10 Lessons From the 1% That Matter More Than Money

00:00:00.000 | I recently spent a few days at a retreat with a really thoughtful group of investors who've all

00:00:05.640 | spent a lot of time thinking about money, how to grow it, protect it, and ultimately use it to live

00:00:11.140 | a better life. It was hosted by Long Angle, and the conversations went far beyond investing

00:00:16.720 | into health, relationships, parenting, time, and the real meaning of wealth.

00:00:21.840 | So today I'm sharing a recap I recorded at the event with Tad Fallows, one of the organizers

00:00:27.040 | and founders of Long Angle, where we break down our top takeaways from managing risk and

00:00:32.780 | defining your purpose to becoming your own health advocate and building stronger connections

00:00:37.300 | with the people who matter. If you're wondering how to better align your time, money, and values,

00:00:42.680 | or you just want a smarter take on living well, you'll love this episode. And if you want to check

00:00:48.060 | out Long Angle, it's a free community for investors with more than $2.2 million in assets, and you can

00:00:53.780 | learn more at longangle.com. Or if you want to keep upgrading your money, points, and life,

00:01:00.260 | click follow or subscribe.

00:01:02.120 | All right. Thank you everyone once again for joining us. Chris and I, and Chris's lovely wife,

00:01:07.600 | Amy, spent some time last night. We made sure that each of us went to one of the sessions throughout

00:01:12.620 | the time. So we got coverage of everything and tried to put together the summaries of, hey, what are the

00:01:16.700 | top 10 takeaways from those sessions? And it's not going to be just going through, okay, here's the three

00:01:20.600 | points from precision medicine, or here's the two points from the women's health thing. But it's going to be

00:01:24.580 | trying to put those thematically together. Yeah. One of the hardest things about this is I probably

00:01:28.560 | spend five to 20 hours trying to prepare for a typical episode of the podcast. And the last session

00:01:35.360 | ended yesterday at like, you know, three o'clock. So it was like, okay, I've got from three o'clock to

00:01:39.780 | this morning, and I want to spend time with you guys. Which is more than five hours, to be clear.

00:01:43.620 | Yeah, it was more than five hours. I saw him in the Google Doc past midnight.

00:01:47.240 | I wanted to get some sleep. I wanted to, you know, hang out with people. But what I really wanted

00:01:51.780 | to do is, we wanted to try to synthesize this not to, here's the takeaway from this session and this

00:01:57.820 | session. But like, what are the real themes that you can pull out of this? And so I think the way

00:02:02.000 | I'll start is, this is an event where the common thread between all of us is money. But I didn't have

00:02:09.120 | a lot of conversations about money. A lot of the topics weren't about money. A lot of the things that

00:02:13.800 | kept people sitting by the fire late at night weren't money. And there were actually a lot of

00:02:18.280 | other things that seemed like you could even call them assets that were more important. We talk a lot

00:02:23.860 | about compounding with our investments and letting your investments grow and grow. But one of the most

00:02:28.420 | important assets that came up in this retreat was health and how important your health is. And if you

00:02:35.280 | don't have health, and specifically the combo of healthspan and lifespan, which I'll touch on, then you

00:02:41.320 | can't let those assets compound because you're not around for them. And maybe they could compound for

00:02:45.260 | future generations. But I'm sure we're all working hard to earn money so that we can actually use it

00:02:49.940 | and enrich our lives and the lives of those around us. And so there were two sessions that touched on

00:02:54.640 | this. And one of them really focused a little bit on the difference between healthspan and lifespan.

00:02:59.800 | And so yes, you can live a long life. But if that's not an enjoyable life, that's not a really great

00:03:06.080 | place to be. And we talked this morning in our little group about how you want that curve of deteriorating

00:03:11.760 | life towards the end of your health to be as steep as possible. You want a great quality of life all the

00:03:17.340 | way until the end. And then if it just all disappears, that's okay. As opposed to this slow, gradual thing that maybe we've seen

00:03:24.800 | parents and relatives go through where the last decade or even longer is not very enjoyable.

00:03:30.160 | And unfortunately, it seems that in our society, the way to tackle that is you've got to be your own advocate.

00:03:38.420 | Right? I had an experience with high cholesterol. And I went to my doctor probably for the better half of 10 years.

00:03:45.100 | And the advice was things that weren't even true, like eat less cholesterol and eggs, which doesn't even have an impact on your

00:03:50.960 | cholesterol. You know, get some more exercise. And for almost a decade, that was the advice. And finally, I took it into my own

00:03:56.380 | hands. And I started testing a few other biomarkers like your LP little a or your ApoB. And I was like, oh, this is real. I need to go get a

00:04:03.860 | coronary artery calcium score. And it's like, oh, this cost $100. And in my case, for some reason, it was actually covered by

00:04:10.500 | insurance. But no doctor had ever suggested any of this. And so you really have to just take on this

00:04:16.100 | responsibility. Or I guess, decide that this is an area where you want to spend to outsource it to someone who is, you know, on the

00:04:23.200 | leading edge of that research, or just shop around, right? I'm sure that there are doctors covered by your insurance that will do

00:04:29.360 | this, but they might not be the first one or the second one or the third one or the fourth one. And nowadays, there are just so many

00:04:35.400 | different ways to get a check as to where you are, whether it's wearing a continuous glucose monitor for

00:04:41.960 | a few weeks and seeing how different things impact your metabolic health, getting different biomarkers,

00:04:46.300 | getting MRIs, DEXA scans, genetic screenings, that can have a big impact on everything. And just understanding

00:04:53.320 | where you are and having things to have a conversation with your doctor. One of the most powerful questions I

00:04:57.920 | asked my doctor once was, if I were willing to spend a little bit of money out of pocket, what should I be

00:05:03.200 | doing? And my doctor was like, what? Like, I don't get that question a lot. And I asked it to my dentist

00:05:09.120 | as well. And my dentist had the easiest answer. In like a split second, he said, get a third cleaning.

00:05:14.060 | And I was like, really? And he's like, yeah, I can't think of anything that would be more impactful for

00:05:18.640 | your oral health than getting a third cleaning a year. And I was like, oh, why doesn't everyone do

00:05:22.060 | that? He's like, well, because it costs $120. And I was like, okay, but like, if the most impactful

00:05:27.540 | thing I could do for my teeth is to spend $120 a year, that seems like people should know. He's like, well,

00:05:32.520 | insurance doesn't cover it, so I don't like to recommend it. And it turns out that a lot of the

00:05:36.440 | guidance I've seen from my care providers is that if it's not going to be covered by insurance, they

00:05:41.320 | don't talk about it. But if you open the door to, well, can we talk about things that aren't covered if

00:05:45.580 | they're potentially not that expensive and can be really impactful? And the answer was yes. They're

00:05:50.320 | interested in talking about that. And it can have a lot of impact. The only other thing I'll add is when

00:05:54.560 | it comes to genetic testing, one of the things my wife did was she did a genetic test after her father

00:05:58.720 | had the BRCA2 mutation and found out she had this BRCA2 mutation, which puts you at an incredibly

00:06:04.980 | high risk for breast and ovarian cancer. And so she went to a few different doctors to try to find

00:06:10.220 | someone who's like, let's be really proactive about this. And there was another session here, which is

00:06:15.400 | where this all compounds about women's health and specifically about menopause. And I think women's

00:06:20.740 | health gets one percent of all health research. So it's a very under-researched area. And a lot of the

00:06:26.840 | latest kind of consensus thinking from doctors might differ a lot from what doctors 20 years ago were

00:06:32.680 | thinking about. And so the theme in that session was the same. It's like you have to be your own advocate.

