E-BOOK MAIN POINTS SLIDES

BY:
SHOMAIS SHOAIB F2020314016
SAMEER AHMAD F2020314073
SHAHRAM ALI F2020314035
CHAPTER 1.1 IT’S YOUR MONEY! IT’S
YOUR LIFE! TAKE CONTROL
Understanding Money and Its Impact on Human Emotions
Understanding Money

• Money is often taboo and off-limits, but it can provoke extreme human emotions.
• Money is about power, having the power to create or destroy.
• Money can fund dreams, start wars, and be used as an expression of one's spirit, creativity, ideas,
frustration, anger, or hate.
• Money is an illusion, as it is now a shape-shifter or canvas, assuming whatever meaning or emotion
we project on it.

The Power of Money

• Money can be an affliction, a blessing, a game, or a burden.
• To change your life, find people who have achieved what you want and model their behavior.
• To master your finances, find a financial master and imitate their behavior.

The 7 Simple Steps to Financial Success

• Money is often seen as a game, with the wealthiest people working long hours to win.
• To win, one must learn the rules and strategies from those who have already mastered the game.
• Learning the pitfalls to avoid and shortcuts to experiencing lasting success can save years of time
and enjoy the freedom they deserve.
average person.
• To achieve financial freedom, one must be able to hold onto a portion of what they earn for their
family and multiply what they earn, making money while they sleep.
• The key to financial freedom is not just to work hard, but to add value, move up the ladder, invest
in company stock, and retire with a pension.

The Complexity of the Financial System

• The world is becoming increasingly complex and crowded with new technologies, leading to a
financial system designed to separate us from our money rather than help it grow.
• High-frequency trading (HFT) is one such tool, where 50% to 70% of the tens of millions of trades
are generated by high-speed machines.

Oscar Wilde&39;s View on Money and Investing

• Oscar Wilde argues that money and investing are often influenced by opinions and tips from
ordinary men.
• He has been working for 38 years to find strategies and tools that can change the quality of
people&39 lives and has proven their effectiveness by producing measurable results where others have
failed.
• The book explores the psychology of wealth, money mistakes people make, and solutions found by
behavioral economists.
• The author shares a personal experience of acquiring a new car after realizing she was spending
more money on her old car for repairs and gas than it cost to finance a new one.
• The book focuses on living life on one's own terms while ensuring the quality of life desired and
deserve today.
• The author aims to break through the complexity of the world of finance by becoming their
personal financial search engine.
• Oliver Wendell Holmes, a renowned financial expert, aims to filter through superfluous and
harmful financial information to deliver simple, clear solutions.
• The book stands out by providing investment strategies that the ultra-wealthy have but also
making them affordable and accessible for everyone.
• The author has been coaching people for nearly four decades, helping them create breakthroughs
in their relationships, emotions, health, careers, and finances.
• The author has been in touch with Paul Tudor Jones since 1993, who predicted the 1987 Black
Monday crash and doubled his investors' money in 1987 and 2008.
• The author has learned more about the real world of investing and decision-making in tough times
through Paul than from a hundred MBA courses.

Author&39;s Journey and Lessons from the Financial Crisis

• The author, a philanthropist, has worked with Paul, a philanthropist who has transformed the
Robin Hood Foundation into a leading organization.
• The author's teaching style is influenced by his love for live events and his ability to connect with
people through his body language and voice.
• The author's journey was inspired by Napoleon Hill's 1937 classic, Think and Grow Rich, which
found hope for ordinary people.
• The book aims to provide a real plan and tools for building a better future for oneself and their
family.
• The book includes electronic segments with interviews with the interviewees and an app to guide
readers through the 7 Simple Steps to achieve financial freedom.
• Despite initial criticism, the author has had great relationships with influential people, opening
doors and gaining access to the masters of the game.

Ray Dalio&39;s View on Investing

• Ray Dalio, founder of Bridgewater Associates, is known as the Steve Jobs of investing.
• He has a Pure Alpha fund that has produced 40% returns for his key clients in 2010.
• Dalio believes that individual investors can win in the volatile market but must not try to beat the
pros at their own game.
• He suggests that the best way to compete in the financial market is to learn a passive strategy and
be cautious when choosing a broker-dealer.

Ray Dalio&39;s Passive Strategy and Henry Ward Beecher&39;s Investment System
Ray Dalio&39;s System:
• Dalio's passive strategy involves setting up a portfolio that protects against all downsides.
• The strategy has resulted in an average return of just under 10% per year (net of fees).
• He has persuaded many of these companies to open up their services for non-wealthy people for free.

Beecher&39;s Strategic Venture:

• Beecher has partnered with Stronghold Wealth Management and HighTower, the fifth largest
investment advisory firm in the United States, to provide transparent, conflict-free advice to the
ultrawealthy.
• The venture will now provide some of the same extraordinary planning services at no charge to
anyone, regardless of their investment level.

The Importance of Giving Back:

• Beecher believes that wealth is not only about winning but also about making a difference for
others.
• He personally matched all his contributions to his Anthony Robbins Foundation, which helps 4
million people a year.

