm.

   7. SBSteven Bartlett6:59

      I take my 100 pounds.

   8. GUGuest7:00

      Mm-hmm.

   9. SBSteven Bartlett7:01

      And in- investing in Hargreave Lansdown, you don't need, there's no, um, minimum-

   10. GUGuest7:06

       Great.

   11. SBSteven Bartlett7:06

       ... from what I understand, and there's no... If you invest in a stock, they charge 12 pounds per investment, but if you invest in a fund, it's free. Um, I put my 100 pounds into a fund. The fund is essentially taking one pounds, one of those pounds, and investing one pound into Facebook. It's investing one pound into Google, one pound into Shopify, one pound into Spotify, one pound into NVIDIA or whatever. It's doing that for me. It's managing it for me. It's making the decisions for me. I just put the money in every month, whatever I can, and I leave it.

   12. GUGuest7:34

       Yeah. And let's go even deeper. I love that we're getting into the nuts and bolts here, because you know, honestly, most people, they do not know how to invest. Literally, what website do I go to, and then what do I do? The fund owns these different stocks, and some will go up, and some will go down, and it's inconsequential to you. All you need to know is you own this fund. Now that you've opened up an account and you've sent 100 bucks or 1,000 bucks, great. You've made one of the most important decisions of your life. Now there's just one more thing you have to do. Set up an automatic transfer so that every single month, you have a certain amount of money going in. Now if you don't know how much money, use my conscious spending plan guideline. What did I say? 5 to 10% of take home is a good guideline. All right? You should be able to do 5%, trust me. Anyone who comes to me, they go, "Ramit, there's no way, must be nice. I can't afford." I go, "Show me where you're spending your money. I guarantee you, I can find 5% to send in every month." Now you're not trying to send it in. I don't try to brush my teeth in the morning. It's a habit. Investing is even easier than brushing your teeth, because you set it up automatically. The investment fund will automatically draw from your checking account, and it will pull in 100 bucks, 500 bucks, 1,000 bucks, whatever your number is. And so you're not gonna log in for three, four, five months. You're gonna log in a few months later. You're gonna be like, "Oh my God, I didn't even realize that all this money is in here." When you add that plus compounding over many years, that is how real wealth is created. So I don't want anyone to think that you have to be rich in order to start investing. One of the ways you get rich is by investing.

   13. SBSteven Bartlett9:27

       I've got a friend that's currently

5. 9:28 – 11:15

   Common Mistakes With Investment Accounts

   1. SBSteven Bartlett9:28

      actually in this building at the moment, and I had this conversation with them about a year ago, gave the advice that you've just given there, and about two months later, this individual, who I shan't name, came to me, and I said, "How's your, uh, you know, your, your, your investments going in that, in that fund?"

   2. GUGuest9:44

      Mm-hmm.

   3. SBSteven Bartlett9:45

      And they said, "Oh yeah, I had bills. I had a credit card bill, so I, I took, took it out."

   4. GUGuest9:49

      Oh yeah, she, she treated it like a checking account. Investments, for me, are places to accumulate wealth. I don't draw from it. That's what a checking account is for. So if, is, what that is, is there's two parts to what your friend is saying. One is, um, mentally she's thinking that this investment account is just money I can draw from if I need it. So I would sort of gently change the way she thinks about it. The second is, I guarantee her account structure is a little, um, subpar. So here's how I would set it up. This is in chapter five. Uh, it's all automation, 'cause trust me, I don't wanna spend time transferring money back and forth. That's... I don't spend any time on that. You, you get paid. Your money goes into your checking account. From your checking account, it is automatically transferred to a savings account. In fact, I have sub-savings accounts for vacation, car, down payment, all that stuff. So you have money set up for specific goals. Money is transferred to your investment account. It's transferred there. I'm not gonna touch that money. I'm gonna let it cook. And then I have my guilt-free spending, which is going out with friends, whatever I love, and my credit card bill is automatically paid off every single month. That's how you wanna set it up. It takes a couple of weeks to set everything up, and then you never have to think about it again.

6. 11:15 – 12:35

   What's the Proof This Is Actually a Good Way to Build Wealth?

   1. GUGuest11:15

   2. SBSteven Bartlett11:15

      C- how can you prove to me that this is the way to make wealth? What case studies have you got that investing in funds-

   3. GUGuest11:21

      Mm-hmm.

   4. SBSteven Bartlett11:21

      ... over a long period of time-

   5. GUGuest11:23

      (laughs)

   6. SBSteven Bartlett11:23

      ... is the path to financial wealth? Because you know, it's, you said earlier about the paint drying thing. The narrative that we see about h- why people and how people get rich is, you know, they sell a company or-

   7. GUGuest11:34

      Yeah.

   8. SBSteven Bartlett11:34

      ... they have a lottery win, or maybe they buy some cryptocurrency and it goes up.

   9. GUGuest11:39

      Yeah.

   10. SBSteven Bartlett11:39

       That's what we hear.

   11. GUGuest11:40

       That's what we hear.

   12. SBSteven Bartlett11:40

       So that's what we try and emulate.

   13. GUGuest11:42

       Totally. We-

   14. SBSteven Bartlett11:43

       Prove to me that that's, that this fund strategy is-

   15. GUGuest11:46

       (laughs)

   16. SBSteven Bartlett11:46

       ... better.

   17. GUGuest11:46

       Well there's, there's a couple things. First off, the research over more than 100, about 100 years, shows the returns of the stock market, and the returns tend to be, at least in America, they tend to be around 11%, 10 to 11%, and if you take out inflation, you get about 7 to 8% per year. Now for anyone listening, they go, "Okay, well what does that mean? That number means nothing to me, 7%, whatever."If you go right now and you Google Investment Calculator, and you just plug in your age, you plug in, let's say, 200, 300 bucks a month, and you plug in 7% return, and you just watch how that money grows, you will be shocked.

7. 12:35 – 18:25

   Compound Interest: Watch Your Money Grow

   1. SBSteven Bartlett12:35

      Jack, give me my phone. I'm going to do it now.

   2. GUGuest12:37

      Okay. So let's search for compound interest calculator, and there's a really simple one. This- it's called MoneyChimp.

   3. SBSteven Bartlett12:44

      Okay. Okay, I've got it.

   4. GUGuest12:47

      All right.

   5. SBSteven Bartlett12:47

      I'm on it.

   6. GUGuest12:48

      All right, so there's four numbers we need to fill out here. Let's take a look. The first is current principal, that means how much you've got in the bank.

   7. SBSteven Bartlett12:54

      I'm going to say $5,000-

   8. GUGuest12:58

      Okay.

   9. SBSteven Bartlett12:58

      ... and I'm gonna start when I was 16. 'Cause if I'd saved my money when I was 16, and not spent it res- recklessly-

   10. GUGuest13:06

       Mm-hmm.

   11. SBSteven Bartlett13:06

       ... I think I could have had that $5,000 when I was 16. Um, annual addition, what does that mean?

   12. GUGuest13:11

       How much can you invest per year? So for most people they think about on a monthly basis. They might say 200 bucks a month, which would be $2,400 annual addition.

   13. SBSteven Bartlett13:22

       Okay. So-

   14. GUGuest13:22

       So what do you want to say?

   15. SBSteven Bartlett13:23

       I'm going to say... Can I say $5,000?

   16. GUGuest13:25

       Yeah. That's, you know, about 400 bucks a month. I think that's reasonable. I often find that with people making, uh, s- median or slightly above median salary that there are hundreds of dollars a month of money that is unaccounted for, that if properly made intentional-

   17. SBSteven Bartlett13:42

       Mm-hmm.

   18. GUGuest13:42

       ... could be invested. So great, 5,000 a year. All right.

   19. SBSteven Bartlett13:45

       Obviously, I could have... Once I got past a certain age, I could have increased that though, so-

   20. GUGuest13:49

       We're gonna talk about that.

   21. SBSteven Bartlett13:50

       Okay.

   22. GUGuest13:50

       Hold on to that idea.

   23. SBSteven Bartlett13:51

       Okay.

   24. GUGuest13:52

       How many years? This was you at 20?

   25. SBSteven Bartlett13:54

       This was me at 16.

   26. GUGuest13:55

       Oh, okay. And how old are you today?

   27. SBSteven Bartlett13:57

       30.

   28. GUGuest13:58

       Okay, so 14 years. Let's just do it until today and we'll see what happens.

   29. SBSteven Bartlett14:01

       Okay.

   30. GUGuest14:02

       All right.
8. 18:25 – 20:32

   The Biggest Debt We Pay

   1. GUGuest18:25

      You know, the, the biggest debt... One of the things that I, um, I love sa- saying this, but, like, the biggest debt all of us pay is ignorance. And so I, I heard this close at this pitch years ago, and this guy got on stage and he, and he was like, "Hey, ma'am." And she goes like, "How much do you make?" And she goes like, "$50,000." So he wrote $50,000 on the whiteboard, and then he wrote a million dollars on top of the 50,000, and he subtracted it and said $950,000. He said, "You pay life, $950,000 every single year for not knowing how to make a million dollars a year." And it was a crazy concept, and he was using it to close the audience, but I... Like, the most expensive thing that all of us are paying for is the information that we don't know. And that's like both frightening and also incredibly exciting, because like, fish in the best ponds, right? Like a good fisherman knows where to fish. And a different way of saying it is find the people who value what you have the most. And I'm sure you've heard this. Have you ever heard the story of the, the father and the son with the car?

