15 Ways to Stay Poor
The Amplified Impact Podcast
February 2nd, 2023
Today, I’m diving into the brilliant mindset model of “invert, always invert,” a favorite of the legendary Charlie Munger.
Ever felt stuck solving a problem? Inverting it, approaching from a different angle, can work wonders.
I’ll show you how this applies to your health, wealth, and beyond.
Think about it: it’s often easier to identify what we shouldn’t do than what we should.
Our brains are wired to recognize negatives, threats, and patterns that could harm us.
Applying this to your finances, I’ll share 15 ways to stay poor.
Yep, you heard that right…inverting these will set you on a path toward financial success.
So, buckle up and let’s flip the script.
TWEETABLE QUOTE:
“You have to find a way to decouple your time from the money that you make.”
– Anthony Vicino
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Episode Transcript:
One of my absolute favorite mental models is one that Charlie Munger was a massive fan of. It was invert, always invert. His idea is that it’s simple. And he wasn’t the first to say this, I think actually it was maybe Fermi or Blaise Pascal or some other mathematician who said, invert, always invert. Which is simply that if you’re trying to solve a problem, often it’s hard to solve the problem coming at it from the front. But if you invert the problem and you come at it from behind, then it can be quite a lot easier. And what this looks like in practical terms is often it’s harder to know what you should do to move yourself towards your goals than it is to know what you shouldn’t do. For instance, if you wanted to be healthy, if you wanted to be fit, if you always wanted to be energized, you might struggle to come up with a list of things that you should do.
But you could probably pretty easily identify what are the things that you shouldn’t do, right? The reason for this is because the human brain is very, very good at finding the negative, at finding the things that are bad for us. To be pessimistic, and it’s a lot harder to find the things that are good for us. And that’s because we are pattern recognition and threat recognition machines. And the ability to identify what things are bad for us, that should come more easily to mind than the things that are good for us. Okay? At least from an evolutionary standpoint, that’ll keep you alive a little bit longer. And so we can apply the same concept to the idea of our financial life. If you want to get rich, well, it’s hard to know exactly what you should do to do that if you’ve never been around people who are rich and you’ve never been rich. So what are the steps? What are the actions you should take? But easier is to say, well, if I wanted to stay poor, what would I do? And since a lot of us have been poor at one time or another, we can identify what were those things that we were doing that we should stop doing.
And so here is a list of 15 ways to stay poor using this idea of inverting. So if you take these and invert them, then chances are you’ll be on the path to a better financial place than you are currently. So, number one, and for the record, I’ve done all these, number one is do the bare minimum. I personally wasted years thinking I was going above and beyond. The truth is, I was doing the bare minimum, because I didn’t really understand how much effort goes into doing great work. A good rule of thumb is this. Take your current output and then multiply it by 1000, and now you’re in the ballpark of what it actually takes to be successful. This is just a simple reframe of expectations.
It’s powerful. Number two is wait to be told what to do. This is a lesson my younger self would have done really well to learn sooner. It’s simply this. You have very little value to the world if you’re waiting to be told what to do, just plain and simple. Number three is to expect praise. Truth is, nobody cares. Work harder.
If you’re working expecting people to pay attention and be grateful for your efforts, then you’re going to end up very frustrated because people generally don’t pay attention. They don’t care all that much. So just get back to work. That’s the moral of the story here. I know for myself when I was a w two employee, I spent a lot of time doing things. And then when they didn’t get recognized by my boss or my manager, I would stop doing those things. And do you think that put me on the fast track to success? Or do you think that just created this negative reinforcement cycle? Yeah, exactly. Number four, turn everything into a transaction.
The poorest people I know, and I don’t just mean this monetarily. They treat everything as a tip for tat. Like, do this for me, and then I’ll do that for you. No more, no less. And this is exactly how I operated through most of my 20s. My thesis was simple. If you want me to work harder, pay me more. Now, when you treat everything like a transaction, you get exactly what you give.
And the people who treat everything like a transaction, they tend to not give very much. I think this is one of the best recipes for staying poor. Number five, spend more than you make. Wealth is the ratio between what you make and what you keep. Unfortunately, for most of us, our lifestyle grows as fast as our income, which means you stay forever poor. This generally occurs because we become more concerned with playing the status game than we are at winning the money game. But ask yourself, this is your goal, to look like you have money or to actually have money and have the security, the peace of mind that comes with that money? Because these are very, very different things. Be very clear about which game you’re trying to win.
Number six, stop learning. Humans are a lot like that myth of the shark that says, if we’re not moving forward, we’re drowning. And this might not be true for sharks, but it certainly is for humans. The day you stop growing is the day you start dying. Number seven, trade your time for money. As Buffett himself said, if you can’t find a way to make money in your sleep, you will work until you die. You have to find a way to decouple your time from the money that you make. Number eight, take advice from poor people.
Okay, here’s my general rule for advice in life is don’t take advice from somebody you wouldn’t trade places with. That means don’t take fitness advice from an unhealthy person, don’t take relationship advice from a single 19 year old, and don’t take financial advice from a poor person. It’s shocking to me that this even needs to be said, but there it is. Number nine, surround yourself with people who tolerate mediocrity. Listen, there are no prizes being awarded for the smartest, most driven, or most focused person in the room. In truth, every room reverts to the mean, which means you’re only ever getting pulled up or down. So choose your rooms wisely. Number ten.
Overthink and underact. Truth is, nobody’s ever been guilty of over executing. Overthinking, on the other hand, yeah, all the time. But over executing is actually impossible. I challenge you to prove me wrong. Number eleven, wait until you feel ready before getting started. Here’s the spoiler alert. You will never feel ready, so you might as well just get started.
Number twelve, quit when things get hard. If you’re out there feeling like you’re screaming into the void and nothing you do matters, just remember, this is what hard feels like, and it’s why most people give up. Don’t be. Most people keep going. Do the hard thing. It will get easier. Number 13, go ahead and complain about how easy everybody else has it. Winners focus on winning.
Losers focus on winners. Truth is, the competition does not matter. Just focus on yourself. It’s the only game that is worth playing. It’s the one that you’re playing against who you were yesterday. Number 14. Break the promises you make to yourself. I had to learn this one the hard way, multiple times in my life, is that if you can’t discipline yourself, then the world will have to do it for you.
I’ve talked about this one a lot in previous podcasts, and it’s something that’s so near and dear to my heart. I recommend that you go spend some time diving into how the concept of discipline equals freedom. I have a video on the main YouTube channel YouTube.com. Anthonyvacino called learning this about discipline changed my life. I highly recommend you go check out that video. It’s one of the most highly viewed videos on the channel and it truly had a transformative effect on my life. So go check that out. Number 15 last but not least, if you want to stay poor, blame luck as the reason you aren’t where you want to be.
Hell, it might be true, you might be the unluckiest person on the planet. It’s not your fault, but it is your problem and no problem was ever fixed by complaining about it. So those are 15 ways to stay poor. If you want to stay poor, go ahead and do these. If you don’t want to stay poor, then go ahead and try to eliminate these from your life and see just what effect that has. I bet it moves you at an astounding speed towards your goals. So good luck my friend.
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