Moment 157: The Money Expert's Investment Strategy NO ONE Is Talking About: Morgan Housel

Steven Bartlett (0:00)

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Confidence, which comes from success often, really does create blind spots. And that's something I think about so much like, how do I stay aware of those blind spots in my life that, you know, the success I've had in various areas has undeniably created. And honestly, a lot of I just go just save loads of money, Steve, because the day you're wrong, you don't want to go broke.

Morgan Housel (1:24)

I also think about that, like whenever the curtain comes down on my career, I want to make sure that I can say like, hey, thank you for letting me have this. I'm so grateful for it, but I've saved enough that like, I'm ready to pass a baton to someone else. And that's a form of humility too. There's a quote from Denzel Washington where he's talking to Will Smith, after Will Smith slapped Chris Rock, remember that whole debacle. After that show, Denzel Washington comes up to Will Smith and he says, Will, when you're at your highest moment in your career, that's when the devil's gonna get you. And it's like, when your career is so high and you're so famous, you think so highly of yourself that you can do anything. That's when you're gonna get yourself into trouble.

Steven Bartlett (2:04)

What a powerful quote.

Morgan Housel (2:06)

And I think just paying attention to that, that's the natural humility that goes into it. And it's not humility. It's not like, oh, I, you know, humility is like, I didn't do any of this. I just got lucky. That's all humility. I think real humility is like, I built this through hard work and I made some good decisions, but I'm just a guy. I'm as fallible as anybody else. I think that's, it's, that's not just important. I think that's critical to any amount of sustainable success.

Steven Bartlett (2:30)

You taught me that the price you pay to be wealthy is the volatility you have to incur along the way. That's kind of how I think about it in my head.

Morgan Housel (2:39)

That's the cost of admission.

Steven Bartlett (2:41)

To being what, to being wealthy and to...

Morgan Housel (2:42)

To be, to any level of success is putting up with an enduring unknowns and volatility and booms and busts. And then other bullshit that you put up with in the investing market and in your career and in your relationships, there's always a cost. For anything good in life, there's a cost that you have to pay. Like of course, nothing's free like that. But most of the costs that you pay are not... They don't have a price tag that you can just measure very cleanly. Like the cost of doing well in investing is putting up with volatility. The cost of a successful career might be long hours where you were pulled away from your family. The cost of a relationship is like always needing to sacrifice and compromise for the other person.

Nothing is ever free and so much of the success in life is just identifying what the cost is and being willing to pay it. Because for all of those things I just laid out, investing, career, relationships, the cost of admission is worth it. Putting up with the volatility is worth it over time. Because if you can put up with the stock market falling 30%, if you can just say, it's not that big a deal, I'm just going to hold tight, 10 years from now, the cost is well worth doing that. If you can put up with the compromise that takes to have a successful relationship, by and large, it's going to be a cost that's worth paying. Because you know, like, so much of what matters in life is just the relationships that you have. And once you identify the cost of that relationship, you're like, oh, I'll pay that cost all day long. It's so worth it.