6 New Wealth Creation Mindsets and Life Habits from Money Masters
Let's master the money! This master series is about learning the right mindset for money and creating healthy habits for wealth creation.
To listen to the entire show, please become a member here.
Creating wealth can improve personal freedom in several ways, ultimately leading to a higher quality of life. Financial independence is crucial in achieving personal freedom, as it allows individuals to choose based on their desires and goals rather than being limited by their financial situation. With more incredible wealth, people have more options and can pursue their passions, travel, or invest in experiences that enhance their well-being.
As an entrepreneur, managing your money and creating wealth is critical to the success of your business. It's not just about making a profit but also about being financially responsible and securing your company's future. By carefully managing your finances, you can ensure your business has the resources to grow and thrive.
Runsheet
Mani Vaya of 2000Books tells us one of Napoleon Hill’s story, from Think and Grow Rich, to inspire a burning obsession for success
Burn the boats_PN (2m29)
Wealthion interviews Dr William D Danko, and promotes how we need to live within our means
Don’t spend your way to wealth, build your way_PN (2m16)
The Swedish Investor breaks down one of Morgan Housel’s pieces of advice, in ‘The Psychology of Money’
Never Enough (3m29)
Naval Ravikants/NavalRavikant shares that getting rich is about knowing what to do, who to do it with, and when to do it
Understand how to create wealth_PN (2’30)
Snapreads gives us a major lesson from Benjamin Graham’s bookand how we need to always consider risk
Be an intelligent investor (1m29)
LondonReal interviews Robert Kiyosaki, and gets his call to action for all of us as we look to create a rich mindset, from his book Rich Dad Poor Dad
Break the habit to change_PN (3m27)
What key lessons have inspired you in the Master Series? Get in touch and let us know! Thanks for listening. That’s a wrap.
TRANSCRIPT
Mike Parsons: Hello, and welcome to the Moonshots Master Series. It's episode 20. I'm your co-host, Mike Parsons, and as always, I'm joined by Mark and Freeland. Good morning.
Mark Pearson Freeland: Hey, good morning, Mike and good morning members and subscribers. We are bringing not only an action packed episode and show for the Moonshot's Master series today, Mike, but I think we're bringing a little bit of proactivity, a little bit of.
Mark Pearson Freeland: Ownership and maybe even starting to discuss things that we're not quite comfortable to air in public,
Mike Parsons: are we? Yeah, I think it, this is time for us to talk about something that we often keep the cards close to our chest
Mark Pearson Freeland: Mark. I think you are totally right. This is certainly an area that I've probably kept close to my chest in the past and hopefully we're gonna be a little bit more revealing today as we dive into a brand new episode on wealth creation.
Mark Pearson Freeland: And this is not necessarily Mike's something where you and I we're gonna spend the next hour talking about the Ferrari that we want to go and purchase the houses that we're gonna go unbid on instead, I think it's a little bit more reflective and proactive from a generation and creation perspective,
Mike Parsons: don't you?
Mike Parsons: I think it is critical work to do, to talk about wealth because it, as you quite rightly pointed out, it can be a little bit on the blingy side, show off side a little bit self-indulgence side. And it really doesn't have to be. I think, when we think about wealth creation here at the Moonshots Master Series, if we think about all the amazing people that we've studied, I believe that there are so many powerful things that come from the pursuit of wealth.
Mike Parsons: Fundamentally, mark, I don't think you can create wealth if you're not creating value for others. And I believe that's very kind of comic approach. If you're not giving away, if you're not creating value, then I don't believe you can create wealth. I
Mark Pearson Freeland: think that's a very interesting question that maybe we will hopefully try and answer in today's show, Mike, because I think I, I see where you're going with that.
Mark Pearson Freeland: This equation of the time you are putting into something in exchange for creating something for others and then being rewarded, I think is perhaps a loaded word here, because then that makes me think of ego and so on. But the idea that you are getting something for the work that you, or the service that you are providing to others.
Mark Pearson Freeland: If I'm reflecting on some of the work that we did in the Happiness series, as well as some of the individuals that we dug in on our previous financial series earlier in the Moonshot Show, I think you're totally right. I'm enjoying the connection between creating so. And therefore getting something out of it and you are creating something brand new for the world, I think is quite right.
Mike Parsons: Exactly. So I think it's time to buckle in and get ready because we are going to go to some of the greatest wealth authors, contemporary ones like Robert Kiosaki, the classics like Napoleon Hill. We're gonna be going into what it takes to create wealth, why you might create it in a way that is, I think, good for you and good for the world around you.
Mike Parsons: And I think that's really important. And I would say what we hope to do is discuss. Things that, you know, with the benefit of hindsight, mark, I really wish I had learned way, way earlier. Don't you have that feeling of like, why am I finding out now? That's what it takes.
Mark Pearson Freeland: I think, again, this is a big insight that for me, I've started to uncover, particularly in the preparation for today's show and some of the reflections we've done on the Moonshot Show and the master series to date as well are 19 other shows how much individual.
Mark Pearson Freeland: Ownership as well as control that I can take that I perhaps have intentionally ignored until now. Yeah, it's only, you don't really get you, obviously you get taught mathematics, equations and so on, and the idea of managing money to a very light extent when. When you're a child, but I don't think this level of insight and view sh of ownership that you have over that wealth of yours is something that you ever really get toward until you dive into content books and so on.
Mark Pearson Freeland: So I think you're totally right, Mike. Today feels like the time when we can start to answer those questions that perhaps have alluded us until now. Yes,
Mike Parsons: let's break the shackles and find out what it really takes to create wealth. And we are going to start with one of my all time favorite books. The author is Napoleon Hill and the book is called Think and Grow Rich.
Mike Parsons: This is gonna be a big theme in terms of wealth creation. We're not gonna just be talking about how to save money and live within your means. We're gonna talk about mindset and one of the biggest and most critical mindsets that there are. Is this idea of burning the boats. So let's have a listen to money via from 2000 books talking about one of the most fundamental mindsets for wealth creation.
Mike Parsons: Now, let me tell
Mani Vaya: you the story of Spanish conqueror Hernan Cortez back in the 15 hundreds to really explain what it means to burn the boats. When Hernan Cortez's Warships arrived on what was then the Aztec Empire, he had clear intentions of fighting the Aztecs and conquering that area of what is now modern day Mexico.
