The skills it takes to get rich are drastically different from the skills it takes to stay rich. Few understand this phenomenon more than Morgan Housel. He's identified unique lessons about wealth, happiness, and money by studying the world's richest families and learning what they did to build their wealth and just how quickly they squandered it all.
In this conversation, Shane and Housel discuss various aspects of risk-taking, wealth accumulation, and financial independence. Morgan explains the importance of understanding personal financial goals and the dangers of social comparison, lets everyone in on his personal financial “mistake” that instantly made him sleep better at night, and why the poorest people in the world disproportionately play the lottery—and why it makes sense that they do. They also touch on the influence of upbringing on financial behaviors, the difference between being rich and wealthy, and the critical role of compounding in financial success. Of course, we can’t have a writer as good as Morgan Housel on the podcast and not ask him about his process, so Housel concludes with insights into storytelling, his writing processes, and the importance of leading by example in teaching financial values to children.
Morgan Housel is a partner at Collaborative Fund. Previously, he was an analyst at The Motley Fool. He is a two-time winner of the Best in Business Award from the Society of American Business Editors and Writers and was selected by the Columbia Journalism Review for the Best Business Writing anthology. He's the author of two books: The Psychology of Money and Same as Ever.
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(00:00) Intro

(04:46) Risk and income

(07:40) On luck and skill

(10:10) Buffett's secret strategy

(12:28) The one trait you need to build wealth

(16:20) Housel's capital allocation strategy

(16:48) Index funds, explained

(20:59) Expectations and moving goalposts

(22:17) Your house: asset or liability?

(27:39) Money lies we believe

(32:12) How to avoid status games

(35:04) Money rules from parents

(40:15) Rich vs. wealthy

(41:46) Housel's influential role models

(42:48) Why are rich people miserable?

(45:59) How success sows the seeds of average performance

(49:50) On risk

(50:59) Making money, spending money, saving money

(52:50) How the Vanderbilt's squandered their wealth

(1:04:11) How to manage your expectations

(01:06:26) How to talk to kids about money

(01:09:52) The biggest risk to capitalism

(01:13:56) The magic of compounding

(01:16:18) How Morgan reads

(01:22:42) How to tell the best story

(01:24:42) How Morgan writes

(01:35:42) Parting wisdom and thoughts on success

Watch the episode on YouTube: https://www.youtube.com/c/theknowledgeproject/videos

Newsletter - I share timeless insights and ideas you can use at work and home. Join over 600k others every Sunday and subscribe to Brain Food. Try it: https://fs.blog/newsletter/

My Book! Clear Thinking: Turning Ordinary Moments into Extraordinary Results is out now - https://fs.blog/clear/

Follow me: https://beacons.ai/shaneparrish

Join our membership: https://fs.blog/membership/

Sponsors:

Shopify: Making commerce better for everyone. https://www.shopify.com/shane

Protekt: Simple solutions to support healthy routines. Enter the code "Knowledge" at checkout to receive 30% off your order. https://protekt.com/knowledge

What if reaching the next level of success wasn't determined by another skill, degree, or course but by something that changed on the inside?

That's what Dr. Jim Loehr believes, and in this episode, he reveals everything he knows about mental toughness and winning the mind game. Shane and Loehr discuss the radical importance of the stories you tell yourself—including how they can damage your kids—and how to change the negative stories you believe. Loehr also shares the best reflection questions to ask yourself to reveal personal blindspots, the importance of rituals for calming anxiety and performing under pressure, and how the best in the world use their recovery time effectively.

Dr. Jim Loehr is a world-renowned performance psychologist and author of 16 books. From his more than 30 years of experience and applied research, Dr. Loehr believes the single most important factor in successful achievement, personal fulfillment, and life satisfaction is the strength of one’s character. Dr. Loehr possesses a masters and doctorate in psychology and is a full member of the American Psychological Association.

Watch the episode on YouTube: https://www.youtube.com/c/theknowledgeproject/videos

Newsletter - I share timeless insights and ideas you can use at work and home. Join over 600k others every Sunday and subscribe to Brain Food. Try it: https://fs.blog/newsletter/

My Book! Clear Thinking: Turning Ordinary Moments into Extraordinary Results is out now - https://fs.blog/clear/

Follow me: https://beacons.ai/shaneparrish

Join our membership: https://fs.blog/membership/

Sponsor:

Protekt: Simple solutions to support healthy routines. Enter the code "Knowledge" at checkout to receive 30% off your order. https://protekt.com/knowledge

(00:00) Intro

(03:20) Parenting and storytelling

(06:15) How to determine whether or not the stories are limiting or enabling you

(08:41) What the stories world-class performers tell themselves

(15:02) How to change the stories you tell yourself

(23:26) Questions to journal about

(26:16) Private voices vs. public voices (and how they impact your kids)

(31:32) How to help your friends change their stories

(37:30) How to better come alongside your kids to prevent destructive behavior

(44:48) - (45:06) What Loehr knows about high performers that others miss

(53:12) On time and energy

(01:06:26) Conquering the "between point" ritual

(01:11:50) On rituals vs. habits

(01:15:54) How to increase your mental toughness

(01:23:51) On success