The Book's Goals:

• The book aims to help readers develop enough wealth, both physically and emotionally, so they
can be a force for good through their economic contributions and time.
• He encourages readers to start on this path by donating 50 million meals to the 17 million
American families who face hunger every day.
• He hopes that by the end of the book, readers will be inspired to make a small direct donation on
their own.
 CHAPTER 1.2
THE 7 SIMPLE STEPS TO FINANCIAL FREEDOM: CREATE AN INCOME FOR LIFE

The Importance of Financial Security and Independence

The Evolution of Retirement:
• Retirement was a relatively new concept, serving only a generation or two.
• The Social Security Act was created during the Great Depression, with retirement benefits
supposed to kick in at age 65.
• The average life expectancy in the US was 62 years, and Social Security retirement benefits were
supposed to kick in at age 65.

The Future of Retirement:

• With advancements in medical technology, it is not realistic to finance a 30-year retirement with
30 years of work.
• Many people are not prepared for this growing emergency, with 75% of Americans expecting their
assets to disappear before they die.
Planning for Financial Futures
• John Shoven, a Stanford University professor of economics, emphasizes the importance of
balancing work and retirement income.
• Many working Americans have not taken the first steps toward planning for their financial futures.
• Building investments into a sizeable nest egg can create a guaranteed lifetime income stream.

Financial Instruments for Financial Independence

• Financial instruments available today allow individuals to make money when markets go up and
not lose a penny when they go down.
• However, even with income for life, people will likely want to stop working when they reach the
traditional retirement age.

Changing Retirement Landscape

• With 10,000 baby boomers turning 65 every day and the ratio of old to young getting more
lopsided, Social Security alone may not be enough of a cushion for retirement.
• Thomas Friedman, a New York Times columnist and author, highlights the changing retirement
landscape in America.
• About 60 million Americans participate in 401(k) plans, totaling over $3.5 trillion.
Taxes and Wealth accumulation: A Complex Issue
• Taxes can significantly impact wealth accumulation, taking up to 50% of earnings.
• Compounding taxes can double a dollar annually for 20 years, resulting in a net gain of over $1
• The Center for Retirement Research reports that 53% of American households are at risk of not
having enough money in retirement to maintain living standards.
• The savings crisis began before the recent crash, with the personal savings rate rising from 1.5% in
2005 to 2.2% in 2013.
• Behavioral economists like Dan Ariely study how our brains deceive us regularly, leading to more
mistakes in areas we are not as good at.
• Tony Robbins, a financial expert, believes that our intuition is deceiving us in a repeatable,
predictable, and consistent way, leading to more mistakes in areas we are not as good at.

Understanding Financial Limitations and Mastering the Game

Understanding Cognitive and Physical Limitations
• Cognitive limitations, similar to physical limitations, can be understood to design a better world.
• Only a third of American workers take advantage of retirement plans.
Mastering the Game: A Guide to Financial Control
• Tony Robbins' book aims to empower individuals to control their financial lives.
• The plan is divided into 7 Simple Steps and a free smartphone app to guide through them.
• The app provides support, answers, and nudges, with regular updates to ensure progress.
Mastering the Game: A Guide to Mastering Financial Life
• Mastery requires cognitive understanding, emotional mastery, and physical mastery.
• Mastery involves understanding the concept, stimulating internal feelings, and making actions
second nature through consistent repetition.
• The book is not designed for quick reading but reflects the author's unique teaching style.
 CHAPTER 1.3
TAP THE POWER: MAKE THE MOST
IMPORTANT FINANCIAL DECISION OF YOUR LIFE
Understanding the Power of Compounding and Its Importance
• Burton Malkiel, the creator of index funds, emphasized the power of compounding, which is the
multiplying power of growth times growth.
• The story of twin brothers William and James, who started saving at 20 and invested $4,000
annually for 20 years, illustrates the power of compounding.
• The difference in wealth between the brothers was due to compounding for an additional 20
years, giving the brother an insurmountable edge.
• Benjamin Franklin left $1,000,000 each to the cities of Boston and Philadelphia, with the money to
be invested and not touched for 100 years.
• The power of compounding is a powerful strategy that can help individuals build and save money
over time, providing financial security for future needs.
• The author discusses the concept of living beyond our means, particularly in the world of sports,
highlighting the struggles of former heavyweight champ Mike Tyson and Floyd Mayweather Jr.
• The author suggests individuals can build on their talents and blessings to earn their way to
financial freedom by making a simple change in strategy and embracing a new mindset.
• Working for a living is trading your time for money, which is the worst trade you can make.

The Ultimate ATM:

• The primary "money machine" in your life is you, and if you stop working, your financial world
comes to a grinding halt.
• Instead of being an Anti-Time Machine, consider building a money machine that makes money
while you sleep, like a second business with no employees, payroll, or overhead.
• The money you set aside for savings will become the core of your entire financial plan, called your
Freedom Fund.