Mani Vaya: However, He quickly realized that his army was badly outnumbered, almost to the ratio of one to 100, and he saw that his soldiers were starting to hesitate and thinking of retreating in case the war did not go according to plants. So in order to get the very best out of his soldiers in order to get them to win, he ordered his men to burn their pots.
Mani Vaya: And once the ports were burned, there was no way of retreating. The soldiers knew very clearly that they only had two options, either win or die. There was no other way out do or die, and that created a burning obsession inside of them to win and to live. And that is why his army went on to win the war, even though they were outnumbered one 200.
Mani Vaya: Now that is the power of burning the boats. It quickly gets us to harness the power of our subconscious mind, because when our survival is at stake, the subconscious mind brings all its power to bear on a given situation. In those situations, we become unstoppable. So if you want to create a burning, obsessive pulsating desire for something, if you really want to program your subconscious mind with your goal.
Mani Vaya: You need to cut off all other paths of retreat. You need to cut off all other possibilities. You have to go all in just one option. And sometimes these situations are externally manufactured for us. For example, you are running out of money in your venture and you have a clear deadline by which you must make the business work or the business will die.
Mani Vaya: Many great entrepreneurs have actually credited those moments as the ones that really turned their businesses around at other times. We have to burn the boats ourselves when there are no external manufactured situations available to us. And one of the ways you can do that is to publicly commit to a goal.
Mani Vaya: Or another way to do that is to create real deadlines with real consequences. If the goal is not accomplished, whatever you do to burn the boats, make sure that it leads to a state of burning obsession where you are almost obsessively thinking about the goal. You need that fire, you need that obsession.
Mani Vaya: You need that in order to program your subconscious mind, and that is what will trigger you to greatness.
Mark Pearson Freeland: Whoa, Mike, we're hearing Manny via there from 2000 books giving us a very passionate telling of Napoleon Hill's story of Burning the boats. For me, this speaks volumes, this
Mike Parsons: idea, it could mark, it could be in a workout series, a health series, that this idea is, the fact that it was in Think and Grow Rich, that's where we are gonna talk about it, but it's this idea of all in is the moonshot's way, is it not?
Mark Pearson Freeland: It really isn't it? I think going back to the insight you shared just before we, we hit that clip, this idea of wealth. Of money. Being a mindset is not necessarily something that I think we are perhaps attuned to and hearing, that breakdown from Napoleon Hill, it really can be, it really can be an area of your life that you create, maybe manufacture situations that drive you in the right direction of success.
Mark Pearson Freeland: For me, and obviously we'll di dive into this further in the show as well, when there is a, let's call it softer option, and I don't necessarily mean softer being easy every single time, but maybe it's something a little bit lighter. Maybe it's, oh, I can retreat, I can maybe point fingers. Maybe I can blame someone else.
Mark Pearson Freeland: Maybe I can just step away. Maybe I can bury my head in the sand and assume that something like my finances will sort themselves out. It's very tempting to go out and follow that route, isn't it? It's this idea of the path of least resistance and the money and wealth idea that we all have access to in our lives.
Mark Pearson Freeland: Mike I'll be honest, I've certainly chosen the path of least resistance in the past when it comes to my finances. I've buried my head in the sand thinking I need to come back to it when I've got bandwidth and head space. Yeah, I won't do it right now because I don't have that immediacy.
Mike Parsons: The interesting thing here that we can take and it's a great read, think, and Grow Rich, so I would really encourage all of our members and listeners to, to tune in to and get a copy.
Mike Parsons: The, we obviously did a show on it, so just head over to Moonshots, do io and just look in the, and the catalog there and you'll be able to go deeper on the poll hill. But coming back to this idea of burning the boats, it's all about getting yourself a hundred percent committed. And when you are a hundred percent committed, your chances of success are much higher.
Mike Parsons: And if you're not living and breathing the goal, it just won't happen. For example, if you say, Hey, I'm gonna get six pack abs, but you still have snacks. In the fridge or in the ladder, then you're not all in. If you say you're gonna start a company, but you're doing some consultancy unrelated on the side to pay the bills, you were not all in.
Mike Parsons: And if you are not all in, your energy is not a hundred percent devoted. And if your energy is not devoted, if you are not compelled and obsessed by this goal, lose weight, run a marathon, build a business. If you are not thinking that way, you will not grow that way. It will not happen. If you look at Y Combinator, Paul Graham, who we've studied on the show also have a great episode on him, so you can go and check that out.
Mike Parsons: He talks about a huge flag with founders in a startup is if one of the founders is doing consultancy work on the side, because that means he hasn't burnt the boats. He's hedging, right? Yep. He or she is not fully in and getting committed to these goals. Yes, you have to face your own self-doubt. Yes, you have to face your fear of failure.
Mike Parsons: Of course. That's just part of it. But unless you make that step, if you don't burn the boats, you are almost guaranteeing failure. You will not reach those goals if it doesn't become a complete mind, body, and sole commitment to that objective. And for many of us, it's very scary to go there to get that committed because if we fell, oh my gosh.
Mike Parsons: But the thing to remember is that failure is not a judgment of you. As soon as you free yourself of that's how you think and grow rich. It is not a judgment of you. You are no less lesser person. In fact, mark, I would argue you are far better a person for your failures and your ability to learn from them.
Mike Parsons: If you think about all of the great people that we've studied, All the great athletes who missed the game-winning shot. All of those great people such as Oprah Winfrey, she got fired for not being good on tv. The queen of television early in her career, but she was all in and she made it happen. I think this is exactly the same with wealth.
Mike Parsons: If you wanna acquire wealth opportunity, if you want to have the freedoms that is granting you, then you need to get all in. You need to stop spending at the premium grocery store. You need to stop spending on all of those nice clothes and experiences. You need to live within your means, and that means sacrifice, which become.
Mike Parsons: It doesn't become easy, but it becomes easier if you are all in. Burn the boats. Mark. We couldn't have started stronger, could we?
Mark Pearson Freeland: I don't think there's a way of kicking off a show an episode, a deep dive into wealth creation than hearing this story from Napoleon Hill. The only other thing that I can build on here, Mike before we continue, is that manufacturing of situations that drive the immediacy.
