Money Master the Game
Tony Robbins
Summary
Although quite long, this book will give you absolutely everything you need to know about how to invest and save your money to get on your path to financial freedom. It’s written from a US perspective but a lot of the lessons and financial tools he talks about exist in most countries.
He also gives you Ray Dalio’s personal asset allocation, as well as David Swensen, who built the Yale endowment fund from 1 billion to 25 billion (keep scrolling below to see)
Rating: 4/5
Notes
Find a way to do more for others than anyone else
‘An expert is an ordinary man away from home giving advice’ – oscar wilde
There is a passive way to win at investing
The more you learn, the more you realize how much you don’t know
A journey of a thousand miles begins with a single step – Lao Tzu
Anticipation is the ultimate power
Most people stick with the decision that’s given to them
Repitition is the mother of skill
The power of compounding is the most important invention of our time
Always no matter what save 15% of the income and increase once you make more
Learn to invest when everyone else is afraid
Automate your 15% savings into your savings account
Increase your savings every time you get a raise
Earn money, spend less and automate it
Life’s basic needs:
- certainty/comfort
- uncertainty/variety
- Significance
- love/connection
- Growth
- Contribution: life’s about we, not me
Find a way to appreciate every day more and expect less
Be grateful for everything. Show gratitude and express it
‘You have to learn the rules of the game and play better than anyone else’ – Albert Einstein
ALWAYS CHECK THE HIDDEN FEES
96% of mutual funds fail to beat the market over a sustained period of time
- Don’t put money in mutual funds – fees
Stocks are the best for long term growth over time
Don’t be sold on that someone will beat the market
Stocks are volatile. Never tolerate the herd mentality
Invest in a low-cost index fund (Vanguard)
Percentage points on feed could make million dollar difference
Your broker is not your friend. Get a financial fiduciary advisor
- Find a registered investment advisor (RIA), not just a broker
Find a 401k advisor with the best/lowest fees
Make sure the 401k has low fees and invest it in low cost index funds
For your Roth IRA, pay taxes today so you’re not taxed when you withdraw
Asset allocation is the single most important skill as an investor
Risk a little to make a lot
Structured note is loaning money to the bank: guaranteed your money back if the market turns or the returns if it goes up (think about canadian banks)
Market linked CDs are guarenteed to pay you dividends (check with an advisor to avoid fees)
Fixed indexed annuities: check from a good insurance company
- All guaranteed and gains are tax deferred or own within a Roth IRA
Remember the breakthroughs
3 basic challenges: finances, relationships and our bodies
Change your strategy, change your story and change your state
To develop a strategy, follow people who have done it in front of you
Success is 80% psychological and 20% mechanics
You can use your story or your story will use you
Money is nothing more than a reflection of your creativity, your capacity to focus and your ability to add value and receive it
Change your story and change your life. Divorce your story of limitation and marry the truth. You can make anything happen
Invest more in your student loans early so you don’t pay higher interest
We all get what we tolerate so don’t tolerate excuses
‘Dare to live the dreams you have lived for yourself’ – ralph waldo emerson
When you’re grateful, there’s no anger or fear
It’s only about your goal and no one else’s because you’re living that life
It doesn’t matter where you start, it’s how you finish that counts
Go with a 401k Roth to invest so you pay taxes now
Save more and invest the difference
If you pre-pay your principle mortage payments for next month, you don’t pay interest
Learn to work harder on yourself than you do at your job
Get in front of a trend
Find a way to earn more
Tax efficiency = faster financial freedom
Invest in a way that allows you to defer your taxes so you compound tax free
Save more, earn more by adding value and reduce fees/taxes to invest the difference
Better returns while reducing risk = diversification
‘Life is like a bicycle. To keep your balance, you must keep moving’ – Albert Einstein
Stock picking, short term bets on the market and asset allocation
Good people fail because they do the right thing at the wrong time
Have a security bucket and a risk/growth bucket where you’re willing to lose
Always keep some cash liquid: cash equivalents
- Money market funds which give you 24/7 access to cash
Buy a low cost bond index fund
CDs: certificates of deposits which you loan money to the bank
- Invest in market-linked CDs
Bonds offer a promised rate of return & principal
Find the right annuities to invest in: income for life and never goes down
Life insurance policy in your security bucket
Notes give you downside protection and ability to participate in upside
Invest notes in canadian banks because they’re the safest
Residential real estate loan: a first trust deed
Buy low cost, low-fee bond index funds that spread your risk
Equities goes in the risk bucket (stocks, ETFs, indexes)
Invest in REITs rather than owning a home
Invest in structured notes through a registered investment advisor
David Swansen: Yale Billionaire investor asset allocation (all index funds)
- Domestic stock: 30% (or 20%) – Risk
- International stock: 15% (or 20%) – Risk
- REITs: 15% (or 20%) – Risk
- Emerging stock markets 10% (or 10%) – Risk
- Long term US treasuries 15% (or 15%) – Risk
