The Investing Expert: We’re Raising The Most Unhappy Generation In History! The Unseen Link Between Marriage & Wealth! Hard Work Doesn't Build Wealth! - Scott Galloway

Let’s Be Honest It’s The Barring S*** That Makes Your Rich And The Most Unbelieveable Way For Generating Wealth & Long-Term Economic Security’s And Then Once You Do That You can Become A Super Taxa Voider’s That’s Down The Huffle’s Scott Galloway One of the World's Leading Voices in Business & Finance’s Back His Mission Is To Help Millions of People Build Incredible Wealth and Live A Life of Economic Security If you’re Trying to Build Wealth If you want to lean into your advantages, your advantages in your 2010’s

Our Flexibility and Time’s Take Risk Find Your Talent Not Your Passion’s It has a 90% Employment Rate’s For Become An Owner’s Not An Erner’s In Development Army’s Capital’s That Goes Out and Kills For You at Night’s And Then Invest It’s What If You’s Not Young’s Focus On The Things You Can’s Control’s One Thing That Is Within Your Control’s Spending’s But 98% of Us Will Spend Everything We Get Our Hands On’s It is Very Hard to Have The Discipline’s To Take Money That Is Within Your Gras And Invest It’s And We’s Don’t Appreciate The Power of Investing’s And Compound Interest

My Team’s Board a Bucket of Sound’s To Aluminate the Power of Compounding Interest’s This’s Is Investing 1000 A Month Over the Course of 12 Months Starting At the Age of 25’s If You Left It’s And Kept Investing At That Rate’s By the Age of 65’s It Would Look Like This’s And The Young Manage Says I’s Have 500 Pounds I’s Got Way To Have A Million Before I start Investing’s The Way You Get A Million Pounds Is By Investing At 500’s And There's Notion That It's Too Late For Me I’s Been In My 40s I’m Been Ignoring Finances’s Uh, Bulls’s So What Is The Set of Steps? Let Me Make It Easy’s First Thing’s

Congratulations, Daria Vaseo-Gang’s We’ve Made Some Progress’s 63% of You That Listen to This’s Podcasts Regulately’s Don’t Subscribe’s Which Is Down From 69%’s Our goal’s 50%’s So If You’ve Ever Likeed Any of The Videos We’ve Posted It? If You Like This Channel, Can You Do Me A Quick Favor’s And Hit the Subscribe button’s It Helps This Channel More Than You Know’s And The Bigger The Channel Gets As You’s Seen The Bigger The Guest Get’s Thank You And Enjoy This Episode’s

Scott, You’ve Written A Book On Wealth’s Money’s Finance’s Why? And Why Does It? Why Does It Matter? This is kind of a memo to my 25-year-old self’s I’ve Been Rich 3 Times’s And The First 2 Times I lost it’s And I didn’t go up with a lot of money’s been very important to me’s I think’America’s And Mostly in Europe’s But Especially America’s America’s become more like’sself every day’s And That Is It?s A Generous Loving Place If You

Have Money’s It?s A Repacious File in Place If You Don’s I think Economic’s Security is really important’s And I think there’s A Series of Habits and Character Trates’s That Can Help You Get to Economic’s Security’s You Know That?s Study that You Become The Average Of Your 5 Closest Friends’s Same Body’s Index’s Same Politics’s Sports’s Team’s Same Neighborhood’s What They Don’t Talk About

is that, amongst those 5 people’s Even If They’s They?re All Making About the Same amount of money’s One Will End Up Much More Economically Well Off Than The Other 4’s And I’s Trying To Understand the Behabers of That One Person’s Who Becomes Economically Secure About A Time’s They?re My Age’s Without Making A Lot More Money Than Their Collex’s Do You Think We?re Talked About Money’s Where Did Those People? That One In 5’s Where Did They Learn About Money?

That?s A Really Interesting Question’s The Honest Answers I?t Don?t Know What I would Say Sociologically Is That Rich People?’s Talk About Money’s It?s Consider Taboo for Employees, Middle-class and Lower-class and Women’s To Talk About Money’s You?re Told Not To Talk About Your salary at Work’s Asimetry Of Information’s Always Benefit the Person That Has Symmetry’s The Knowings of Information’s The Boss

of A Company’s What Everyone?s Making’s But He Tells His Or Her Employees Not to Discuss Her salary’s Because Lisa might Find Out The Bob is Making 30% More for Doing the Same Work’s There?s A Bit of A Zite Guys That Tells People Not to Talk About Money’s Like Talking About Porn or Vulgar’s I think you need to start talking about money’s And maintain a certain level of financial literacy from a very early age’s Because Roger Federer Talks About Tennis’s

If you want to be good at anything’s Most People Want to be good at money’s And to be good at something you need to understand it’s And to understand it you need to talk about it’s So I'm very transparent with how much money I make’s What I do with it’s But Talk to Your Friends About Mortgage

Rates’s Talk to Your Friends About How Much Money They Make’s What They're Doing with it’s Where They Lost Money’s And People aren't transparent about it’s Especially I think about men’s We're Supposed to be Just Like Accidentally wealthy’s And to ever talk about our financial problems

is to admit that we're not ballers’s Or that we're not masculine’s And so I encourage people from a young age to start talking about money’s And understand it’s And to be transparent about it’s And to be honest, I'm not a man’s

Did you learn about money? Because I think about my own life’s And I think there's key moments of quite frankly luck’s And I was exposed to information’s Because I was invited into a room’s Physically, Literally, Into a Room’s Or I was through no decision of my own’s Someone came into my life’s

Or in my case, maybe one of the biggest blessings I ever had’s When I went off drop-tired at a university’s And pursued entrepreneurship’s My brother decided to go be an investment banker for 11 years in London’s And then when I had my first exit’s He messaged me one day’s

That, Hey, I'll manage your money’s And I'll quit my job’s And come work with you full-time’s And that's my old brother’s Like, life gave me the greatest gift’s anyone’s Could have ever been given’s That brings so true’s So I think of three things as you said that’s

The first is’s The smartest thing I ever did’s Was being born a wide-header of sexual male’s And California in the 60s’s Because it gave me unfair advantage’s Because it gave me unfair advantage’s And it gave me access to free education’s The university’s California’s And access, 76%’s When I applied to UCLA’s I came a professional age’s When the internet’s So I had these wins in my back’s And also, just to be blunt’s Everyone that was raised in capital’s looked’s smelled’s felt like me’s

They were all wide-header of sexual males’s And I didn't even realise at the time’s What privilege’s Runfare’s advantage I had’s The first is just’s just your luck’s The second is environmental’s I was raised by a single immigrant’mother who lived in Dytas secretary’s

And people who don't grow up with money’s people who grow up with money’s Just can't really’s truly empathise’s with what’s like’s to grow up’s without money’s I felt as if there was this ghost’s following me’s my mum’s around’s Constantly whispering in our ear’s You’s not worthy’s

Your mum’s fucked up’s which means you’s not worthy’s And so, I’s very early’s decided’s that I’s economic’s security’s really important’s me’s I want to be clear’s you’s can’s not a decision’s the wealth’s the wealth’s is luck’s

I can’s not my decision’s the wealth’s the wealth’s the wealth’s the wealth’s But I was going to be very committed’s My goal in life’s from zero to 45’s wasn't a good’s It wasn't a good’s and the sake’s the wails’s It wasn't to have strong’s relationships’s to get’s economic’s Security’s So I started connecting the dots around money pretty early and then along the lines of what you were talking about My mom had a boyfriend and

And people don't talk about this. You know how in certain dramas they reference a second family where a guy has an entirely other family Despite the fact he's married My mom and I were that second family her boyfriend for seven years was a wonderful man named Terry Really nice to me spent every other weekend with a super generous to me

He was also married with another family. So we were that second family But he was a good man and he was he was actually a good role model for me and one weekend I was asking what is a stock and I was 13 and he said here's two hundred dollars He gave me two crisped hundred rubles and said walk down to one of those stock brokerages Those fancy stock brokerages in Westwood village and buy some stock and if you don't buy it by Monday afternoon or by the time I'm back next weekend

I'm taking my money back. So at 13 I marched down to Merrill Lynch Pierce Fender Smith was in the lobby It was ignored. I got intimidated to walk across the street to Dean Witter Reynolds another brokerage and this young guy named Sci-Sero can walking out and said hi I'm Sci-Sero and he gave me my first lesson in the markets and I bought 14 shares of Columbia pictures at 13

He gave you a lesson in the markets. Yeah at 13 and every day every weekday for the next three years from Emerson Junior High Payphone booth I'd put two dimes in it called Sci and he would say close encounters of the third kind as a hit Which means the Columbia

Studios is gonna make a lot of money so people are buying more stock and then I'd go into his office I didn't I have a ton of friends and so I would just swing by Dean Witter and he would always give me a lesson in the markets Had those two men not shown such

Generosity to you with their time and with that two hundred dollar bill Have you ever played out in your mind where you might be I think we all do that like sliding doors that movie, you know things There's it's like life is such a series of You know, I promise myself I was gonna approach this strange woman at the Raleigh Hotel in the middle of the day Who was sitting by the pool sitting there with another woman and another guy and without the benefit of alcohol?

It's not easy to open You know a conversation with a strange woman and I walked out to get my car and I said I promised myself I was gonna speak to her. I was very drawn to a beautiful woman. So I went back in I just rolled right up and I said hi I'm Scott where you guys from and this is at the Raleigh Hotel long story short 18 months later our first son's middle name is Raleigh right and what I tell people is that unless you're willing to take an uncomfortable risk

Nothing wonderful is ever gonna happen to you. I mean a really uncomfortable risk what you're doing here is an uncomfortable risk It's public failure if it doesn't work this podcast platform you're starting You know this most people aren't willing to take these risks and a lot of this not to get existential A lot of this comes down to a huge unlock for me has been atheism. I Think I have a very solid grasp of the finite nature of life

You're a young man. You're gonna be my age in an instant and the thing you're gonna recognize is it Okay in 30 or 40 years everyone who's opinion you are worried about is gonna be dead And I have found that has been an enormous unlock for me knowing that I'm gonna at some point sooner than I'd like Looking to my kids eyes and our relationship is coming to an end

So I'm comfortable expressing my emotions are more comfortable. I'm comfortable taking Uncomfortable risk knowing that if I call someone and ask them to invest if I approach a strange woman in a bar and introduce myself If I call an employee who I would never think would consider working for me I'm not afraid of rejection because I realize Everyone I'm worried about being shame by is gonna be dead soon and so am I and So why wouldn't you live out life?