Mark Pearson Freeland: Similar to the Y Combinator story where you've got a founder also working on something else. I think for me, one way that I can start to really bring in this obsession with focus, with desire on Wealth is to, maybe even reflect on what we uncovered on the Moonshot Show with goals, with OKRs, possibly even with David Allen and the idea of, getting things done.
Mark Pearson Freeland: This is just some of the ways I think that we can start to manufacture those. Simulations, let's call it. There's situations where it feels as though we've got no other option, right? I've committed to this goal, they're committed to this deadline. With my team, with those around me, maybe it's even my partner.
Mark Pearson Freeland: I'm then going to stick to it. I'm going to feel as though I've burnt the B, the boats. Yeah. And therefore I'm gonna go out and give it a go.
Mike Parsons: You're almost getting into like, all right, once you make that commitment, how you can use the support of people around you to, that accountability or as James Clearwood talk about his designing the environment around you to support if you want to, he eat healthy.
Mike Parsons: He talks about in his book, Put the apples on the top of the kitchen bench. Don't hide them in the bottom tray of the fridge, right? That's how you and that's this burning desire. You start engineering everything, the people, the environment around you in order to reach this goal, to whether it's an entrepreneurial goal or a personal goal.
Mike Parsons: But I'll tell you, I'll tell you who's in. We got a bunch of people, mark, who are all in, and those are our members, our patrons, whose support is enormous for us, isn't it?
Mark Pearson Freeland: These guys and girls and members just keep on giving us the love and keep on growing week in, week out. Mike, if there's anything being created, it's a lot of good karma, and today we can celebrate even more members not only joining us, but also eclipsing the 12 month mark of being members.
Mark Pearson Freeland: So please welcome Dan, Bob, John, Terry Maral and Ken Dimar, Marj, and Connor, Yasmin, Lisa, Sid, Mr. Bonura, Paul and Berg, all of whom have been with us for well over a year now. Now hot on their tales include Cowman, David, Joe, and Crystal. Ivo Christian, Sam, and Kelly. Barbara and Andre, Matthew and Eric, Abby, Chris, Deborah, lase, Steve, Craig, Javier, Daniel, Andrew Ravi, Yvette, and Lgv.
Mark Pearson Freeland: Karen, Raul, pj, Nico, Ola, and Ingram, di Emily, Harry and Karthik. Vanatta. Veara, Marco Suns Jet, Pablo, Roger, Steph, and our brand new member. Gabriel, thank you so much everybody, for not only D in and listening to us every week and every show, but also giving us your continued membership of the Moonshot's Master series.
Mike Parsons: Fantastic. Thank you so much for burning your boats and giving up one. One Starbucks cup of coffee a month to support us, to help us on our mission, to help people shoot for the moon. It is so awesome to have that support. We thank you. We are very grateful and we are really glad to produce this Moonshot's Master series for you, our members.
Mike Parsons: And if you wanna share with us your thoughts, head over to Patreon or shoot us an email hello@moonshots.ao. But let's turn our minds back to creating wealth and the opportunities that creates the forum, if you will, the arena. You might say of giving us a shot at being the best person we can be. And this is so crucial.
Mike Parsons: We talk about humility, we talk about doing the work rather than showing off. And boy, do we have some thoughts here from none other than Dr. William d Danker, one of the best wealth authors you'll ever hear. So let's get some thoughts for him. One of the real godfathers on wealth creation, what are the behaviors that those people what behaviors are most likely gonna get him there?
Mike Parsons: Yeah.
Naval Ravikant: One of the problems we have in America, in Western society in general is how pervasive advertising can be and how influential it can be. And you look at all these beautiful people you know, in beer commercials or car commercials and say, my gosh, I wanna aspire to be like that. I want to buy what they're buying.
Naval Ravikant: One of the things that we know based on the empirical evidence is that for every wealthy person who can actually afford one of those luxury items, the car or the house, the whatever, there are four to five non millionaires or non wealthy people buying the same product. Because they wanna look like a millionaire
Naval Ravikant: See? And this is really critical. So there, there is a group of people who can really afford to buy their helicopters and private planes and everything else. I have a number of friends who can do that and do that. And they are truly mega millionaires. I don't know any billionaires yet personally, but people with, 20 50 million net worth can live that kind of lifestyle.
Naval Ravikant: No question. But when you realize and look at the, what is the median net worth that America today, it's about $120,000 per household. 120,000. That's, current data to be a one percenter, 11 million net worth will get you there. That's the lower. End of the threshold to, to get into the 1% category.
Naval Ravikant: And so when you have, say 2 million, you're in the 95th percentile, you're in the top 5%. So when you say a million doesn't go as far as it, it used to, then this is true. It's absolutely true. But we still have people stuck in this mindset that they're going to spend their way to wealth , and of course that's the number one problem that's preventing them from becoming wealthy.
Naval Ravikant: They want to create a lifestyle because they want to emulate others in their neighborhood. ,
Mark Pearson Freeland: this mic is a big takeaway. , big insight, big recommendation that we're hearing from William Danko and more broadly from, I think all of the individuals we're gonna hear from today. In fact, all of whom I think we are hearing via Danko in that clip, which is be sensible over what you are spending on, specifically don't spend your way to wealth, which I love as a as a phrase, don't spend your way to wealth.
Mark Pearson Freeland: Don't spend to try and look like a millionaire because that in turn will stop you becoming a millionaire when you are buying the car and it's outside of your means, why waste it? Why not put it on something more constructive? It's quite a clear call out, but one, I think Mike, that to be honest, I've probably fallen guilty of as well, maybe not buying a luxury car or a private jet, but there'll certainly be things in my life where I've probably splurged.
Mark Pearson Freeland: Maybe a little bit higher than I should have because of some kind of ego or opinion that I wanted to give myself that then would show off to others. Are you, do you, not putting you on the spot necessarily, but do you think that's probably quite a common situation? Do you think that a lot of us fall into this category that Danko is starting to call us out?
Mike Parsons: Yeah. Yeah. I, it specifically reminds me of a time when I was living in London and I took my wife to Selfridges and I was showing her this sort of $20,000 Panai watch, and I was literally making the argument for why I needed a 20th thousand dollar watch. Thank goodness she kept me honest. But So I think it's natural to feel that temptation.
