#TBT - How to Invest for Income and Achieve Real Freedom w/ James Altucher

Ryan talks with James Altucher, a successful hedge fund manager, entrepreneur, bestselling author, venture capitalist, and podcaster. In this episode of the Freedom Fast Lane podcast, James shares how to achieve real freedom following four guiding principles for a healthy lifestyle, as well as the investment strategies he would have told his 20-year-old self to follow.

Key Takeaways

[2:46] James talks about where he started out. How after he sold his first company building websites for a lot of money, he figured “if I can make it there, I’ll make it anywhere!”. He was wrong, he lost every penny. And then he was wrong several times again.

[4:04] So what was the problem? Why was he having such wild success and such brutal failures? He explains how he set out to find and rectify the cause of this uneven keel and what he managed to distill from this research.

The 4 pillars of health

1. 1. Physical health [4:52]
2. It’s one of the most basic but most important aspect of overall health for high achievers. If you don’t have the energy to get things done, they won’t happen. Eat well, don’t drink or do drugs, stay in shape.
3. 2. Emotional health [5:12]
4. You are the average of the people you surround yourself with, and life is short so be cut-throat about the people you love, value, and spend time with.
5. 3. Creative health [6:40]
6. You need to be creative everyday, if you wait for inspiration you’re already too late. Write your ideas down, think about how to execute them. Do fun, unique, new and stimulating things.
7. 4. Spiritual health [7:15]
8. It’s your fault, no matter what. If something negative happens, take ownership: improve, learn, evolve. Life goes on, so make sure it goes on the way you want it to and move forward.
9. [8:26] If you are healthy and creatively doing things you love around people you love, you will automatically find things to sell, people to work with, businesses to build.
10. Being a choice-ist
11. [9:11] You make 10,000 choices a day from the most mundane to the most important. Most of them will be inconsequential or negative. Being a choice-ist means that that you aim to have the highest amount of the choices you do make in a day be ones that you enjoy making and care about.
12. [10:21] How can you become more of a choice-ist in your own life: delegate the choices you don’t like to make or are not knowledgeable enough to make, to trustworthy people. Setting up these systems may take time, but they will reward you in the end.
13. [12:25] James shares some practical tips on increasing the quantity of enjoyable choices you need to make. Every experience should be a source of earning, what did you not like, what would you want to do more of. Focus on that, make decisions that will serve that goal.
14. [14:00] Money is never the critical factor in freedom. James takes Elon Musk as an example to illustrate this point.
15. “Elon Musk has to wake up at 5 a.m., run six companies, deal with spaceships blowing up, deal with government subsidies to run his solar panel business. He’s making a big bet on the future of energy — a good bet, but a scary one nonetheless — and he’s got to manage thousands of people from 5am to 10pm.”
16. What might be good for Elon may not work for you! You need to think about the lifestyle you want and decide what will make you happy and fulfilled and make choices in your life accordingly.
17. Investing
18. [15:54] James shares advice he would have given his younger self on investment.

1. 1. The Plus-Minus-Equal rule [16:27]
2. PLUS: Find the people that are better than you and learn from them. Read, read, read, read: learn everything you can about investment and everything relating to it, history, related fields, people, etc.
3. EQUAL: Find people at your own level that can constantly challenge you. You’ll be surprised how fast you can evolve alongside a community of like-minded people.
4. MINUS: If you really think you know something; teach it. It’ll remind you of all the basics, and people just starting will ask questions that you might have overlooked.
5. 2. You are the biggest stupid idiot ever [21:24]
6. This alone has reduced James’ chances of failure from 95% to 10%. Despite all that you’ve learned in step 1 you should never invest in anything thinking you are the smartest person in the room. You aren’t.
7. Look up at who is investing alongside you, do you trust them, do you look up to them, are they successful? Trust your “plusses” and talk to you “equals”. You can only bet on people.
8. [29:50] James shares his endgame.
9. Mentioned in this episode
10. James Altucher
11. Mike Massimino
12. Jocko Willink
13. Elon Musk
14. Berkshire Hathaway
15. Warren Buffett