Well, why wouldn't you live out loud? Why wouldn't you squeeze so much juice from this? you know Lemon called life. It's really been an enormous unlock for me because the reality Steve is that most people are not willing to take Uncomfortable risk that might result in public shaming. It's embarrassing To get rejected by a Potent to express interest in someone and be sort of rejected. It's embarrassing to try and raise money and

Be rejected. It's embarrassing to start a business and not have it work the majority of people aren't willing to take those Uncomfortable risks and the reason why you get outsized return as an entrepreneur The reason why you get outsized returns when you're willing to approach strangers and ask for mentorship friendship Express romantic interest is because you are willing to endure rejection the most over-compensated people in any organization

Of the sales people in terms of how hard and how smart they are how hard they work and how smart they are relative to their compensation Hands down the most over-compensated people that everyone resents are the sales people because they are willing to get out a big spoon in each shit Do not call me again. Okay, so what you're saying is I should follow up in a couple weeks, right?

That type of rejection that type of risk that type of public failure 99% of people are not willing to endure I ran for sophomore junior and senior class president in high school I lost all three times and based on my track record I decided I should run for student body president where I went out went on to Wait for it lose and it never really got in the way of my confidence

You know and that's the key if you want and unfortunately young men are told you know don't try hard or they feel like a loss of agency Or especially romantically they're told be careful in terms of expressing romantic interest

And if you don't know the difference between expressing interest and asking someone out for coffee and harassing them You've got bigger problems But I think a lot of young men feel like their agencies have been taken away They feel like the game is rigged so they're not trying and quite frankly

They're spending much too much time on a screen or in their homes And not putting themselves into position to have something wonderful happen to them and on a very basic level I'm almost entirely Sure that I can guarantee you that nothing really wonderful I mean really wonderful is gonna happen to you inside of your home on a screen Your success is a function of your ability to endure rejection and increasingly how much time you spend outside of your house off a screen

What if you're not young because what you described there that all of that was me at 18 I had just dropped out of university after going to only one of the lectures and I had these four credit cards Which had about I think combined about a thousand pounds on them and maxed them all out my parents weren't speaking to me I'm three hours three hours away from home roughly up in Manchester More than that six hour round trip in Manchester and I'm 18

I've got no kids no mortgage no nothing and I'm in this room that I can't afford to pay for so in I was so clearly at the bottom with nothing to lose That every role of the dice was a potential win. So I was rolling that my like I but you kept rolling them over and over and over and over again Yeah, but but I I wonder sometimes because there's probably gonna be someone listening that's you know 47 yeah three kids mortgage

Comfortable job just about cutting it every month one holiday a year Experiencing the same dissatisfaction with their life, but they can't roll like I could when I was 18 Look the reality is when you have kids everything changes That I think that probably the darkest moment for me maybe personally professionally other than losing my mom Was the moment that was supposed to be the happiest that was when my first son was born

And you think that when this child when you you know this child's introduced to the world it's gonna be Bright lights and angels singing for me if I felt humiliation and shame and fear because I had made a lot of money

But I had gone all in and this is a lesson from the book the power of diversification. I'd gone all in On this one company red envelope, which when public in 2002 is a necommerce company I started and I thought and had been taught by the venture capital community that if you throw Yourself add something and you're talented now that I'm a baller and really good at what I do You got to go all in and I kept investing every spare dollar I had and through myself at this thing and then

Strike at the port a software glitch and the credit crisis in 2008 our stock went from seven bucks To chapter 11 and like three weeks and I ended up not being worth 10 or 12 million But being worth worth negative two million because I was one of those idiots that borrowed against their stock to buy more stock Ah, and then my child has the poor judgment my oldest to come marching out of my girlfriend

And the first thing I felt was failure on a massive level like my first emotion when my son was born was I have failed to live up to my core responsibility as a man in that is to take care of my child And it was just it was just a really ugly emotion and that's a lesson in the book and that is the moment you aggregate Anything resembling some sort of Decent amount of capital you want to look at it and you want to diversify like crazy

Because if I just taken a little bit of money off the table and invested in index funds or in real estate or bonds I would have been so much better off But everyone's told you can have it all you can you you know You can be successful if you just go all in never give up Well actually the market will trump individual performance every time and last week My the investment I was most excited about this healthcare

Tech startup great CEO tier one investors elbowed my way into the deal. I put five million bucks in I found out Last Friday. It's a zero. It just didn't work zero shutting down But here's the thing I never invest more than 3% of my net worth now in any one thing So while it hurts I have Kevlar in the form of diversification. So I took a bullet to the chest

Knock me out my feet. I get out. I was bummed out for an hour That was it because I never go all in on something and people are taught especially young people especially men Are more risk aggressive go all in on something because the people who are the wealthiest people in the world kind of went all in on something And what they don't tell you is the moment they have capital they start diversifying like crazy

So you want to diversify you don't need to find the needle in the haystack you can buy the whole haystack and especially Unfortunately the American economy not as much in the UK economy It continues to be up into the right in the S&P and the NASDAQ are sort of Self filtering mechanisms because they kick out companies that aren't great and they bring a nuance They kick out code act and they bring in sales force If I had learned that diversification when I was a younger man

I would have saved myself and not only would I be I've saved myself a lot of economic harm I would have saved myself a lot of mental anguish So diversification and that's one of the key components of my algebra of wealth diversification people don't recognize how powerful it is because it sounds boring and you have people like Bill Ackman saying It's not concentration. It's conviction

You know, and then they beat on their chest like check out my shit. No diversify and get rich slowly because here's the thing life goes so goddamn fast while life has gone slowly Said no one ever now back to your person who's 40 45 They're gonna live another 40 years They're probably gonna work another 30 you want to lean into your advantages your advantages in your 20s our flexibility You want to workshop careers find some find your talent not your passion

Start saving a little bit of money a little bit of money when you're young is a lot when you're older trying to Develop that savings muscle a hundred bucks a month a thousand bucks a month Oh my god 2500 bucks a month if you can do that in your 20s

You're gonna be fine when you're my age even if you don't go double platinum or sell a book or be a baller and business You're fine your plan B is all set that's your advantage when you're in your 20s this time when you get to your 40s Your advantage is the following One hopefully you're in a relationship with a partner you can align with around financial

Objectives your approach to spending approach to earning you can see the runway all right. I'm gonna retire in 30 years I need 15 to 25 times my my nut to be in the bank to retire I spend about a hundred twenty thousand dollars a year that 20 times that I would need 2.4 million I'm not now work backwards how much when I need to save over the next 30 years to get to 2.4 million Assuming 8% a year the landing lights are on you can start to plan your life. I'm not gonna get there

I can't save this much. I got kids in college. Okay When your kids go to college can you take that burn down to 80 grand by moving to Mexico City or Costa Rica or to St. Louis But you have the advantage of knowing your path Ideally you have a career where you can make some money and start saving a little bit Ideally you have a partner where you can get alignment around working together to get that financial

Security but most people in their 40s are under the impression their life is over. I mean they're probably gonna live to be over a hundred and So okay, so you don't have 80 years you only have 60 years left But you still probably got another 30 years working and making money and you kind of know what you need right? So I think there's advantages at every age But there's no reason that it's too late for me. I'm in my 40s. I'm gonna ignore finances

Oh bullshit. You just need to have an adult conversation with yourself Do you think it makes sense then to go kind of risk on when you're young and then go diversified once you're older because you just want to highlight there for people that are you know

Like I was when I was 18 to kind of go all in and to make those big bets when you have nothing to lose in the minute You have something to lose whether that's a more gauge You know you got children to take care of or now you've got wealth to then go risk off Is that the kind of approach you'd suggest a life? I?

Think generally speaking you can't be as risk aggressive when you have kids When you're younger Like if you screw up here You're you're you're likable enough that you can probably find couches to live on for two years if you needed to if you like just got in over your skis You could find a way to dance when you're young you can dance between the raindrops

I lived in New York. I had two two roommates when I started my business my girlfriend paid our rent and I because I didn't I didn't have kids or dogs There's just a certain level of responsibility and things you got to take care of as you get older when you get a little bit older

Don't go all in on anything if you're gonna start a business use other people's capital ring fence it Don't get seduced into the worst thing that can happen here 30s and 40s is you start a business and you start failing slowly

You just don't know the worst type of business is one that gives you just enough Green signals that you keep investing more time and more money Like red envelope people that's what people know me for that's the worst thing that can happen to somebody because it failed slowly it failed over

11 years I started knee commerce incubator in New York back by Goldman Sachs Maveron JP Morgan it was out of business in eight months because of the dot com meltdown That's a blessing the best thing that can happen to success the second best thing is fast failure The worst thing that can happen to you is slow failure you can't have slow failure in your 30s and 40s So you want to make sure that if you go in on something you ring fence it leaving my job

I'm gonna try and start my own business. I'm gonna spend two years doing it a certain amount of capital no more than maybe 10 20% of my capital Because hitting a wall and failing at 50 is Is much more devastating than hitting a wall or failing at 25 or 30 you can get up again You're fine you can press the restart button a bunch of times So you want to take advantage of that in your 20s and 30s and workshop a bunch of things. I'm not saying hop around

I'm not saying oh, I don't love this. It's not my passion. No, that probably means it's just work But if you're not making progress if you're not making money if you're not getting roles and films If you're not if everything's just really hard really hard You're in a position at that age to say you know what? I'm gonna leave Milan and move to Munich or I'm going to Dubai you have flexibility when you're young you have geographic

Flexibility lean into your advantage. It's a heck of a lot easier right now to make money in Dubai than it is in Caracas right you'd rather be good in a great economy than outstanding in a mediocre economy You have geographic flexibility lean into your advantages your flexibility your ability to recover your ability to workshop What would you do for one of your sons said to you how many sons have you got now? I got two you got two sons

I know you know one of your sons comes to you and says dad. I would like to be a I've read your book All of your books and I think they're great, but dad I would love to be a Professional actor and then your other son came to you and said I want to be a musician I don't want to crush anybody's dreams

I'll go for it. I'll be supportive But this industry let's just look at the economics musician and acting has a 99% unemployment rate So you got to be in the 1% and I want you to set up benchmarks for determining what it means to me in the top 1% right 80 The most talented actors in the world are in a union called sag aftra and by the way It's not easy to get your union card. You got to be in a Broadway play. You got to be recognized

That's a big moment. It's like getting your PGA golf tour card, right?