- TIPS (treasury inflation protected securities): 15% (or 15%) – Risk
Don’t overestimate your abilities and be an emotional investor
Always have a dream bucket
Grace comes when you commit to doing something that will serve more than yourself
Find a way to add more value than anyone else
Fill the dream bucket with a big hit
- If your risk/growth bucket becomes positive, take some off the table and re-invest it into your security, risk or dream bucket
3rd way is to save a set percentage of your income and stack it away (not from the freedom fund allocation but separate)
Be fearful when others are greedy and greedy when others are fearful (Warren Buffet)
- Take emotion out of investing and automate it
Always, no matter what, put the same amount of money in the market
Dollar cost averaging is how you make volatility at the market work for you
You need to rebalance your portfolio at regular intervals
- Sell high and invest into the other basket
- Check it once or twice a year
Asset allocation is everything
Have a dream bucket and use rebalancing to maximize returns/minimize lossess
The secret of all victory lies in the organization of the non obvious’ – Marcus Aurelius
Ray Dahlio All Weather asset allocation:
- Stocks/indexes: 30%
- Immediate term bonds (7-10 years) 15%
- Long term bonds (20-25 years): 40%
- Gold: 7.5%
- Commodities: 7.5%
Re-sell annually so it’s always the same proportion
Income is freedom! Income is the outcome, not just accumulating wealth
Invest in deferred annuities
Who cares if you die early with annuities because you’re dead
- But you get a guarenteed source of income for life
Fixed annuity: fixed income/rate of return
Indexed annuity: rate of return is tied to the stock market with no downside risk
Don’t invest in variable annuities
Fixed indexed annuity (FIA) is where you should invest
- Or uncapped annuities because you’ll never lose your principal and can participate in the market increase
- If you’ve added to your principal, you can never lose that amount
ADD THIS TO THE SECURITY BUCKET
Advisors Excel and FIA where you participate in all the upside and no downside (FIND OUT IN CANADA)
Private placement life insurance (PPLI) is the secret of the ultra wealthy
You can withdraw from the policy as a loan and your account will pay for the balance
- You can withdraw tax free
Set up a living trust for your family, makes dealing with the courts easier
Don’t lose money
Risk a little to make a lot
Anticipate and diversify
You’re never done: never stop growing and learning
Carl Icahn makes opportunities in business (look at his company)
Vanguard and TIAA-CREP don’t have the high fees
Take every opportunity to invest in a tax free way
Don’t trade, just stand there and wait (Power of vanguard)
Invest in vanguard, bond funds and market funds
Single most important lesson is risk control, don’t lose money
200 day moving average of closing prices
- If you use the rule, then get out if it doesn’t meet the 200 day rule
5:1 ratio: risk 1 dollar to make 5
Biggest opportunity is Japan: insurance policy
- Spend 0.004% per year which could be worth 2000%
‘How little we know, how eager to learn’ – Sir john templeton
The more you help others, the more prosperous you will be
Buy at maximum pessimism and sell at the peak of optimism
A change in focus and a change in meaning is what you shall focus on
Invest in experiences, buy time for yourself (chores, etc.), invest in others
Giving in any form builds wealth faster than getting ever will
The secret to living is giving
***
Buy the book here
Free E-book download here
How the World Works
Noam Chomsky
Summary
A combination of books Chomsky wrote in the 80s and 90s about America and it's role in the world. Fascinating read and insight into one of the great thinkers of the 21st century
Rating: 5/5
Notes
The US invaded Greece in 1947 and supported a horrendous war which led to 160k Greek deaths. This was the model for Vietnam and allowed American business to gain and thrive
US policies in the 3rd world consistently opposed democracies if they couldn’t be controlled as real democracies believe government should respond to the needs of their own population rather than those of US investors
US-run contra forces in the 3rd world isn’t ordering killing - it’s brutal sadistic torture (Nicaragua, El Salvador, Guatemala)
From the Bolshevik revolution in 1917 till the collapse of the communist governments in eastern europe in the 80s, it was possible to justify every US attack as defense against the Soviets
If you want a global system that’s subordinated to the needs of US investors, you can’t let pieces of it wander off. It’s clearly stated in the documents of record
The US wants ‘stability’ meaning security for the upper classes and large foreign businesses
Solid case for impeaching every American president since World War 2 either outright as war criminals or involved in serious war crimes
El Salvador and Nicaragua were not covered by the US media in the 70s when US-supported brutal torture and murder were taking place
In the early 80s, America’s friends slaughtered 10s of thousands of Guatemalans with countless others tortured and raped
After Vietnam, the major US policy goal has been to maximize repression and suffering of countries demonstrated by their violence - blocked other countries from seeking aid
The US regularly carries out or supports aggression
For most of the 20th century, the US was the dominant economic power and used economic warfare as a weapon ranging from illegal embargoes to enforcement of weak IMF rules with their military becoming pre-eminent
