The Psychology of Making Money

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about the making more money piece i think that everyone is unique in their own way right i would encourage people to kind of lean into what makes them unique and where they've spent a lot of their time i think everyone has something that they're good at inherently figuring out what skills you have internally and how you can kind of monetize those one of the hidden things to do is you really are a function of who you're surrounded by invest in your network and i don't mean that in a kind of cold-hearted you know i want to network with these people but just surround yourself by people who are who are also trying to push themselves to push their income push her opportunity set and it makes it so much easier if you're the only one doing it and you're around a group of friends you're the odd one out and you're castigated for it find other people who want to do the same thing and you kind of help each other in that journey so at an early stage that's just one of the key things is to find people who also want the same journey as you that really helps then it's still about the best leverage of your skill set and being honest with what your skill set is just because you're a doctor doesn't mean you should be a doctor just because you've graduated because you can do other things and it's it's figuring that that's not an easy bit but you figure it out over time by trying stuff if you're early it's the time to make bets in yourself and your network and that gives you the foundational tools to then earn more income and then invest more create a plan anytime you get paid you know how much money you're going to save you know how much money you're going to invest and then you spend what's left because the difference between the person that becomes wealthy and everybody else is wealthy people save and invest their money first everybody else i spend all my money i wonder where all my money went and then if there's anything left i'll try to save and maybe invest and hopefully i'll get rich i think money plays a very very big role in our life we should control the money we should never let money control us a simple tip that i think people can do is just kind of figure out how much they spend on a monthly basis track your expenses for 30 days 60 days or 90 days and you're going to learn so much more about just your personal habits of what you do i think you need to start with the mindset you have to build the basics you got to get rid of the credit card debt you got to save a little bit of money like you gotta have some breathing room because investing is all about taking the extra money that you have throwing it somewhere to grow that money educate yourself learn about investing invest above all things investing above saving is the only way you're going to get there because if not your money goes down and then just do it make a trade make an investment fail learn do it again and do it again and keep learning educating and then surround yourself buy a good network the secret to wealth is have multiple sources of income you don't have one you have all kinds of them i mean you can earn more money when you're sleeping than you could spend when you're awake personal finances comes down to your income minus your expenses so know those two intimately know how to drive both of those two and then just really watch what you spend your money on wealthy people spend their money to earn more money the majority of everyone else spend their money to buy things which makes everybody else around them rich rich people are typically more disciplined they're they're typically checking their bank account every day right they're doing little things that compound into huge results at the end of 10 or 20 years and they're they're thinking in decades not just what am i going to do this week right they're they're choosing investment choices for themselves in 10 years 20 years from now instead of choosing sports betting on the football match for a thousand pounds you know uh that night because they know that their thousand pounds working for them today will be worth 10 000 20 000 in 10 or 20 years so it's more just like a long-term mindset versus a short-term mindset the reason why so many people will go into debt to buy vacations to buy things to buy stuff to look rich and ironically that's the key thing that keeps so many people poor for the rest of their life is because they're scared to look broke and now when you try to look rich that's the thing that's actually keeping you broke everything starts in thought so if you want order with money it starts here relationship starts here your business starts itself starts in your mind and that's the thing is if you want to become wealthy the first part is just your own mindset it's your own discipline you have to understand if you want to continue being able to live that lifestyle you're going to have to make some changes today otherwise you're going to be stuck in this lifestyle for the rest of your life and it's only going to get more difficult there's a three-step framework that i'll talk about because there's a lot of ways to invest at the very simplest is i can be completely hands-off i can work with a financial advisor i can give them my money and they can do everything for me stage number two is i can be a completely passive investor it's a little bit more involved than an advisor but i can just put my money into the stock market then we have the people that want to be more involved what we call is a active investor and an active investor is somebody who now wants to invest their money themselves and i don't mean trading i mean actually investing their money and now i'm going to be doing the research to find which investments i want to own maybe it's real estate that i want to own maybe i want to invest in individual companies so it's more risk for more potential return vision of your future self you know how do you see yourself living because that is what we do everything comes with effort there is no such thing as returns without effort there's no way of making money without effort or risking something and so for a lot of people if they feel like they don't they can't save money it's like sometimes a lot of the times what they're really saying is like they have an inflated expectation of what would be a significant amount of money and if you lose your job or have a medical emergency what it might be every every dollar matters every dollar counts and so there's no there's no amount of savings that is too small to get going for five dollars ten dollars twenty dollars so much what matters is that you are building up the savings muscle so that in the future if you do