   2. SBSteven Bartlett19:22

      No.

   3. GUGuest19:22

      Okay. So-

   4. SBSteven Bartlett19:24

      Maybe I have, but I'm not sure if it has enough detail. (laughs)

   5. GUGuest19:25

      Okay. No, it's good, it's good. So there's, there's a father who gifts his son an old beat up car, and he says, you know, "Hey, I don't know if it drives or not, but you can take it down to the, um, the dealership down the street, see if you can trade it and get some money." And he's like, "Okay." So he goes down the street, goes to the dealership, they say, "We'll give you a thousand bucks for it." (sighs) And he come... you know, hears him out, comes back home, he's like, "Dad, they said give me a thousand bucks." He's like, "Okay." He's like, "Go to the impound yard," where they, you know, break the cars up just for metal. He's like, "See what they'll give you." Goes there, and, uh, the guy's like, "Ah, I don't know, this might be 500 bucks of metal." The kid like, you know, comes back home, he's like, "Dad, you know, he said it was gonna be $500." He's like, "Okay." He's like, "Hey, go down the street to that, uh, that antique, uh, dealership, see if they've got anything. They use a car a lot." And he's like, "Okay." So he goes down there, talks to the guy, comes back home, super excited. He's like, "Dad, you won't believe it." He's like, "This is a historic car. There's only like 10 of them left." He's like, "It's worth $100,000." And so the father smiles and he's like, "And the lesson I want you to know is that it's not necessarily who you are, but the people that value you the

9. 20:32 – 22:51

   Find Where Your Skills Are Most Valued

   1. GUGuest20:32

      most." And so you can talk to different people and go to the people who value you. And I just... I, I love that story because from a... It's a hu- it's a huge business story in terms of like sell, (laughs) sell the, where the fish are, where the big fish are. Like, if you, if you're gonna go hook fish, go to, go where the whales are. Um, it takes the same work, but a lot of it is just belief. People don't think it's possible. And so a lot of times you have to just keep leveling up and you sell your first $10,000 thing, you sell your first $100,000 thing, you sell your first multimillion dollar package, you realize that it's the exact same thing. It's just... So maybe if I'm list- if anybody's listing right now, it is the same thing. It's the exact same thing, and sometimes it's easier. (laughs)

   2. SBSteven Bartlett21:07

      (laughs) It's normally easier.

   3. GUGuest21:10

      Like, you know, you've seen that meme that says like, uh, "So what exactly am I gonna be getting for this $50 thing?" Right?

   4. SBSteven Bartlett21:16

      (laughs)

   5. GUGuest21:16

      And then it's like, uh, $50,000 clients, like, "Wire sent yesterday." Like, "What do y- else do you need?" Like, it's... And that's totally true. Um, but I think there's a skill in understanding where to fish.

   6. SBSteven Bartlett21:28

      Certainly a skill. Um, information. (clears throat) It's information. It's even knowing that there was another lake over there-

   7. GUGuest21:34

      Totally.

   8. SBSteven Bartlett21:34

      ... in part. And, and that's why, like, listening to conversations, like, this is so valuable t- for people, because it lifts the curtain.

   9. GUGuest21:39

      Totally.

   10. SBSteven Bartlett21:40

       And you go, "What the fuck? You guys were behind here the whole time partying?"

   11. GUGuest21:42

       (laughs)

   12. SBSteven Bartlett21:42

       That's what my business life has been like. (laughs) It's like gradually, like, the... Uh, I think I heard Kevin Hart describe on Joe Rogan one time where he said there's this other room-

   13. GUGuest21:51

       Yeah.

   14. SBSteven Bartlett21:51

       ... where these people are playing this other set of money games.

   15. GUGuest21:54

       Yeah.

   16. SBSteven Bartlett21:55

       And then when you get in that room, you get... You're almost pissed off that nobody told you this room existed, but then there's another door.

   17. GUGuest22:00

       Yeah. (laughs)

   18. SBSteven Bartlett22:01

       (laughs)

   19. GUGuest22:01

       Yeah.

   20. SBSteven Bartlett22:02

       And then you get through there maybe a couple of years later and you find these other people, these fucking billionaires-

   21. GUGuest22:06

       Yeah.

   22. SBSteven Bartlett22:06

       ... that are playing another set of games, and you're going, "What?"

   23. GUGuest22:08

       Yeah.

   24. SBSteven Bartlett22:08

       And they're chilling. (laughs)

   25. GUGuest22:11

       Yeah. (laughs)

   26. SBSteven Bartlett22:11

       They're just smoking cigars. They're not even doing any hard work. And you go, "Tell me the games that you guys have been playing in here."

   27. GUGuest22:16

       Yeah.

   28. SBSteven Bartlett22:17

       And then, again, the frustration is... And that's kind of what I feel like in my business life. It's been like where at the jump I'm charging, I don't know, I remember my first... We found our first deck from 2014 charging... I remember the package. We had gold, silver and b- bronze. It was like, you know, like-

   29. GUGuest22:30

       Yeah, yeah.

   30. SBSteven Bartlett22:30

       ... $200 package for like support, and then $500, and then the goal package-
10. 22:51 – 26:01

    The Most Valuable Bit of Information You Wish You'd Known Sooner

    1. SBSteven Bartlett22:51

       when you think about curtains that have lifted, that have really shifted the games you play from a value, money perspective-

    2. GUGuest22:58

       Mm-hmm.

    3. SBSteven Bartlett22:58

       ... like where someone's turned the lights on you. Fuck! Of course.

    4. GUGuest23:01

       Yeah.

    5. SBSteven Bartlett23:01

       Is there anything else that comes to mind?

    6. GUGuest23:04

       (sighs) I will answer it with the stair steps of how each order of magnitude changed my income. So when I went from being an employee to self-employed, I went from making four figures a month to five figures a month. And that was for me just like, "I am now in control." The level above that was I started having other people who worked for me, and then went to six figures a month, right? And then from there, stayed there, d- did the turnaround business, still had the same organizational structure, had another degree of leverage. And so the next degree of leverage was that I started licensing, so it's digital, right? So the cost per... you know, cost of goods was basically nothing. But all of these things are about leverage. And so this is like one of my favorite topics in the whole world, but we define leverage as the difference between what you put in and what you get out. So if you have a lot of leverage, you put a little bit in, you get a lot out. If you have no leverage or low leverage, you put a lot in, you get a little bit out. And a lot of times people who are listening to this and are not making as much money as they want, they're putting lots of input in and not getting a lot out. They have low leverage opportunities. And so understanding how to get more for what you put in is the game overall. And so the first level that I described was labor. It's just work. First, I was working for someone else, then I worked for myself, then I got other people to work for me. The first level in each of those levels was more leverage. Above that, I had media, which is the thing that I was licensing out. So another degree of leverage. I made it once and I could license it out infinity. On top of that, I have capital. I can take capital. I don't have to sacrifice time in order to g-... get something for it, so it's high input-output. Um, above that would be some sort of technology. You build the code once, in theory, obviously you continue to improve the code, but theoretically, you build the thing once and then a million people can use it. And so, you want to stack as many types of leverage as you can, and as much of them as you can, because, like, Joe Rogan also has a show and somebody else has a podcast, (laughs) they both technically are using media as their, as their, as their vehicle for leverage, but he has significantly more of it. So it's not just like, "I'm gonna use all these," right? Yes, but it's also how much and to what degree. But, like, Facebook had other people's money, he used media, had other people's work, max leverage. Amazon, same thing, right? They used every element of leverage and they maxed all of them out. And, um, that's, that's at least the, the curtain that... And Naval talks about this, if you're familiar with Naval Ravikant, um, he talks about these things as the, as the, the p- the elements of leverage, or four types of leverage. Um, and understanding that, for me, has kind of been a blueprint for wealth overall. And then, you know, capital, there's degrees of capital (laughs) , right? Like, you, first you can get friends and family to give you money, then you can get, you know, institutional money, and then you can get public money, right? Which, you know, you saw, like, the IPO money, like, the fact that the NASDAQ was 4X, uh, the Dusseldorf Exchange-

    7. SBSteven Bartlett25:42

       Yeah.

    8. GUGuest25:42

       ... is that where it was?

    9. SBSteven Bartlett25:43

       Yeah, yeah.