The Importance of Saving Money Painlessly:

• A technique to make saving money painless is to make saving money painless.
• Set aside money to avoid losing it all and invest it in a safe environment and follow the Money
Power Principles to watch it grow to a tipping point where it can generate enough interest to
provide the income needed for the rest of your life.

Automating Savings:
• Experts recommend saving at least a minimum of 10% of one's income, although many agree that
15% is a better number, especially if one is over 40.
• Behavioral economists have studied how people fool themselves about money, and the key to
success is to make savings automatic.
Examples of Successful Saving and Wealth Building
• Theodore Johnson, a former United Parcel Service employee, set aside 20% of his earnings from
every paycheck and Christmas bonus to invest in company stock.
• Oseola McCarty, a hardworking woman with just a sixth-grade education, also lived simple and was
careful to set aside a portion of her earnings.
• Sir John Templeton, one of the greatest investors of all time, went against the grain by starting
with practically nothing and then put his savings to work in a big way.

The Power of Compound Savings and the 7 Simple Steps to Financial Freedom
The Importance of Compounding Savings
• Theodore Johnson, John Templeton, and Oseola McCarty are examples of wise investors who have
successfully leveraged the power of compound savings.
• By committing to a steady code of savings, drawing down on income each pay period, and paying
oneself first, individuals can tap into the power of compounding and realize significant gains over
time.

The 7 Simple Steps to Financial Freedom

• To become an investor, one must decide what percentage of their income they will set aside for
themselves and their family.
• This small shift in spending can save approximately $2,000 each year, helping harness the power of
compounding and realize big gains over time.

The Save More Tomorrow (SmarT) Solution

 Chapter 1.4:
Understanding Wealth Psychology and Simple Solutions
• Discusses the psychology of wealth and its limitations.
• Highlights the power of financial breakthrough strategies.
• Outlines 7 Simple Steps to become financially independent without a fortune in annual income.
• Teachs how to build an automated "money machine" that generates lifetime income.

Section 2: Becoming the Investor: Understanding the Rules Before Investing

• Highlights danger zones marked with red Xs, marketing myths or investment lies.
• Explains why the returns mutual funds advertise are not the actual returns received.
• Discusses deceptions in target-date funds and noload funds.
• Provides guidance on protecting oneself from firms that tailor their products and strategies for their maximum profit.

Section 3: Making the Game Winnable: Exploring Financial Dreams and Setting Realistic Goals
• Helps individuals explore their financial dreams and set realistic goals.
• Provides a plan to turn these dreams into reality.
• Provides five ways to speed up the process if progress is slow.

Section 4: Making the Most Important Investment Decision of Your Life

• Emphasizes the importance of proper asset allocation in investing.
• Explores the journey of Charles Schwab, Carl Icahn, T. Boone Pigns, Ray Dalio, and Jack Bogle.
JUST DO IT, ENJOY IT, AND SHARE IT
• Presents an action plan to improve individuals' lives.
• Discusses the impact of new technologies on our lives.
• Emphasizes the importance of giving and the experience of being alive.
• Provides seven simple steps to financial freedom.

TAP THE POWER: MAKE THE MOST IMPORTANT FINANCIAL DECISION OF YOUR LIFE
• Discusses the power of compounding to create real wealth.
• Cites economist Burton Malkiel, who created index funds.
• Discusses the story of twin brothers William and James, who had different investment strategies.
• Highlights the power of compounding and investing in index funds for a sustainable financial
journey.
• Discusses Benjamin Franklin's legacy of leaving $1,000,000 each to the cities of Boston and
Philadelphia.

Compounding: A Powerful Strategy for Financial Freedom

The Power of Compounding
• Compounding is a strategy that can help individuals build and save money over time, providing
financial security for future needs.
• High-paid individuals like Curt Schilling, Kim Basinger, Marvin Gaye, Willie Nelson, M.C. Hammer,
Meat Loaf, Francis Ford Coppola, and Michael Jackson have faced near-brushes with bankruptcy.
 MONEY MASTERY: IT’S TIME TO
Understanding the Power of Money
The Importance of Money in Our Lives
• The 2008 financial meltdown underscored the significance of money in our lives.
• The events highlighted the power we give money and whether we let it control us or take control
of it.

The Death of Adolf Merckle

• Adolf Merckle, the 94th richest man in the world, shorted Volkswagen, causing a stock price spike
and nearly $3 billion in losses.
• Despite having $9 billion left in his pocket, Merckle's death serves as a reminder of the importance
of money in his life.

The Billionaire Who Wants to Die BROKE

• Chuck Feeney, a self-made billionaire, started with nothing in 1960 and ended up with a sales
empire worth $7.5 billion.
• Feeney has been working to use money to change lives worldwide, helping create peace in
Northern Ireland, fight AIDS in South Africa, and educate kids in Chicago.
• Feeney's goal is to bounce the last check he writes, raising the question of what money means to
The Need for Certainty/Comfort
• The need for certainty is a fundamental human need that influences our willingness to take risks in
various aspects of life.
• A higher need for certainty leads to less emotional risk and a higher "risk tolerance."
Understanding Human Needs and Their Importance

Need 2: Uncertainty/Variance
• Humans need uncertainty, variety, and surprise to strengthen their character and character.
• Growth requires pushing back against challenges.