00:06:37.080 | Menopause impacts your entire body. And if something's off, a doctor might say, oh, well, maybe you're not

00:06:43.460 | sleeping well. Here's something to help you sleep. But there could be a lot of underlying things. And so if you're not

00:06:48.040 | testing all of the things, and I don't mean all like go test one million biomarkers, but if you're not

00:06:53.080 | getting a good baseline of where you're at, when something feels off, you might not easily be able

00:06:57.560 | to know, well, what caused that? Is that different from my test last year? And so she's going through

00:07:02.600 | the process of, I'm going to mispronounce this, but either an oophorectomy to remove her ovaries in two

00:07:07.820 | weeks, which is going to kick her in to some form of early menopause. And so she's, I guess, fortunate that

00:07:14.000 | it's not going to come as a surprise at some point, but it's something that she's going to know is about

00:07:18.880 | to happen. And a lot of the people she talked to, doctors she talked to, some of them were like, well,

00:07:24.300 | hormone replacement therapy, I don't know, it kind of has a bad rap. I'm not sure it works. And here at

00:07:28.640 | the session, there was a panel of health practitioners who were all like, no, no, the research now consensus

00:07:33.580 | is this is a good thing to do. And so again, if you're talking to a doctor and you don't feel like

00:07:38.200 | they're understanding what the latest research is, they're up to date with things. And I can understand

00:07:42.540 | that doctors have a lot going on. Staying on top of research is hard. Look around, do your own research,

00:07:48.060 | be in charge of this because she's going through the process of testing all the biomarkers to make sure

00:07:53.520 | that she could dial in hormone replacement therapy with a doctor who's really supportive of it. And as a

00:07:58.300 | husband, I don't know if you've thought about this, like I have not ever learned anything about menopause

00:08:03.260 | and the impact it has on the woman's body in school, from my doctor, from my family. And so it's been really

00:08:08.700 | interesting to get that perspective from her, from this room and how important it is and how much can

00:08:13.660 | impact you. I'm curious. I know you didn't attend the two health sessions, but have you been thinking

00:08:17.820 | about health a lot in your life lately?

00:08:20.180 | I have. And I think the biggest thing I would add, and this kind of ties into a theme that will come

00:08:24.260 | up a few times in different sessions here, which is what is the role of third-party professionals or

00:08:30.060 | service providers, you could call them, whether that's looking at your portfolio and do I want to

00:08:34.020 | do all my own management? Do I get somebody else? Whether it could be in taxes, different areas. But

00:08:38.500 | specifically in this area of fitness, I know one thing that we've been looking at personally is what

00:08:43.140 | my wife asked for her birthday and said, "Hey, I want you to figure out how to get me a personal

00:08:47.220 | trainer who's going to come to our house every Monday and Thursday night at 7:00 p.m. and make

00:08:51.460 | me work out." And it's not that she doesn't know how to work out, but having that person show up and

00:08:56.660 | actually be there and make her do it is a place where I say, "Hey, that'll be a couple hundred bucks a

00:09:01.220 | week." That's going to be the highest ROI, 200 bucks, because to your point around your health,

00:09:06.020 | if that actually is the thing that gets you over the hump on doing it. So I think,

00:09:09.300 | you know, you were talking about how it's not just about money, even if that's a sort of common

00:09:14.420 | denominator of the group. And it was funny, I actually was speaking with a good friend of mine.

00:09:18.180 | We've been friends since freshman year of college, but she came here and she's sort of in the New York

00:09:23.380 | family office circuit. And she says, "Hey, I go to a lot of family office events. This is the only one

00:09:27.380 | where no one's talking about investing. They're talking about everything except investing." But I do see

00:09:31.540 | that as an investment. Some of it can be this information of a different doctor, but some of it is just,

00:09:36.500 | hey, I may have all the information. I listened to this one podcast where he said, "Hey, if knowledge

00:09:42.580 | was the limiting factor, we'd all be billionaires with six pack abs." It's all around, you know,

00:09:46.500 | how do you actually get execution? So I think that's another way to kind of throw a relatively

00:09:50.660 | small amount of money at the problem and get a very high return on it. Absolutely.

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00:12:26.420 | The second asset that I thought, this one actually started this event. So we started this event with

00:12:32.580 | these circles where we got together with a group of 10 people and we just kind of talked about what's

00:12:37.460 | going on. I'll share this diagnostic we did later. But the other asset that seems to be one of the

00:12:42.980 | highest returning assets in everyone's life, and it's not money, was relationships and people. And the theme

00:12:49.060 | amongst a group of, I don't know, the average age at this event, but I'd say probably mid-30s to mid-60s,

00:12:55.700 | like a pretty wide range, was building relationships as an adult, especially in a world where many of us

00:13:03.700 | are now working from home or not going into the office every day or overwhelmed with our kids such

00:13:09.860 | that we're not being as social as we used to be, is really hard. And in our group, I think every single

00:13:16.020 | person was like, gosh, I wish I had more real friends. And this is true across almost every

00:13:22.660 | group. As I talk to other people, there was this common theme that having friends, which seems like

00:13:27.860 | such a fundamental, easy thing that we overlook, was just something that was hard for a lot of people.

00:13:32.500 | We've grown apart. We've moved away from where we were because we had kids and we moved to some

00:13:36.420 | suburb. We moved for a job. And it seemed like a thing that really matters. And just today as we're

00:13:42.660 | recording this, I released an episode of the podcast with a guy named Tim Ferriss. And we talked about

00:13:49.460 | relationships being the most important thing, like the thing that you should prioritize in your year

00:13:54.500 | before anything else, because it's what really brings actual happiness to our lives. Yet so many of us

00:14:01.300 | put it as like the seventh, eighth thing on our list. Well, and I think you made the point that

00:14:05.220 | it's hard as an adult. And I think from what I've read about this, it's not that there's something that

00:14:09.700 | changes in your brain that you're no longer willing or able to make friends. A lot of it is that making

00:14:14.260 | friends is this structural factor of seeing the same set of people on a recurring basis in some context.

00:14:21.380 | And so when you're a little kid, you're going to see those same 30 kids every day you show up at

00:14:25.060 | school and you're going to be friends with Chris because he's staying next to you, even if you don't

00:14:28.580 | have that much in common. Or when you're in college, you've got your roommates, maybe even your first job,

00:14:33.620 | all four of you analysts are in it together. You're going out for drinks afterward. But the further along

00:14:38.020 | you get in the career, the less natural recurring interactions there are there. And you are making the

00:14:44.260 | point that maybe to jump ahead a little bit, that session on Lighthouse Parenting, as we were talking

00:14:48.020 | before, that as a parent, you're trying to help guide your kids, but you're not going and doing

00:14:53.220 | it for them and being next to them every step of the way. You're kind of being a coach on it.

00:14:58.180 | And I think there can be this natural, especially as you have kids, this tendency of anytime I'm not

00:15:02.340 | doing stuff just with my kids and for my kids, it's kind of wasted time. And to recognize these

00:15:07.300 | relationships are important. And it's actually important to be intentional at investing in those

00:15:12.020 | relationships. And it's not being selfish or taking away, but it's actually probably making you a better

00:15:16.660 | person and a better parent in the long run if you do invest in those things beyond just being with

00:15:22.100 | your kids there. And I think there's a lot of ways that intentionality can look like. That's probably

00:15:27.220 | part of the reason a lot of people enjoy religion, whether the religion is for you or not. But it means

00:15:31.700 | that every Sunday you're going to be at church with the same set of people doing the same thing. It

00:15:35.700 | creates that continuity. I know for me personally, what we do on Sunday morning is not going to church.

00:15:40.580 | We have a Sunday 7:00 AM pickleball game with the other dads from my daughter's class. And so that's

00:15:45.140 | always a highlight of the week. That was the only time that we were all free from

00:15:48.180 | child rearing obligations was 7:00 AM on Sunday. Everybody's tired, but they're there. And it

00:15:52.820 | creates those friendships. I think similar to trusted circles. Okay, I've got these same eight guys I

00:15:57.220 | meet with once a month and we're carving out three hours to really have those conversations. So there's

00:16:01.540 | different ways it can look. But I think that intentionality is key to creating the recurrence.

00:16:05.540 | And the relationships don't just have to be friends, right? This could be family. One of the most

00:16:09.780 | kind of impactful stories I heard was there was someone in this retreat circle that we started

00:16:15.860 | with who said, I've spent so much time and energy trying to work hard to accumulate assets and wealth

00:16:22.900 | so that I could take care of my family. I could provide my kids the resources that they need that

00:16:27.380 | if they want to go do a job in nonprofit, there's some financial support so that they can live a

00:16:31.620 | fulfilling life and do that all at the same time. And I was talking to my daughter about it and she

00:16:36.580 | told me, "Dad, I don't need any of your money. Can you just spend some time with me?" And it was

00:16:41.620 | really tough to even tougher for that person to hear that message. But we sometimes think about

00:16:47.780 | what we're doing and we don't actually step one step back and say, "What is the purpose of this?"