    10. GUGuest25:43

        Right? Um, there's just significantly more capital in that market. And so it... Same work, more zeros. Um, and so I love this topic because I think that that's fundamentally, like, the people who move faster in life don't actually move faster, they get more for every step. (swoosh sound)

11. 26:01 – 28:05

    Finding Your Unfair Bet That Will Make You Lots of Money

    1. GUGuest26:01

    2. If right now you wanna find where is your unfair bet that can make you your millions with your skillset that nobody else in the world can replicate except you? Here's what I need. I would need a whiteboard, I would need a pen, which I would do if I was you, and I would need a smart friend. Perfect. Like, so I've got Stephen here. And at the top of the wri- whiteboard, I would write on this side, "Skills." Oh my God, you're gonna see my handwriting, like a doctor. And on this side, I would write, "Money."

    3. SBSteven Bartlett26:30

       Mm-hmm.

    4. GUGuest26:30

       And I would start writing down all the things that we're brilliant at. So let's pretend it's, it's Stephen here, and we'll pretend like you don't have all the things that you have, but your core skillset.

    5. SBSteven Bartlett26:38

       You can put your hand on the screen, by the way.

    6. GUGuest26:40

       Oh, it makes me nervous.

    7. SBSteven Bartlett26:41

       No, you can.

    8. GUGuest26:41

       Am I doing this like a boomer? I am.

    9. SBSteven Bartlett26:43

       The handwriting's a little bit... It's giving doctor, so, um-

    10. GUGuest26:45

        Okay.

    11. SBSteven Bartlett26:45

        ... put your hand-

    12. GUGuest26:45

        Oh, yeah, look at that.

    13. SBSteven Bartlett26:47

        There, you see? There you go.

    14. GUGuest26:48

        Okay. Ah, it's so embarrassing. Okay, so social media, right? You're incredible at social media. What else are you probably good at? Well, you know a lot of people, you've got a network. What else? Well, it's not just social media though, it's actually a few particular things. It's, like, YouTube, and I think you're one of the best in the world at short-form video, right? You're also one of the best in the world at, like, a data-driven social media strategy, so you can kind of say upfront, "Hey, we think this is gonna go viral because the data says this thing over here." What else is Stephen good at? He's charismatic. He can probably get people to agree to things just by talking to them. (laughs)

    15. SBSteven Bartlett27:24

        (laughs)

    16. GUGuest27:25

        You know, what, what else? Uh, British accent, you know? So probably you want more in-person interaction because, uh, we've got, you know, uh, a very charismatic person. What else is Stephen really good at? Well, he asks a lot of questions.

    17. SBSteven Bartlett27:40

        This is my Hinge profile, by the way.

    18. GUGuest27:41

        (laughs) Yes, exactly.

    19. SBSteven Bartlett27:41

        I'm totally just gonna copy and paste all of this stuff over.

    20. GUGuest27:43

        Yeah, good-looking, funny, you know?

    21. SBSteven Bartlett27:46

        Oh, thank you so much.

    22. GUGuest27:46

        Yeah, exactly. So, so we'll just say these. There's a lot more deal flow, but let's just pretend that all you're good at is social media, you're good at getting to people, which is a network. You don't even have to know rich people, just can you get to them? You're charismatic, you're data-driven. Okay, great, we've got all these skills. Now, how could we apply these skills to get the most money humanly possible? And I would do exactly

12. 28:05 – 30:35

    Applying Your Skills to Get the Most Money

    1. GUGuest28:05

       what you said. So how do you figure out most money humanly possible? It's two things. It's the... How would I do this? It's the size of the problem. It is the value of the solution.

    2. SBSteven Bartlett28:21

       Interesting. Okay.

    3. GUGuest28:23

       And so, wha- if, if I'm thinking about this for you, if I go and I give your social media skills-

    4. SBSteven Bartlett28:29

       Yeah.

    5. GUGuest28:29

       ... to a trade or service business-

    6. SBSteven Bartlett28:33

       Hmm.

    7. GUGuest28:34

       ... I'm not gonna make that much money. How do I know I'm not gonna make that much money? 'Cause I'm gonna go look up online, what is the average revenue of this business and the average profit margin?

    8. SBSteven Bartlett28:45

       Yeah.

    9. GUGuest28:45

       Now, you probably didn't even think this way when you were thinking about it, but you guys look online right now, what's the average profit margin of a biotech company and average revenue? Let me tell you what it is. It's gonna be, like, 50 to 80%, and it's going to be hundreds of millions that you could potentially get. Trade services business, a lot less.

    10. SBSteven Bartlett29:06

        Yeah.

    11. GUGuest29:06

        And so that's where I would start. Skills plus money really equals to three things, which is, like, sector, size of the business, and profitability of the business. And I would play this game. And what that might look like is you go, "Okay, I know that I have some friends in..." Let's go to the places that we know have the most cash. In Silicon Valley, in w- on Wall Street. If they could make a lot more money, if they had a lot more attention, 'cause what I'm selling is attention, I wanna get to the people who can make the most money with the most attention.

    12. SBSteven Bartlett29:41

        Mm-hmm.

    13. GUGuest29:41

        And that means that I'm not gonna go to Walmart, only has 6% margins. I'm gonna go to the highest person that I could get to. And it'd be fun. If anybody's listening to this right now, try it. Like, tag Stephen and I in your stories on Instagram of your little charts, and let's see... And w- I'll give feedback. Anybody that tags me in it, if you're like, "Here's the... Here's what I think my skill is, here's what I think the industry is," I'll tell you one way or another, and it can be fun. You can see other people's examples live.

    14. SBSteven Bartlett30:05

        So people... F- for people that are only listening on audio and, and that can't see what the, um, this, uh-

    15. GUGuest30:11

        Chicken scratch looks like?

    16. SBSteven Bartlett30:12

        ... chicken scratch you've just drawn on this iPad, um, on one hand you have... You list your skills, and then on the second side, you're listing the ways you believe you could make the most money from those skills based on the size of the problem you'd be solving with them and the value of the solution. So, for example, let me, let me try and play this game with you then. So, okay, so I am a writer.

    17. GUGuest30:33

        Mm-hmm.

    18. SBSteven Bartlett30:33

        So I'm gonna do my skills on the left-hand.

13. 30:35 – 34:11

    Example of Ways to Apply Your Skills

    1. SBSteven Bartlett30:35

       I'm a writer.... and on the right, I'm gonna write money.

    2. GUGuest30:38

       Yep.

    3. SBSteven Bartlett30:39

       I'm a writer. I'm really good at writing stuff. Um, that's it. And I kinda get, I kinda get the internet, so I'm, I kind of understand LinkedIn blogs and stuff like that. But that's it, I'm a writer.

    4. GUGuest30:49

       Well, let's go with what would be the worst. What would be the worst thing you could do if you're a writer?

    5. SBSteven Bartlett30:53

       To make no money?

    6. GUGuest30:54

       To make no money. 'Cause sometimes it's easier to do the negative.

    7. SBSteven Bartlett30:56

       Okay. Working for a local newspaper. What were you thinking?

    8. GUGuest30:58

       Yeah, local. I was thinking, like, fantasy books.

    9. SBSteven Bartlett31:01

       Ah.

    10. GUGuest31:01

        Like you could write, like, fiction, you know-

    11. SBSteven Bartlett31:03

        Ah.

    12. GUGuest31:03

        ... really hard to make money in. You could write for a local newspaper. That's an even worse idea, so I like that. So now you've got your, your bottom tier, right?

    13. SBSteven Bartlett31:11

        Okay.

    14. GUGuest31:11

        Which is, like, 14 bucks an hour or something like that.

    15. SBSteven Bartlett31:14

        Yeah.

    16. GUGuest31:14

        Now if you look about, I mean, you could Google this, what is the highest paying jobs for writers? I bet the thing you'd find on top, copywriter. Why?

    17. SBSteven Bartlett31:21

        I got a better one.

    18. GUGuest31:22

        Ooh, what's the better one?

    19. SBSteven Bartlett31:23

        Do you know why I know this? Because when I was in, working in biotech, we couldn't hire one, which is a medical writer.

    20. GUGuest31:27

        Oh, so smart. Hyperspecialized.

    21. SBSteven Bartlett31:30

        For a bi... Honestly, we... So a typical copywriter, when I was working in my social media company, we might pay entry level 25,000 pounds, which is probably about $35,000.

    22. GUGuest31:39

        Okay.

    23. SBSteven Bartlett31:40

        A medical writer, someone that can write about-

    24. GUGuest31:43

        Yeah.

    25. SBSteven Bartlett31:43

        ... the psilocybin compound in my psychedelics business, would get paid $150,000 or more.

    26. GUGuest31:51

        Fantastic.

    27. SBSteven Bartlett31:51

        We just couldn't find some. We found loads of people that could write-

    28. GUGuest31:54

        Yeah.

    29. SBSteven Bartlett31:54

        ... but nobody that had within their skill stack, even though it's quite easy to teach, the ability to write using medical words, slightly medical words. It doesn't mean you need a medical degree. You could probably learn how to write, become a medical writer in a month if you really committed yourself to it. So that's the top end.

    30. GUGuest32:08

        That's so true. And same with finance. We go to the things we know.
14. 34:11 – 35:29

    The Importance of Doing Deals

    1. SBSteven Bartlett34:11

       "Gimme some stock in this IPO, and I'll run your social media for six months."