Mike Parsons: Yeah. And comparison is obviously very natural. And first of all there is nothing good of comparing the success of others with your own, because we're all on our own journey. And in the end, if you woke up and did the hard work today, only, so it doesn't really matter if you're looking over at your neighbor at their fast cars and big houses because hey, you are doing your work.
Mike Parsons: That's what you control. And there's no point in making a comparison with others. Because who knows what the story, their story is. Everyone has a unique story, and Elizabeth Gilbert talks about that with creativity, and it applies crazily enough with wealth as well. Here's the other thing, mark, if that was not convincing enough why you shouldn't just stop spending your way to wealth to look like a millionaire?
Mike Parsons: I ha I wanted to tell you a funny story. There's this thing in Holland is that when you go to a gala event, you can always tell the millionaires because they are the ones that turn up in the rented suit. Ah, interesting. So I am paraphrasing to put it into English but the point here is that looking wealthy is not wealth itself.
Mike Parsons: It really isn't. And I think you're right. It's so tempting, isn't it, to have fast cars, big houses and all of that. But if any of this doesn't convince you, I've got another argument. Mark, are you ready?
Mark Pearson Freeland: I'm ready. I'm here for the arguments. Okay.
Mike Parsons: Because people are so private about their finances. Here's the interesting thing.
Mike Parsons: Many of the people with the fast cars, fancy clothes, big houses, you don't actually know what debt they're carrying. . And what you often find, not all the time, but you would be surprised at how many people you think are wealthy, who technically when you use the measure of what we call net worth, like after they've paid all their debts, what do they have left over?
Mike Parsons: Are not rich at all. . So that's why you shouldn't even compare cuz you don't know the full story. You shouldn't. We've all got different stories, and even if you did think that this person was amazingly successful and you're so damn disappointed that you're not as successful variably, the odds are when you look at their balance sheet, they're not nearly as wealthy as you might think.
Mike Parsons: So this is all a way of getting your energy back into the things that you control, your circle of influence. That's a big thing that Stephen Covey talks about. We did a whole show on that. Focus on yourself and where it is really taking me mark with William Danker's thoughts. Don't try and look like a millionaire.
Mike Parsons: No. Is this hugely compelling idea of getting committed, burning the boats as they say, and living within your means? I think this concept, choosing. To spend less than you earn every month. So each month you're putting a little bit more in the bank, a little bit more to invest with, or whatever you wanna do with it.
Mike Parsons: Like this idea, do not live paycheck to paycheck. I believe that this should become an unacceptable terms of engagement for life. You must reorganize your life to live within your means, spend less than you earn. So over time you make progress. To me. This is such a profound idea. Mark, don't you think?
Mark Pearson Freeland: I think it's so obvious, it's something that I think we all.
Mark Pearson Freeland: Want to aspire to be. And I think already what I'm hearing from the clips from today's show is this differentiation between where we are now with our opinion towards money. We know that we should be, a little bit, maybe more cautious, maybe spend less, maybe save more. But until the penny drops for us and we realize that it's up to us and that wealth can be this mindset that we were hearing from Danko as well as our first clip with Mani via who's calling out Napoleon Hill, is once you put into your own approach and your own daily practices, that this is a habit, this is a mindset.
Mark Pearson Freeland: You have the opportunity to not commit to yourself and overspend. You have the capability to put some money aside each month. You have the capability to keep an eye on your budget and take ownership of it. Once you start realizing that, then I think it can become easier. But Matt, it's sometimes a challenge to, to get going, isn't it?
Mark Pearson Freeland: Yeah. So I think.
Mike Parsons: I think so. We'll pause there. Let's dig into that. W why is living below living within your means so hard, and how do we start building habits for that? Like, where do you
Mark Pearson Freeland: start? I think for me, it's all about taking a in my time whenever I've got to moments when I've got some big expenditure coming up.
Mark Pearson Freeland: Maybe it's thinking about a mortgage, maybe it's moving house, maybe it's moving country or making a big purchase. What I like to do is take stock. So I will gather everything that I've got from a wealth perspective, the credit card bills, the mortgage statements, the savings, and so on, and.
Mark Pearson Freeland: Consolidate everything together. I need to get a full picture. Oh yeah.
Mike Parsons: I think that's me is on that one Mark. You are, you're absolutely right. And I think a habit that you could get into is checking your bank your credit card statement or your cash account statement regularly. And I'm not talking like once a month, move into once a week.
Mike Parsons: Definitely. If you are really measuring what you spend, you, we have so many great apps to do that. If you're in the US you can use Mint which is a great product. There are many apps that will help you better understand how you spend and if you wanna get drastic about controlling how you spend your money, if you wanna reel it in.
Mike Parsons: Great example would be is reduce the limit on your credit card. . If you want to get old school My wife and I started with cash envelopes where you would put cash in an envelope and that's your spending money for the week or for the month. . . These are ways that you can take control.
Mike Parsons: I think if you to use a very modern scenario, mark, if you find yourself using a lot of buy now, pay later services, warning. Warning, like that is such a warning. So you basically, you're, you are, you're using a means that allows you to buy things you actually can't afford,
Mark Pearson Freeland: right? Yeah. Yeah. It's the awareness, isn't it?
Mark Pearson Freeland: It's the control that you challenge yourself, but also the awareness of what your current situation is like. And I think a lot of us, including myself, have put the blinkers on in the past. You intentionally bury your head in the sand because you think, I don't wanna have to deal with that right now.
Mark Pearson Freeland: Because then it'll pull in questions of my career, my goals, my spending, and so on. But I think today I'm hoping that we're making the case, Mike, that we should all be checking those statements, calling out those budgeting, really thinking about what we're spending on in order to try and cultivate a slightly more, let's say, positive, but also healthy approach when it comes to creating wealth.
Mike Parsons: Yeah. Yeah. So there you go. Know what you spend, and then reduce your ability to spend. Many of us have several credit cards, right? , just get rid of some of them, or don't take them with you or take them off your Apple Pay so they're not as easy to use.
Mark Pearson Freeland: Man. Exactly. And that's such a simple little space, isn't it?