00:16:51.860 | Because if the purpose is to accumulate this money so that we can help our kids, but what the kids really

00:16:56.100 | want is our time, then maybe we should spend a little bit less time accumulating the wealth and

00:17:00.100 | a little bit more time with them. And it's a fleeting moment that was very top of mind for a lot of

00:17:04.500 | people here because some people were like, "My kids are going to college in two years." Like,

00:17:08.260 | I have two really solid, great years with them around and some people are just getting started

00:17:12.500 | in the journey. And so that was another big one for me. How do you really make sure you're spending

00:17:17.540 | time with people and really having good experiences? And one of those things that I think this community at

00:17:22.900 | large and really just our society loves to do with other people is travel. And so I think one of the

00:17:29.780 | takeaways was that travel really compounds when you're intentional about how you do it. Now, this was a

00:17:35.300 | session I led. So instead of me talking about something I've already talked about, I'm curious

00:17:39.460 | what you took away, Tad, from that session. Yeah, I loved hearing you and Lee talk about it. There

00:17:44.260 | were a lot of hacks, if you will, on, "Hey, Argentina is a great place to go. And here's the right way to

00:17:48.900 | think about Japan." But for me, I think the biggest thing that I took away listening to it, which I loved,

00:17:54.020 | was this idea of, "All right, let's say, are you taking a trip to Paris in order to work through your top 10

00:17:59.140 | checklist?" So you get to the top of Montmartre, you take a picture. You get to the top of the Eiffel

00:18:03.220 | Tower, you take a picture. You have your five seconds next to the Mona Lisa and you take a picture.

00:18:07.700 | Is that actually why you wanted to go to France? Or was it getting to know the culture? Or it sounded

00:18:13.780 | like really what you guys were talking about and the one that was most meaningful was you're actually

00:18:17.620 | going to France, but to have that relationship with your friends or with your family. And you were saying

00:18:22.660 | that often the best trips are the second or third time you've been to a city because you don't feel any

00:18:26.740 | compulsion to say, "I'm going to hit the top 10 highlights here." With Paris in particular,

00:18:30.580 | actually, my wife is a huge Francophile. So I try to maybe every five years, we do a two of us trip

00:18:35.700 | to Paris. And I don't think we've gone to Louvre once on that. You know, she's spent probably years

00:18:40.340 | of her life cumulatively and she's been to every museum there. But it means we just walk around and

00:18:44.020 | we go to the pretty parks there. Or another one like that, we actually made a decision pretty early

00:18:49.220 | on in my kid's life that every other year we'd go to Rome for Christmas. Partly that's because we've got

00:18:53.700 | family in Rome. And partly it's because it's just it's amazing to do Christmas. It's great weather.

00:18:57.700 | You've got the Pope there. Every church, they're singing these Christmas carols. And tell you,

00:19:01.780 | New Year's there is like the Baghdad air raids. Everybody's setting off these fireworks off their

00:19:06.260 | desks there. But the really cool thing about it is now that we've been a bunch of times, my kids are

00:19:10.740 | familiar with it. The last time we went, one of the highlights, we went to the A.S. Roma game.

00:19:15.300 | Another one is we found a gladiator school. So the kids got dressed up in their gladiator uniforms and

00:19:19.540 | we're hacking at each other. And so really the point of the travel was not, okay, did we see the

00:19:23.860 | coliseum for the fifth time? But as they got their time with their grandparents, they got that time with

00:19:28.260 | their cousins, they got that time with the parents not distracted and in a different place. Lee said

00:19:33.300 | this, when somebody comes to me planning a trip, the first thing I asked them is, what are you trying to

00:19:37.220 | accomplish on this trip? Do you just need a break? And like, I'm going to send you to Hawaii. You're

00:19:41.060 | never going to leave the resort. You're just going to lie on the beach there. And maybe you'll go for a walk and

00:19:44.980 | you'll have a Mai Tai and that's going to be the perfect vacation. Are you looking to get in shape?

00:19:49.140 | Are you looking to reconnect with your spouse? If you know that what you're trying to accomplish

00:19:52.900 | beforehand, then travel can get you what you're trying to accomplish. But otherwise, and this will

00:19:57.220 | come up in some other things. If you put the cart before the horse and say, well, what's the perfect

00:20:01.620 | itinerary? But it doesn't fit where you are in your life. You know, he's also saying, look, if you've got

00:20:06.260 | a newborn baby and you want to go to Europe for four days, you literally can do it. But there is no reason to go

00:20:11.700 | to Europe for four days for the newborn. You should go for three weeks if you want to take that trip.

00:20:15.620 | Kids are an interesting thing to travel with. We took a pause because, you know, we went through

00:20:19.380 | that phase where they barely sit still. And now we're about to start embarking on that journey again.

00:20:23.460 | We've got a trip planned to Japan. And again, for us, it's a repeat destination where we have no pressure

00:20:28.980 | from my wife and I to do anything. And we can just kind of see the city through our kids' eyes,

00:20:33.860 | which is a really interesting experience, right? To watch your children experience a thing that you've

00:20:39.540 | experienced in the past. And that makes parenting sound easy. The next takeaway I have is the exact

00:20:45.220 | opposite. Parenting is hard. It's hard for all of us. Maybe that's the point of parenting. And maybe

00:20:49.860 | there's no perfect way to do it. And one of the biggest challenges I think today, you could probably

00:20:55.140 | walk around this room and any room and any Instagram scroll and any TikTok scroll and any blog post,

00:21:01.300 | and you'll find a million different results of how you should parent, what you should do,

00:21:05.220 | what's ruining your kids' lives. And it might be the same thing that's enriching your kids' lives on

00:21:09.380 | another post. And it makes the whole thing feel overwhelming. And in some world, I kind of am

00:21:14.020 | envious of my parents who were like, well, we had one book and we kind of just read that book and we

00:21:18.740 | did what our friends did. And like, we didn't have to think about it at all. And you could be envious of

00:21:22.660 | that. But there was a parent who had the exact opposite opinion. In that session, they raised their hand,

00:21:27.540 | said, hey, I feel like I messed it all up. I didn't have all these resources. I didn't know what I was supposed to be

00:21:32.020 | doing. And so it's great that we have a lot of resources to know what we are doing and how we

00:21:36.180 | can be better parents. But there's almost information overload to the point that you're like, oh, what

00:21:41.380 | should I, how should I respond to my kid? Oh, should I look at chat? How do I respond to my kid? They just

00:21:44.820 | said this thing. It can be a lot. And I liked the simplicity of the lighthouse parenting concept,

00:21:50.900 | which Andrew explained as there's this lighthouse and your kids are riding the waves and your job

00:21:55.940 | is to be this grounded thing that's there, that's supportive, but not always to just go get in the

00:22:00.980 | waves with them, like let them deal with the struggles. And it can be so hard to watch your

00:22:06.100 | kids struggle and not just try to solve the problem. But then I look back to my childhood and I was like,

00:22:11.700 | I was just in the woods trying to figure things out on my own. And like, that seems crazy that we would

00:22:15.940 | even let our kids roam free in the woods these days. But they need to learn that independence somewhere.

00:22:21.380 | And they need to learn that you're there. You're reliable. You're predictable. You'll be there. You'll

00:22:24.980 | be there to support them. But they've got to ride those waves. They've got to figure it out on their

00:22:28.740 | own. And so maybe instead of giving your kids a job, make them get a real job where they have a boss

00:22:33.460 | that's not you. And there are a lot of examples of things like that to just kind of help them

00:22:38.260 | figure it out, but not figure it out for them. Yeah, I think that's a great point. I heard a member

00:22:43.860 | talking about this. He was saying it's easy when they're really little. Like when your kids are trying to

00:22:48.740 | learn how to walk up the staircase, you have zero temptation to pick them up and put them at the

00:22:52.900 | top of the staircase and say, OK, you know, I solved your problem. You're now at the top of the stairs.

00:22:56.820 | Enjoy yourself. But then applying that to my kids now in sixth grade and not all of his grades are

00:23:02.980 | where they should be. It's much harder to say, OK, well, you know, that's on you if your grades aren't

00:23:06.980 | where they need to be. Or, you know, if you're going into freshman year of high school, it's going to be on

00:23:10.180 | their transcript. It's much harder to let them do it themselves. I'm from Texas, so we talk about grace a lot.

00:23:16.820 | Your idea of it's OK for your kids to fail, I would also say as a parent, there's no right answer.

00:23:22.180 | We should give ourselves some grace that we're not going to get it exactly right in the parenting.

00:23:27.060 | I think the more we can try and do that, I think it builds on itself. Like for me, the example of this

00:23:32.100 | with my kids now being in middle school and certain things I'm not comfortable with them failing at,

00:23:36.820 | but trying to find the ones where they can. My son has bar mitzvah recently. And going into that,

00:23:41.380 | I decided, you know what, this is something that we're only going to do this if this is your deal.