Need 3: Significance
• Adolf Merckle&39;s concept of Significance suggests feeling important, special, unique, or needed.
• This can be achieved through various means, such as earning billions, collecting academic degrees,
building a large Twitter following, appearing on The Bachelor, or becoming a Real Housewives.
• Some individuals gain significance through having more or bigger problems than others, being
more spiritual, or being the most significant thing in their life.
• Violence is one of the fastest ways to gain significance, as it costs no money and requires no
education.

Need 4: Love and Connection

• Love is the oxygen of life, and when lost, people often settle for connection.
• Connection can be found through intimacy, friendship, prayer, or nature.
Need 5: Growth
• Growth is crucial for personal and professional growth, regardless of financial status or relationships.
• It leads to fulfillment and a sense of worth, irrespective of personal wealth or relationships.

Need 6: Contribution
• The sixth need of life is contribution, which is about creating meaning and contributing to others.
• The ultimate significance in life comes from something internal, which is not something we can ever get from someone else.
• The wealthiest person on earth is one who appreciates.
• Sir John Templeton taught that the secret to wealth is gratitude.
• To be rich, start rich by being grateful for what you are grateful for today, who you are grateful for, and even for some of the problems and pain in your life.
 CHAPTER 2.0
BREAK FREE: SHATTERING THE 9 FINANCIAL MYTHS
Albert Einstein's Financial Myths and Their Impact
• Einstein outlines nine myths about the financial system that can harm one's financial future.
• One such myth is the offer to put up 100% of the capital and take 100% of the risk, with 60% or
more of the upside coming to them in fees.
• The Money Power Principle 1 states that it is crucial to know the rules before getting into the
game.

Failed Experiment
• The modern financial system has changed significantly, with high-cost mutual funds and a do-it-
yourself pension system being the main issues.
• The do-it-yourself pension system has failed because it expects individuals without investment
expertise to reap the same results as professional investors and money managers.
• Most people give their money to a "professional," often a broker, who works for a company that is
not required by law to do what's in their best interest.

The Game is Still Winnable

• The advent of technology has made it easier and more convenient for individuals to invest in
various assets worldwide.
• The millennial generation has embraced this change, leading to the creation of high-frequency
The House Has the Edge
• Mutual fund companies have a stacked deck, making them the ultimate casino, with guaranteed revenue regardless of winning or losing.

Twice Burned
• After the 2008 stock market crash, 44% of investors still wouldn't invest in the market and 58% lost
faith.
• Insiders remain in the market due to their knowledge of the "right" way to play the game and the existence of powerful tools and strategies.

The Road Less Traveled

• The journey towards Financial Freedom requires full participation and preparation.
• A false step could lead to an abundant life free of financial stress.

The Path to Success

• Successful investing involves growing savings until the interest from investments generates enough income to support your lifestyle without working.
• There are two phases to investing: accumulation (socking away money for growth) and
decumulation (withdrawing income).
• Dr. Jeffrey Brown emphasizes the importance of creating a lifetime income plan.
 CHAPTER 2.1
MYTH 1: THE $13T LIE: “INVEST WITH US. WE’LL BEAT
THE MARKET!”
Investment Strategies and Market Performance
Investing in Non professionals
• Nonprofessionals should aim to own a cross section of businesses that are likely to perform well,
rather than picking winners.
• A low-cost S&P 500 index fund can help achieve this goal.

Financial Entertainment
• Financial news is filled with sensationalism and hype, creating the feeling that investors may miss out on the best returns.
• Personal finance writer Jane Bryant Quinn once referred to this sensational hype as "financial porn."

The War for Assets

• Investors often put their money in the stock market, which has been the best long-term investment over the past 100 years.
• However, 96% of actively managed mutual funds fail to beat the market over any sustained period
of time.

Investing in Indexes
• Investing in a low-cost index fund that tracks or mimics the top 500 stocks can provide a single
investment in the strength of "American capitalism."
• Various indexes available, such as the Dow Jones index, can help diversify and own a piece of
American capitalism.

The Fact Are The Facts:

• Only eight out of 200 fund managers beat the Vanguard 500 Index, a mirror image of the S&P 500
index.
• The S&P 500 returned an average annual return of 9.28% over a 20-year period, while the average
mutual fund investor made just over 2.54%.

The Wisdom of Ages

• Burt Malkiel, 82, proposed the rationale of an index fund, which mimics the market rather than
trying to beat it.
• Jack Bogle, founder of Vanguard, backed this idea by creating the first index fund, emphasizing
maximum diversification, minimal cost, tax efficiency, low turnover, and no sales loads.

The S&P Indices Versus Active Funds Scorecard (SPIVA)

The UnicoRNS
• Hedge fund managers, known as "unicorns" or "market wizards," consistently beat the market
• Active managers can gain an edge in less-developed or emerging markets like Kenya and Vietnam.
• Active management is not more effective for all major asset classes, but presents opportunities for
occasional outperformance in frontier markets.