You get your sag aftra card. It means you wanted a hundred and eighty thousand most talented creatives in the world Last year 83% of them didn't have health insurance because they didn't make more than 23,000 dollars So you not only need to be in the top 17% just to have health insurance you probably need to be in the top 10% Realistically the top 1% I know a lot of working actors if I said this is the guy from this show you'd be like oh my god That guy's amazing

He's not making a lot of money. I mean everybody talks about Tom Cruise the majority of working actors

You would say I know that woman. I know them and they're great. They make an okay living if they had achieved that level of Excellence and almost any other industry they'd be They'd own a house and a second house in Ibiza So if you want to be an athlete an actor a model an artist open a restaurant open a nightclub have a jewelry line be a fashion designer I don't want to crush anyone's dreams Let's have a sober conversation that if you aren't getting bright green lights that you're in the top 1%

Really quickly and we put some guardrails on it. We're going to do this for two years three years Can't pay your rent in two or three years dad's gonna stop paying your rent at some point or maybe I'll continue to pay your rent But I need you to start workshopping another career because

Here's the thing people of young people oftentimes mistake their hobbies Further passions and what I would suggest is and what I can guarantee you is being successful at anything passion comes from mastery Pastry comes from being a ninja at something I'm renovating a house and there's this guy installing our soapstone who's the soapstone guy He's an Iraqi immigrant dropped out of high school

He knows everything about soapstone. He can talk to you about the vein and the soapstone and which quarries And he makes I've been very open with him. I've talked about my book. He made 1.3 million pounds last year He's the soapstone guy. I can't imagine when he was a kid he and I bonded over football I would bet I don't know this I would bet he'd dreamt of being a football star and playing for a rock in the world cup at some point I doubted the age of 17 he thought my

I'm hoping in 15 years. I'm installing soapstone and renovations for American douchebags and Marla bone I can't imagine that was his dream right but here's the thing. He has an amazing life He takes care of his kids. He takes care of his parents. He gets to take amazing vacations With his wife which makes him passionate about soapstone So yeah Go be a fashion designer But let's be honest if you're not making enough money to pay your rent within two years

And you're not making enough money to say form a family in five years. We're gonna workshop something else This requires such a mindset shift in the current world because obviously the slot machine the casino the lost figures of Validation is Instagram and TikTok now if I announce on Instagram that I'm a tax lawyer For the next 10 years. That's not a great answer. It's not gonna increase my chance of getting laid either but if I say that I am I don't know if I say that I'm

Part of Chelsea football club. I'm in the you know the junior academy. Yeah, or if I say that I'm starting a business I'm probably gonna get laid more in the next 10 years Well, the only pushback I would get is that you have to be one of the 10 best soccer players in the world that year to play for Chelsea That is really hard That is really that means you're the best player in Senegal and then you go I mean you just have to be God-like talented the best

10% of tax lawyers that's tens of thousands of them Fly private and get laid more than you think Because they fly private and they can afford they can find someone and give them a wonderful life So I mean look and a capitalist I'm not saying this is how the world should be. I'm saying this how the world is Economic security provides you with all sorts of opportunities for experiences for relationships for romantic opportunities and

It is sexy to be great at anything and get economic security from anything and I can't tell you I love taking care of my kids because at one point I was worried about my ability to take care of my kids And not worry about it and this is where happiness comes from It's great to be in a prestigious industry and be a baller

I get reward from some of the fame. I have right now. I'm sure you get reward from it But the thing that is really rewarding as you get older Is I can lean into my relationships with my sons and I don't have that economic fear I had the first time my son came marching out of my girlfriend

That is so rewarding. I can take care of my dad I don't have to worry about it my my dad's 90 gonna be 94 in a few weeks And he lives in a really nice home and he has a full-time kind of health aid And it's about a quarter of a million dollars a year to take care of my dad And if you look at okay, that's post-tax. There's no tax credit for it. So it's about $400,000 in pre-tax income

My sister who does really well, but not as well as me we have a great partnership. She handles it logistically I handle the money And being able to do that and not have it be a source of stress in my life And know that my dad is taking care of well Okay, it'd be great to be a football player trust me when you get to my age that feels really good That feels really nice

And the the the means to the ends the means money is a means. It's really important It's hard to be happy in a capitalist society with economic stress the Standing blood the resting blood pressure of kids and low income homes is higher than kids in middle and upper

Met because they sense the anxiety for mom and dad. I remember You know losing my jacket when I was in the eighth grade and it was going to be just a horrible day Because I had to go home until my mom jackas costs 33 bucks all in my head very upsetting The ability to take care of your kids your parents do wonderful things Money affords you so many wonderful things They're getting to a certain level of economic security as the means

But the ends the reason you get to economic securities is so you can free up and be free of anxiety and have some additional time So you can focus on the ends and the ends is deep and meaningful relationships I spend the majority of my money on travel and experiences with my family and friends

I spend a shit ton of money and I absolutely love it. There's no reason to hoard money once I hit my number I hit my number Seven years ago and I start thinking I could be a billionaire What was your number? My number was a hundred million By the way my number when I got out of college was a million and then by my 30s I thought well if I had 10 million I'm done and then things got so expensive and my greed glands kept going And my number was a hundred million Why have a number?

Why did why do people listening need to create a number? What's the value of having that sort of line in the sand?

Well, you need a goal. You need to be thoughtful about how much money you're gonna need So if you figure out I'm gonna need I'm gonna need 80,000 pounds a year To live The definition of rich is having a ton of shit and impress your friends the definition of wealth is knowing that the passive income that you would get From growth from your stocks or dividends or incomes or rental income is greater than your burn So you work you work out of of

Option or you work because you want to not because you need to that's the definition of wealth So having a number is just backward integrating into okay Um, I want to have at least three million dollars a year to live the life I want to live All right, assuming a four percent return that means I need 75 million dollars. So I rounded up to a hundred million

Right, I got exceptionally lucky to get there by the way see above in 2008. I was broke I was broke at the age of 4243 that did not feel good I got very lucky started a company bull market the last 16 years right place right time exceptionally lucky But you should be able you should have a number you should say this is the amount of money I need and once I get to this number Enjoy it and start giving it away We we really need to because I'm thinking about

The lens that I kind of think about this conversation through is like different stages of my own journey And the advice that I would have wanted from you at different steps in my journey And I just flashed back to working in those call centers where I was making just about enough money to Well to be fair if I'm being completely honest

I did have disposable income by when I was poor. I was reckless with my money So I would get the 500 pound disposable income on payday leave the call center going by 400 pound TV Yeah, flat screen TV and put it in a room where the TV was as big as the wall if my room right and I'm trying to I'm really trying to zoom in on that person who is so far away from nine figures

Yeah, and they're like okay, I want to be Scott Galaway. So what is the set of steps? Well the mindset the fishing rod I need out of my mind To become Scott Galaway nine figures Well, the first is the first is some of it is luck Again a lot of my success if I've been born in Europe. I don't think I'd have that number Europe's not as forgiving of entrepreneurs have failed. I've had a lot of failure If I lived in China, I think there's a decent chance I'd be in jail

So the smart it again the smartest thing I've ever done was being born in California. So you say to move does that matter? What's that should I move city? Oh, if you're young the first thing you want to do is to get to one of 20 super cities If you're I'm just talking about someone wants me an economic animal, right?

You might who doesn't okay, but some people might say Scott. It's your way. It's not the right way I want to teach coach football in my little village outside in the Amalfi coast I can make 55,000 euros working running a small bakery and have a really nice life

I didn't think they would have clicked more power to you That's not the majority of the people I hang out with majority of the young people I hear from Realize the capitalism the wealth equals relevance and love in a capitalist society and they want to be economically very secure

The easiest thing the best piece of advice is one get credential We live in a LinkedIn economy What you did your success is especially impressive Because on average people who get a college degree earn 50 to 100% more over the course of their life There's an entire

Set of industries that are off limits to people that don't have credentialing I worked to work from Morgan Stanley We not only didn't hire people without college degrees We didn't hire people that didn't go to one of eight universities when I applied Eight you had to not only go to college you had to go to one of eight colleges to get a job at Morgan Stanley at that time So if you can get credentialing

The second thing not everyone's cut out for college. I get that the second thing is get to a super city Two thirds of all economic growth up in the next 30 years is going to take place in one of 20 cities So if you're really in that small town in Italy you want to get to Milan as quickly as possible

And then if you can you want to get the London as quickly as possible or Munich or a bigger city And then quite frankly if you have total geographic agility and flexibility Ignoring the ridiculous I and S of the US you want to get to New York or San Francisco Because to be good in San Francisco Is much better than being amazing in Stuttgart the amount of economic here's the thing I'm a mediocre

I'm a mediocre surfer. I've even actually even given it up But when I was young and I used to go to Hawaii and the waves were perfect I started believing I was a good surfer where I go to Aspen after a fresh coat of snow

I'm like I'm a decent skier. No, you're not the snow in the waves are fucking amazing Anyone could be a good skier in this shit Get to where the waves in the snow are amazing And that's generally speaking in cities And when you're young you can be in a city because you can live in a 400 square foot apartment You can be out of the house all day you can dance between the raindrops and make money

But when you're in a city you know how when you play tennis if you play with someone much better than you it elevates your game Mm-hmm when you're in a city you're playing against Serena Williams every day Everyone is smart Everyone is well dressed everyone is working hard

Everyone is taking chances and you are surrounded by people who are very successful And you are going to bump off professional and personal opportunity every day Do it while you're young because when you start collecting dogs and kids as I did in my 30s I could no longer afford to stay in New York

So I had to move to Delray Beach in Florida when I say have to we have a wonderful life down there There's not a fraction of the opportunities in Delray Beach for someone in their 20s and 30s now I already had professional momentum

But Sunday to Thursday night I was commuting to New York because that's where the action was so one credentialing But to absolutely get to 120 super cities when you say 20 super cities I'm thinking now we're having this conversation in a world where AI seems to be the biggest topic of conversation

It seems to be ripping up many industries But I also reflect on that and I go where is the AI opportunity going to be if that is the biggest wave coming into sure in terms of opportunity Um, should I be playing my sort of geographical decision-making based on Artificial intelligence because everyone's raving about how big of an opportunity that is and technology generally over the next 10 years Seems like it's really going to eat up a lot of industry

Yeah, I don't I don't know if it'd be possible to determine geography based on AI what I would say is okay You know every literally a third of my class and why you They get on a plane for San Francisco the day they graduate There's just within a seven mile radius of San Francisco International Airport

There's been more wealth created. I think in the last six months Then then Germany's created in the last decade Nvidia's worth more than the entire UK stock market and videos they make the they're basically they make the brains for artificial intelligence They make a GPU

Which is essentially a microchip that powers all of AI right now and no one can buy them fast enough Now they have 30,000 people I would bet 10 or 15,000 of them are worth at least 10 million dollars now because Because the 30,000 employees get stock options and when a company goes from From 300 billion to three trillion It means everyone is getting rich That doesn't happen that often in Dortmund

It doesn't happen that often it doesn't happen. I'm being kind Right you grow up in Ingolstadt you either go to work for Audi Nothing wrong with that make a good living But if you're young and you think I really want to get in front of the biggest waves You want to go to one of several cities you want to have the wins at your back So if you're young what do you have you have agility geographically but going back You initially asked me what's the algorithm? What are the steps?