    2. GUGuest34:14

       You're so right.

    3. SBSteven Bartlett34:15

       Could've changed your life.

    4. GUGuest34:16

       Yeah, and it's, it's something I'm struggling with, trying to get people to understand right now, is that even if you never buy a business, which is what people fixate on, "Well, I haven't bought a business yet. I haven't bought a business yet," it's like, God, you're never gonna regret learning how to do deals.

    5. SBSteven Bartlett34:29

       100%. That makes so much sense.

    6. GUGuest34:29

       You're never gonna... It's, I think that is the most valuable skill set in the world.

    7. SBSteven Bartlett34:34

       I completely agree, and it's so unfair that people don't know about it.

    8. GUGuest34:36

       It's so unfair. But it's also your fault if you don't (laughs) know about it, because nobody's gatekeeping this information anymore. It used to be gatekept.

    9. SBSteven Bartlett34:43

       Mm-hmm.

    10. GUGuest34:43

        Like when I first started off in private equity, I wasn't allowed in the rooms where they were actually doing the deals and the terms. And if I wanted to see what the final terms were, like I had to kinda s- you know, sweet talk my way into figuring out how they structured it.

    11. SBSteven Bartlett34:56

        But it's an unknown unknown. So before I knew, I didn't know that I didn't know.

    12. GUGuest34:59

        Yeah, that's true. Yeah. That's very true. But now I think there's enough people out there talking about it, where you're like, I mean, if you think about whether you like Donald Trump or not, what is he really good at? Deals.

    13. SBSteven Bartlett35:09

        The art of the deal.

    14. GUGuest35:10

        Like, it, it, that's it. And that is what mo- I mean, Elon Musk, how does Tesla actually make money? They make money through credits, through credits for solar. So he was able to survive for those 10 years of building that company because he has some of the best solar tax credits in the world that he negotiated with the government.

15. 35:29 – 36:18

    Where Do We Go to Learn How to Make Deals?

    1. GUGuest35:29

    2. SBSteven Bartlett35:29

       So where does one go then? Where does a t- 25-year-old kid listening to this go to learn how to make deals?

    3. GUGuest35:35

       Well, I have a book coming out-

    4. SBSteven Bartlett35:37

       Yeah.

    5. GUGuest35:37

       ... called Main Street Millionaire.

    6. SBSteven Bartlett35:39

       Yes. Exciting.

    7. GUGuest35:40

       I know. And we have f- we have stuff we can tell them about that later, too.

    8. SBSteven Bartlett35:43

       Okay. Well, I'm gonna link Main Street Millionaire below so everyone can pre-order it. I've pre-ordered, I think, 10 or 20 copies of it, maybe a couple more.

    9. GUGuest35:50

       I like that.

    10. SBSteven Bartlett35:50

        Um, but-

    11. GUGuest35:51

        But that's, like, 30 bucks and you learn almost everything you need to know about doing a deal to start.

    12. SBSteven Bartlett35:56

        Mm-hmm.

    13. GUGuest35:56

        And that book is only what you need to know. I made it on purpose not really long-

    14. SBSteven Bartlett36:01

        Mm-hmm.

    15. GUGuest36:01

        ... not overly intense. It is exactly what you need to know. And then if you like learning deal making and you like that book, then you go to contrarianthinking.com, and we have courses and free newsletters and a community all about buying businesses. Um, but that's where you should start.

16. 36:18 – 37:36

    Playing the Tax Game

    1. GUGuest36:18

       (swoosh)

    2. SBSteven Bartlett36:18

       The other thing I, I came to learn is I got money, and I, it was almost like someone pulled the curtain back for me, is how wealthy individuals play the tax game.

    3. GUGuest36:28

       Oh my gosh.

    4. SBSteven Bartlett36:29

       And it's a tax game that the average person has no idea is going on.

    5. GUGuest36:32

       Gotta talk about money. Tax avoidance is a key skill to building wealth. And by the way,We, we don't talk about ... I, I speak openly about my, um, call it tax avoidance, but my tax strategies. If you're a, you know, it's like they said, if you're a prisoner of war, you have an obligation to escape. If you're trying to build wealth, you have an obligation to pay as little tax as possible. Do it legally. But Apple will issue their IP to Apple International in Ireland, and then they will use Apple Ireland ... They will license their IP to America, charge them tens of billions of dollars, thereby increasing the income of Apple Ireland at a lower tax rate, and decreasing the income in the US, thereby lowering their overall tax rate. That is pure tax avoidance. Every organization, every corporation does this to the hilt, and so should you. By the way, I will vote for people who have an alternative minimum tax. We have to raise taxes on corporations. The 25 wealthiest Americans pay between 6 and 8% tax rate.

17. 37:36 – 40:08

    What Are the Tax Games the Rich Are Playing?

    1. GUGuest37:36

    2. SBSteven Bartlett37:36

       What are the tax games they're playing?

    3. GUGuest37:38

       Oh-

    4. SBSteven Bartlett37:38

       This, the rich people.

    5. GUGuest37:39

       There's a bunch of them. First and foremost, it's you buy stocks, you never sell them, you borrow against them.

    6. SBSteven Bartlett37:45

       Okay, explain that to me like I'm a 10-year-old. So-

    7. GUGuest37:47

       Sure. You own $100 in Amazon stock.

    8. SBSteven Bartlett37:49

       Yeah.

    9. GUGuest37:49

       You need money to buy something. Instead of selling the stock, and let's say it's gone up 50%, let's say it's dou- doubled, you would have to realize a capital gain and pay long-term capital gains on that $50 gain. No, just borrow against it and let the stock continue to grow. And you pay a little bit of interest, hopefully, from your current income. But basically, it's invest, borrow against it, and die. Put it into a, a trust and then pass it on to your kids. There's a lot of, um, state arbitrage. Jeff Bezos just moved to Florida to spend more time with dad. Isn't that sweet, Steven? Isn't that nice? No, it has nothing to do with his father. Give me a fucking break. He aggregated $160 billion in wealth. He would pay about another 8 or 10% in state taxes in Washington because he's got to leverage the public school system, the University of Washington, the Seattle-Tacoma Airport, the hospital system. But in the US, you're allowed to peace out to Texas or Florida and pay no income tax. So all the people shitposting California and New York, show me someone who's cri- all of a sudden can't handle San Francisco politics. I'm gonna show you someone who needs to recognize a capital gain and has all of a sudden decided they like Texas politics. It's really not very ... It's very disingenuous. There's, uh, the tax loophole I've leveraged. In the US, there's something called 1202, or qualified small business. So when I started L2-

    10. SBSteven Bartlett39:12

        What's L2?

    11. GUGuest39:13

        L2 is my analytics company. I started it. I invested a small amount of money, um, uh, because it was a business worth fi- fi- less than 50 million, Your business would qualify in the US as QSB small business. If you hold onto that stock in that company for longer than five years, when you sell it, the first 10 million, or 10 times the basis, are tax-free. So the first 10 million out of L2 was tax-free, zero. That makes no sense. If that sounds like we're screwing the middle class, trust your instincts. I invested in a company, brought a company outta bankruptcy. I invested two and a half million. The first 25 million got very lucky. The company got sold for a lot of money. The first 25 million were tax-free. These are ... The tax code has gone from 400 pages to 4,000, and that extra 3,600 pages are to turn rich people into super rich people. Now, the myth around taxes is

18. 40:08 – 41:27

    How to Bring Your Tax Down From 40% to 8%

    1. GUGuest40:08

       the following, that rich people don't pay their taxes. Actually, the sort of rich pay a disproportionate amount of taxes. So if you make all of your money from current income, that is salary, and you make a lot, you're actually paying more taxes than anyone. So mom's a baller. She's a partner in a prestigious law firm, making a million bucks a year. Dad's a chiropractor, has three people working for him. He makes 600... $1.6 million a year, total ballers. In order to make that kind of money, they probably have to live in a urban center in a blue state, where, at that level, they're paying 45, 48, sometimes 52% tax rates. But if dad decides to raise capital and buy a bunch of chiropractic clinics, and they become investments, and he sells them for $50 million, his tax rate plummets. So you don't wanna be a super earner. You wanna earn enough money to invest so you can become a super owner. The top 25 wealthiest Americans pay about 8% in tax, right? So actually, the bottom half pay almost no tax. They pay a lot of consumption taxes, but it's the super earners that get screwed, what I call the workhorses. But once you make the jump to light speed, and you own things, and you make your money from buying and selling assets, your tax rate plummets.

19. 41:27 – 42:56

    Leveraging Investments and Tax

    1. GUGuest41:27

    2. SBSteven Bartlett41:27

       The really sort of actionable thing there for the average person as well is probably the, the first point, where you said a lot of what rich people do is they'll buy a stock. So I'll, I'll spend 10K on Amazon stock, and then I go to a bank, and the bank give me a $5,000 loan against my Amazon stock tax-free-

    3. GUGuest41:45

       Right.

