Mastering Wealth: The Real Path to Financial Success
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Chapter 1: The Illusion of Luck
Last night, I encountered a young woman who was convinced her fortune would change by winning the lottery. Her dreams of yachts, lavish European vacations, and caviar reflected a naive view of wealth.
I couldn't help but feel concern for her. History shows that many lottery winners end up in dire financial situations, regardless of the amount they win, simply due to a lack of financial education. For instance, YouTuber "Mr. Beast" spent $1 million on lottery tickets only to lose $200,000. Winning the lottery requires an extraordinary stroke of luck, making it an unwise pursuit.
Ultimately, accumulating wealth is not about chance; it stems from pursuing a fulfilling career, following your interests, investing wisely, and exercising patience. After reflecting on this between yesterday and today, I identified three distinct mindsets regarding wealth accumulation—choosing the right one can lead to financial success without relying on luck.
Section 1.1: The Financial Blue Pill Mindset
Individuals who subscribe to the “Blue Pill” mindset typically earn money through conventional 9-to-5 jobs without saving or investing. They often rely on a single stroke of luck—like winning the lottery or investing everything in a speculative cryptocurrency project—or they don't make any attempts at all.
These individuals may feel trapped in their jobs, believing that wealth is something inherited or only achieved through sheer luck. When they see peers striving for more, they often pull them down, akin to "crabs in a bucket." This includes coworkers dismissing promotion aspirations and friends encouraging them to remain stagnant in their hometowns.
Unfortunately, for Blue Pillers, achieving wealth is nearly impossible.
Subsection 1.1.1: The Purple Pill Perspective
The “Purple Pill” mindset acknowledges that wealth is attainable but insists it takes decades of hard work. Adherents believe in dedicating significant portions of their income to safe investments like index funds, bonds, and Roth IRAs, expecting to grow their wealth over 30 to 40 years before retiring.
While the traditional approach has its merits and is a tested path, it may feel overly conservative for some. I recently read “Die With Zero” by Bill Perkins, which emphasizes that the value of time, particularly in youth, surpasses financial wealth in later years. I'd prefer to enjoy experiences while I'm still young rather than hoarding money for retirement.
As Perkins notes, spending typically declines as people age, countering the belief that aging leads to more extravagant spending.
Section 1.2: The Red Pill: A Balanced Approach
The quest for wealth is commendable and achievable, but it shouldn't involve sacrificing your entire life for enjoyment in your later years or relying on luck through gambling or lotteries.
My philosophy is centered on balance. You need not live like a miser to build wealth. It's possible to savor life's pleasures—like enjoying a coffee at Starbucks—while still investing for the future.
The Red Pill lifestyle begins with seeking high-income opportunities or pursuing side hustles if your current job falls short. As Tim Denning often states, “The 9–5 pays the bills, the 6–10 builds your skills.”
For me, this includes writing, publishing, and freelance work. At the same time, you should adopt a proactive investment strategy, allocating a portion of your earnings to blue-chip cryptocurrencies like Bitcoin or Ethereum and diversifying into tech stocks. The goal is to generate passive income effectively.
Chapter 2: Overcoming Financial Obstacles
Even if you've made poor financial choices in the past, they shouldn't define your future. Personally, I faced challenges such as accruing significant debt for an impractical degree and lacking financial literacy until late in my academic career.
It's crucial not to allow the mindset of a Blue Pill thinker to hinder your progress. Always keep your focus ahead, avoiding the traps that can ensnare you. This is the essence of the true Red Pill philosophy regarding wealth generation—there are no shortcuts.
This video titled "How to Get Rich" offers insights into establishing a financial foundation without relying on luck.
In "How to Get Rich Without Getting Lucky (Naval Ravikant)," you'll discover practical advice for creating wealth through strategic planning.
My Investment Strategy
While conservative investing can be beneficial, I prefer an aggressive approach that involves calculated risks. My conservative investments are primarily in a Roth IRA, which offers tax-free withdrawals later.
It's important to recognize that being overly conservative may not yield the wealth you aspire to achieve.
As you gather insights from seasoned investors and innovative thinkers, ensure you also do your own research.
My Cryptocurrency Portfolio
- 50% in Ethereum
- 30% in Bitcoin
- 10% in Polygon
- 10% in Altcoins
Diversifying excessively within your portfolio can be counterproductive. Studies suggest that owning more than 20 stocks doesn't significantly lower risk while restricting potential gains.
I keep my cryptocurrency investments straightforward.
Ethereum stands out as a leading investment with immense potential for growth and innovation, promising not just digital transactions but a platform for decentralized finance and NFTs. Meanwhile, Bitcoin remains a strong asset, particularly in turbulent economic times.
I invest heavily in cryptocurrencies as a safeguard against inflation and economic instability.
My Stock Investment Choices
- 80% in FAANG stocks
- 20% in Walt Disney
Some may question my choice to prioritize cryptocurrency, but my confidence in its long-term value is grounded in extensive research.
I also maintain exposure to the stock market, particularly in big tech. Companies like Amazon, Apple, and Tesla represent robust growth prospects. Additionally, I consider Walt Disney a reliable long-term investment.
Conclusion: Crafting Your Path to Wealth
Forget about luck—it doesn't exist.
Wealth is built through hard work, strategic planning, and the right mindset. By adopting the philosophies outlined in this article, you can pursue wealth with both aggressive and conservative strategies.
You don't need extraordinary intelligence or a wealthy background; you only need the right attitude. Now, go forth with this knowledge. Best of luck—believe in yourself.