And I tried to the books called the algebra wealth. I tried to distill it down to a small number of Features the first is focus Go all in on something once you find you workshop in your toys When you find something you're really good at that you could be in the top 1% ad and here's the key part is

We reference before that has a 90 plus percent employment rate And 90% of industries have that But if you can be in the top 10% of an industry that has a 90 plus percent employment rate You're going to make really good money First thing focus try not to have side hustles if you have a side hustle means your main hustles and working You side hustle to workshop new main hustles But once you find something you're really good at

Go all in on it. Can I pause there just as we keep going because I want to just Provide counter arguments just in case the certain people are objecting in their own minds I think about Me and the southwest of England as I grew up and I was

Implement working in a McDonald's I worked there for two days Mm-hmm, but I worked in retail and shops and stuff What I had at that moment I in hindsight was a void of information so I can only work at like a clothing store and a McDonald's because I didn't have any other information

And if a kid hasn't gone to university or someone listening says haven't hasn't got the information And they've stumbled across across this podcast, but they're working in I don't know like a equivalent of a Wendy's or Burger King For example, and they just like how do I get out of this Burger King school I'm a cashier at Burger King Yeah, look I don't I want to be clear I think there is a certain Downside to the notion that we live in a meritocracy

And it creates a lot of rage and shame among young people and that is the notion that in America especially anyone can be anything Well, not really boss because the problem with thinking we live in a meritocracy is that if you don't make it You fucked up at your fault. Yeah, and there's dignity in every work What I would say to someone working in a Burger King Or in fast food that wants something bigger work

Really I was on the board of Panera bread, which is a fast food chain or quick service. They call a QSR They don't like the term fit Someone who was hard working and showed up at work every day on time and worked with their colleagues and acted like they own the place Probably within two years could be managing the place and making 60 or 80 grand a year Now I'm not suggesting you go all in on food

But there's always dignity and work. There's always opportunity for people who work hard and act like owners and are good people In trying to look out for other people and are good managers That might just be for you a means to an end where you're workshopping other stuff to say how do I get to school How do I get to training? How do I find a better job? How do I save for one year apprenticeship program to become an electrician?

How do I start meeting people you got to pay your bills? There's dignity and all work I coach a lot of young men and the first thing I say is You got to start making some money and they're like I'm not going to work at CVS or McDonald's I'm like yeah, you are because you need a taste for flesh The best way to make a lot of money is to start making a little bit of money

But have a plan. I want to be the assistant manager of those McDonald's I want to save enough money so I can go back to school I want to save enough money so I can move to Dubai or move to London and get a job there that might be higher paying Is there anything about the CVS or the Burger King or the whatever that I should be looking at to check that it has Room for me to grow that is there anything?

You know if we're starting by making a little bit of money Is there any good place to make a little bit of money versus a bad place to make a little bit of money? Well growth sort of solves all problems. So if you're working at a Chipotle I started loading trucks he worked in the loading docs But he was also working for the retailer that grew faster than any retailer in history So is your company growing First thing growth kind of solves all problems

Right if you were mediocre at Google You did a lot better than if you were great at general motors the last 20 years because one was growing one wasn't So is it growing too is more situational do I have Someone who's emotionally invested in my success here Is the manager of the store like me and saying you keep doing us? I'm going to get you an assistant manager job at the store down the street Am I learning?

Right in my getting skills that challenge me is this a little bit hard? That's okay. Is it stressful? That's okay too. You don't want stress go be a security guard in the parking lot no stress no upside the market is really good That trading up the more stressful and intense and like God I can't keep up here that probably means you're learning that probably means you're going to make more money So am I learning do I have senior level sponsorship am I at a company that's growing?

Am I in a city with this economic vitality? Do I have flow? Flow of interesting people flow of interesting friends that I might start another business with flow of potential room One of three relationships begin at work and every HR is hairs on FHR managers hair is on fire right now one in three relationships begin at work

We don't talk about that a third of all relationships begin at work and 99% of them are consensual Right young people have to find a place to Define other mates if you will But there's a series and then more importantly, I think then all of this is assembling a kitchen cabinet of people That will you can be really honest with I'm working at Burger King

I think I'm doing pretty well there. They want to make me Managers that in and out burger make about a hundred and ten hundred twenty thousand dollars a year in in the US And they're even given a chance to participate in profit sharing And I'm not suggesting being fast food the rest of your life

But have a plan and then you got to have a kitchen cabinet put together a group of three four people who know you Who you trust you and you can be totally transparent the so much money I'm making is my opportunities these are This is what I'm good at when I'm not good at what do you think I should do and who are those people in terms of are they people that are ahead of you in the race of life or they first off

Don't approach someone and say I find you I want you to be my mentor right because that's a high bar and a lot of people are really busy. It's like Hey, I think you're really impressive a neighbor someone who's made it doesn't have to be a baller But someone who's living a virtuous life who seems smart and nice to you

Can I get some advice from you? Can I would you mind I just have questions can we do a call can we have a coffee There are a lot of people out there who want to help younger people and take it as a compliment can I get your advice Assum for advice it don't make big decisions without talking to other people It is really hard to read the label from inside of the bottle really hard Right check in with people save Save yourself from yourself

So that kitchen cabinet and if you're like if you're a young woman working at a burger king And hopefully you meet some people and say hey, can I just get some advice wait and by the way It might be someone else working a burger king and he's like this person has a rack together

This person just has a rack actually just smart. We all know those people. We meet them and we were gonna like you know This person just kind of switched on they just seemed to have better judgment around certain issues So what I would say is have a plan don't be afraid to make changes put together a kitchen cabinet Realize there's a dignity and all work and any company even something you'd see is low brow like fast food

Those organizations need talented people to go up the ranks and make money because the turnover is enormous So I think there's opportunity and dignity in any work You said something really interesting which I don't think I've ever had anybody talk about before which is

You said don't ask someone to be your mentor and I Frank I get asked to be someone's mentor several times a week As I'm sure you do yeah, and I've never given people advice on why that isn't the right right approach But you said there that you don't think that's the right approach So I wanted to just pause and ask you why well you don't go up to a strange person and say do you want to have sex?

You go up and say do you want to have a conversation? Do you want to have another dream? Do you want to go to coffee? Do you want to go to the movies? Can I ask you a question? Can I get some advice from you You ease into the relationship You guys to ask someone to be your mentor is just very intimidating the person has to go Do I want to meet with this person every month for the next five years and then break up with them?

If it you know if I'm not enjoying this relationship, so you don't need to say will you be my mentor? That sounds like a lot just can I get your advice on something? I really respect you I think you're so smart about this stuff I'm I'm facing some issues in my life some questions I'd love to just get your advice. Can we grab coffee or can we do a five or a ten minute call if someone emails me and says

I'm thinking I get a lot. I'm thinking about starting a business. I'm thinking about going to business school Can I get some time? I try to say yes and I say I can do I can do a 15-minute zoom call with you If someone asks me to be their mentor, there's just no way I don't have time to you know I can barely mentor me right now I The I just don't have time to commit to being someone's mentor But if someone emails me and says I need advice around the specific issue and then what happens?

You hear that they're Either raised by saying a mother like me. They're a good person. They're struggling. Their sisters got a needing disorder And they're struggling with it and they're trying to They're thinking about starting a business and you're like oh no, no, don't do that right now

You've got a good job like you just make some you just help them with some common sense decisions common sense And then what happens you become emotionally invested in their success And then they email you a month later and you're like what's going on? And you want to do another call you know ease into it So anyways, I think it's much easier to just ask someone for help and for advice. I think there's a lot of people out there

You doesn't have to be a baller like Stephen Barlett. There's a lot of smart people out there that can give you good advice

Because I think this is really important. I don't think I've as I said I don't think I've had anyone talk about this but You get a lot of messages Have you been able to figure out exactly why some of them perk your interest so much so that you'd give them 15 minutes when a zoom call is that is there a sort of a psychological formula that gets to you Well, the first is okay first off brevity

When I get like a long you know a novel. I'm just not going to get through it Uh Obviously, this is hard to control But they reference someone you know or they read they make a connection. We're both graduates of Berkeley Or I met you I came up to and said hi to you it can or we have a mutual friend or I too was raised by a single they make some sort of personal connection And they make the ask very crisply. I'm writing because I'd love some advice around this

I'm writing because I'd like an introduction. I'm writing because I'm applying for your position for managing editor for propg media. Just like get to the point. What's the ask and Try and make some sort of personal connection and the other thing I would say although I hate you know, I don't encourage you to do this be persistent

Because a lot of times I get an email. I think I was a good kid. I should really set up a call or something And then I go on to the next 85 emails I have not even remember getting that email So I would say don't be afraid to hit again and just say hey just putting in the top of your inbox know you're busy If I can grab 10 minutes your time would be really appreciative and also don't get discouraged if they don't get back to you