    4. SBSteven Bartlett41:46

       ... and I just hold the Amazon stock. Now I've got 5,000 c- tax-free. If the Amazon stock goes to twe- uh, $20,000 in value, then I can, I can go to the bank and say, "It's gone up now. Give me another-"

    5. GUGuest41:55

       Far more.

    6. SBSteven Bartlett41:55

       "... $5,000," and I just spend and live off that money. Now, if the Amazon stock collapses, I'm fine because the loan was against the stock. So they'll sell the stock at a certain point as it's collapsing to get their money back.

    7. GUGuest42:07

       Yeah, I mean, you don't wanna get into too much trouble, but, uh, leverage is how smart people go broke. But the idea is that one of the great tax schemes in history is that stocks grow. Think of yourself as a stock. You, you go up in value a million bucks a year. You're making a million dollars a year doing a very successful podcast. Every year, the government in the UK is gonna take 40 cents of that, 40% of it. If you own a million dollars in stock and it goes to 2 million, you don't get taxed on it till you sell it.

    8. SBSteven Bartlett42:39

       Yeah, so just never sell it.

    9. GUGuest42:40

       Never sell it.

    10. SBSteven Bartlett42:40

        And that's what Elon's doing with his companies.

    11. GUGuest42:42

        He'll never sell it.

    12. SBSteven Bartlett42:43

        People say he's got, you know, $200 billion, whatever. In fact, he's borrowing tax-free against those companies.

    13. GUGuest42:48

        And then when he finally needs to sell it to pay off some of those loans, he moves to Texas, despite the fact he built all his wealth in California.

    14. SBSteven Bartlett42:55

        Smart.

20. 42:56 – 45:11

    The Importance of Understanding Tax

    1. SBSteven Bartlett42:56

       I think, uh, one of the great advantages of life is, um, as it relates to wealth creation, is really getting good tax advice, 'cause I've sat here over and over again with people that have great tax advice and some people who didn't have any at all. And the outcomes are, quite frankly, um, shocking. The variance in outcomes are, quite frankly, shocking. From one person going bankrupt to the other person becoming a multi-billionaire. And it comes down to, some of it comes down to their tax strategy and how they thought about tax. And having, you know, being around a lot of people now that are masters in tax-

    2. GUGuest43:25

       Yeah.

    3. SBSteven Bartlett43:25

       ... it was like, yeah, I describe it as someone pulled back a curtain that I never knew was there, and all these people were doing magic behind this curtain, and no one ever told me that curtain existed-

    4. GUGuest43:34

       That's right.

    5. SBSteven Bartlett43:34

       ... and it's called tax.

    6. GUGuest43:35

       Well-

    7. SBSteven Bartlett43:35

       We don't all pay the same tax.

    8. GUGuest43:36

       ... 'cause we're not supposed to talk about it.

    9. SBSteven Bartlett43:38

       Yeah.

    10. GUGuest43:38

        Again, not talking about it is rich people trying to keep poor people down.

    11. SBSteven Bartlett43:41

        Yeah.

    12. GUGuest43:42

        Because rich people talk about their taxes all the time. Brightest woman in my entire professional universe is a woman named Lucy Lee, who is my tax Yoda, who works at a big law firm that I pay 1,800 bucks an hour to, to figure out the smartest... When I set up a company, I talk to my tax person. When I'm about to get a big payment from my podcast distribution company, I talk to my tax person first. This is, it is everything, but the key when you're young is to become an owner, not an earner. You're an earner. You want to bust a move out of earning and develop an army of capital that goes out and kills for you at night. 500 bucks is a lot of money when you're 21. 500 bucks when you're 21 is 10,000 when you're my age, right?

    13. SBSteven Bartlett44:24

        Mm-hmm.

    14. GUGuest44:25

        And it's gonna go really fast. So just start. And then, once you become a super owner, you have 10,000, 50,000, 100,000, a million dollars in assets, then, then you can become a super tax avoider.

    15. SBSteven Bartlett44:41

        (laughs) This is so good.

    16. GUGuest44:48

        That sounded awful, didn't it?

    17. SBSteven Bartlett44:50

        (laughs) Yeah.

    18. GUGuest44:50

        Sounded awful. That sounded awful. Sitting here with your bucket of sand.

    19. SBSteven Bartlett44:58

        (laughs)

    20. GUGuest44:59

        Oh, my God.

    21. SBSteven Bartlett45:00

        Our budget -

    22. GUGuest45:01

        That's right. Talk about this is how we fuck the middle class, Stephen. This is how we really screw over the little guy.

    23. SBSteven Bartlett45:10

        What is your

21. 45:11 – 46:39

    Morgan Housel's Capital Allocation Strategy

    1. SBSteven Bartlett45:11

       capital allocation strategy? How do you invest your money? Um, this is, you know, this is the thing people wanna know most about you.

    2. GUGuest45:16

       I keep it as painfully simple as I possibly can. So literally, my entire net worth is cash, a house, and index funds, and some shares of Markel, where I'm on the board of directors. And that's it. There's nothing else. My entire... I can summarize everything so easily and so cleanly. And truly, that's it. It's not even like I have 20 bank accounts. Like, I have one bank account, one brokerage account, and, like, and a house, and that's it. So simple.

    3. SBSteven Bartlett45:40

       Why, why index funds? You're the reason I... Your capital allocation strategy is almost identical to mine. I wanna talk about the house thing as well. But, um, after reading your book, I stopped trying to pick stocks-

    4. GUGuest45:53

       Yeah.

    5. SBSteven Bartlett45:53

       ... and I invested all of my available capital into index funds, outside of investigating starting companies. So I'm a shareholder in, I don't know, 50, 60, 70 companies. I, all my other available capital is invested in index funds. And then, I have a very longstanding large position in Ethereum, which I've held for, like, six years or something-

    6. GUGuest46:14

       Yeah.

    7. SBSteven Bartlett46:14

       ... now, which has done me very well.

    8. GUGuest46:15

       Yeah.

    9. SBSteven Bartlett46:16

       That is it. And I, the Ethereum investment is also based on the fact that I run a software business that is in blockchain, and I could see that developers are building on top of Ethereum more than any other blockchain. So that insight was really beneficial to me.

    10. GUGuest46:30

        And six years, so even with the big fall over the last two years-

    11. SBSteven Bartlett46:34

        Yeah.

    12. GUGuest46:35

        ... you're, you're still up a lot.

    13. SBSteven Bartlett46:36

        Yeah, I, I think your book taught me that

22. 46:39 – 47:59

    How to Get Into the Top 5% of Investors Easily

    1. SBSteven Bartlett46:39

       successful investing is when you lose the password to your investment account.

    2. GUGuest46:42

       Yes. (laughs)

    3. SBSteven Bartlett46:43

       (laughs)

    4. GUGuest46:43

       That's, that's exactly it.

    5. SBSteven Bartlett46:44

       I don't actually think you said that in there, but that's like... When I lose the password to my investment account, I'm so proud of myself-

    6. GUGuest46:49

       Yeah.

    7. SBSteven Bartlett46:50

       ... because it means I haven't checked it in forever. And so, it was funny 'cause you were coming today. I thought, "Oh, yeah, well, I have all this money in these index funds. I'll check it." And I thought, "Fuck, I don't know the password." I thought it was so-

    8. GUGuest47:00

       Good, that's why you're gonna do okay.

    9. SBSteven Bartlett47:02

       I'm so proud of myself.

    10. GUGuest47:02

        The reason I do this, what's important is that I am not one of the people who says, "Nobody can beat the market, so therefore use index funds." That's not what I believe. I think they're, I think it's extremely hard to beat the market, and very few people will do it. But I think there are really smart people who can do it, and people who I know who I could invest with. The reason I don't is not because I don't believe it can be done. It's because the variable that I wanna maximize for, in my investments, is endurance. If I can just earn average returns for an above average period of time, it's gonna lead to amount of success that will literally put you in the top 5% of investors. My parents are a great example of this. My parents are smart people, but they really, they have no financial background. And they have, like, minimal financial interest, I would say. And, but they have dollar cost averaged into index funds for going on 40 years now. And literally, if you look at their returns, they've never sold anything, ever. And literally, if you look at the returns, they'd probably be in the top 3% of professional investors.

    11. SBSteven Bartlett47:56

        What is, for anyone that doesn't know, what is dollar cost averaging,

23. 47:59 – 48:37

    Dollar Cost Averaging

    1. SBSteven Bartlett47:59

       and what is an index fund?

    2. GUGuest48:00

       Dollar cost averaging means you buy the same dollar amount of investments every single month, come hell or high water. Doesn't matter what the stock market's doing, recession, boom, bust. You say, "I'm gonna put $100, or whatever it is, in the stock market on the first of every month." Now, most people who, like, have a 401k at work are doing this whether they know it or not. They have $100 or whatever removed from every paycheck, and it goes into the funds that they own, and they don't have to do anything. Whether you know it or not, you're actually doing it. The contrast to that would say, "I'm gonna buy and sell based off of how I feel for the stock market." I wake up. I watch CNBC. I decided to sell, and I'm gonna put it back in when I feel better about the market. It's the

24. 48:37 – 49:48

    What's an Index Fund?