00:23:45.300 | And I told him directly, I was like, you know what, you can do it. You can not do it. You can take it

00:23:48.980 | seriously. You can do a crappy job like that's totally on you. And it was amazing. I would never

00:23:53.620 | say that to him about math class. It would be you're going to get an A. You're going to get turned in all

00:23:57.060 | your homework. You're going to do it right. But when he actually knew that I meant it, that it was

00:24:01.460 | totally his choice how well he did it. He was there every Saturday morning, reminding me like,

00:24:05.620 | oh, I got my Zoom call with Hadar, like get me on there so I can do my tutoring. And he was practicing

00:24:09.940 | his letters late at night. And it was up to him that that had significance, but it became a much more

00:24:14.260 | meaningful experience because it was something he was driving himself. Where we can, I think we all want

00:24:18.900 | to try and extend that to the things that really do matter. Because also ultimately, we're not going to

00:24:22.820 | be there when they get to freshman year of college. You're not going to be waking them up and making sure

00:24:26.980 | that they get out of bed at 8:00 AM and get to class on time. And I think it is somewhat unfair

00:24:31.700 | if senior year of high school, you're waking them up and making sure they're eating their breakfast and

00:24:35.140 | make sure they get there on time. Not only do they have to deal with college level course expectations,

00:24:39.620 | but they have to do their laundry for the first time. They have to set an alarm for the first time.

00:24:43.380 | I think you need to see that childhood is that slow evolution where they're picking up more and more

00:24:47.300 | responsibility rather than having it all happen at 18. Yeah. So my kids are young, so I'm glad we got to go to

00:24:53.460 | this session earlier. And my wife and I actually had a really good conversation about it after, about how we

00:24:58.100 | want to learn from them and learn from that session. But also this next takeaway is actually about how you can

00:25:03.220 | learn from your kids. So a lot of what we think about is, okay, well, we've got to teach our kids all these things.

00:25:08.820 | We've got to be there for them. But there was a session that Nate Hurd did about expanding what's possible.

00:25:14.180 | And the premise was, you look at your kids and I look at my daughter and I'm like, well, in the morning,

00:25:18.740 | she is an astronaut. She's has a spaceship. She's flying around. A few hours later, she's repairing

00:25:23.780 | all the damaged limbs on my other daughter. She's dressed like a doctor, has her stethoscope.

00:25:28.260 | Bedtime, she's a dinosaur. You know, she's a cat. She's meowing. She can be anything she wants,

00:25:32.660 | any time of day. And I was talking to someone here about learning to play the guitar as an adult. And in my

00:25:37.540 | mind, I was like, man, I don't even think I could learn to play the guitar before I die. Like, that just seems

00:25:42.660 | impossible. And I'm like, my daughter thinks she can have 47 careers in her life and I can't learn

00:25:47.540 | to play an instrument. As adults, we forget that our imagination can just run wild and it can really

00:25:53.780 | expand what we think we can do in this world. And so we went through this exercise and I brought this

00:25:58.740 | little book just so I can highlight a few of the things for people to remember. But we started with

00:26:03.140 | this diagnostic where we went through your physical health, your mental health, your meaning or your

00:26:07.700 | purpose, your romantic partnership, your family, your friends, your wealth and your financial mastery,

00:26:13.780 | your time, your adventure and exploration, you know, your self-improvement, your play, your expression,

00:26:18.900 | your hobbies. And we said, let's rank ourselves on how satisfied we are. And then let's rank how

00:26:23.460 | important this is to us. And this actually kicked off the earlier conversations in the whole retreat,

00:26:28.260 | which was we sat in a group of five to 10 people and said, well, let's not talk about the things that

00:26:32.820 | aren't important to us or the things we're doing really well. But let's just skip right to the end.

00:26:36.980 | What are the things that people are a two out of 10 satisfied and an eight out of 10 with are important?

00:26:42.740 | And then in this session about expanding what's possible, Nate pushed us all to just sit there

00:26:48.500 | and pick one of them. So pick one area of your life. And I'll challenge anyone listening or in this room

00:26:52.500 | that hasn't done this exercise and say, what's an area where I'm not where I want to be? And what would it

00:26:57.780 | look like if I were wildly where I wanted to be? If it's, you know, hobbies where I'm taking a cooking

00:27:03.140 | class every day of the week, where, you know, I'm jumping out of airplanes on the weekend, like

00:27:06.980 | just everything you could ever want. I'm being trained by chefs, you know, around the world,

00:27:11.540 | whatever it is. And it's not to say you're going to do that, but let's just treat our brains in the way

00:27:16.020 | that we can dream much bigger and be more creative. And then Nate's like, okay, now we're going to take

00:27:20.660 | another 15 minutes. We're going to do it for all of them. And so I left with this crazy idea of how

00:27:25.460 | could I improve every aspect of my life at a level that is not necessarily practical.

00:27:30.580 | And he encouraged us to stop treating our lives. Like we do our work where it's like,

00:27:35.620 | wow, we've got to optimize this. We've got to execute on this. We've got to set milestones and

00:27:38.900 | goals and said, you know, what's interesting is when you do that, you might hit those things,

00:27:43.300 | but you're thinking so short sighted when you just inspire yourself, when you think really big about

00:27:47.940 | where you could go, what you could do, all these possibilities that just naturally pulls you.

00:27:52.900 | You don't need to set the goal because now you've created this North Star that's so inspiring.

00:27:57.460 | For me, I was like, well, I actually don't have a ton of friends that live nearby. A lot of my

00:28:02.340 | friends moved far away. It just seems impossible with kids to just drive an hour to grab a coffee with

00:28:06.980 | someone. And I was like, you know, what would a crazy version of this look like? And I was like,

00:28:10.500 | well, we have a sauna. Like maybe I run the neighborhood sauna club. Maybe I've got like a

00:28:13.860 | website where people sign up and we have regular saunaing with random people until I meet more interesting

00:28:18.020 | people. I've had this dream for years and many people will think I'm crazy of just like creating

00:28:22.660 | almost like a profile on a dating app, but as a person for friends and just put it in mailboxes.

00:28:28.580 | And I figured like the people I'd randomly meet through this are probably people that are interested

00:28:32.820 | in random weird things like me. It's like, that could be this world. And so now I'm kind of inspired.

00:28:37.060 | I'm excited to do all these things. It was just really fun. Like I felt like a kid in that session,

00:28:41.220 | getting to think big and creatively with no restraints. I don't know. You weren't in that room,

00:28:46.020 | but I'm curious what you think of that exercise. I mean, I love that exercise. I guess in the world

00:28:50.340 | of inspiring, the one thing that I found really inspiring here is there were a number of members

00:28:55.140 | I talked to, and I genuinely had not expected this, where they were successful entrepreneurs.

00:29:00.180 | They'd had very good exits. You know, one guy, his company's about to IPO. Another one,

00:29:04.660 | he sold his company as strategic acquirer. So very successful, very smart, very driven. But they said,

00:29:09.940 | you know what, my next thing, I am not going to have a profit incentive. I'm going to start a

00:29:14.100 | nonprofit and I'm going to take all of that energy and the skills and the discipline,

00:29:18.900 | but toward driving that nonprofit. So, you know, Andrew, for example, started Sober Entrepreneurs

00:29:24.180 | and his previous company, I believe it was a SaaS company. So he knew all the metrics of what's

00:29:28.420 | customer acquisition costs and what are churn rates and how do I measure impact. So he's applying all

00:29:33.060 | those things, this nonprofit. So he's looking at what's my CAC to get a new member and doesn't get any

00:29:38.020 | revenue from that member, but he's being rigorous. He's holding his team accountable. Like, hey,

00:29:41.540 | you missed your numbers. We are not having the impact we are trying to have here. And so I found

00:29:45.460 | that really inspiring of saying, hey, you can not just pigeonhole yourself. Hey, here's the thing I

00:29:51.140 | started. And so I need to start another SaaS company here. But I can, if what I care about

00:29:55.060 | now is not making more money, but actually having impact, you know, for him is sobriety, for another

00:29:59.860 | member who's around couples counseling and helping couples be more successful together. And that's where

00:30:04.820 | he was going to put the same energy that took him to building a public company, just toward having that

00:30:08.580 | impact. So it's easy to sort of pigeonhole ourselves and say, okay, well, I'm 45 now. And my thing is

00:30:14.340 | doing this. And you'd think it was silly if your kid said, okay, well, you know, I'm six now. And so

00:30:19.860 | I'm an astronaut expert and I'm never going to branch out from astronaut. I would imagine a 65 year old

00:30:25.220 | looking at 45 year olds who's pigeonholed themselves and say, well, I can only start another SaaS company.