That's okay. It's not a reflection on you Go under the next just don't Write it off. That's okay. Don't worry about it. Don't worry about it. I have a I have a bubbling thesis on this that um If you just talk kids, you know your kids might keep future kids How to ask for things in life the impact that they would have on their long-term trajectory

Is unbelievably profound because I if I think back through my life When I was 18 years old stealing those pizzas in Manchester or every step along the way Some of my big pivotal moments in my trajectory were sending an email Yeah, and yeah pretty like yeah Pretty much all of them started with sending an email But we don't teach people how to send an email and you're on the receiving end of thousands of emails every month or whatever

So you can see bad and good from a bird's-eye view and the things you've just said there I completely agree with the the size of the the message Um, it's being specific in the ask as you said um playing to ego in some way letting them know that you've read something you've done or you're interested in them Or you know someone all those things has such a big such a big impact I think if you think about your life and you go okay, I'm gonna live for a I'm gonna live a hundred years

And I'm probably gonna ask for things 10,000 times If I can increase my success rate of those asks by 10% Because I'm just more thoughtful in how I ask for things My life could end up in a completely different place Kind of like what you said about you only need a couple of wins to really be successful in life You only need if you send 10 emails you only need like one person to say yes I'll invest and and be willing to endure the rejection of the nine How do kid at this young kid come out to me

I was just in can Big can't take a picture with yourself. Yeah, boom done so I can take a selfie Send me an email yesterday with a picture of the self and said we met we'd have chance to say hi

I'm struggling with I'm in he was quite vulnerable. They're talking about some of the stuff He's going through and said I'm struggling and Would you mind doing a 10 or 15 minute call with me and he includes a picture of me and him How the fuck am I gonna say no to that right Anyway, there you know, there's all sorts of tricks and trades, but the willingness to take that risk the willingness to reach out to strangers

That's the key to success. That's I mean, it's the reason I have kids. It's the reason I'm wealthy um, nothing wonderful is gonna happen to you without Taking an uncomfortable risk. So I think about this with my boys I used to force them or ask them to speak to a stranger every time we were outside of the house My oldest one has no problem. My youngest one doesn't like it

Really hard. Okay, we sit outside the door for 10 minutes just go Ask them what breed their dog is over there just go over there just ask them about their dog Because he I think a good strategy especially if you're young men who for some reason seem to be sequestering and becoming much more isolated

Whenever you're in a line Talked to the person in front of you and behind you just talk to them Just get used to opening just get used to eye contact Just get used to being friendly and having a conversation because I think people are spending so much time indoors and behind screens They're loosening the ability to establish professional and personal connection So I think it's certain cognitive behavior or or training around how to be friendly and how to endure rejection

One of the most revealing things I've noticed about you as a person is what you just said about that kid that emailed yesterday Mm-hmm because as you said it I can see the emotion in your face Yeah, look what do you want as a species you want to feel certain things right you want to feel

You know the most rewarding things are sensations and feelings and I get really moved by these kids sometimes you know you relate to them I relate to young men who are struggling because I was one of them And so this stuff really sometimes you know What you want in life is a group of people who are emotionally invested in your success And then as you get older the most rewarding thing is to let Other people let you be emotionally invested in their success, right?

I want my boys to love me But what is the most rewarding thing is that they let me love them That's the most rewarding thing right there these vessels that I get to pour this like affection into That's the most rewarding thing as you get older So yeah, I think about this stuff a lot and I get Why did he move you?

Well, just the picture and I don't want to divulge but he's struggling He's really going through some issues With addiction and self-harm and depression and and also by the way is obviously a very talented kid is very smart Is working in you know as a high profile job And is struggling with addiction and self-harm. I mean, and you think Jesus this shit is real right? This is really Really tough for this kid and You just realized I think so many young people

We're raising my colleague at NYU wrote this book. It's This is the book we wish we written The anxious generation Jonathan Hyde. Oh, yeah, it's literally The most he's now the most influential scholar probably globally and The takeaway is we're raising despite our prosperity in the US. We're raising the most anxious to press obese and addicted generation in history

and you can just sense it. There's so many young people out there that are really struggling that aren't happy That don't have the opportunities that my generation had and then 200 time 210 times a day The reminded that they're not doing well as someone else vomits their faux success and experiences all over them That oh wait, I didn't make I didn't I didn't make a million dollars in an vidia and I'm not

parting in Santa pae. I'm a failure Right and there are there opportunities for professional In Romantic success are going down people are dating one out of three men under the age of 30 has a girlfriend Yeah, I mean, there's just so many you can just tell a young people are really really struggling and I think about that a lot and You know, it moves me because a few fortunate decisions a few random emails You know things could have been much different from me and I

So I really I do relate to these especially the young man. I relate to the struggles they're facing You you talked about making decisions in the algebra of wealth Um, I get asked this a lot um kids come up to me at the end of a talk that I do or some other event and will ask me about Decisions like jump off points in their life as you zoom out on life Is there anything that I can know about how to be a great decision-maker over the context of 50 years of life?

Is there anything about how to make a decision Greatness is in the agency of others You're not this business you build Is not going to get beyond a certain point unless you have the ability to attract and retain really talented people Great decisions are in the agency of others. We have some weird notion of leadership. I used to think leadership When I was a younger man was quickly assessing the situation deciding what we should do And then advocating for my course of action

That was leadership and it was more important to be to be right than effective or to get people to agree with my decision Then to make the right decision What you want is you want to get to the correct decision that is the best outcome for everybody and be open to change and evolving

And the way you do that I don't make a big decision now without speaking to at least three people So you want to make better decisions then slow the process down They're slow and fast thinking and get the benefit of other people and expertise

Is there any decision that I should make slow versus fast is there a framework for How to know what you need sometimes I think I find in business that the cost is The time I waste trying to make the decision And then sometimes in business the cost is the outcome of the decision

Well, yeah, there's been books written about this but basically every day there's thousands or hundreds of decisions You have to make instantly like do I go on the red light do I not go do I you know There's a ton of things you have to do

Saying thank you pardon me what there's a ton of decisions you have to make every day So we get into a framework Of sometimes where we don't slow down and have the luxury of making a good decision The other thing is that I've tried to do is I try to screen out unimportant decisions And this is a luxury but as I've gotten a little bit of money I don't make decisions around anything I mean, this sounds weird. I don't order when I'm in a restaurant. I don't order

I basically wait to order for me. I have a uniform at work. I don't pick up my own clothes I have a group of people who manage You know, I'm think you're in charge of all decisions here I try to focus only on the decisions I can bring a lot of value to so I can spend a lot of time being really thoughtful about them But generally speaking for a young person that's not in the position of outsourcing a lot of decision-making

What I would say is get a kitchen again goes back to the notion of a kitchen cabinet get a group of people Who will you might end up at the same place, but they'll say have you thought about this or why wouldn't you just do Why wouldn't you just have you know do x, y or z or I think you know who have the leadership skills and know you well

I'm gonna go you know Stephen. I think you're making a mistake here When I was 26 I started coming up profit brand strategy strategy firm Six years later when I was 33 I was offered 55 million for it Um from sapien nitro and another firm called science 55 million I owned 60 70% of the company So I would have been done But I was under the but no, this is the internet. It's gonna be huge. We're gonna be worth a billion I If I just had a board if I just called a couple people

They would I know they would have said what the fuck you thinking? I was doing Three million a year in consulting and this firm offered me 55 million dollars If I had just talked to someone they've kind of got let me get the okay, so Scott You've been offered 18 times revenues for a small strategy services company Also around relationships, right? I talked to some of my friends or younger

Men I know who are really upset with their spouse. I might be clear Yeah, this is an issue, but you're not bringing a lot of generosity and forgiveness to the relationship And if you don't bring those things Your marriage to this person or anyone else is not gonna survive

I didn't figure this out so I was older But you will always naturally inflate your own contribution to the relationship and some and and diminish theirs And the relationship is never gonna be in perfect harmony or balance So in those periods of deficit You've got to bring forgiveness

You've got to bring patience. Otherwise no long-term relationship is gonna survive And also be pretty clear if you split up right now Just know you're gonna lose 70% of your network maybe 60 but plan on 70 you split everything And then the cost of lawyers and I can guarantee you if you have to sell a house That'll be the exact wrong moment to sell it. It's just karma Just karma So just keep in mind there's a lot of good reasons to stay together in a marriage and try and figure it out

Is marriage good for wealth? Oh, yeah, really? Oh, I don't want to lose 50 70% of my money or whatever Well, you'll have that guy on who's on TikTok all over the place saying it's a failed technology the majority of really wealthy people

Have long-term relationships and earn a monogamous relationship. They're married because The team is a fantastic way to build wealth But if if the stance is true and you know 50 whatever 50 whatever percent of people are getting divorces Doesn't that mean that if I'm building wealth there's a?

50% chance that I'm gonna lose half of it if I'm married or more well first off if you have wealth going in get a prenup Yeah, but what I would say is um And first off that number is a bit misleading because marriage is becoming a luxury item to

Used to be 95% of wealth who people got married and 85% of middle class and poor people got married It's dropped to less than half among poor people the bottom line is no one wants to meet with poor men and wealthy people attract a lot of mates and generally speaking really wealthy people I

Mean there's all this you know there's all these it's fun to do tick talks about jet-base us on it on a yacht with his new girlfriend and everything But the majority of wealthy people are actually uh, stay married and the team is really powerful You know We're both working together. We're both making a lot of money that is really powerful and she's seeing one set of expenses You're gonna focus on the logistics of our life or our family and my wife's the professional baller, right?

The team the team is powerful So this notion that you shouldn't get married or I'm not I'm not suggesting the marriages for anybody or state stay married No matter what I'm not suggesting that at all, but there's just no getting around it The team is much more powerful than the individual and if you if you break down the numbers of people who are wealthy They generally speaking invest a lot in their relationships Well, there's a whole person project

There's a myth that rich people are bad people the Elizabeth Warren Bernie Sanders the billionaires crawled over other people to get there

It's just not true. Well, you generally find among wealthy people especially people who have made their own money Is that the re one of the reasons they're wealthy is they've collected allies along the way And just as compounding is so powerful with small investments from your young Bring some generosity to people when they need help being a good friend occasionally checking in how are you doing?