All Weather:Portfolio
• Emphasizes the importance of having an all Weather portfolio for investments.
• Passive owning the market beats 96% of the world's "expert" mutual fund managers and nearly as many hedge fund managers.
• The All Weather portfolio involves a portfolio of low-cost index funds.
• Understanding asset allocation is crucial for success in both good and bad times.

It Pays to Be a Star
• Over the decade ending December 2009, 72% of all fund deposits flowed to four- and five-star
• funds.
• Mutual fund companies are quick to eliminate funds that fall below the four-star threshold.
• Only four of the 248 mutual stock funds with five-star ratings at the start of the period still kept
that rank after 10 years.

Upside with Protection

• Investing in indexes is a great solution for a portion of your money.
• Investing in and diversifying across multiple different indexes, aligning yourself with the market, and thinking like an insider can smooth out the
ride.
FEES ON FEES
• Passive owning the market and using indexing can combat the myth of not knowing your fees.
• It is essential to make forward progress and avoid letting excessive fees drain your account.
 CHAPTER 2.2
MYTH 2:
The Real Cost of Owning a Mutual Fund
• The $13 trillion mutual fund industry is known for hiding fees, making it difficult for consumers to understand the actual cost of owning a mutual
fund.
• Forbes' article reveals the average cost of owning a mutual fund is 3.17% per year.
• Owning the market, which involves owning the entire market, can be achieved for as little as 0.14% or 14 basis points.
• Most mutual funds charge nearly 30 times more in fees for inferior performance, leading consumers to pay more than they should.
• Excessive fees can give up 50% to 70% of your future nest egg.
• The S&P 500 remained flat with no returns between January 1, 2000, and December 31, 2012, a period often referred to as the "lost decade."
• Mutual fund companies use misdirection to trick investors into thinking they are smarter than they are.
• The expense ratio, the "sticker price," often doesn't reveal the full list of fees.

PhD in Fees and the Excessive Costs of 401(k)s

• Robert Hiltonsmith, a PhD in economics graduate, discovered hidden and expensive 401(k) fees.
• 17 different fees were charged by various providers, including asset management, 12b-1 fees/marketing, trading costs, soft-dollar costs,
redemption fees, account fees, purchase fees, record-keeping fees, and plan administrative fees.
• Hiltonsmith's report, The Retirement Savings Drain: The Hidden & Excessive Costs of 401(k)s, calculated that the average worker would lose
$154,794 to 401(k) fees over their lifetime.
• David Swensen, the chief investment officer of Yale's endowment, reveals that mutual funds extract enormous sums from investors in exchange
for providing a shocking disservice.
• Actively managed mutual funds, which account for 96% of the market, will not beat the market, charge high fees, and potentially extract up to
The Truth/Solution to Owning a Mutual Fund
• Owning a mutual fund can be more expensive than owning a taxable account due to higher fees for the plan administrator.
• Owning a tax-free account can save 10%, but half of it is paid in fees.
• To avoid fee factories, reduce annual fees and investment costs to 1.25% or less.
• Consider paying 1% or less to a registered investment advisor and 0.20% for low-cost index funds like Vanguard.
• Becoming an insider and never paying insane fees for subpar performance is crucial.
• Removing expensive mutual funds and replacing them with low-cost index funds can recoup up to 70% of your potential future nest egg.
• Choosing the right index fund and managing the entire portfolio over time are key to success. Trusting a broker to save on fees is like going to a pharmacist
to help you get off meds.

Understanding Core Fees and Costs Impacting Mutual Fund Investments

• Expense ratio: US stock funds pay an average of 1.31% of assets annually for portfolio management and operating expenses. Larger funds aim for a 1%
ballpark expense ratio.
• Transaction costs: Brokerage commissions, market impact costs, and spread costs are the most expensive components of owning a mutual fund.
• Tax costs: Most employees have replaced 401(k) costs with "plan administrative" fees. The average plan administrator charges 1.13% per year, while the
average tax cost is between 1.0% and 1.2% annually for taxable accounts.
• Cash drag: The average cost from cash drag on large-cap stock mutual funds over a ten-year time horizon was 0.83% per year.
 CHAPTER 2.3
MYTH 3:
"Returns: What You See Is What You Get"
• Jack Bogle, founder of Vanguard, argues that mutual fund returns are not earned by investors.
• Charles Schwab's 2002 TV ad portrayed a sales manager highlighting the weather but not the fundamentals.
• Darrell Huff's 1954 book "How to lie with Statistics" highlighted the use of "dodges" to deceive investors.
• The mutual fund industry uses a "sleight of pencil" illusion to calculate and publish returns that are not actually earned.
• Erik Krom's Fox Business article "Solving the Myth of Rate of Return" highlights the significant discrepancy between the
average return and actual return.
• Mutual funds calculate their returns to appear better than they actually earn due to time-weighted returns, which are not the
actual return.
• Jack Bogle advocates for changing this rule, but mutual funds resist, resulting in investors achieving closer to 3% than advertised
returns.
Understanding the Truth and Solution in Investment
• Average returns are likened to online dating profiles, presenting a better picture than reality.
• Accurate assessment of actual return on investment involves considering the initial and current amount.
• Mutual funds' returns are based on a theoretical person who invested all their money on Day 1, which is not always the case for
most investors.
• The path to financial freedom is clear with "truth," understanding that stock-picking mutual funds don't beat the market over
time and that fees matter.
• Financial professionals who are full of integrity and committed to their clients' futures can act in the best interests of the client.
• To distinguish between a salesman and a trusted advisor, use Myth 4 to determine if the person is working for the client or the
company's name.
 CHAPTER 2.4
MYTH 4:
Understanding the Financial Services Industry