00:30:29.700 | And he would say, no, that's silly. If you want to, you can, but if you've been successful here,

00:30:34.180 | you can try something else. And again, it doesn't have to be profit driven.

00:30:37.140 | And it's not very culturally in the American DNA, but we went to Iceland and I can't remember this

00:30:42.980 | data. I'm going to butcher it, but I think it's like 10% of adults in Iceland have written a book.

00:30:46.900 | It's a wild number of people. And for whatever reason in Iceland, it's very normal for people to

00:30:52.660 | live their life in seasons where a doctor will be like, you know what, now I'm going to write a book.

00:30:56.180 | And now I'm going to open a coffee shop. That seems normal. And in our society,

00:31:00.180 | it feels very strange to be like, well, I have this career. Now I'm just going to go pivot,

00:31:03.380 | try some totally new career, but it works. And I like hearing this story of like, let me take

00:31:07.460 | something I learned and apply it somewhere else. And I think that life can be more interesting if you

00:31:11.860 | allow yourself to pull yourself to things you're excited about and not get too caught up in,

00:31:17.220 | this is the only thing that I do. The other fun, inspiring anecdote, my 10 year old daughter,

00:31:22.020 | very into gymnastics. So my parents live at the top of a hill. She did 300 cartwheels in a row to

00:31:27.380 | get up to the top of their hill. And they're saying, grandpa, you know, I want you to do it now. So I

00:31:30.900 | can't, she goes, you can't do it yet, grandpa. Yeah. They just think everything's possible.

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00:34:09.140 | questions. All right, so your imagination can be really valuable and it can make you think of amazing

00:34:15.140 | things. But another theme that I took away from this event is, especially as we talked about more

00:34:22.580 | tactical and strategical, that's not even a word, more tactical and strategic things about assets and

00:34:28.740 | wealth, there were people talking about these complex structures. And you could probably apply this to the

00:34:33.460 | same story with travel planning, where you've come up with this complex way to do something and you

00:34:39.620 | rewind and say like, did we actually define the objective of it before we did it? I went to the

00:34:43.860 | session, I think we both did on estate planning and I was like, yeah, there's a lot of stuff going on.

00:34:48.020 | I'm like, do I need this? Like when it comes to estate planning, Chris started saying there are things

00:34:53.700 | people need, right? Like you should have some document that dictates what happens with your assets and who

00:34:58.180 | will make health care and financial decisions if you're unable to. Like we need those things.

00:35:02.420 | And who's taking care of your kids? And who's taking care of your kids? Like what happens to your

00:35:06.420 | children if you're not around? But at least at present, I think each person starting next year has

00:35:12.580 | about 15 million dollars per person. So a married couple, about 30 million dollars of exemption for

00:35:19.220 | leaving money to other people who aren't your spouse or aren't a charity. And so we love in this world and in

00:35:25.780 | in this community finding creative ways to save on taxes and earn a higher return. But if you're

00:35:30.740 | sitting there without anywhere near 30 million dollars and thinking about how cool it would be

00:35:35.380 | to set up a dynasty trust or some crazy life insurance private placement thing to try to avoid the taxes,

00:35:41.380 | that in all reality, you're never going to face. Like you can get excited about it. But if you rewind

00:35:46.020 | and say, is this even for me? You might find that you didn't actually start with the same question

00:35:51.140 | Lee posed about travel is like, what's the purpose of this whole thing? Because the purpose might not

00:35:55.700 | actually matter in your circumstance. I agree. And there was another session

00:35:59.300 | that Josh Cantor did on the similar idea, less in the weeds of, OK, what are the exact difference

00:36:03.620 | between a crat and a crud and a slat and a grat, et cetera, but just taking one step back on what are we

00:36:08.980 | trying to accomplish with transferring wealth to the next generation? And so he did some interactive polls.

00:36:14.660 | First one was how much of your structure you have in place? And I think most people felt pretty good.

00:36:18.900 | Like, OK, I have a set of trusts in place. I've got a bunch of the entities there and I have my assets

00:36:24.500 | properly domiciled in the various ones. And then he had one just free form. What is the objective

00:36:30.020 | you're trying to accomplish? And the top three answers were, I'm not sure. I don't know. And I

00:36:36.100 | have no idea. So everybody, they'd optimize their whole structure. I'd say I'm in the exact same

00:36:42.820 | position myself. I submitted, I voted, I have no idea. I think that's a big one before the other. And I

00:36:48.100 | think it can be stressful too, because it feels like one of these things when you look at estate planning,

00:36:52.100 | it only really works if it's irrevocable. But the nature of irrevocable is you can't take it back.

00:36:57.620 | You want to do as soon as possible, but as soon as possible is when your kids are really little.

00:37:01.140 | And so you end up in this kind of tension where you're trying to optimize about it.

00:37:04.340 | And another thing that I thought was interesting when Chris was talking about the way these structures

00:37:10.260 | worked is that for a very long time, the English for centuries had this principle of no perpetuity.

00:37:15.780 | So you can't just put your money in what we now call a dynasty trust and have it compound for 1,000 years.

00:37:21.300 | And the tax man can never do it. You know, even the English thought that was a bad idea to have dynastic

00:37:25.140 | wealth build up in that way. For various reasons, the U.S. has moved away from that policy.

00:37:29.300 | So we now can put your money away for 1,000 years. But Chris was saying, you know,

00:37:33.860 | if you think about it, that means that William the Conqueror, when he took over England,

00:37:37.700 | if he put his money in a dynasty trust, that trust he set up would still be enforced today.

00:37:42.500 | And so this idea of saying just because you can plan 1,000 years out and try and, you know,

00:37:47.380 | rule it from the grave, that's not necessarily the best thing to do. Or at least you should think

00:37:51.300 | carefully about what those things are before you start just putting a South Dakota trust in place.

00:37:55.300 | Yeah. And this applies outside of even trust, just thinking in your investment policy. Like,

00:38:00.980 | what is my goal with my investments? What are these assets for? If the assets I'm trying to invest in

00:38:05.460 | are for 20 years, I might take a different risk profile or liquidity profile than if I'm trying

00:38:10.900 | to save for my down payment that I need to make on a home. So just really thinking in advance on

00:38:16.660 | what I'm trying to do before I get all excited about the structure that I could create, the tax loophole

00:38:22.260 | that I've found, making sure it actually even fits in with what you need to do.

00:38:25.300 | Well, as you and Lee were talking about the travel session, you talk about a lot,

00:38:28.260 | what's the most efficient use of points. They're saying, hey, if you find a killer deal on a flight to

00:38:32.980 | Frankfurt, if you didn't actually want to go to Frankfurt, you really shouldn't buy that killer

00:38:36.900 | deal on the flight to Frankfurt.

00:38:38.420 | Yes. And so you can create these complex structures. And oftentimes what they do is they

00:38:42.580 | try to reduce risk. But one other key theme from this week for me was that you can try to reduce risk,

00:38:49.860 | but you really shouldn't think about it because you're not going to eliminate risk. You're really

00:38:52.580 | trying to manage it. And there were two big moments talking both about insurance and really like

00:38:57.300 | personal and online security where I thought risk really came out as a theme. And in a world where

00:39:04.180 | just more information and more things going on, risk can really play a role. You talked about

00:39:09.380 | insurance and went to that session. I'm curious what the big takeaways were.

00:39:12.580 | The concept of the session was two things. Hey, why are insurance rates going up so quickly? And

00:39:17.780 | especially in places like California where you live, but also Florida,

00:39:21.460 | Carolina is Texas. Why am I getting dropped entirely? And then what can I do about it?

00:39:26.660 | In terms of why they're going up, a lot of interesting factors there, whether it is

00:39:30.820 | climate change, whether it's insurance has been just an unprofitable business. So insurers are trying to

00:39:35.620 | pull out of it largely, whether it's that people are building in high wildfire risk areas,

00:39:40.500 | a bunch of reasons like that. But in terms of what to do about it, I think the key thing he was saying

00:39:45.380 | is, look, insurance is really just a contract where you're moving risk from one person to another

00:39:50.420 | person. But it is not a particularly efficient way to do it. If I have $1,000 of risk, pushing that to

00:39:56.180 | you is probably going to cost $1,500 when I look at different brokers and middlemen and that sort of

00:40:00.580 | thing. So to really think about the only kind of risk you should try and push off is really catastrophic

00:40:05.620 | risk that you can't afford. So if you're in a position where you could afford $1,000 loss, you should

00:40:11.540 | not buy AppleCare because if you lose your iPhone, you can just pay $1,000 to get a new AppleCare.