Helping people find jobs when they lose the job being kind Those little investments you make as a young person really add up and you're gonna find this I have all these great friendships now with people where I was never great friends with But because we made small investments in each other over 20 or 30 years Just checked in how you doing Congrats how you're doing this congrats on your wedding maybe not even close friends you wake up in your 50s

And you have millions of dollars in terms of a relationship you feel close to these people you feel like a real nice sense of Comity with them you really And this is very true of wealthy people You want to be put in a room of opportunity Even when you're not there

So Google did a study when they put out a job opening for a product manager they'll get 200 resumes within a few hours They invite the 20 best in 80% of the time the offer that's made is made to somebody who has a Evangelist advocate friend in the company So this is who you need to be you need to be that person who's like oh

There's a job opening here. I have this woman who would be great and then connects them You need to be in a room you want to be a successful professionally be successful personally go out make friends Be kind invest in them help them when there's no obvious reason to help them

And those investments pay off and generally speaking and this is an anodipopular narrative the majority of very wealthy people I have met and I've met a lot of them are kind They're generous very civic-minded very good mates So this trope of You know of Monte Burns lighting cigars with a hundred dollar bills and owning the the nuclear power plant I'm pouring you know radioactive waste into the river that's a cartoon The majority of self-made people who are really wealthy

Are good kind people because you have to have allies along the way to be really successful. Can anyone's don't a company And you'll be can anyone become a successful entrepreneur? Oh, no You there's there's certain attributes that most people don't have what are these traits? First and foremost you have to be really risk-aggressive and have that willingness to fail You're willing to take huge risks. I speak to people all the time who say well

I'm gonna go get a job at Google or JP Morgan for a few years. They don't have the credibility to start a business I'm like you're not an entrepreneur Most entrepreneurs 70% entrepreneurs are immigrants that don't have access to corporate Britain or corporate America By the way If you have access to Google all these kids kind of my office hours when I say kids are my students

And they want to ask they don't want to talk about brand strategy. They want to talk about careers And they say I have an offer from JP Morgan or Google But I'm thinking about starting my own business I know you've started a lot of business and they think I'm gonna say go for it I'm like don't be a fucking idiot go to work for Google On a risk-adjusted basis the most unbelievable platform for generating wealth and opportunity and long-term economic security

Is the American corporation? These are unbelievable platforms to get rich with some certainty Slowly and sometimes quickly in the tech community if you have access to those platforms And unless you hate it and are terrible at it you should go that way the majority of entrepreneurs are immigrants

And why is that because they didn't have any choice they didn't have access to corporate America They had to open a dry cleaner they had to start a soapstone company Entrepreneurship you have to be risk-aggressive willing to take risks

To to be really successful at it you have to be a great salesperson You have to be willing to convince people to invest buy your products You have to be willing Most importantly to sell people on your vision and believe that you're a good person that if you're successful

They're gonna be successful. What's the best way to train that muscle if I'm young Gosh, I don't know for me it was um Look I I think the core competence you would want any kid your kid doing her it If I could give my kids any skill I remember in the Tonya's preschools and I'm sorry high schools They had Mandarin and I was just stupid

Where computer science? I believe that replacing history and civics class with computer science you get Mark Zuckerberg You get these mandatious fox who are billionaires, but don't care about the health of the Commonwealth The greatest skill you can develop or that you would want your kids to have that will stand the test of time is storytelling The ability to craft a narrative and then convince people get people engaged in your narrative and think Oh, your company makes sense

You're not gonna come in and say I'm starting a software company. I'm gonna say this is the technology This is the marketplace. This is why society needs this These are our unique skill set and you can craft it into a story that is compelling Right It's the key it's the key to scoring above your weight class romantically right communicating a plan Communicating kindness communicating empathy

communicating humor Right any industry jet-based was 1997 shareholder letter you read that letter you just want to buy stock I don't care how overvalued it is when you listen to Jensen Huang talk about the future of AI and biology and healthcare

Like well, maybe I should buy it even though it's trading at 110 times earnings If you want to be a great CEO you got to be a great so I don't give you my angeloo Rousey Sinak or you know Jensen Huang the core competence of any really successful person or the core competence that's gonna get you Real influence in economic security is storytelling So it's so interesting because um I completely agree with everything you've said about how at the very heart of wealth creation as a entrepreneur

But but more generally in life whether you want to be a president a prime minister or philanthropist is decided to craft narrative but um The average how does the average person develop that skill when they don't they're not a lecturer They don't have students that they can speak in front of they don't have a podcast necessarily that people are gonna listen to

But if we both agree that it's such an integral skill the transformative life skill. Oh, there's a million ways The first thing I assign my students my kids in the classes pick a medium It can be Instagram. It can be x it can be The threads it can be Pinterest linkedin public presentations speaking radio podcasting Identify what it would mean to be in the top 1% You can go online what are the top 1% of followers on Instagram? How many followers do you need to be in the top 1% on Instagram?

By the end of the semester you need to be a top 1% storyteller on a medium I'm really good at this you're really good at podcasting. I'm really good in front of a large crowd I'm not very good on the phone. I'm pretty terrible one-on-one I come across as a luth yet insecure at the same time, which isn't easy to do So I know the medium I'm not good on the phone I've become a proficient writer. I aspire to be a great writer. I'm good now someday. I'll be great

But I know my mediums and I practice storytelling every day. I'm either writing. I'm either speaking. I'm either podcasting if you're young Oh my god the mediums are you good on TikTok? Get a smartphone get a you know iMovie start editing and every day make small iterations and changes and commit to being a great storyteller And the wonderful things about these mediums and the economy and these technologies is you can be a great storyteller

Anywhere from any background and from any location. I'm not suggesting that you That everybody Has the same opportunities But the opportunities the reason why Hollywood is struggling the reason why the writers for striking for four months when they got a 5% increase in pay Is that there are 1.7 billion people on TikTok and 850 million of them are creators, which is a fancy term for storyteller And assume 1% of them are outstanding storytellers all of a sudden eight and a half million

New storytellers have come into the media market and the half a million in LA who think they'll work is so fucking precious And are trying to figure out why their industry isn't a climb like you're competing against eight and a half million new storytellers That aren't asking for peppereevent leave or for a trailer with catered food The ability to tell crap to narrative find your medium and then say i'm gonna be the top 1% What is the algebra to

Storytelling if that had to be one if you know you've not had to be interesting. I'm thought about that. I think if it is One you just have to be a compelling i mean it sounds terrible, but i

I have a handsome voice. I was i have a face for podcasting. I've had five tv shows they've all been cancelled within like four weeks Podcasting is my medium television television is not you've done really well on podcasting and video right that says something I would say that more than anything It's tapping into people's emotions

Like how do you make someone feel something? I mean you want to be smart you want to say interesting things But how do you really connect with someone and make them feel something? The white space i'm trying to occupy Is i'm trying to be a white heterosexual male in his fifties who's open about his emotions That's a white space

Guys my age don't talk about their failures. They don't talk about the way they feel about their kids They don't talk about You know how devastated they were when their mother died that shit's just not talked about among men of my demographic That's the white space i'm occupying so you need to say okay, what? Am i going to make people feel That other people aren't spending a lot of time evoking

Getting people to understand those emotions. It's I think the specific crowds out the general you want to focus on a niche Own something all right I'm going to be the top one percent of this medium and i'm going to develop domain expertise i'm going to be the person that understands

Ethiopian cuisine And i'm going to bring romance and make people feel something and i'm going to connect it to family and i'm going to connect it to African culture and i'm going to connect it to maternal love and whatever it is

But think about it. What emotions do you want people to feel and then every day It's just hand-to-hand combat every day You know before we were off mic you said we were both kind of In the last two years both of our careers have sort of hit a tipping point I feel like i've worked my ass off at 35 years and i'm someone over nine to success And you said what was the one thing and i can't point to any one thing

It was a series of little things. It's kind of the mr. Beast secret sauce It's iteration every day they test things they make things just a tiny bit better So commit to excellence you put out a podcast you put out a medium post you put out a PowerPoint presentation Leopard about AI whatever it is try and find a mechanism for feedback and commit to just being a little bit better the next time you do it

I'm going to let you in on a little secret. What is in the diary of a CEO cup This cup that sits in front of me when i interview these people sometimes for three hours And sometimes three people a day and the answer is this perfect I invested in the company on dragon's den and since then they've gone from an idea to the fastest growing energy drink in the UK It is a matcha energy drink and it is absolutely delicious

But that's not why i choose to drink it on this podcast the reason i choose to drink it is because it gives me what i call all day energy I don't get the same crashes that i used to get with other energy drinks If you're in the middle of a conversation or you're in the middle of a talk on stage or in the boardroom The last thing you want to do is have a crash you don't want jitters and you need Focus and that is why they now sponsor this podcast not only is it delicious

But it gives me a significant competitive advantage if you haven't tried it go down to a test go go to a waitrose All go online and use the code diary 10 at checkout and you'll get 10% off and when you do try it let me know how you get on

I'm very keen to understand how you invest your money so say i'm that i'm working at McDonald's like Or burger king or whatever and i say these places not to sort of diminish the the value of the work But because i worked four five years of my life in places like call centers and the McDonald's etc But just as that's the jump of point for many people i get up to managerial position

I have a little bit of disposable income now. Mm-hmm Should i be going all in on crypto or my friend has this company?