Mark Pearson Freeland: Don't take it out a lot. A lot of apps now enable you to pause your card rather than cancel. So I think, back in the day it would've been, let's shred it and therefore I won't use it. Don't worry. You don't need to go that far. If you need it because you've got outgoing bills or whatever, you can just hit pause, you can leave it at home.
Mark Pearson Freeland: And instead you can adopt those healthier habits where you instead only donate your cup of coffee to the Moonshot's Master Series rather than buying lots and lots of coffees during the week. There you go.
Mike Parsons: There you go. So Mark, before we transition into going even deeper into this idea Wealth, I wanna remind all of our members and listeners that you can head over to Moonshots ao.
Mike Parsons: We are doing a master series, so you might want to be flicking through some of the show notes here. Getting some of the links of course, because we're actually. Covering a lot of people we've done shows on and some new ones too, which is really cool. You can head over to Moonshots AO and you can get everything you need, not only around wealth, but every single master series.
Mike Parsons: All of the show notes are there, and plenty, plenty more. So now I'm really excited to actually study a book that has of recent times, mark, I would say in the last few years, this has to be one of the best new books on wealth creation and it's Morgan Housel's, the Psychology of Money. So let's have a listen to Swedish Investor doing a breakdown of Morgan Hassel's book, the Psychology of Money and Tackling.
Mike Parsons: Oh, one Big Idea. Never enough.
Sweedish Investor: Never enough.
Mike Parsons: It's a very interesting phenomenon that that you can hand somebody a $2 million bonus and they're fine until they find out that the person next to 'em got 2,000,001, and then they're, they're sick for
Robert Kiyosaki: the next year.
Sweedish Investor: Capitalism is great at doing two things, generating wealth and generating envy.
Sweedish Investor: The urge to surpass your neighbors, peers and friends can help energize your hard work and strive to really make it. And of course, being motivated into becoming more productive and doing meaningful work is a good thing. But social comparison can also cause us to feel like we are never enough. Let's look at some statistics to belong to the top 1% highest income earners in the us you'd have to earn somewhere around $500,000 a year.
Sweedish Investor: That's what a highly specialized doctor, let's call him Bill Earns, and by almost any standard bill would be considered rich. He can afford to drive nice cars, go on long vacations to exotic countries, perhaps hire someone to do work, which he thinks is tedious, et cetera. Bill has been feeling good about himself and what he has achieved financially in his life.
Sweedish Investor: That was only until he bought a vacation home in the Hamptons and realized that he had Stan as his neighbor. Stan belongs to the top 1% of the 1%. He is a c e O of quite a large public company, and as a staggering 10 million per. Now, you'd hope that at least Stan would be satisfied with his financial achievements.
Sweedish Investor: But nope. This guy was a childhood friend of Michael Jordan and this all-time great basketball player is someone who belongs to the 1% of the 1% over the 1%. And compared to Michael's fortune of about 2 billion Stan's yearly salary of 10 million suddenly seems like peanuts. Does it end here? No it doesn't because Michael occasionally attends parties with celebrities where a guy named Def Bezos shows up.
Sweedish Investor: Bezos is the top 1% of the 1% of the 1% of the 1%, and he increased his net worth by about 75 billion in 2020. Now, sitting at something like 200 billion, there's always a bigger fish. The type of envy which has emerged from comparisons of this kind, has caused a lot of people to do foolish things throughout history.
Sweedish Investor: Some have leveraged their portfolios to the teeth in order to move up to a higher pyramid, just to lose it all and then commit suicide. Some have acted on insider information and lost both personal reputation and then later their freedom when they've gone to jail. Many have forsaken their families and then had their partners leaving them or cheating on them, or both.
Sweedish Investor: As a result, by watching this channel and learning on how to become a successful investor, chances are that you will at some point reach a level of financial freedom that the average Joe can only dream about, but you need to at some point accept that enough is
Mark Pearson Freeland: enough. Enough is enough. Mike, I think this is a big call out that obviously we're hearing from a number of our other clips as well.
Mark Pearson Freeland: But I just really wanna dig into what we are hearing from the Swedish investor with Morgan Household's book there, which is very popular. The psychology of Money, timeless Lessons on wealth, greed, and happiness. What I th what I think is really interesting about this admission, when enough is never enough, and how we need to stop focusing on being that big fish because at the end of the day, there's always gonna be somebody bigger in our neighborhood or our social circles.
Mark Pearson Freeland: It's calling out that doing well with money isn't necessarily what you and how successful you are. Instead, it's how you behave with that. It's how you behave from an expenditure perspective, what you're purchasing, obviously, but also internally, how you're behaving from a healthy perspective.
Mark Pearson Freeland: Are you looking at your money as a source of stress or are you looking at it as a source of freedom? Is it gonna help you go out and achieve the life that you wanna live? Or is it actually holding you back and making you self-conscious when you want to interact or collaborate with other people?
Mark Pearson Freeland: What are you hearing from that clip where we just heard with the psychology of money, what's standing out to you?
Mike Parsons: I loved like the rabbit hole that you can go to go through when you're comparing with others. Mark?
Mark Pearson Freeland: It's so tempting and again, similar to the reference you called out earlier with Elizabeth Gilbert, she's obviously calling out the.
Mark Pearson Freeland: Comparisons that we all have when it comes to creativity and success from a career perspective, in terms of deliverables. Whereas we're hearing that same thing here. We are all tempted to continually compare ourselves to others, which in turn negatively affects our ability to go out and do the thing that we wanted to go and do.
Mark Pearson Freeland: which in this case would be to
Mike Parsons: create wealth. Yeah, I love the twist in that clip where he talks about, but then there's Stan, right? in the Hamptons and we've all got a stand. And it's, as long as you accept that there will always be a stand, there will always be someone wealthier than you. It can release you.
Mike Parsons: And what's really interesting is, and now this is gonna be tangential, so Mark listeners, members, hold on for a second here. There is a very profound practice in mindfulness of saying and truly manifesting the idea of. I have enough. Because once you get to this point, you are no longer chasing. You can just be, and the same thing comes with wealth.
Mike Parsons: Once you've got a roof, once you have food in the fridge, everything, and one or two people around you that love you unconditionally man, that's the good life, right? . , that's enough. And if you are not careful and you chase all that other stuff it, somewhere, there's always a stand.