00:40:15.940 | And Apple has priced their AppleCare such that it's going to be a lot more expensive than the

00:40:19.860 | value you're actually getting. But the same thing scales up to your home insurance. If you get $1,000

00:40:24.740 | deductible, so if you have a $2,000 claim, you're taking it. If you could have afforded to pay that $2,000

00:40:30.020 | out of pocket, both your premium will be much lower. And in just two or three years, you will save the

00:40:34.900 | money by having that higher deductible. And you'll also honestly remain insurable. He was saying that he has

00:40:40.980 | clients to come to them. I've got a ton of money. They're very successful, lots of assets.

00:40:44.900 | But they have put in four little nickel and dime claims over the last five years,

00:40:48.900 | said, you are literally uninsurable. I cannot get any carrier in the country to insure you. Lloyd's

00:40:53.220 | will not insure you because you put in these small claims here, which is frustrating. You say, well,

00:40:57.300 | I have this. I want to go ahead and take advantage of it. But it's because they're not thinking about

00:41:00.980 | insurance as purely a contract to move catastrophic risk. My house burned down. My spouse got cancer.

00:41:06.900 | I got in a car crash with a school bus. Those are the times you have insurance. It's anything

00:41:11.140 | you can cover yourself. You should set your deductible. And there's not one answer. Is

00:41:15.060 | that right deductible $10,000 or $100,000? It really depends on how much money you have and how much buffer

00:41:20.420 | you can afford. But to really move it a lot higher. And the other thing he was saying is that, again,

00:41:25.620 | it is just this transfer of risk that you started with. So think about the risk that you are creating.

00:41:30.820 | So I own a house in a high wildfire risk area of California. And I'm always moaning that I can't

00:41:36.100 | get anybody to insure my house. Well, I'm actually the problem there because I own a house in a very

00:41:40.580 | high wildfire risk. And so it's just a very expensive liability to have. And nobody feels like picking that

00:41:45.460 | up on my behalf. And so if you think about, you know, it's not just California. Again, if you buy a

00:41:50.020 | beach house on a hurricane prone area of Florida and it's not brand new built to this superstructure code,

00:41:56.100 | there's a lot of risk there. And so insurance is not some silver bullet. You know, if you want to

00:42:00.260 | transfer that risk, you're going to have to pay a lot because you create a lot of risk in the first

00:42:04.020 | place. So those are a couple of things I took away from it. Yeah. My two takeaways were one,

00:42:07.700 | just tactically look at your insurance policy and look at the deductible and ask yourself,

00:42:12.740 | would I even make a claim if something were slightly over that? And if you have a $500 deductible on your

00:42:17.300 | car and you got into a minor accident and there's $700 of damage, I think making that claim to get

00:42:24.340 | reimbursed the extra $200 is going to increase your premiums by way more than $200. So ask yourself at

00:42:30.980 | what level, you know, if you total the car, yeah, you probably make that claim. So find the level at

00:42:35.300 | which you would actually use the insurance and increase your premium to that level because otherwise

00:42:39.940 | you're just overpaying for your insurance. And so that's the one thing that I would encourage people

00:42:44.740 | to do. And then also if you're ever buying property, absolutely check the cost to insure that property

00:42:49.780 | before you close on it. Because I have had some friends look in places in California and they're

00:42:54.900 | like, oh, we found this place. It's awesome. And then when they finally looked at the insurance,

00:42:58.180 | they're like, wow, like I can't even get insurance easily for this home.

00:43:01.780 | Or you can't get it full stop. You know, Lloyd's of London will not cover you. It's just can't be

00:43:05.940 | covered. And also, you know, one other thing on those tactical thing he shared is the claims follow

00:43:10.820 | the home. So if the person who owned that before you, if they had a water leak and they put a claim,

00:43:15.460 | when you're trying to insure that house that you bought, you're going to be dinged for that claim

00:43:18.900 | they put in because the insurer is going to say that home is risky. So that's another tactical thing

00:43:22.580 | to look out for. I wonder if you can actually like, you can actually see the history of claims on that

00:43:26.900 | home. You can talk to your broker about it. And there's one specific risk that I took away from

00:43:31.300 | this event that I think I hadn't really thought about when it comes to investing. And that is that

00:43:37.140 | right now, I used to think that the easiest way to invest, just put your money in the US stock market.

00:43:41.460 | It's just so simple, right? Buy the S&P 500. Don't worry about anything else. You know,

00:43:45.220 | don't worry about all these crazy investments. That's pretty diversified. There's a lot of

00:43:48.500 | different types of businesses and different industries in the US. So you're good. There

00:43:52.660 | was a session about private investments and all the private markets and going beyond that traditional 60,

00:43:57.620 | 40 portfolio. And one of the takeaways was if you actually look at the S&P 500 and you look at the US

00:44:03.940 | stock market, you are very concentrated. It is not as diversified an investment vehicle as it once was.

00:44:10.660 | And even if you look at just at the broad US economy and say, well, yeah, lots of things are

00:44:14.260 | concentrated in technology, right? Like, do you know what percentage of the S&P 500 is technology?

00:44:19.220 | I mean, it's pushing 50%. It's something crazy. And even often they say, well, Apple's not really

00:44:23.860 | technology, that's consumer. But anything a normal human thinks of as technology is probably half of

00:44:27.940 | your S&P. And you take that and then you look at, well, there's even a lot of technology opportunity

00:44:33.940 | outside of the public markets. I think OpenAI's recent valuation was $500 billion. You have companies

00:44:39.220 | staying private so much longer. And so if you're not looking at diversification beyond one single index

00:44:46.500 | fund, one single kind of geography, you're probably under diversified. And that could look like different

00:44:53.300 | funds that you don't have to go search long and hard for, but it also could look like other geographies.

00:44:58.900 | And I think on top of that, I bet a lot of your listeners live in the Bay Area or somehow work in

00:45:03.300 | tech. So then they're compounding that personal career concentration on tech with then their retirement

00:45:08.900 | savings, their emergency fund are also heavy into tech there. And I think it's tricky because

00:45:14.660 | it's something where if you look at today, if you said 10 years ago or 20 years ago, I'm all in the S&P

00:45:20.100 | or even more, I'm all in on the NASDAQ, I'm all in on the FAANG stocks, you have made a fantastic bet.

00:45:25.780 | And I think that one of the hard things about looking at this stuff, a 10 or a 20 year sample size is not

00:45:32.100 | actually statistically significant. So it could be your whole adult life and feel like, well, of course,

00:45:36.260 | you know, it's smart to bet on Facebook, it's done great, or smart to bet on Google, it's done great.

00:45:40.260 | But I think we should all be humble that there's a significant degree of luck there. And so if you

00:45:45.380 | say, hey, my history is not just what's happened in the US in the last 30 years since I've been investing,

00:45:50.180 | but actually what's happened global in, you know, different equity markets over the last 150 years.

00:45:54.900 | If you were in 1920s, Buenos Aires and looking at say, hey, I've been all in on Argentina,

00:46:00.020 | this has been a great bet. Argentina is one of the 10 richest countries in the world, I'm just gonna

00:46:03.940 | only buy Argentine government debt and Argentine equities. That's been a terrible bet for you for the last

00:46:08.580 | hundred years. And not that I think the US is going there. But I think we should all realize

00:46:12.980 | that the whole point of diversification is that we don't have a crystal ball on what's going to happen.

00:46:18.180 | And so I think that can be geographic, as you're saying, if you don't just buy US stocks, like a good

00:46:23.140 | example is, if you happen to have bought German defense stocks, when Russia invaded Ukraine, you're up

00:46:30.420 | 10x now. Now, I'm not saying everybody should be going and thinking about third order implications of

00:46:34.980 | different geopolitical events. But just by the nature of if you'd owned European stocks, you would have

00:46:39.380 | had German defense stocks and they'd gone up at the same time something else was going down.

00:46:43.380 | So it can be that. It can also be looking outside of equities. You know, it can be looking at real

00:46:47.380 | assets like timber, land, oil. It can be looking at less real assets like Bitcoin. It can be looking at credit.

00:46:53.620 | There's a lot of those different ones asset class wise. And as you said, there's both public markets and private markets, which have their own

00:47:00.260 | different dynamics there. And I think some of the sessions you were talking about is, OK,

00:47:04.420 | if I have a significant level of assets, if I'm a qualified purchaser and I can make $100,000 investments,

00:47:10.020 | I have 10 million, I can get these complicated things. But you don't have to be at that level.