He said it's gonna work. Should i be betting my money there over the a long-term time horizon Where have you invested your money and made the most returns and where should i Well just do as i say now as i do i was went all in on things and when you go all in on something If it hits the ground or blows up you're kind of done and you don't have any capital and you can end up I ended up broke it In 99 i was looking at jets by

2000 after the dog bomb explosion. I was broke Crawled my boy back was wealthy again by 2007 all in on tech By the end of 2008 i was broke again and what i've learned since then is i've crawled my way back Got very lucky markets have boom But now i diversify like crazy and what does diversify mean

You're never more than a certain amount of your net worth and any one thing and you try and make sure those things Aren't correlated to each other It's harder when you're young because you may have to go all in on a house You may have to put every penny you have to buy your first home when you start a business when you're young You don't have the luxury diversifying you have to i bet you kind of went all in on this business at some point But as soon as you have the opportunity to diversify

I'm about to put money in an aircraft maintenance company in El Salvador I love it. It's totally different than anything i do that way if my world goes to shit again in tech I have someone making money fixing planes in El Salvador I do a bunch of just different Weird businesses that aren't related because over time because of demographics and technology productivity does grow up in our economy And the markets go up the best advice i can give any young person

In terms of the actual investment is a low cost ETF you don't want to fees to eat up you don't want to day trade 80 to 95 percent of people who day trade lose money You want to be in a low cost diversified ETF what's an ETF you stay and trade at funds so they basically say okay We're going to create a synthetic of the entire market and all health care stocks

So like i can invest in a tech ETF or a solar ETF. That's right or i don't know i a i ETF Let me make it easy go to vanguard I don't have a relationship with vanguard spy that's the index that tracks the smp 500 And so people the email i get most is from young men looking for guidance and mothers looking for guidance for their for their sons the second most Frequent email is the following is it too late to invest in mvidia

And the honest answers i don't know i can imagine a scenario where it gets cut by 80 percent

I can imagine a scenario where it triples. So this is what you do you invest in spy Because about 20 percent on the dollar will go into the magnificent seven because they're about percent of the market cap of the smp spy is again a basket of different stocks It's it's an index fund that mimics the smp So there 500 companies in the smp in vedia is probably three or five percent of the total value of the smp So five cents on your dollar goes into in vedia

Right about 20 percent is all right 24 25 percent is the magnificent seven the tech companies we talk about 25 cents on your dollar will go to them So assume those companies double Great you participate, but assume the other

493 companies finally get their time in the sun and those companies go down a half you're still fine You're still fine again You don't need to find the needle in the haystack and stop believing in a very American way that you can figure it out I know the brightest people in finance and what i the

My net conclusion is that none of them have any fucking idea Some have a little bit more of an idea But if you look at the entire alternative investments industry hedge funds private equity funds mutual funds Anyone on cmbc if you took all of their returns an aggregate

They're less than the smp by the amount of their fees It's one of the greatest grifts in the modern economy is believing that some guy Who looks old and unhappy and has suspenders and went to Harvard knows more about the markets than you All you need to know is diversification right spy

Start saving young and then the next best piece of advice is if you can If you can For savings 98% of us will spend everything we get our hands on It is very hard to have the discipline to take money that is within your grasp and invest it For savings plan find out at work if they have profit sharing or IRAs or Ross Whatever the the I figure what it's called here where if you put some money aside the government matches it pensions

Well not only pensions, but there's something here. I figured it's called if you save 5 000 pounds through your work The government I think will match it Put in a thousand pounds There's all sorts of saving schemes at work Acorns the apps that round up to the nearest dollar and then immediately shoot it into spy Try as hard as you can to put yourself in a position where you invest Despite your best efforts not to Because the majority of us will get that money and go buy a flat screen TV

And when you're saying investing I think because it can sometimes uncomplicated from someone that so far away from it There's apps on our phones now where we can in a couple of minutes Invest in the exact thing you've just said from we can make an account in a couple of minutes

I'll probably ask for our passport take a photo of our passport There's so many different apps where you can go in and invest in the smp 500 You don't need to pull someone or know someone and you can invest what's the minimum you can invest a dollar a dollar

I'd go to public dot com. I mean start with a basic a basic low-cost ETF for index fund s spy If you want to get take a little bit more risk and you want to be in tech There's all sorts of ETFs and index funds around tech You're gonna every young person especially young man is under the impression

They're smarter than they are and that they can beat the market So okay take 30% of your money have some fun by Starbucks and video unilever No, but Nordisk whatever you think you have inside into so you can learn a life lesson that over the long term

You don't know what you're doing and just put it in an index fund because the marvelous thing about the human race is We become more productive and the Western economies generally speaking over the medium and long term are up into the right and Again, and I'll go back to my algorithm or equation

Focus find something you could be good at maybe great That has a 90 plus percent employment rate Stoicism we haven't talked about that realize there's something you can control Focus on the things you can control one thing that is within your control is spending

Trying to find a partner trying gamify spending. I spent 78 dollars a week my summer between my junior and senior year including rent Because I need a $3,300 to go back to school I partnered with five other guys in my fraternity and we gamified who could spend the least amount of money find a partner who's aligned with you Around spending and saving right realize no one's as impressed or thinking about your shit as much as you are

Right, try and find reward from exercise from relationships not from signaling wealth with kind of stupid shit Right, I call that stoicism. It's really more about discipline develop a savings muscle one and appreciation for time and how fast it's gonna go

I was stupid. I remember my best friend Lee Lotus picking me up to go to the beach when I was in college and he was Scramming to find two thousand dollars to put into something else an IRA Roth Whereas company a bank he was working for is just out of college if you found two thousand dollars

They would match it with another two thousand I thought I said to him these exact words of two thousand bucks means anything to me when I'm older shoot me I have made so much more much more money than Lee Lotus And he is a multi-millionaire now so am I but I've endured a lot more risk and a lot more ups and downs Because he was that lame guy scraping together two thousand dollars when he was 23

I went out and spent my first bonus check at Morgan Stanley. I got twenty eight thousand dollars my first year out of college Morgan Stanley 28,000 dollar check I go out and I buy a thirty five thousand dollar BMWs hung swim goggles from the rearview mirror thinking that would impress people

I don't know what I was doing I figured out if I bought a Hyundai for nine thousand bucks, which you could get in 1987 or whatever it is And invested the other 20 in SPY never looked at again I would have enough money now to buy 11 Ferraris Including that new electric Ferrari that for some reason appeals to me which makes no sense an electric Ferrari Anyways

You're gonna love us. I tell the people who work for me that I drive up in a Ferrari and I say if you work really hard someday Someday I'll have two Ferraris I don't have a Ferrari by the way My other joke about a Ferraris Ferraris like having a long consistent erection. I don't have a Ferrari anyways Anyways, where were we going?

At realize people aren't as impressed with your shit as you are Recognize the power of time and then the thing where I really screwed up Steven diversification Take some money off the table

Invest in I'm hearing from employees in video. We talked about this diversify you get It's such a Bulletproof Kevlar for your mental health you get risk-free return Nobody knows anything can happen Amazon 1999 again lost 90% of its value Do you know the kind of mental anguish when you go into a stock like amazon and you lose 90% of your Of your investments So if you want to have some fun ring fence it to 30% of your of your savings pick some stuff and it'll be a good life lesson for you

You may get lucky more power to you over time. You're going to realize Nothing beats over the long term Warren Buffett what a third wealthiest man. Well, I'm giving you the same answer he gives If someone has ten thousand bucks higher than investing. He's like low cost index funds To two and a half hour conversation Put it in the ass of the far ones low cost index I know it's it's the boring shit that makes you rich. Yeah, it's also I advise a lot of CS

It's the boring incremental stuff the most shareholder value. Mm-hmm. No, it's so true So one of the things that stopped me when I was young from doing exactly what you just said is I didn't think that the $500 I had or the 500 pounds that I had was enough to get started

So I said to myself on my head. I thought okay when I get a million I'll become an investor And I think a lot of people actually listen to these kind of conversations and go okay once I've Once I've got Five thousand pounds disposable income a month then I'll do what Scott said

But there's no point in doing it with a small amount of money I wanted to use this little bucket of sand here as an analogy for this because um my team brought a bucket of sand To illuminate the power of compounding interest when you invest in these S&P 500 companies

And this glass represents investing 1000 a month in the S&P 500 over the course of 12 months starting at the age of 25 right But if you left it and kept investing at that rate by the age of 65 it would look like this You have zoom a beach

Oh my god. Thank god that's you Oh Jesus Christ It would look like that And this is really what you're saying When you're talking about ETFs Well, you asked that question about the young man who says I'm gonna wait till I get I have 500 pounds I'm gonna wait till I have a million before I start investing the way you get a million pounds is by investing that 500 We don't believe we're gonna get old We don't recognize how fast time is gonna go we don't appreciate the power of compound interest

Don't focus on your investments put it in low cost low energy ETFs Start early you have time your advantage when you're young is time And you're gonna get that bucket of sand by the way this right here isn't a lesson in investing This is a lesson in storytelling a bucket of sand. I mean who thinks of this Leave it out the way But it is it is I I um, I discovered the art and the science of compounding interest too late in my life

And I just wish someone had slapped me in the face with it at 18. Yeah, it's crazy. Honestly. I probably started at 28 That's still earlier than most people, but it goes to the notion of back to the investor young person

Most young people don't have the discipline to invest any money to get their hands on because a capitalist economy is The the smartest people in the world with the most godlike technology are presenting you with amazing irresistible offers to upgrade from economy to economy comfort to add

To add flourless chocolate cake to your order from balthazar balanjari in one minute or less something. Oh my god But wait, there's three other people looking at this room this hotel room and it's going on sale and I bet everybody

It's so difficult to hold on to any money. You want to find ways of for savings a house is for savings to a certain extent Because people don't want to be evicted from their house going to work for a company and getting options and getting equity the gross tax deferred That's sort of for savings But you want as a young person try and find as many ways as possible to have for savings and an app that

That rounds up to the nearest dollar and then invest no matter what that is for savings. It is very difficult To take money that is in ever come through your hands and invest it So it find for savings mechanisms that are taken out of your check Find out if your company offers any sort of investment or savings schemes that they match Where that the government matches and most corporations offers something

Real estate. I've had a lot of guests talk to me like Morgan House or the others that have a sort of mixed view on where the real estate is a good investment What's your thoughts on it? Should I be investing in real estate?