Mike Parsons: So really I cannot encourage us to get into this idea of enough because it's truly liberating and enables you to ask what should I do today? What would be the best use of my time? How might I go and how might I go and build something of value in the world? And that's exactly what we've got in this next clip.
Mike Parsons: This is Naval aka one, a really popular show. He's an inspiring guy. His tweets whip everyone up into a frenzy, so let's listen to his ideas on how we might create. Wealth. There's this battle
Naval Ravikant: that happens on Twitter a lot between should you work harder and should you not. Like David Houser's on there saying, it's like you're slavering people, and Keith Revo is always on.
Naval Ravikant: They're saying like, no, all the great founders work their fingers to the bone. First of all, they're talking about two different things. David is talking about employees in a lifestyle business, which is fine. Your number one thing in life if you're doing that, is not getting wealthy. You have a job. You also have your family, you also have your life.
Naval Ravikant: But Keith is talking about the Olympics of startups. He's talking about the person going for the gold medal and trying to build a multi-billion dollar public company. That person has to get everything right. They have to have great judgment. They have to pick the right thing to work on. They have to recruit the right team, and they have to work crazy hard because they're basically engaged in a competitive.
Naval Ravikant: So if getting wealthy is your goal, you are going to have to work as hard as you can. But hard work is absolutely no substitute for who you work with and what you work on. What you work on is probably the most important thing, finding product market founder fit, which is how well you are personally suited to that business.
Naval Ravikant: The combination that three, that should be your overwhelming goal and you can save yourself a lot of time if you pick the right area to work in. Picking the right people to work with is the next most important piece. And then third comes how hard you work, but they're like three legs of a stool. If you short change in any one of them, the whole stool's gonna fall down.
Naval Ravikant: So it's not like you can pick one over the other that easily. The order of operations when you're building a business is, or even building your career, is first figure out what should I be doing? What is something where there is a market that is emerging, there is a product that I can build that I'm excited to work on, and something where I have specific knowledge and I'm really into it.
Naval Ravikant: And then second, surround yourself with the best people possible. And no matter how high your bar is, raise your bar because you can never be working with other people who are great enough. If there's someone greater out there to work with, you should go work with them. I advise a lot of people who are looking at which startup to join in Silicon Valley.
Naval Ravikant: I say, basically, pick the one that's going to have the best alumni network for you in the future. Look at the PayPal Mafia. They work with a bunch of geniuses, so they all got rich. So just try and pick based on the highest intelligence, energy, and integrity people that you can find. And then finally, once you've picked the right thing to work on and the right people to work with, then you work as hard as you can.
Mark Pearson Freeland: I like this call out from Navar Ravikant, Mike, because what Navar is helping us achieve at this point in our deep dive into the idea of creating wealth, taking care of it, and cultivating it, is again this admission that we've all gotta have as to what we are spending our time on. And it's very easy for us to all turn around and say that we're working as hard as we can, and I'm sure you know we certainly are, but what Naval is waking us up towards is also considering not only how hard we're working, but are we working in the right direction?
Mark Pearson Freeland: Are we working on something that is going to matter? Going back to your insight at the very beginning of today's show, Mike, are you creating something that is benefiting the world? I'm starting to feel a little bit of icky guy coming
Mike Parsons: through here. Yeah, that's interesting, isn't it? Yeah.
Mark Pearson Freeland: This idea of finding what you are really good at, what gets you outta bed in the morning, what you love, what the world needs, and what you can get paid for suddenly starts to bring in a whole new layer of life here.
Mark Pearson Freeland: As we hear from Naval who, again, he's calling us out and reminding us, we should be considerate of a, how we're working, who we're working with and what we're working on. Not just put your back against the rock and try and move it. Let's try and work maybe a little bit smarter as well as trying to work a little bit harder on the things that are going to help us create that little bit of wealth.
Mark Pearson Freeland: What, what's coming through to you at this
Mike Parsons: point of the show for your, that was an awesome connection that you made to icky guy, cuz I think you're spot on there because the closer the work you do meets the criteria that Naval mentioned, the easier it is to do, like for. To, to me, like a key test that we talked about with Icky Guy is when you are choosing to work on to do, and I'm got my hands up here in voted comments to do some work on the weekend like preparing for this show doesn't feel like work.
Mike Parsons: I'm like, oh, I'm studying Naval Ravikant. Awesome. I would do that on my weekend. I would do that even if you didn't pay me. In fact, if Naval Ravikant was in Sydney right now, I'd pay to go and listen to him. . My point here is that when your work meets the criteria that you are really compelled by it, you have a natural affinity for it.
Mike Parsons: You're working with great people, it can help other people. Oh, and by the way, it can be a business and it can create value for you and all the. Stakeholders, then that's wealth. The chance to do that every day, that's true wealth and the fact that you capture value and that you can live your life through pursuing this objective, that's wealth.
Mike Parsons: And this is really an exciting moment for me because once you are doing that, you just feel good in the day. Put the money thing aside. You just f you just get to the end of the day. And when you put your head on the pillow, you know you did good stuff with good people that mattered. And that's all we want as human beings.
Mike Parsons: And as soon as you have that mark. As soon as you build on that day after day, week after week, over time, you start to accumulate a little bit of spare change because if you've been following the show, you've lived within your means. You've got the right mindset, you're working hard on doing the right thing.
Mike Parsons: You are not comparing yourself with others, and then you start to create this net worth, this spare cash, and you can put that cash to work for you. So it is with great delight that we get to turn to the person who inspired Warren Buffett. That's right. Warren Buffett was a student of a guy called Benjamin Graham, and he wrote this incredible book called The Intelligent Investor.
Mike Parsons: So let's have a listen to what his wisdom is and how we might put our money to work. The Intelligent Investor by Benjamin Graham, published in 1949, the Intelligent Investor by Benjamin Graham, takes on investing approach called Value Investing, a concept he created from his experience. After losing most of his capital in 1929, market Crash, Graham sought safe and proof investing options.
Mike Parsons: Here are the most important lessons from the intelligent investor. Never give up and learn from your mistakes. Although he lost almost all of his capital, he didn't quit as most would have. Instead, he learned valuable lessons about risk that resulted in analyzing risks and valuing them. Investing isn't speculating or gambling markets should be looked at.