00:47:14.900 | There's a lot of easily publicly tradable things that may not be quite as good exposure to those

00:47:20.420 | diverse fires, but are fully liquid and you can get into for $100. So whether you look at REITs that are

00:47:26.020 | investing just in U.S. farmland, you can buy U.S. farmland REIT at probably, you know, $20 a share to

00:47:31.060 | put as much as you want there. Or, you know, whether that's investing in energy companies or international

00:47:35.940 | ETFs or Bitcoin tracking funds. So these are not only applicable to those with significant access

00:47:42.180 | and the ability to get the best access, it can go sort of anywhere on the net worth ladder.

00:47:46.660 | Yeah, I think I'd always mentally thought there's all these better asset classes that you get access

00:47:51.860 | to as you have more money. And I think the real trade off is there's these two spectrums of

00:47:56.420 | diversification and liquidity. And if you have more money, you can get into a set of assets that you

00:48:01.460 | can't without more money. That is true. But most of those assets, the trade off isn't just better return

00:48:07.620 | for access. It's often better return for a lot less liquidity. And so, yes, if you have less assets,

00:48:12.820 | you might not have access to them. But most people who don't have that many assets probably don't want

00:48:17.060 | assets that are going to be tied up for 10 or 15 years. And so there's kind of two spectrums of

00:48:21.460 | trade off. And so you can still get exposure to those asset classes. You might not get the same

00:48:25.780 | return, but it's because they're fully liquid. And I would also say there's sort of an information

00:48:30.660 | arbitrage here. I think one of the best things about public markets is they perform price discovery.

00:48:36.020 | So if you're blindfolded and pick 50 stocks at random, you're going to get general index like returns.

00:48:41.860 | And that's actually one of the things that doesn't bother me that much to kind of pick random stocks,

00:48:45.540 | because you're sort of entertaining yourself and you're really just investing alongside the overall

00:48:49.700 | economy. But that's not true in the private market. So I think the other thing is it is much more

00:48:53.860 | difficult to diligence those. And if done correctly, you get the alpha of that. But if done randomly,

00:48:59.300 | you get the negative alpha of doing it randomly. This episode is brought to you by Masterclass.

00:49:05.460 | If I'm trying to rewrite something or do some research, AI tools have been great. But when I'm

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00:50:10.020 | additional 15% off any membership at allthehacks.com/masterclass.

00:50:16.580 | Thank you for being here today. You can find all the links, promo codes,

00:50:29.060 | and discounts from all our partners at allthehacks.com/deals. They're all brands I love

00:50:35.060 | and use, so please consider supporting those who support us. One of the takeaways I got from this

00:50:41.220 | event is you can earn money, but you can also let trying to optimize the amount you earn and the amount

00:50:46.980 | of taxes you pay really just take over your mind share, your hours of the day, your emotional state.

00:50:54.180 | One example was around becoming a qualified real estate professional. This was in the tax planning

00:50:59.460 | session and it's a thing you can do. There are very few ways that you can take a loss on a business

00:51:04.340 | and apply that loss against your income from a high-paying W-2 salary. And that is a way you can

00:51:10.340 | do it. But if you're thinking, "Gosh, how do I eke out a little extra tax alpha? How do I save a little

00:51:15.860 | bit of money this year?" And now all of a sudden you're two years in and you're like, "Well, I got it.

00:51:19.860 | I got my little alpha right there." And then your friend says, "Well, what would you do?" He's like, "Well,

00:51:23.460 | I became a qualified real estate professional. I spent a thousand plus hours a year doing this. I documented it all.

00:51:29.060 | I went to the trade conferences. I did all this stuff." And they're like, "Do you even like doing

00:51:32.740 | that?" You're like, "No, but I saved $3,000." You know, like you can let the kind of tax dog-

00:51:38.660 | The tail wag the dog. Yeah, exactly. And you don't want to unless you want to.

00:51:43.140 | Yeah. No, I think a lot of those, if they actually fit the lifestyle that you want to have,

00:51:48.100 | they're a fantastic one. So I have a great friend back home, the managing director of a law firm.

00:51:52.740 | He makes probably millions of dollars a year. His wife is a realtor. For them, it's fantastic because she was

00:51:58.500 | already a realtor. She enjoys being a realtor. And now their rental properties, their paper losses are

00:52:02.980 | deducting from his huge profits from the law firm. But they're not actually jumping through any hoops

00:52:07.860 | they wouldn't have otherwise have had. But if I'm trying to become a realtor, that's crazy.

00:52:12.180 | Yes. And Guy Raz gave a talk and he had a really profound kind of statement, in my opinion, was that

00:52:21.300 | he's interviewed people that have far out accumulated wealth than he has. Billionaires,

00:52:27.700 | 100 millionaires. And he said, "Beyond a point, the money doesn't really matter. I can do all the things

00:52:32.820 | I need to do." And I'm not necessarily chasing that. And I think we could probably all learn a

00:52:38.020 | little bit of his acceptance of, I'm at a place that lets me do what I want. And I know we're all

00:52:42.740 | competitive. We're all curious. We all want to achieve more and more and more. But for the same

00:52:46.660 | reason, you might want to stop focusing on the accumulating side and spend time with someone.

00:52:51.060 | You might want to stop focusing on it just to regain your own sanity, because maybe it doesn't matter.

00:52:55.860 | And I'm surprised that someone who's so exposed to people that are on that journey and have 10x,

00:53:01.460 | 100x, 1,000x their wealth, he just seemed very grounded about it.

00:53:05.140 | No, I agree. And it got to your point around the precision medicine talk and the person there

00:53:09.220 | making the point that, hey, no one in this room would switch places with Warren Buffett. You would

00:53:13.540 | have a thousand times as much money, but you don't want it because it comes with the other trade-off of

00:53:18.020 | you're about to die. And so this same idea here of, as Guy Raz said, I have enough money to do

00:53:25.140 | whatever I want. There's nothing that a billionaire can do that I can't do that I

00:53:28.420 | actually want to do. I can go on a yacht, but if I don't want a yacht, then...

00:53:31.460 | Yeah. He's like, I don't want to fly private. I don't want a yacht, so I don't need those things,

00:53:34.660 | but I can hang out with my kids. And in the same episode I did with Tim Ferriss, he was like,

00:53:38.900 | you know, it's not that expensive to go on a trip with your friends. It doesn't mean you need to fly

00:53:42.580 | a G5 to Europe and live on an island. You could just like rent an RV and go camp in the woods.

00:53:47.460 | You know, there's a lot of things you can do to have the similar emotional experience with people you love

00:53:53.300 | that don't cost a lot of money. And the more you accept that, the easier it is to stop focusing on

00:53:58.980 | accumulating money and letting your optimization of your taxes, letting the extra percent you want to

00:54:03.780 | eke out of your portfolio kind of drive where you spend your time and energy. Although I would just

00:54:08.660 | build on that to also be a little less philosophical and more tactical. I think there's another place

00:54:12.980 | where you can make a mistake on over optimizing for taxes, which is if you let yourself become

00:54:17.860 | way over concentrated, there's certain strategies you can make. You can say, okay, I'm going to donate

00:54:22.420 | it to a DAF and that'll help. Or maybe I'll do an exchange fund or I'll do some direct indexing,

00:54:27.460 | things that mitigate that tax. But if you are so maniacally focused on just not paying taxes and say,

00:54:33.300 | I'm going to follow this buy, borrow, die framework and the IRS will never touch it. You can just from a pure,

00:54:39.860 | selfish financial self-interest perspective, make a big mistake. I'm a little older than you are.

00:54:44.420 | So I do remember, you know, the dot-com bubble and there were people who had 10 million dollars

00:54:48.500 | of WorldCom or AOL or Lucent. They said, well, I don't want to sell and pay 4 million in taxes on that.

00:54:54.580 | Well, their 10 million of pets.com went to literally zero. And so by just focusing on the tax aspect,

00:54:59.940 | they made a terrible personal financial decision. So being willing to say, you know what,

00:55:04.340 | the taxes is part of the picture, but it is not the whole picture on my financial management.

00:55:09.220 | And to anyone in that position, I always push them to just pretend their broker or their spouse or

00:55:14.820 | someone just mistakenly sold the asset they don't want to sell because of the tax consequence or the

00:55:19.940 | current price. And then just pause and say, okay, we made this mistake. Do we want to rebuy it?