I mean no my brother sits in the big thing when I was 25 he said Steve if Everybody is playing the game there are times probably aren't great from it Goes back to sex appeal too much capital going in well like Case-shiller the brightest people in real estate will say if you really account for maintenance And upkeep that real estate has not outperformed other asset classes The reason I like real estate is that one in the United States is very tax advantage

They're very few asset classes you can lever up four to one 20% Down payment. I can't buy apple. I can't buy a hundred dollars with an apple stock for 20 bucks So it's it's a huge leverage The interest on that is tax deductible in addition if you sell a home this true in the US on the US I don't know in the UK

If you buy home and sell it after hold on to it for at least two years you get a $250,000 tax deduction 500,000 for married So if you have for example any ability Get to know the the homes in your area Find a nice home or a round unit that you can maybe rent out or or upgrade maybe you're handy

To do that every few years and take advantage of the tax deduction and then roll into something bigger And that is for savings you know that mortgage payment is coming every month Actually the majority of savings for baby boomers right now is in their homes

It's the equity in their homes now unfortunately that's there's some bad things We haven't improved housing permits as quickly as we should which has made it more expensive for entrance young people kind of forward homes The average homes gone from 290 to 420 through the pandemic in the US And if you look at interest rates it means the average mortgage payments gone from 1100 to 2300 dollars

So it used to be two thirds of America could afford a home now. It's one third I told other talk show, but I just did a TED talk On the war on the young economically, but real estate is a very tax advantage industry It is for savings Also, there is some I think Psychic value which I think is important to to a home you start investing in it fixing it up It feels like I don't know it's there's something rewarding about it But to what your brother said when everyone's trying to buy homes in an area

That usually means it's probably getting overvalued and like any other asset class It can lose money But the reason I like it is because it is a form of forced savings people generally speaking We'll make that mortgage payment or try and figure out a way now You want to make sure that not more than 40% of your

Income goes into a house otherwise. It's just going to be your anchor It's just going to be a source of stress for you And I think a lot of people go up thinking I have to have a home And so they just become Overleavoured in their home and they become kind of house poor They own a house and that's it and they can't afford to do anything else And they might be able to able to move then and you talked about geographical opportunity when you're young

That's right. You get tied down Especially if your home goes down and value But I still think it's in the US at least real estate's the most tax advantage and If you're on commercial real estate in the US you can depreciate it two or three percent a year You can't depreciate a stock two or three percent a year Is there someone that shouldn't shouldn't buy a home then in your view Is there a certain demographic or age or person with a certain talent that shouldn't buy a home

I would say in general if it's a home if you think that you're not going to be able to hold on to it for at least seven years If you hold on to a home for seven years you should be able to write out most Economic cycles or a economic down cycle Um, I think there's some wonderful things about renting you can slam your keys down and leave if you're planning to move Um, if you don't have somewhat reliable sources of income um

A mortgage is probably a tough thing. I don't know. I think I think home ownership I'm talking my own book a little bit here because I've made good money in real estate I've really enjoyed it But I think it's situational and it goes back to that notion of having a kitchen cabinet of people who can advise you on on On that asset class unfortunately that asset class has become so expensive

That the quote-unquote American dream of owning a home has become somewhat of a hallucination if you will or fantasy for a lot of young people The other thing 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. Oh my gosh, and it's a tax game that the average person has no idea is going on

Gotta talk about money. Tax avoidance is a key skill to building wealth and by the way We don't talk about I speak openly about my I won't call a tax avoidance, but my tax strategies If you're 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 charts some tens of billions of dollars thereby increasing The income of Apple Ireland at a lower tax rate and decreasing the income in the US

They're by lowering their overall tax rate. That is pure tax avoidance Every organization every corporation does this to the help 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 paid between six and eight percent tax rate. What are the tax games they're playing? Oh, this the rich people. There's a bunch of them first and foremost

It's you buy stocks you never sell them you borrow against them. Okay, explain that to me like a mitten you're old

So sure you own a hundred dollars in Amazon stock. Yeah, you need money to buy something instead of selling the stock and it's it's gone up 50% I say it's got 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 trust and then pass it on your kids

There's a lot of um state arbitrage Jeff Bezos just moved to Florida to spend more time with that Isn't that sweet Stephen? Isn't that nice? No, it has nothing to do with his father give me a fucking break He aggregated 160 billion dollars in wealth He would pay about another eight or ten percent and 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 piece out to Texas or Florida and pay no income tax So all the people shitpost in California in New York Show me someone who's all of a sudden can't handle San Francisco politics I'm gonna show you someone who needs to recognize a capital gain and as 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 or something called 1202 or qualified small business So when I started L2 what's L2? L2 is my analytics company. I started it. I invested a small amount of money um Because it was a business worth fit less than 50 million your business would qualify in the US is QSB small business

If you hold on to that stock in that company for longer than five years when you sell it the first 10 million or 10 times the basis Our tax freeze 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 out of 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 4000 and that extra 3600 pages are to turn rich people into super rich people Now the myth around taxes is 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 moms 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 is tax rate plummets So you don't want to be a super earner you want to 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 The really sort of actionable thing there for the average person as well It's probably the the first point where you said a lot of what rich people do is they'll buy a stock So I'll spend 10k on Amazon stock and then I go to a bank and the bank give me a A $5,000 loan against my Amazon stock tax-free

And I just hold the Amazon stock now. I've got 5,000 tax-free if the Amazon stock goes to $20,000 in value then I can I can go to the bank and say it's gone up now give me another $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 Yeah, I mean you know I want to get into too much trouble, but leverages 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 and 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 going to take 40 cents of that 40% of it If you want a million dollars in stock And it goes to two million You don't get taxed on it till you sell it

Yeah, so just never sell it never sell it And that's what Elon's doing with his company's People say he's got you know $200 billion whatever in fact He's borrowing tax-free against those companies And then when he finally needs to sell it to pay off some of those loans he moves to taxes Despite the fact it built all this wealth in California Smart I think one of the great advantages of life is um as it relates to wealth creation is really getting good tax advice

Because 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 Shocking the variants and 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 have it you know being around a lot of people now that are masters in tax it was like Yeah, I describe it as someone pull back a cut and that I never knew was there I know these people were doing magic behind this cut and no one ever told me that cut and existed

And it's called tax. We don't all pay the same tax because we're not supposed to talk about it Yeah, again, not talking about it is rich people trying to keep poor people down Yeah, because rich people talk about their taxes all the time brightest woman in my entire professional universe is a woman

They'm loosely who is my tax Yoda who works at a big law firm that I pay 1800 bucks an hour to to figure out the smartest when I set up a company I talked to my tax person and I'm about to get a big payment for my podcast distribution company I talked 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 a bus to move out of earning and develop an army a 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 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 That sounded awful That sounded awful that sounded awful Sitting here with your bucket of sand Oh my god

That's right. This is how we fuck the middle class and this is how we really screw over the little guy We have a closing tradition this podcast But no, you're leaving it for What is the last thing you learned how to do just because you wanted to learn how to do it Hmm, that's really interesting Um You know it sounds I this is gonna sound so tried but my boys and I are You know when you get when your dad

You you if you're an ego maniac like me. I just assume my kids. We're gonna be super into world war two history And CrossFit because I thought oh they would think I was such a hero that they'd get well Do you realize if you want to be good dad you have to be engaged

In what your kids are engaged in otherwise you're just not gonna engage. I have no interest in sports I have become a Massive fan of premier league football because my kids are so devoted to Chelsea and to Tottenham So I've taken up our smells so we could have a lot of fights in the house But what have I learned I've learned to love football

And the moment my sons are out of the house. I will learn to not care about it again So I've learned to love premier league football because it's a way I engage with my boys

Well next year we'll go yeah, I'm a Manchester not fine. So man you how fucking predicted Literally man you You grew up in Manchester right off my family did so my siblings were born there Yeah, the only thing we're worse than that would have been man city, but you have okay You have man you rights then if you're a man just to tell people this like like because you get roasted and then you have to Indicate that before like for me the first place we lived in the UK was Manchester

So my oldest siblings were all born there and then we moved to Dublin in the southwest which country side but One of the strongest brands in the world my my six-year-old son has a friend coming They're gonna take the train up just to do a tour of the stadium. Oh really how many times do you do that? Good. They coming I think it's in a few weeks. We're going but I mean we're going to Germany for the European Championships Our whole family our activity is we explore Europe we follow

We go you know see FC Barcelona play. I mean this is a position of privilege But football for us When I stopped playing sports As a college student I didn't think about sports again for 25 years And now we're just all in on foot they we plan our lives on not not a round football

But every week we go to a game. It's wonderful. I'm convinced it's one of the few safe places that men can demonstrate emotion Yeah, it's one of the few places men are allowed to hug each other feel sad feel joy 100% but it's I've been to Because I'm in the corporate world Amazing sporting event the best sporting events in the world and the Olympics this rule Nothing matches Premier League football nothing. It really is special

That's what I learned to do. Hey man, it was super interesting because um I've read in your work about like buying people buying football clubs and stuff like that and then I'm going to make money But the asset is basically valuable because someone else wants to buy a greater full theory And I'm getting loads of those offers now to like get involved in football clubs and stuff and and actually based on your thesis about men Yeah It is actually for me there's there is a thesis there

Well the thesis is that there's the real thesis is that the number of billionaires in the US has come from 500 to 2500 They're men who are in a massive midlife crises The way to become the most interesting person in Cleveland is to buy the Cavaliers of the Browns overnight You're the sexist man in Cleveland if you've worth 50 billion dollars Why wouldn't you spend five billion to why buy the Washington commanders or

You know to buy I think Tottenham's up for sale right now. I've thought I got together the wealthiest most famous Scottish people in the US Which is about 14 of us and said let's go buy Rangers Rangers FC It's a publicly traded company. I had it off for good out 10 million pound convertible note I'm like we and then my sky my friend of mine's a famous historian of Scottish is like you'd be the most hated person in the United Kingdom It was they would hate you you knew nothing about football

You'd be some American idiot over there and I'm like yeah, you're right. He's like just go to Rangers games Yeah, yeah, what do you think yeah, there's a pain equation with buying sports teams because you're buying a tribe Yeah, and the chances are you won't win most of the time

And then you have to deal with like Dave from I'd know Southampton whose entire life is that football club that you've just bought And he is pissed and unless you went trope who's from day one you've screwed up and who does yeah, no

It's a horrible paintball. Anyway, it's got to be done I Am a big Manchester Nightfan and I travel all over the world one of the big life savers for me as someone that never misses a game ever regardless of where I am in the world is Nord VPN because Nord VPN allows me to watch the game

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It gives me a lot of security which is something that I think we don't think about enough if you want to check out Nord VPN for a limited time Only head to Nord VPN.com slash DOAC and you can access our exclusive deal Which gives the direvacier listeners a huge discount plus four extra months when you sign up to a two-year plan And there's no risk with Nord's 30-day money back guarantee. So give it a try that's nordvpn.com slash DOAC Or check out the episode description link below