Mike Parsons: As an ally, you should only buy when prices are low and sell when they are high. Minimizing risk. Graham always implied how important it is to buy investments when it's under its true value. This is allowing profit when the market revalues or offering protection if the market goes downwards. The margin of safety.
Mike Parsons: The key point here is buying assets when their value is lower than their true value, and then later on selling those assets when their value is back to normal or even goes up, thus earning a return from your investment. See beyond the horizon, keep your eyes on the long term outcome. There is no way of knowing what markets will do.
Mike Parsons: Markets will fluctuate and always come back to its
Mark Pearson Freeland: true value. Okay, this is great, Mike. We're now getting into some real habits, some real practical tips that we can start to put into action. Now that we've got that little bit of foundation with regards to wealth and how to create, for me this core admission.
Mark Pearson Freeland: That we're hearing from Benjamin Graham's book, which obviously undoubtedly had a lasting impression upon Warren Buffet, is this idea of, for me, my long-term outcome, of those three or so tips that we heard in that clip, just then, aside from the idea of never giving up the core bit for me is this long-term outcome.
Mark Pearson Freeland: Taking a look at where things are going to be in the future. Whether it's stocks and shares, whether it's savings or maybe it's an item that you are thinking about purchasing and having a second look at it, rethinking it from a long-term perspective, where is it gonna be in 12 months, six months, even, maybe six weeks?
Mark Pearson Freeland: What is the outcome gonna be if I now look into the future, maybe even bring in some second order thinking, some frameworks that obviously we've learned on Master Series and moonshot show before in order to help make decisions. But obviously from a wealth perspective, I think that for me, this long-term idea is pretty substantial and a core takeaway.
Mark Pearson Freeland: But my what about you? What are you hearing from Snap reads in that breakdown of the intelligent investor?
Mike Parsons: Look, I think putting your money to work is one of the biggest lessons. If you follow the logic that we've, and the order of, and sequence of the show so far. Get committed, live within your means.
Mike Parsons: Really focus on creating value, pursuing the right work with the right people. And if you do that, you'll start accruing some spare change and then you put that spare change to work. That's critical thinking that we're seeing here. And by putting money in stocks for the long term, if you zoom out and look at the stock market over a hundred years, it runs in cycles with ups and downs, but always ends up higher rather than lower than where it was seven to eight years ago.
Mike Parsons: So that's how long term we're talking . We're talking here, mark, but I totally, yeah. Put a, put aside your emergency funds. Anything left after that, if it's sitting in a bank account, is gathering dust, right? Because it's not accruing value, at least a, at a minimum in line with inflation. If you put your money into investment vehicles, some of them might be pretty liquid investments, meaning you can get your cash out pretty quick.
Mike Parsons: Others like a house bit slower. The point is this, buy value vehicles, and in this case, value stocks. And what that means is good companies who are a bit undervalued that you'll think will win in the long term and just buy and hold. Warren Buffet often talks about the thing he hates the most is having to sell a stock, right?
Mike Parsons: Because he buys everything super long term. So right now, after the market has corrected massively over the last year post covid, a lot of people on this show, a lot of our members and listeners might be tempted to sell if we bought good companies before or during Covid. If you fundamentally believe there's still a good company, but the stock is now down and you've lost some money on it, don't sell.
Mike Parsons: If you're in a position to hold, just hold because good companies always win over time and they will outperform the market. So this is like such sage like investment advice because here's the real problem, mark. When you buy and sell stocks, you pay commission, and that commission eats away at your returns.
Mike Parsons: If you are continually trading in and out of positions on the market and trying to beat the market and try to beat the timing of the market, the thing that you don't see is that all those commissions on your trades are reducing your wins and increasing your potential losses. And if you never sell, you never have to pay commission and you can enjoy dividends.
Mike Parsons: You can see the price of the stock accrue over time. This is so fundamental to how Warren Buffet thinks. About investment. This is how Benjamin Graham built great wealth after almost like being right at the edge of bankruptcy. He built out from there. So check out Intelligent Investor, but by Benjamin Game.
Mike Parsons: But Mark, just when you thought, is there more that we can squeeze out of the wealth creation concept? I think there.
Mark Pearson Freeland: I think there's always something that we need to end on Mike for all of our Master series episodes. I think it, we owe it to ourselves, the moonshots family, as well as our members to end on a real moment of practicality, as well as inspiration.
Mark Pearson Freeland: So we've got that for us all in spades. There's no loose change when it comes to this final clip. Hopefully I built it up enough. Mike . So we're gonna hear from one of our all-time greats, the author of Rich Dad, port Dad Robert Kiosaki, who's being interviewed by one of our favorite interviewees interviewers, London Real, who's gonna call us out.
Mark Pearson Freeland: He's gonna put us into action today, and he's gonna help us all break the habit in order to change.
Robert Kiyosaki: People say why don't you give the poor money? So the only problem with that is just creates more poor people. Give a man a fish. He
Mike Parsons: fishes for the day or eats for the day.
Robert Kiyosaki: Yeah. You give a man a fish, you get a lot of people who want more fish, you teach 'em to fish. But you
Mike Parsons: are the Robinhood of knowledge because I see you giving this knowledge out and yeah. Do the rich people cringe and say, don't tell them that, Robert?
Robert Kiyosaki: Yes. Don't tell people what they what, keep 'em poor. Unfortunately the poor as was in the Bible, I'm not really religious.
Robert Kiyosaki: The poor will always be amongst us. Cuz it starts
Mark Pearson Freeland: up
Naval Ravikant: here. It's that fear
Mike Parsons: mentality.
Robert Kiyosaki: It's in their words, and the words become flesh. God, not really religious. I fluted a Sunday disco also. But when they say I can't afford it or I can't do that, they go down. They become what they say.
Robert Kiyosaki: And I made so many people, I don't, I can't afford it. You think I made a money?
Naval Ravikant: Your mom used to say that. Your mom used to say that. My
Robert Kiyosaki: dad. Your dad. My PhD dad, he says, what do you think? I have made up money. I can't afford that. And my rich dad would say, that's why he's poor. Poor people say, I can't afford it.
Robert Kiyosaki: I can't do that. I don't have time because this is escape. It's an escape. You know what I mean? It's easy to say, I can't afford it. Oh I'm too tired. Oh, I can't go to the gym. You know when you could go to the gym, but now I can't. Truth is I'm just too lazy to go to the gym
Mike Parsons: and you play it safe and you don't introduce new risks into your life.