00:55:24.740 | If that person who had 10 million dollars of pets.com stock that didn't want to sell it because they

00:55:28.900 | thought, God, there's a big tax hit. Let's pretend they did by accident. Now they're sitting on six

00:55:33.140 | million dollars after taxes. Do they want to dump it all into pets.com right now? Like, is that truly

00:55:38.100 | what they would do? And if the answer is no, like if you wouldn't do the inverse of selling and buy that

00:55:42.900 | day, then you probably should be on the sales side. The final takeaway that I had from this event, I know

00:55:48.420 | you did too, because we talked a lot about it this morning, was that it's great when you can sit down

00:55:53.540 | and have someone say, hey, here's exactly what you should do. But the reality is everyone's in a different

00:55:57.620 | place and there's no one size fits all answer, which is not the best thing to hear. But for everyone,

00:56:03.700 | it's not just about the right answer from a, is this what you should do or not in terms of the

00:56:08.740 | actual tactics, but is this something you enjoy doing? And I think about contrasting a session I

00:56:14.420 | went to on doing due diligence for investments with a session on health, which might not seem similar at

00:56:21.060 | face value. But they are both areas that I think people in this room, people broadly listening,

00:56:27.620 | want to spend time on investing and accumulating money and living longer and being healthier.

00:56:33.220 | And you can choose which ones you want to advocate for yourself on or which ones you want to outsource.

00:56:38.820 | And as I was thinking about the health session, I was like, I really enjoy this. I enjoy doing research,

00:56:43.700 | trying to find research reports, going down chat GPT rabbit holes. And I was listening to Matt talk

00:56:49.300 | about all of the things that they do on the long angle investment team to evaluate investments. And

00:56:55.220 | he's like, here's what we do. Here's who we talk to. Here's the research we buy. Here's the people in

00:56:59.140 | our network. We can go validate whether this deal is as good as it seems. There was a story about an ATM

00:57:04.260 | deal that it's like on face value, it looked like an incredible investment. But if you actually just look at

00:57:08.420 | the data about how the ATM industry is doing, you would have known this was a terrible deal. Would I

00:57:13.140 | have done that if I were evaluating this deal on my own? Probably not. And I was thinking, gosh, on one

00:57:17.940 | hand, when you think about outsourcing things, you're like, I got to pay someone to do something I could do.

00:57:23.300 | But if you couldn't do it as well, and the result of that in the investment side is you make a few bad

00:57:28.820 | investments. Well, those bad investments absolutely probably would have outweighed the cost to hire a

00:57:33.380 | professional to do that service, whether that's a professional manager that takes a percentage or a

00:57:38.660 | professional person to do due diligence for you that you pay hourly. And the same is true on your health.

00:57:43.620 | If you're not going to take it seriously, maybe hiring a private concierge medicine doctor or just

00:57:49.860 | someone that isn't as far down the cost spectrum of concierge, but is just a practice where maybe you

00:57:56.180 | pay a little bit of extra to get a little bit more care, spending that extra money to have someone else

00:58:01.140 | thinking about your health, someone who's maybe has a couple extra resources from that fee to hire staff to do

00:58:07.380 | research, to spend more time with patients, finding the place where you want to spend the time and energy.

00:58:12.580 | And you can do that. You don't need to outsource that. But for each person, that's different. For my wife,

00:58:17.620 | she is the personal trainer that your wife hired for me. Like, she doesn't need someone to come to the house.

00:58:22.660 | She is so diligent to the point that I'm like, gosh, I'm looking bad here. Like, I need to exercise more.

00:58:26.900 | She's making me look bad. For us, that's not something that would make sense. For you,

00:58:30.900 | it's 100% the most valuable money you're spending. And we didn't talk at all about the conversation you

00:58:35.540 | had with Kai from Marketplace. But when he talked about the economy and he talked about the K-shaped

00:58:41.540 | recovery, which for people who haven't thought about this, it's not just an up and down. It's a lot of

00:58:47.060 | different trajectories of what happens in different industries. It just makes me think that you might think

00:58:52.580 | something is happening in the economy in your life. But that doesn't mean that the impact of it on you

00:58:58.020 | and your industry and your family is the same as the impact of that exact event on many other people.

00:59:03.860 | Yeah, I think that's right. And, you know, I think one other really interesting example for me is we had

00:59:08.900 | a couple of sessions we said on estate planning, and I felt like that was a archetypical example of one

00:59:14.580 | size doesn't fit all. So ironically, I was talking with Chris, who is an incredible estate tax lawyer,

00:59:19.460 | where, you know, servers, centimillionaires, and billionaires have these great structures. And I was like,

00:59:23.460 | all right, because how about you? Like, do you actually have your house in a Q-pert? He said,

00:59:26.900 | well, no, I don't have my house in a Q-pert, but my doctor might prescribe me chemo. That doesn't mean he's

00:59:31.460 | going to prescribe himself chemo if he doesn't have cancer. So it's really, does this tool make sense for

00:59:35.380 | you? Whereas conversely, I was talking with another member here who, he is not a estate tax attorney,

00:59:41.140 | you know, he runs a business, but he said he's paying an estate tax attorney $1,800 an hour and paying

00:59:46.740 | them for a lot of hours. And then he hired another entirely separate firm and also paying them $1,500

00:59:51.940 | an hour to redo the same thing. Because he's saying, in my case, if I get this 1% wrong, that is going to

00:59:57.540 | blow out of the water paying a law firm $100,000 or $200,000 to get it right. So I think just a perfect

01:00:02.900 | example of there is not one answer. It really just depends on your personal situation, whether it makes

01:00:08.420 | sense to take this thing to the nines or really ignore it because it's not going to get you any mileage.

01:00:13.140 | I had the same conversation. I had a friend who said, should I hire a CPA? And I had this

01:00:16.900 | conversation about whether their taxes were complicated enough that they could just do it

01:00:19.860 | themselves or use TurboTax. And I have another friend who was like, how many CPAs should I hire?

01:00:24.260 | Because his philosophy was taxes based on the type of income I have in the businesses I run are so

01:00:30.340 | complicated that everyone seems to always mess something up. So do I hire two and then have them,

01:00:35.540 | you know, compare their returns to hire three, like for them, that extra cost was negligible compared to

01:00:41.300 | the cost of a mistake. For the other friend, it was like, you know what, TurboTax is great. Goes back to the

01:00:46.340 | just don't think that because someone is doing a thing that it's the best thing for you. And, you know,

01:00:52.260 | this applies to money, but it applies way more broadly. And so my broader takeaway is, you know,

01:00:57.060 | we all think about money all the time. We all you know, it's this thing that in our society fuels a lot of what we do,

01:01:02.740 | how we spend our time. But when you sit down and you sit in a room of people where you don't really

01:01:07.940 | have money as a topic, right? You just take money off the table as something we think about.

01:01:12.420 | There are a lot of human problems that we all have that in some ways seem pervasive across every

01:01:18.180 | level of income and wealth that we're probably not spending as much time on. And if we actually asked

01:01:24.420 | ourselves, hey, how would you like to focus your time and energy? Like what's most important to you?

01:01:28.900 | At the end of the day, is it about the people? Is it about your health or is it about your money?

01:01:33.060 | Is it about your career? I bet most people listening, most people in this room would probably prioritize

01:01:37.540 | relationships and health over money and career. And then you say, well, how do you spend your time

01:01:41.620 | every single day? How do you spend your time on the weekends? Is it actually focusing more on your

01:01:45.940 | career and your money? And like, are you completely contradictory towards the things you actually care

01:01:50.100 | about and what can we do to try to change that and force ourselves to align where we spend our time

01:01:55.860 | and energy with everything that we care about? I couldn't agree more. I think that's all I've got.

01:02:00.660 | Tad, thank you so much for putting this event on. Every year I look forward to coming and meeting

01:02:05.380 | everyone and having a community to talk to. And then I love that we do this at the end because it just

01:02:09.620 | forces me to actually process everything I've learned. Yeah. Thank you so much for joining us.

01:02:13.620 | Thanks again for the session that you did on travel there. Yeah. All right. Thanks everybody for being here.

01:02:17.700 | I really hope you enjoyed this episode. As always, email is podcast@allthehacks.com.

01:02:24.020 | If you want to learn more about Long Angle, I'm a member. It's an amazing community for investors

01:02:28.500 | with more than 2.2 million in assets. You can learn more at longangle.com. That is it for this week.

01:02:34.740 | I will see you next week.

10 Lessons From the 1% That Matter More Than Money

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