    1. GUGuest48:37

       contrast to that. An index fund is just a single fund that owns hundreds or thousands of stocks within it. And if it's diverse enough, if it's big enough, really what you're doing is you're owning a slice-... of the global economy, which is how I think about it. It's thousands of individual stocks in there, Tesla, Apple, whatever it'd be, but really what you're doing is you're owning a slice of capitalism.

    2. SBSteven Bartlett48:56

       If I was your son and I said, "Dad, prove to me that that's a better long-term wealth creation strategy than buying crypto or buying companies that I use or like," how would you explain that to your, to your kid?

    3. GUGuest49:09

       Your ability to do well over the next one year or five years is gonna have no role whatsoever on your lifetime ability to generate wealth. All that's gonna matter is not what are the best returns you can earn. All that matters are, is, what are the returns that you can sustain for the longest period of time? All that matters is your endurance. It doesn't matter if you can double your money this year or even double your money again the next year. All that matters is, can you stick and keep it going for 50 years?

    4. SBSteven Bartlett49:35

       Pre-

    5. GUGuest49:35

       That's where compounding comes from.

    6. SBSteven Bartlett49:37

       Prove it.

    7. GUGuest49:37

       All... Because the formula for compounding is returns to the power of time. That's not quite it, but, like, more or less, that's it. So in that equation, if you understand the math, all of the heavy lifting comes

25. 49:48 – 51:07

    How to Build Wealth Like Warren Buffett

    1. GUGuest49:48

       from the exponent.

    2. SBSteven Bartlett49:48

       Give me a case study where someone has followed that strategy and done well.

    3. GUGuest49:51

       Okay. Here's one way to explain it that I use in the book. 99% of Warren Buffett's net worth was accumulated after his 60th birthday. After he turned 60 years old, 99% of his wealth-

    4. SBSteven Bartlett50:03

       Jesus.

    5. GUGuest50:04

       ... has been accumulated after that period because the longer you hold that for, the crazier the numbers get. When he was 60, I think he was worth about $3 billion. A lot of money, he's a multibillionaire, but now that he's 90, he's worth over $100 billion. And he's given like $100 billion away to charity. So if he didn't do that, he'd be worth... He'd go from $3 billion to $200 billion, since he's been 60. 'Cause the numbers just get crazier at that point. He's worth $100 billion. So if his, if his market, if his net worth goes up 10% in one year, he makes $10 billion, which is three times that he was worth when he was 60.

    6. SBSteven Bartlett50:34

       Mm-hmm.

    7. GUGuest50:35

       So that's... When you look at somebody like Buffett, is he a great investor? Is he a great stock picker? Of course. But the real secret to his success is that he's been a good investor for 80 years. And if he had retired at age 60 or at age 50, nobody would've ever heard of him.

    8. SBSteven Bartlett50:50

       Hmm.

    9. GUGuest50:50

       He would've been like, uh, one of the other multibillionaires who lives in Florida and plays golf and, like, y- you've never heard of him. The reason he's a household name is because he's been doing this non-stop since he's, since he's been 11 years old, and he's never stopped. It's just the endurance that's made him so wealthy, not necessarily the

26. 51:07 – 53:03

    The Importance of Patience

    1. GUGuest51:07

       annual returns.

    2. SBSteven Bartlett51:07

       Patience. It's a difficult thing. It also reminds me of the story that you talk about in the introduction of your book about the janitor, Ronald James Read.

    3. GUGuest51:15

       Yeah.

    4. SBSteven Bartlett51:16

       Who, when he died in 2014, aged 92, had a net worth of over eight million.

    5. GUGuest51:22

       And he was a janitor.

    6. SBSteven Bartlett51:23

       How did he do that?

    7. GUGuest51:25

       He took what very little money he could save from his job as a janitor, mopping floors at the gas station. He put it in stocks and he left it alone for 70 years. And that's it. That's all you need. That's all you need to do. If you have endurance and you're investing and you can keep it going for years or decades, you don't need to be a genius stock picker. And not only do you not need to do it, if you have endurance, you're gonna beat literally 97 or 99% of the genius stock pickers. And what's so interesting about it is, like, picking the right stocks is hard. It's supposed to be hard. Like, there's no world in which everybody who tries to beat the market is gonna do it. Of course it's hard. Just like being an NBA player is hard. And, but having endurance is, like, largely in your control. It's so much easier to just be patient than it is to pick the right stocks every single day. And I think some people, nature-nurture, some people, like probably Ronald Read and my parents, ju- just understand it naturally. It's not hard for them to be patient. But, dude, like, there are professional investors who work 80 hours a week for 30 years to try to beat the market, and they can't do it. Not only some, that, that explains like most of them. And even the ones who can do it are maybe gonna beat the market by half a percent per year, 1% per year. But if you can have endurance, that is th- uh, that's a bigger benefit than you can have by even being, like, a very successful stock picker. Like, somebody who outperforms the market by one percentage point per year and they can do that for 10 years, that's amazing. That's like Mount Rushmore investor. But somebody who earns average returns and does it for 20 years is gonna have way more money. You do it for 30 years, you're gonna be filthy rich. You'd be like Ronald Read, you could be a janitor who leaves $8 million to charity when you die.

27. 53:03 – 54:40

    Play Games Not Many People Can Play

    1. GUGuest53:03

    2. SBSteven Bartlett53:03

       Is buying a house a good or bad financial decision? My brother, who works in my company, and so he's the one that introduced me to your book many, many years ago, said to me something along the lines of, "Steve, don't buy houses to make money, because you have the ability to play a different set of games that very few people can play."

    3. GUGuest53:22

       Yeah.

    4. SBSteven Bartlett53:22

       And what I mean by that is, he kind of explained it to me, he goes, "Listen, everyone can buy a house, so the returns there aren't gonna be huge."

    5. GUGuest53:28

       Yeah.

    6. SBSteven Bartlett53:28

       "Go find a game that, like, only you can play-"

    7. GUGuest53:30

       Yes.

    8. SBSteven Bartlett53:30

       "... and you'll get bigger returns."

    9. GUGuest53:32

       If you're buying a house because you think it's gonna be a good financial investment, stop. Like, even if it turns out in hindsight that it was, it doesn't matter. I think these are just purely lifestyle decisions. And I think so many people get screwed up when they're in a spot in their life where they should be renting because they need to be mobile, they need to move around to a new job, new career, new school, whatever it is, but they end up buying because they think they're gonna make money doing it.

    10. SBSteven Bartlett53:54

        That's, that's

    11. NANarrator53:54

        Yeah.

    12. GUGuest53:54

        And that's like, that, that, that's the problem. So I own a house, and if I ended up losing money on it, I, I, I don't think I'd care. Th- that's not why I'm owning it. I'm owning it just 'cause I want the stability for my family.

    13. SBSteven Bartlett54:04

        People, people buy houses 'cause they think that they're making loads of money from doing it.

    14. GUGuest54:06

        Because there have been periods in time in which people have made loads of money. Historically, like, that's the anomaly. Historically, in the US and the UK, housing prices adjusted for inflation go nowhere. And it's just been the last 20 or 30 years that there's this very brief window of time that owning a house was a great investment.

    15. SBSteven Bartlett54:22

        Mm-hmm.

    16. GUGuest54:23

        Robert Shiller won the Nobel Prize about a decade ago for his work in showing that over the last 150 years in the United States, adjusted for inflation, most home prices have been flat as a pancake. It's just the last 20 years that have in- inflated people's expectations of what a house can do.

28. 54:40 – 56:10

    Don't Do This to Make Money

    1. GUGuest54:40

    2. SBSteven Bartlett54:40

       Statistically, there's gonna be at least one person listening to this that has made an offer as we speak for a house under the assumption that it's going to help them stack wealth.... if they were purely doing it for those reasons, what would you tell them to do instead?

    3. GUGuest54:57

       If that's purely the reason, run for, run for your life. (laughs) Don't do it. Particularly, I mean, it, it used to be, and maybe it still is like this in many cities in America and the UK, but it used to be that rentals were almost, without exception, shitty houses. There were no good rentals. A big change, at least in America in the last 20 years, is that most big cities have tons and tons of luxury apartments to live in, and they're great places to live. And they're in the city centers, and they got beautiful granite countertops, and they're great places to live. Don't fall for the idea that you can't live well if you're renting. I think that's, that's, that's the problem. And realize that if you're doing it for financial reasons, you're probably about to borrow a shitload of money for an investment that historically has been a very bad investment. Like, if you put it in those terms, like, what are we doing here, man? You're gonna borrow hundreds of thousands of dollars for an investment that historically has been a loss? That's what you're doing here? Does, you feel good about that? That's what I'd say to that person.

    4. SBSteven Bartlett55:56

       (laughs)

    5. GUGuest55:57

       Godspeed.

    6. SBSteven Bartlett55:58

       I, I would love to be in the room somewhere where that person has just looked at their partner, after persuading them (laughs) to make that offer because it was gonna make them rich.

    7. GUGuest56:07

       Sorry, guys.