• Upton Sinclair's argument that understanding a man's salary depends on his understanding of a subject.
• Mutual funds are charging high fees that could potentially strip up to 70% of a person's future nest egg.
• 96% of actively managed mutual funds are underperforming the market or their benchmarks.
• The returns offered by mutual funds are typically better than the actual returns, as they are marketed as time-weighted returns.
• Many Americans are skeptical of the financial services industry and its desire to help them succeed.
• The financial services industry has been kept in the dark for decades, leading many to accept being part of the herd.
• As of early 2014, the market prices have continued to grow, with the fifth largest bull market in history.
• The "Dodd-Frank Wall Street Reform and Consumer Protection Act" failed to address the need for protection from financial
managers, brokers, managers, and high-frequency traders.
• A 2009 Morningstar study revealed that 49% of managers in over 4,300 actively managed mutual funds own no shares in the
funds they manage.
"Where Are the Customers' Yachts?" and "WOM TO TRUST"
• Fred Schwed Jr.'s 1940 investment classic, "Where Are the Customers' Yachts?", is retold in various ways, with William Travers,
a successful broker, asking where the customers' yachts are.
• The commercial portrays a financial advisor as a trusted friend, but the advisor's interests may not align with the couple's goals.
The Suitability Standard
• The financial services industry prioritizes clients' best interests, but many operate in a closed-circuit environment.
• The suitability standard is defined as providing a product or fund that meets the client's goals and objectives.
The Gold Standard
• To receive conflict-free advice, align with a fiduciary, a legal standard adopted by independent financial professionals.
• Fiduciaries must remove potential conflicts of interest and prioritize the client's needs above their own.
• The fee paid to a fiduciary may be tax deductible, making it more cost-effective than paying a 2% or more fee to a
mutual fund manager.
Finding a Fiduciary in the Investment Industry
• Aligning with an independent registered investment advisor (RIA) is crucial for solidifying an insider's position.
• Over 200 professional designations for financial advisors are not tracked by FINRA, often providing window dressing
without a fiduciary duty.
• Not all advice is good or fairly priced, and not all professionals have equal skill or experience.
• 46% of financial planners lack a retirement plan, indicating the need for elite advisors to navigate market complexities.
The Butcher vs. the Dietitian
• Brokers are like butchers, promoting meat over fish, while dietitians advise on health-related choices.
• Brokers have no 'dog in the race' to sell a specific product or fund, giving them power.
HighTower: A Case Study
• Elliot Weissbluth, a former litigator, founded HighTower to eliminate conflicts of interest in the investment industry.
• HighTower's growth demonstrates clients' desire for independent advice and the importance of independent advice.
• Despite its success, HighTower was built to service only the wealthiest Americans, which is not an efficient way to do business.
"Let's Blaze a Trail"
• Elliot, a passionate advocate for justice and fairness, is tasked with delivering transparent, conflict-free investment advice to anyone,
not just the wealthy.
• The speaker challenges Elliot to deploy resources and deliver solutions typically reserved for ultrahigh net worth individuals.
• A complimentary review service is proposed to provide people with an honest view of their treatment.
• Elliot expresses his commitment to making this happen.
Stronghold Financial
• Elliot and Ajay Gupta, a former brokerage executive, collaborated to democratize investment advice.
• Stronghold Financial (a new division of Stronghold Wealth Management) was born, serving everyone regardless of their investment
size.
• The company's patented system allows users to link all their accounts, analyze every holding, fee, and risk, and provide a
comprehensive analysis and new asset allocation.
• The company doesn't charge for this service, but clients can transfer their accounts and have Stronghold manage their wealth.
• Stronghold has a network of independent advisors in all 50 states who are aligned with the same principles and have access to some
of the unique solutions.
Finding a Fiduciary: Key Criteria and the National Association of Personal Financial Advisors (NAPFA)
• Ensure the advisor is registered with the state or SEC as a registered investment advisor or an investment advisor representative
(IAR).
• Ensure the advisor is compensated on a percentage of your assets under management, not for buying mutual funds.
• Avoid 12b-1 fees or 'pay-to-play' fees.
• Avoid having an affiliation with a broker-dealer.
Buy Enron!
• Experienced fiduciaries should provide transparent advice and investment solutions.
• Be cautious when seeking advice from brokers.
• The example of Enron illustrates how conflicts may arise when receiving advice from a broker.
Lobbying for Profits
• The concept of prioritizing client interests has caused a stir on Wall Street.
• Under Dodd-Frank, the SEC was required to conduct a study on a 'universal fiduciary standard' across all investment firms.
Finding a Fiduciary: A Five-Step Process
• Review current holdings from all accounts, including 401(k).
• Check fees and potential retirement savings.
• Evaluate risk exposure, including market performance.
• Get conflict-free advice on portfolio options.
• Consider tax situation and recommend tax-efficient allocation.
• Transfer accounts to recommended third-party custodians for ongoing account management.
• Access the Private Wealth Division for investments limited to accredited investors.
• Contact a registered fiduciary advisor for personal questions or connect with local partners.
The Plan:
• Majority of investors are unaware of fiduciary issues, especially regarding brokers and investment advisors.
• Fiduciary standard involves offering a broad array of approved products and services, being independent, acting as a custodian of
investments, and using third-party custodians.
 CHAPTER 2.5
MYTH 5:
"The 401(k): A Comprehensive Retirement Plan"