The US tries to avoid negotiations with countries as the US fears it will lose and other countries will be better off
When a state has huge debts, it must divert the population from what’s happening and they do this by inspiring fear of our enemies (Russia in Europe)
The real enemy of the US has always been ‘the poor who seek to plunder the rich’. In America, it’s the opposite and has been for generations
‘The war on drugs’ was a manufactured media blitz by the US leadership to distract the population, increase repression in inner cities and build support for attack on civil liberties
The US government blocks international effort to seek peace (Russia and Ukraine)
Major media are large companies owned and interlinked with even larger conglomerates. The market is the advertisers and the product is audiences
The power in the US lies in the hands of people who determine investment decisions as they determine production, distribution and staff the government. They want a passive, quiescent population
The struggle of freedom is never over and requires active and sustained efforts
One important consequence of globalization is it extends the third world model to industrial nations where the average person has their jobs shipped away while the rich and elite continue to amass massive amounts of wealth
We’ve moved to an international state with the IMF, World Bank, G7 & EU, WEF where the general population doesn’t know what’s happening and it doesn’t know it doesn’t know
If the borrowing the US has done was used for constructive purposes like investment or infrastructure, the US would be better off, but it was used to enrich the rich - for consumption, financial manipulation and speculation which are all harmful
The class warfare of the last few decades has successfully weakened popular organizations leaving people to feel isolated
The US is so deeply in debt to the international financial community because of debt that they have a lock on US policy
Many of the large number of security council resolutions vetoed by the US have to do with Israeli aggression or atrocities
Invaders typically use local collaborators to run things for them by playing upon existing rivalries to get onne group to work for them against another
European wars were wars of extermination. If we were to be honest about history, we would simply describe it as barbarian invasion
There has always been racism but it developed as a leading principle of thought in the context of colonialism.
A standard technique of belief formation goes along with oppression
In the US, you’re not allowed to talk about the class differences, which is the real issue
When the US establishment talks about jobs, it means profits for its corporations
The elite are masters and they follow what Adam Smith said about ‘the vile maxim’ - all for ourselves and nothing for anyone else
People who aren’t owners and investors have nothing much to say in the US
Jefferson warned against banking institutions and corporations and said if they grow, aristocrats would’ve won and the revolution would’ve been lost
The ‘Free market’ is for the poor. We have a dual system - protection for the rich and market discipline for everyone else
There’s been a considerable increase in inequality and has the American society moving towards a third world model, thereby seeing increased crime and signs of social disintegration
A huge area of the media is dedicated to diverting people and making them more stupid and passive
There’s nothing individualistic about corporations who are totalitarian in nature
Free trade agreements result in reduced wages for local employees while predominantly benefiting the rich consumer while also destroying unions
Operation Paper Clip imported large number of known Nazi criminals
The American army’s counter-insurgency literature begins with an analysis of the German experience in Europe written with the co-operation of Naxi officials (instruments of statecraft - book)
US involvement in Chile with the coup in 1973 to reduce social democracy
The threat of a good empire is what the US worried about with reforms on uncontrolled capitalism
The US killed a few million people and destoryed 3 countries during the Vietnam war
A huge amount of business propaganda is to create wants
The answers to solve all these issues is to organize. Being alone you can’t do anything but if you join with other people, you can make changes
Under capitalism, investment is supposed to be as risk free as possible. No competition wants free markets - what they want is power
The government subsidizes corporations’ costs, protects them from market risks and lets them keep the profits
There’s never been much difference between the 2 business parties and the differences are disappearing
The CIA has been involved in drug running for generations (the politics of heroin book)
You need something to frighten people with, to prevent them from paying attention to what’s really happening to them. You have to engender fear and hatred
The first world lives in a highly indoctrinated society
Neoliberalism is nothing more than the imperial formula: free markets for you and plenty of protection for me. The rich would never accept it but they’re happy to impose it on the poor
The UN does mostly what US business wants
‘Politics is the shadow cast on society by big business’ - John Devery
If people dedicate themselves to organizing and activism, we’ll gain access to broader audiences
If you extrapolate to the future, it’s very ugly but the point is it’s not inevitable. It can be changed but we can’t change things till we understand them.
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Buy the book here
Free E-book download here