29. 56:10 – 57:45

    The Blockchain

    1. SBSteven Bartlett56:10

       So, to make sure I, I and everyone listening understands what a, what the blockchain is, it's this public, can think of it as this database in the sky. And the database in the sky is checked by everybody who has their computer on and is interacting with the database in the sky. So, you no longer need a government or a bank checking the transactions and the, and the contracts in the database in the sky, because now all of our computers that are on, interacting with it, are in the background checking that if I send you one Bitcoin, if I do something on this database in the sky, it is, um, in accordance with the history of the database, and, um, it is in line with that database.

    2. GUGuest56:55

       Yeah. Well, and to, to make it less complicated, it just makes it a source of truth.

    3. SBSteven Bartlett57:00

       Okay.

    4. GUGuest57:01

       In a world where we don't even know who is who online, who owes each other what, any of these things, we now have a source of truth that everybody can agree on.

    5. SBSteven Bartlett57:11

       And everyone can see.

    6. GUGuest57:12

       And everybody can see.

    7. SBSteven Bartlett57:14

       You don't need to trust anybody.

    8. GUGuest57:16

       And so, that as a technology solves many things, problems that we don't even know we've got because they're so part of how we exist. So, the technology is not about money. The technology is about truth and exchanging value and creating value in a digital age. Now, what is interesting and powerful

30. 57:45 – 1:00:14

    Investing in the Blockchain

    1. GUGuest57:45

       about this technology is we've seen technologies similar before, the internet. We've seen broadband. We've seen these big global infrastructure things. Most of those, the internet was a public service good. Broadband was all built private sector. We didn't get to make money out of these things, really. Amazon made the money, or, or whoever it was building the broadband, they all went bust as well. What we've got here is this very clever thing that everybody in this blockchain gets rewarded for their role that they play.

    2. SBSteven Bartlett58:32

       In maintaining the blockchain?

    3. GUGuest58:33

       In maintaining the blockchain. And because these things are scarce, and let's say Bitcoin being the most classic example, there's only 21 million that will ever exist, you've created this scarce asset that is a reward system. So, the people who mine the Bitcoin, they use the electricity to solve the algorithm to get the Bitcoins to make sure there's only 21 million, well, they get rewarded. The people who verify the chain get rewarded. And then we can buy the asset, which is actually us investing in the future use cases of this thing. Are people gonna use it for storing wealth or building stuff? So, now you get this global infrastructure layer of which people can invest. Now, let's go back to the example of AI. AI, 99% of people listening to this will not be able to invest in it, apart from buying some of those big public companies. Because they're not accredited investors, they're not allowed, they don't get to see it, it's an insider, all of this stuff. This is the inverse. It is fractionalizable. So, a Bitcoin, you don't have to buy one at 60 whatever thousand, what it is today. You can buy a fraction. So, remember we talked about property and the guys who own the big high-end property make all the money. None of us can buy the $50 million apartment in Manhattan and then do it up and flip it for 250 million. Now, blockchain, we can all put 10% of our paycheck in it.

    4. SBSteven Bartlett1:00:12

       Do you think people should?

31. 1:00:14 – 1:01:54

    Everyone Is Equal When It Comes to the Blockchain

    1. SBSteven Bartlett1:00:14

    2. GUGuest1:00:14

       Yeah, and more. But the point being is this is the only globally homogenous asset on Earth. It's the same in Nigeria as it is in Brazil, as it is in London, as it is in Silicon Valley, as it is in India, as it is in Papua New Guinea. And everybody is on an equal footing. You can put the same percentage of your worth in it. Okay, that is mind-blowing, and it bypasses the banking system, the brokerage system, and all the other incumbent things that get in the way of a Nigerian buying an international investment.So we've got a playing field that's leveled in the fastest growing technology of all time, and the fastest appreciating asset, in price terms, of all time, in the shortest period of time, that is globally available to anybody. And then you realize, "Holy shit. Okay, this is important." Now, why that's important is because having more investors in it means the asset becomes more valuable, which means you're more likely to secure it, people want to join the network to earn some of these tokens to secure it. The more use cases get built upon it because people are making money. And it bootstraps it. It's behavioral economics. It's an incentive-based system to bootstrap the most ridiculous startup idea of all time, which is, "I'm going to entirely disrupt money and create a new internet." I mean, that's laughably stupid, and that's what's happening.

    3. SBSteven Bartlett1:01:53

       One

32. 1:01:54 – 1:03:13

    Crypto Use Cases

    1. SBSteven Bartlett1:01:54

       of the... I run a company called, um, Third Web, which is a Web 3.0 infrastructure business. We- we've raised quite a lot of money for the company, about 30 million dollars now, and we have a big team. And it's interesting for me to observe the use cases, because people come to Third Web to build on the blockchain. And one of the really interesting use cases we've seen over the last, I'd say, 12 months, that's really exploded is, is gaming. People building-

    2. GUGuest1:02:19

       Hmm.

    3. SBSteven Bartlett1:02:20

       ... uh, Web 3.0 blockchain-based games, because if you think about games like FIFA, which is a huge game, obviously, in the UK where we're big soccer fans, or other games like, you know, um, RuneScape back in the day, where you have assets in the game. In FIFA, you have a Messi card, in RuneScape you might have a sword. The thing that the blockchain now enables us to do is to take those assets from the game and actually trade them outside the game. So I can, if the, if the sword was on the Ethereum blockchain, even though I'm not inside the game, I can trade that sword on the Ethereum blockchain. And so one of the most exceptional use cases we've seen at Third Web is people building AI games. Oh, sorry, people building Web 3.0 games because these assets are now valuable. It's great for the game developer. They've now got this brand new economy for their, for their company, and it's great for the people that own those assets in the game 'cause they've now... Those assets are now more valuable 'cause more people can access them.

33. 1:03:13 – 1:04:26

    If I Own Crypto, How Do the Other Use Cases Benefit Me?

    1. SBSteven Bartlett1:03:13

       And if, if I own Ethereum-

    2. GUGuest1:03:14

       Yeah.

    3. SBSteven Bartlett1:03:14

       ... if I own an Ethereum token-

    4. GUGuest1:03:17

       Yeah.

    5. SBSteven Bartlett1:03:17

       ... which I do by the way-

    6. GUGuest1:03:18

       Yeah.

    7. SBSteven Bartlett1:03:18

       ... I've been stacking it and refusing to sell.

    8. GUGuest1:03:20

       (laughs) Good.

    9. SBSteven Bartlett1:03:22

       Um, but how do I benefit from the fact that games are now being built on Ethereum and-

    10. GUGuest1:03:25

        So, it's really simple. If we'd all been given shares in Facebook when it started, we'd have all been hilariously rich, but we didn't. The VCs got it, and then it went to the public market, and then you have to have a brokerage account, and you have to be approved, right? While this is happening, you buy an Ethereum token today. If Ethereum ends up becoming bigger and more uses, your token value goes up. It's as simple as that. So you get to participate in an entire technological revolution really simply from your mobile phone. And you don't need anybody to approve it or do anything. Yes, there's regulation and stuff, but simple stuff like that, it's pretty straightforward for almost everybody in the world. So therefore, we talked about how do you invest in your disruption in the future of technology. Okay, here's one where you can really do it, and it's easy to do.

    11. SBSteven Bartlett1:04:25

        A couple

34. 1:04:26 – 1:07:18

    How Do I Invest in Crypto?

    1. SBSteven Bartlett1:04:26

       of questions here, then. So you said it's easy to do.

    2. GUGuest1:04:28

       Yeah.

    3. SBSteven Bartlett1:04:29

       Let's talk practicalities. How do, does one do it? I can do it on my phone? I have to call someone? How do I invest in crypto?

    4. GUGuest1:04:36

       You just open a crypto account-

    5. SBSteven Bartlett1:04:39

       Yeah.

    6. GUGuest1:04:40

       ... um, with one of the big crypto providers, Coinbase, Kraken, Crypto.com, whoever may 　 ... Gemini.

    7. SBSteven Bartlett1:04:46

       What about this, though? My bank, my digital bank is offering me to buy crypto on there. Should I do that?

    8. GUGuest1:04:52

       Yes, you can. And you could do it via PayPal. Start somewhere. I'm not gonna say no. But you will go down the journey that everybody goes down, which is the easiest on-ramp is the best, Revolut, whatever. I don't care. Just do it. Get a feel for what it's like to own an asset that goes up and down a lot. (laughs)

    9. SBSteven Bartlett1:05:12

       Hmm.

    10. GUGuest1:05:13

        Particularly down. When it goes down, it makes you feel terrible, and you gotta learn about how to deal with it. And then because it goes up over time, if you don't do anything and you've chosen a good quality asset that's provable as a, as an asset in itself, it'll probably go up over time. In fact, highly likely to go up a lot. And then you'll start thinking, "Do you remember Raoul saying that the bank owns this stuff and I don't own it?" And then you might say, "Oh, but the magic here is, unlike the bank where I can't take more than 10 grand out, I can put it all on my little Ledger device." Because-

    11. SBSteven Bartlett1:05:51

        What's a Ledger device?

