Avoiding Psychological Pitfalls

After our most popular article of all time (due to several high quality people re-linking to it!), we thought it would be valuable to provide a rough framework for avoiding all the pitfalls that becoming “successful” can bring. These include: personality destruction, passive aggressive behavior, deterioration of health, loss of empathy, insecurity and increased stress despite being set for life. While it is certainly normal to be high strung when you’re still trying to make it, there is no logical reason to remain in this state of consciousness when you have nothing else to worry about. The shift isn’t easy and we doubt there is a “step-by-step” to avoid all the pitfalls. That said, we’ll give it a try.

Personality Destruction: One of the odd items that successful people have in common is ruthless focus. This usually leads to too much attention into one item. We suffer from the same thing and once we get our heads stuck on something: trying to a contract, trying to get in contact with someone or trying to fix a problem with the online sales funnel… it is all but impossible to change gears. This still occurs even after you’re financially well off because it is a habit that got you there in the first place. After all we’ll always choose Will over Skill. If you go to the point of obsession you usually get what you want.

The flip side of this is enormously negative. Which is the actionable piece of this post. When you’re already set, it is a lot smarter to move horizontally versus vertically. This means you want to expand the types of people you’re talking to instead of digging further down the same rabbit hole you went down. This prevents group think, prevents you from hitting the stereotype of your industry and allows you to recognize your own tendencies. Many times, we’ve stopped and said “shouldn’t push this anymore” and are happy to admit it. The same strategy that works in one industry is not going to work in another.

In case this is confusing we’ll provide a concrete example. If you’re used to hammering the phone/email to get in contact with a manufacturer for example… Try to avoid this same strategy in your every day life. A good example would be friends in completely different industries. It’s a 100% different social dynamic and the guy/girl that constantly does this ends up being a thorn in their side (losing the relationship). A second example would be a sport that involves combat: Boxing/MMA etc. Similarly, the strategy would be 5x worse. If you continuously pepper people to fight/practice you’ll end up getting laid out very quickly and regret using the same strategy for this environment.

As a final layer of security (to avoid becoming the dorky passive aggressive rich guy), you’ll want to find a new hobby 1x a year. This does not mean you need to be “good at it”. It means you should learn a new basic skill once a year. It could take two years (learning a language) or it could take a single year (becoming proficient in XYZ activity). This forces you to adapt to a different culture and environment and we have no doubt that someone who is proficient in 10+ items will have a differentiated contact list.

Passive Aggressive Behavior: This is the most common tactic for the rich, they give off their own insecurities by using this strategy. The first answer is to avoid these people at all times. You’ll meet them daily, so try to spend the least amount of time as possible around them. There is no winning here. If you hang out with them you’ll lose motivation because in the back of your head you’ll think “wow I don’t want to end up like this guy”. By minimizing your exposure to them, you’ll be able to reach financial independence without having to hear about how they invest $X thousand dollars or even $X million dollars into something you’ve never heard of (or care about).

Fortunately we do know a way to avoid adopting this behavior which is by praising people specifically. People you talk to on a daily basis should have at least 1-3 things where they are significantly better than you. This is a great thing and praising them for it (honestly) is going to keep your own ego in check. We do the same thing. There is no way we’re going to “compete” with a tech guy in coding. No way we’re going to “compete” with a top-tier club promoter in throwing a party. And. No way we’re going to compete with a billionaire in terms of the value of his time. Being able to praise honestly solidifies relationships with people you want to keep around. To be clear… There is no need to constantly do this, simply acknowledge it once and a while and they’ll appreciate the comment.

Deterioration of Health: This is a tough one. In your 20s, your health can take a hit without much long-term damage. We laugh when people say “investment banking will kill your health forever”. There are always 1-3 people who over-do it in anything. Don’t be this person. Also, look at the hundreds of thousands who have successfully made it up the chain and look great as of today. There are quite literally millions of people who had much harder lives from age 20-25 that are still alive and doing amazing at age 70-80.