earn more money it's second nature you view to put away 10 20 30 percent of your paychecks you have to understand that this is just what the system is lenders are in the business of lending money period they make money when they lend money so it is in their best interest to lend you more money a salesperson job a sales person is in the business of selling something it's in their best interest to sell you something bigger sell you something more because they're on commission the more they sell the more money they make period and so now when you understand this way of thinking you're going to start changing the way you start looking at things what is a corporation's best interest a corporation's best interest isn't for you to keep your money in your pocket and invest your money and be financially smart a corporation's best interest is to now get you to open up your wallet and buy their stuff because that's how they make money does that make them evil well i'll let you decide i think look you don't need to decide an emotion it just is what it is because once you understand this you're just going to look at the world very differently because when you understand the way the system works now you can say huh in the business of selling you something a bank's in the business of lending you something a sales person's in the business of getting me to buy something bigger what do you need i need the financial education to know what i can buy because guess what we all need things and when you have money you don't feel so bad about spending money because you know how to control it now i can go to a corporation and buy the things that i want that i like and have a great experience because i can i can go out and know when i should borrow money maybe i use money borrow money to buy other assets some you borrow money to borrow money to buy rental properties i borrow money to grow a business maybe i go to a sales person and i have them sell my things for me now you start thinking about things very differently because you understand the way the system works what is your perspective what is there to know about people who can't put their hand in their pocket as opposed to keep putting it in too frequently i have two two views on this one is it's just as broken and detrimental to have a mentality of i can't spend this money to the person who can't spend it fast enough and runs himself over a cliff it's just as much of a mental illness in that situation. And if you talk to a lot of financial advisors, they will tell you the number one psychological ailment of their clients are baby boomers who have saved several million dollars, can easily afford to safely have a wonderful retirement and can't bring themselves to spend a penny of it because their financial identity is number goes up every year. I'm a saver. I'm a saver. And my net worth goes up every year. And the idea of starting to entrench that down is so painful to them. The other side of this and why I think it's actually half rational is we're fortunate to live in a world where if you retire at 60, there's a meaningful chance you're going to live into your 90s. And so you're talking about it was not that long ago. I mean, 60 or 70 years ago, the idea of retirement by and large didn't exist for most people. People just worked up until they couldn't work anymore. Your retirement party was also your funeral. That was how it worked. And retirement was something that rich people could afford to do. But ordinary people, it didn't work at all. And then even if you go back to the 1980s, you retired at 60, you're probably going to die at 68. So you're talking you might need to fund a retirement for three, five, maybe 10 years. Now you're legitimately looking at people who might need to fund a retirement for 40 years. And the amount of money that you so the idea that they are worried about spending too quickly, like, yeah, good worry, you should think about that. I'm a big advocate of not doing what the majority people do. Nothing comes easy. But change can always be made regardless of where you are, what your background is, where you come from, but it's going to take work. I think the best thing to help your outcome to get to where you want to go is hard work, sacrifice, that way you can enjoy the rest of your life and never have to worry about money again. So how do you figure out most money humanly possible? It's two things. It's the size of the problem. It is the value. The value of the solution. Multiple revenue streams is now the way the world works, because the cost of living has become so expensive, that everyone's having to do multiple jobs. But with technology, we can actually do it much easier. I think investing is much more important. I made the mistake of being a saver when I was young, because, you know, the fear that you know, all of that stuff meant I was super risk averse. And I was an investment banker, I was investing. And then once we saw the banking system fell, I'm not doing this anymore. I'm going to take control of my own finances. There has to be change. And that change is difficult. And that's the part that I think a lot of people have a hard time talking about, or comprehending. There is relief, but it comes with severe, extreme and quick sacrifice. What do I mean? Number one, you got to cut back your expenses as fast as possible. In that situation, you have to sell as much stuff as possible. I mean, bankruptcy obviously works, but you also lose your house. You also lose other things along with it. There's a lot of emotional toll with it. You have a family, you have a kid. I mean, it's also a big reason people end up getting a divorce. So it can also impact your life in many different ways. So you have to make extreme sacrifices. And I mean, get rid of the Netflix subscription, not because it's just costing you $15 a month, but because the average American is spending more than two hours a day watching Netflix. And if you're in that type of situation, and you're spending two hours sitting there watching whatever the heck is on Netflix, how do you sleep at night? You shouldn't be sleeping eight hours a night. You better be getting up, go and try to get some more money. I don't care if it's Uber. I don't care if you're working at McDonald's. Find some extra money and learn how you can earn some more money. And I mean, it sounds harsh, but the reality is if you want extreme change, it's not going to happen without extreme change. I mean, if you're going to get a divorce, you've got to get it done. You've got to get it done. And if you're going to get a divorce, you've got to get it done. And if you're going to get it done, you've got to get it done. And if you're going to get it done, you've got to get it done.