    12. GUGuest1:05:52

        ... a Ledger device is, it's actually a, it's a company who provides it. But what it is, because this is just an address on a blockchain... And think of it as like your mailbox. You can send stuff to it but you can't actually take it out. Like your email, somebody can't read all your emails but they can send you emails. Well, that, that part that's private, that secure passkey essentially, well, you keep that to yourself and it's stored on a device. And there's a complicated way of doing it, and you'll have to go through that, which is you have to have this seed phrase that does it. This technology will change quite soon, you know, fingerprints, face prints, and a bunch of other stuff. But basically, a little USB stick will secure, that you can go and put it in a safe or go and take it to your nan's house, or whatever it is, can secure your money that it's only yours and nobody can take it out.

    13. SBSteven Bartlett1:06:56

        I have mine on a Ledger. So I have my Ethereum on a small, it's kind of like a small USB stick, and then that USB stick is protected by, like, 24 words or whatever it is.

    14. GUGuest1:07:05

        That's right.

    15. SBSteven Bartlett1:07:06

        And those words are on pieces of paper in different countries at the moment.

    16. GUGuest1:07:09

        That's right.

    17. SBSteven Bartlett1:07:10

        Um, and it means that...... no matter what happens, no matter where I am in the world, no matter who comes for me, I can always re- retrieve the X

35. 1:07:18 – 1:08:07

    The Bank or Government Doesn't Control Any of Your Crypto

    1. SBSteven Bartlett1:07:18

       thousand Ethereum that I have on this Ledger device.

    2. GUGuest1:07:20

       Yeah.

    3. SBSteven Bartlett1:07:21

       Um, unlike a bank where my, my account could get frozen by the government, or they could empty my bank, they could freeze my bank. I can, I will always have that value.

    4. GUGuest1:07:30

       And also, you know, there's a famous example of the conversation of gold in the United States, and it's been done in many countries in the past. The good thing about this magic internet money is you don't have to physically cross borders with it.

    5. SBSteven Bartlett1:07:45

       Yeah. Yeah.

    6. GUGuest1:07:47

       Think of all the Jewish people who had to take money and diamonds and gold out of Nazi Germany and out of Europe. It was hard to do. Here, you don't have to do anything. You just need to remember a seed phrase.

    7. SBSteven Bartlett1:08:02

       A seed phrase being basically a string of words.

    8. GUGuest1:08:05

       Yeah.

    9. SBSteven Bartlett1:08:05

       Yeah.

36. 1:08:07 – 1:09:46

    How to Get Out of the Living Paycheck-to-Paycheck Cycle

    1. SBSteven Bartlett1:08:07

       Do you know for people that are in that paycheck to paycheck cycle, which I was in for many, many years of my life, where I'd get paid from my call center, I'd go and spend the money and I pretty much spent all the money within the first couple of days of getting the paycheck, and I was just waiting the next three weeks for the next paycheck. What advice would you give them about getting out of that cycle? 'Cause it, 'cause you almost feel imprisoned by that cycle, if you're in it.

    2. GUGuest1:08:28

       Absolutely. Well, before I give the advice, I want to explain to that person what's happening, because you are the prime customer for our economic system. Banks love you because they can sell you payday loans, they can sell you credit cards, they can sell you lines of credit, and they can keep you in debt for the rest of your life, which means you keep making the bank rich. Corporations love you because you're not gonna think twice when we show you this nice bag, when we show you this nice vacation. You're gonna want the stuff, and so we love selling you the stuff. The government loves you because you're gonna pay the highest taxes. Employees pay the highest taxes. And so when you're in that situation, you are making everybody else rich at your expense. And so if you want to break out of this, the first thing is you gotta understand, you need to make yourself rich before you make everybody else rich, because when you're spending all your money, you are putting your money into their pockets, and you have to stop that. You gotta keep that money for yourself. You're in a boat. Think of it this way. You're in a boat, and this boat has water just flowing in and you are sinking, and you gotta start by sealing the holes, and that means you gotta stop the spending. So

37. 1:09:46 – 1:11:01

    If You See This, You're in the Financial Danger Zone

    1. GUGuest1:09:46

       if you are in what I call the financial danger zone, which is you don't have $2,000 saved up for an emergency and you have credit card debt, if you are in that situation, you are in the financial danger zone and you have to make drastic changes. That means right now, no more eating at restaurants, no more vacations, no more doing anything that doesn't put money in your pockets, and no more Netflix.

    2. SBSteven Bartlett1:10:10

       No.

    3. GUGuest1:10:11

       And the reason why I say this isn't because you're gonna save $15 a month. It's so you can save two hours of your time a day. The average American is watching more than two hours of television a day. And if you don't have $2,000 saved up, if you have credit card debt, you cannot afford those two hours a day being wasted on TV. And that means right now, you have to go out and start using the time to learn, start using the time to work, and start using the time to make some extra dollars. So what do you do? Start selling stuff. Stop spending money.

    4. SBSteven Bartlett1:10:46

       Selling stuff you own?

    5. GUGuest1:10:47

       Selling stuff you own. So if you have a TV that you're not using, sell it. You have a car that you can't afford, sell it. If you're living in a house that you can't afford, sell it. Downgrade. Move smaller. And then work to earn more

38. 1:11:01 – 1:13:49

    Pick Your Hard

    1. GUGuest1:11:01

       money.

    2. SBSteven Bartlett1:11:01

       I've got to say, the couple of things that I, came to mind as you were saying that, and funnily enough, I put myself in the shoes of 18-year-old Steven Bartlett. When I was in that small apartment with three or four immigrants in, uh, Moss Side, Rusholme, and I was, you know, my rent was nothing. My rent was, uh, one thous- no, 150 pounds a month, which I could not afford and I could not pay. And I was w- intermittently working between call center jobs, and whatever money I got, I spent. And part of the reason I spent it, Jaspreet, is because like many people watching, especially men who sometimes feel the need because of the way society is, I was trying to get laid at the same time.

    3. GUGuest1:11:43

       (laughs)

    4. SBSteven Bartlett1:11:44

       And it's hard-

    5. GUGuest1:11:45

       Yeah.

    6. SBSteven Bartlett1:11:45

       ... when you're a young man, and I say young men in particular because the stats do support the fact that there is an expectation that men pay. Um, when you're a young man, it's particularly difficult to do all of these things, to cut back and also get laid. And what am I gonna do? Defer getting laid for 10 years? When I say laid, I'm really saying meeting someone and falling in love and having a, having a life. So what do I... If I, if I'm living in a shoebox, which I was, I can't bring anyone back there. I can't take anyone for dinner. I can't take anyone to the movies. So what do I do?

    7. GUGuest1:12:12

       This is why every Indian parent tell their kids to become a doctor, so their son can get married.

    8. SBSteven Bartlett1:12:17

       Mm-hmm.

    9. GUGuest1:12:18

       It's the same concept. But here's the thing, you have to pick it hard. Either life's gonna be hard now or it's gonna be hard for the rest of your life, and you have to pick what's more important to you right now. And, you know, if we talk about balance, if you want to have a balance of everything where you want to find a girl and you want to make money and you want to stay healthy, you are dividing your attention everywhere. Not saying it's impossible, but very few people can actually do everything all at once. And if your number one goal is to become wealthy, if your number one goal is to turn your finances around, you have to get serious about it, because where you put your attention is where you get the results. And so if you want to be in a better financial situation, you are gonna have to make sacrifices. And it's difficult. I can't come here and tell you it's gonna be easy-

    10. SBSteven Bartlett1:13:08

        Yeah.

    11. GUGuest1:13:08

        ... because that's gonna be me lying to you.

    12. SBSteven Bartlett1:13:10

        I gotta be honest, I did make a sacrifice. And for me, the sacrifice was I started a business, and frankly, that meant that I didn't have time...... to be going out, getting laid, or meeting people or socialising. But it's, it, it, my story arc ends with it going well and then the romantic situation taking care of itself many years later- (laughs)

    13. GUGuest1:13:31

        (laughs)

    14. SBSteven Bartlett1:13:31

        ... once it had gone well, because I was so focused on myself. And it's funny, there is a bit of a paradox to life that the more you actually focus inward, the more you become a magnet.

    15. GUGuest1:13:40

        Yeah.

    16. SBSteven Bartlett1:13:41

        Um, and the more I focused outward, the more I pursued and chased and sort of neglected myself, the, the more harder it was to get people interested in me.

39. 1:13:49 – 1:16:27

    Understanding The Seasons of Life

    1. SBSteven Bartlett1:13:49

    2. GUGuest1:13:49

       Yeah, and, y- you know, I, I also wanna say that when I talk about building wealth, I'm not talking about becoming a money hungry, just money greedy, this, this evil person that just cares about money. That's not what I'm talking about, because I want you to live a holistic life, because money is just one part of your life. But the second part to that is I'm not telling you to never enjoy life. I'm telling you to make a sacrifice for a period of your life. That way, you can enjoy the rest of your life and never have to worry about money again.

Episode duration: 1:21:16