Mike Parsons: And I have job security, right? And your rich dad used to say, what? Instead of, I can't
Robert Kiyosaki: afford it, how can I afford it? How can I do that? What would it take? Or why should I do that? He says a question opens a mind, a statement closes the mind sleeve. When you say, I can't afford it, your mind shuts down and you become what you say.
Robert Kiyosaki: Like I struggle with weight all the time. You're telling me that you were on a vegan diet and all that. Yeah. I go on a vegan diet three times a year. It's one of the most miserable thing in the whole world. But I had the discipline to do it for 21 days and then I'm back to picking out again.
Robert Kiyosaki: But the thing is that we've become creatures of our own habits and until we break the habit, we don't change. So I have my retreats twice a year, three days. People come from all over the world and we studied together. And this time went back to spirituality. Spirituality.
Mike Parsons: Most people would, they can't believe what they're hearing from Robert Kiosaki that Rich Dad poured at is, it should have been, was originally about spirituality.
Mike Parsons: Cuz they think it's all about the money.
Naval Ravikant: It's not, yeah.
Robert Kiyosaki: People say money is not that important to me. Then if money is not that important to you, money is not important to you. I don't care about money. The money doesn't care about you. It, the word does become flesh or I'll never be rich, or the favorite one is the rich or greedy.
Robert Kiyosaki: It's the poor that are greedy, if you think about it, because to be rich, you have to give something, you have to I have to produce books and games, and I purchase real estate. I provide housing, provide jobs and all that. That's why I'm rich, but greedy, people produce nothing. Oh, no. Is the rich that are greedy, and I'm going, Hey, sports fans, they point a finger forward.
Robert Kiyosaki: Three are turning backwards.
Mike Parsons: Oh my gosh. Mark, I think we just covered a spectrum of moonshots thinking right there. We saw atomic habits, we saw growth mindset. Being curious. Oh my gosh, my, I honestly there, that was one knockout of the clip, wasn't it? Yeah.
Mark Pearson Freeland: I'm not sure where to start, Mike. I think the key build that I can do from hearing from Robert Kiosaki and comparing it to the clips that we've seen today and we've dug into all these different lessons, is this idea that we can all achieve it.
Mark Pearson Freeland: Then it is up to us. Going back to the idea of thinking about the psychology of money and so on. We can all go out and achieve something that we are comfortable with as long as we put in the work to identify what that might be and how we're gonna go out and do it. I think the ownership piece that I'm hearing from Kiosaki.
Mark Pearson Freeland: And obviously that breakdown that he does in Rich Dad, poor Dad around awareness as well as how you look at things, the interpretation, an awareness that you have is such a key takeaway, isn't it? And again, it's calling back to the thing that we've stoned upon three or four times in the show, which is wealth being a mindset and something that you can proactively work on every single day.
Mike Parsons: Yeah. And, I think the important thing to, to, we can do with this clip from Robert Kawasaki of whom we have done a show hit the moonshots.ao to check that out. I think there is a choice. We can either be the rich dad or the poor dad, the rich mom or the poor mom. I think the choice is if you really want something, how do you.
Mike Parsons: Earn it and obtain it rather than I'll never get there. That to me is such a, an essential question of stepping into the arena of life. , like getting after it. Do not sit in the stands and let everything go by, because the powerful question to ask is how do you wanna be remembered? And that always shakes me to my bones.
Mike Parsons: Damn, I got work to do Mark . But the thing is, when I go through this thinking from Robert Kawasaki, it is totally about asking what is the best version of myself? What can that be? How do I get there? And what do I need to do to make this happen? And every time you entertain limiting beliefs, you are pushing that.
Mike Parsons: That moonshot further away, aren't you?
Mark Pearson Freeland: So limiting putting a glass ceiling on what we are all capable of doing, fundamentally we can be put off while we're learning. We can have bad mentors, bad bosses, even unfortunate circumstances in our lives that then stop us perhaps having the easy path to success or being in the best version of ourselves.
Mark Pearson Freeland: What I think we've learned today with regards to wealth echoes what we've learned when it comes to physical challenge resilience, which is we can all do it if you have the structure or the strictness and the discipline to go out and do it, isn't it? That's what we're starting to hear.
Mike Parsons: Do the work.
Mike Parsons: What I thought was interesting about what Qi said is actually, if you're wealthy, you've at least you've had to given something, created some sort of value in the world. However, what was quite. Provocative. And what he said is that if you are poor, that would suggest you haven't given enough of yourself.
Mike Parsons: And that's really like talk about some paradigm shifting, like glass of, glass, a bucket of water on the head there. This is really interesting thinking and I think that at the heart of wealth is a growth mindset. At the heart of wealth are these habits of discipline. Pushing through and fighting for what you believe is your mission and purpose in life.
Mike Parsons: And that is such a different thing than the latest side hustle, or how I earn a gazillion dollars in two seconds. It isn't about, that isn't about how your neighbor looks, what they drive, the house they live in. It is about you creating value and you being the best version of yourself. That, to me, is the most powerful manifestation of how we can think about wealth.
Mike Parsons: And Mark, I wanna say big thank you to you, and I wanna say an enormous thank you to you, our members, our patrons, and listeners to thank you for sharing this journey on wealth creation, which was our 20th Master series. And it started with this big idea of burning the boats and quickly followed. You cannot spend your way to wealth.
Mike Parsons: You have to build and save and be careful of that evil psychology where there is never enough, because that is gonna get you into all sorts of black holes, wormhole of comparison, and nothing good comes of that. But what you can do is listen to the guys like Nav can and understand that you need to pursue what you're meant to do with the right people, and you need to get after it if you want to create.
Mike Parsons: And once you have accumulated some spare change, put it to work like Benjamin Graham does in the Intelligent Investor. And if you really need any more convincing, remember this, that wealth truly is a mindset. Wealth is really, truly giving value to others so that you can be the best version of yourself.
Mike Parsons: So break the habit of, I can't do this, I can't afford it. And open yourself up to the possibilities of what you can do. Become the best version of yourself and do it together and learn out loud with all of us here at the Moonshots Master Series. Okay, that's a wrap.