History of the 401(k)

• Introduced in 1984 to allow Americans to participate in the stock market and save on taxes.
• Not meant to be the sole retirement plan for Americans due to the soaring stock market and the bull markets of the '80s and '90s.
• The 401(k) represented freedom but often gave people the illusion of control.
Challenges in Using the 401(k)
• Navigating all available investment choices, generating sufficient returns to support retirement, being a part-time investment expert,
and raising a family are all challenges.
• To ensure the system works for you, consider determining when you will be laid off or sick to work, when you will die, saving 7%
of every dollar you earn, earning at least 3% above inflation on investments every year, not withdrawing funds when you lose your
job, have a health problem, get divorced, buy a house, or send a child to college, and timing retirement account withdrawals so the
last cent is spent the day you die.
Fees and Costs of 401(k) Plans
• Most 401(k) plans charge hefty fees that can erode 50% to 70% of a retirement nest egg.
• These fees include communication, record-keeping, administrative, distributions, loans origination, loans maintenance, semiannual
discrimination testing, 5500 filing package, other expenses, investment, and trustee fees.
America's Best 401k: A Lean, Mean, Non-Green Plan
• America's Best 401k, owned by Tom Zgainer, aims to help individuals avoid fee-loaded plans.
• The 401(k) industry, which has been around for three decades, has only been required by law to disclose fees in 2012.
• Over half of employees in 401(k) plans are unaware of their fees, with 67% believing there are no fees.
• The company only allows low-cost index funds and doesn't receive any payment from mutual funds to sell their products.
• Tom proposed a 70% reduction in total fees from over 2.5% to just 0.75% annually, resulting in hundreds of thousands of
dollars or millions going back to employees and their families.
• A simple switch to this plan can result in over $1.2 million going back to the owner's family and staff.
• Tom and his team have developed an online "Fee Checker" that can compare a company's plan against others and show cost
savings over time.
• High fees in 401(k) plans can lead to significant financial penalties for business owners.
• The US Department of Labor (DOL) is actively defending employees against such plans, with the business owner being held
liable.
• Small business owners are at greater risk due to the high fees in smaller plans. To protect themselves, business owners must
have their plans 'benchmarked' annually against other plans.
Understanding the Importance of Low-Cost 401(k) Plans
• Business owners often face liability from the DOL for high-cost 401(k) plans.
• Companies like America's Best 401k offer ongoing benchmarking and professional fiduciary services.
• Employees should visit the Fee Checker on America's Best 401k's website and forward the report to upper management.
• High fees drain hard-earned cash and affect financial freedom.
• If employers don't switch to a low-cost option, opt out if contributions aren't matching.
Unconventional Wisdom and the Roth IRA
• The government has a significant spending problem with over $17.3 trillion in debt and nearly $100 trillion in unfunded liabilities.
• Conventional logic suggests that wealthy individuals and corporations can tax every individual and corporation at 100% of its income/profits.
• The percentage of your 401(k) balance that will be yours to spend is unknown, and if taxes go up, the slice of the pie you get to eat gets smaller.
The Roth 401(k)
• Introduced by Senator William Roth in 1997, a Roth IRA is a legal "tax haven" for individuals facing rising future tax rates.
• The Roth 401(k) allows for $17,500 per year, allowing high-income earners to participate without income limitations.
• The system called Save More Tomorrow allows individuals to advance their savings rate each year, "auto-escalating" their savings amount until
reaching a certain cap.
Understanding 401(k) Plans and IRAs
• Setting aside a percentage of income in a 401(k) plan is crucial for ensuring low fees and low-cost index funds.
• Employers should inform their management of their legal responsibility to provide the most efficient plan and avoid potential
Department of Labor issues.
• Small plans can save $20,000 per year in fees, while larger plans can save hundreds of thousands or millions over the life of the
plan.
Seven common questions when considering 401(k) plans and IRAs include:
1. Should I Participate in My 401(k)?
• Employer matches contributions, so it's advisable to take advantage of 401(k) as the company covers taxes.
• Roth 401(k) plans allow contributions to receive Roth tax treatment, reducing tax payments today.
• Yes, you can set up a Roth IRA account and contribute $5,500 per year.
• If you make too much money for a Roth IRA, you cannot contribute to it if your annual income is over $114,000 as an individual or more than
$191,000.
Roth IRA and 401(k) Conversion
• Roth conversion allows for immediate tax payment and protection against future higher taxes.
• If taxes are expected to rise, it's advisable not to convert.
• Older 401(k) plans can be left with a previous employer or rolled over into an IRA.
• Rolling over allows greater control over investments and hiring a fiduciary advisor.
• Small business owners can add a cash-balance plan to their 401(k) plan.
• Cash-balance plans provide future retirement income.
• High-income business owners can max out their 401(k) and profit-sharing plan and add a cash-
balance plan.
• Money Power Principle 2 states that "You get what you tolerate."
• Different rules exist for Roth IRA and a Roth 401(k).
• IRS states that if you were 50 or older before 2014, your contribution limit for 2013 will be the
lesser of $6,500 or your taxable compensation for the year.
 CHAPTER 2.6
MYTH 6: TARGET-DATE FUNDS:
"Just Set It and Forget It": An Analysis of Target-Date Funds
• Jack Bogle, founder of Vanguard, advises individuals to follow the money when evaluating 401(k) investment options.