Where is the line? We’ll draw it at around 35. This seems to be around the time when professional athletes in high-twitch sports begin to see a notable slowdown. That’s probably a good marker for when your body really cannot grind out 60-80 hours a week. By this age, having a system in place that optimizes your time will help you grow your net worth without killing your health. Ideally, you’re getting paid to do everything and move around for free by the time you’re 40, unlocking free time to focus on the 5% of items that actually matter. Assuming the big items continue to get done, we’d become more cautious when it comes to grinding out long hours. It just isn’t worth the trade-off anymore. For fun we’ll add a physical marker as well. When you find it much harder to stretch in the past (you’ll notice it!), that is probably the time when you should focus a lot more on your health. Your body is messaging that wear and tear has finally kicked in. Take down the hours, increase flexibility and keep it at those levels before your joints/muscles get stiff.

Loss of Empathy: This is yet another common feature of success. In fact, many studies have shown that if you give a group of people the “money” idea, in the form of making them richer than a control group, they will see a dramatic drop off in empathy. They no longer care about the “other group”. This is similar to rich people constantly believing they are above everyone else because they are rich. This is more of a psychological feature and is certainly solvable.

The solution is quite simple: find some people to help. We don’t believe in giving anything away for free. All that does is make it less likely the person listens and less likely the person succeeds in the first place. A basic idea is finding someone who wants to succeed and having them help you do some mundane task in exchange for your time (organizing calendars, basic customer email etc). This makes the individual do actual work in exchange for information (also why many firms have low-paid internships). This is exactly why we have a free blog and a paid for book, if it’s free, less people will actually do it. Defeating the purpose. To clarify. When we say “mundane task” we wouldn’t have them do this for free, you pay them a basic wage for it and see if they can add value beyond that during his/her time there.

Insecurity: This is the most common feature and is likely due to too much concentration in one task. For what it is worth, we’ve found the most insecure people are only good at one thing. Typically that is their line of work. This is why they dislike any disruption or change to their industry (puts their entire identity at risk instantly). Insecure people don’t have many skills beyond one (maybe two) things which makes it harder for them to have any internal happiness.

Luckily, it’s quite easy to have a diversified skillset. It takes a lot of work but having a diversified set of skills will make anyone comfortable in their own skin. By branching out and trying to be “good” in several items, you’ll find some that you excel in and several that are difficult. This is a good and humbling experience since it is unlikely that someone is able to be in the top 10% in every single task on the planet.

Increased Stress Despite Being Stressed: We have no idea how this is even possible but we see it all the time. Our belief is that it is because the person grew up with money. While a lot is said about being born poor (lower chance of successes) one of the benefits is the upside. If someone grew up with nothing and suddenly gets to financial independence, they are rarely stressed! We’re not sure why this is but it is likely due to some sort of higher bar for “lifestyle costs”. If someone grew up well off in the first place, their standard of living bar is so high already that getting back to that same level doesn’t “feel” like success.

An interesting solution is to go out and travel more to lower quality countries. While counter intuitive, putting yourself in a situation where you see that life can be significantly harder will solve this issue. You may even solve two problems at once: Empathy and Stress. Knowing that you’ll never have to worry about food, water, shelter and basic health care is going to be more than 99% of the world can ever say in the history of their lives. It should cause immediate relief and empathy for people who are in significantly worse situations with minimal ways to climb out.

Concluding Remarks: The main threads here are as follows: 1) creating a diversified set of skills, 2) avoiding a 100% dive into one category, 3) keeping a broader set of contacts than most in your industry, 4) recognition of others being more talented – ego destruction and 5) having a mental focus on keeping empathy high. If you’re able to do this we think it is unlikely you’ll have the major symptoms that many rich people suffer from. If you have additional ideas to avoid these pitfalls please drop them into the comments!