• Pay-to-play fees are common in mutual funds, requiring clients to pay for a mutual fund's inclusion in their 401(k) plan.
• 90% of 401(k) plans require these fees to ensure limited selection and profitable investments for distributors.
• Target-date funds, or lifecycle funds, are the most expensive and widely marketed creations, except for Vanguard's ultra-low-cost versions.
• Target-date funds (TDFs) are the fastest-growing segment of the mutual fund industry, offering a portfolio allocation based on the date or year of retirement.
• A survey by Behavioral Research Associates found that employees who invested in TDFs had misconceptions about their benefits.
Target-Date Funds (TDFs) and Retirement Planning
• TDFs are an asset allocation that becomes less risky as retirement approaches.
• David Babbel, a former World Bank employee, consulted for the US Treasury and Federal Reserve.
• A 2006 federal law made TDFs the default retirement option.
• Over half of all employers auto-enroll their employees into their 401(k) and over 96% of large employers use these target-date mutual funds as the default
investment.
• However, some funds chose to invest in stocks, despite being in the "final stretch" and most conservative.
• Academics in retirement research are in favor of TDFs, citing confusion and poor decision making before TDFs.
• Dr. Jeffrey Brown recommends low-cost target-date funds like Vanguard.
• For those not interested in TDFs, asset allocation models like Vanguard are recommended.
• Stronghold Financial offers a service to assist with 401(k) fund choices and provides a complimentary asset allocation.
 CHAPTER 2.7
MYTH 7:
"I HATE ANNUITIES, AND YOU SHOULD TOO"
• The article discusses the negative impact of annuities on long-term growth and security, highlighting the use of active-approach
stock pickers.
• Former Federal Reserve chairman Ben Bernanke appreciates the use of annuities in his personal finance plan.
• The choice between annuities and insurance companies depends on the type of annuity and the fees charged.
• Dr. David Babbel, a Wharton professor, created a lifetime income plan using guaranteed income annuities.
• Understanding different types of annuities can help readers make informed investment decisions.
• The first lifetime income annuities date back 2,000 years to the Roman Empire.
• The term "annuity" comes from the Latin word "annua," meaning annual.
• The modern world uses the same concept, but governments have been replaced by high-rated insurance companies.
• Variable annuities, where underlying deposits are invested in mutual funds, are often considered bad.
• Annuity products offer special tax benefits and can grow tax-deferred, similar to a 401(k) or IRA.
• Additional fees for the annuity itself can be a disadvantage.
Variable Annuities and Their High Costs
• Variable annuities are often purchased to avoid taxes, but come with high costs, averaging approximately 3.1% per year.
• Additional fees include expense ratio, transaction costs, soft-dollar costs, cash drag, and sales charges.
• The total cost of an actively managed mutual fund is $3,100 per year for every $100,000 invested.
• Additional fees to the insurance company include a "mortality expense" of 1.35% per year and administrative charges ranging
from 0.10% to 0.50% per year.
• Despite these additional fees, the potential gain is likely minimal.
Low-Cost Variable Annuities
• Vanguard and TIAA-CREF offer low-cost variable annuities with low-cost index funds without commissions, making them
worth considering for tax efficiency.
• The author combines the power of a Roth IRA with the power of a lifetime income annuity to accelerate financial freedom.
Solutions
• Annuity specialists can provide a complimentary review of your current annuity to help determine its pros and cons, fees,
guarantees, and whether to keep it or exchange for a different type.
 CHAPTER 2.8
MYTH 8:
"Taking Huge Risks for Big Rewards"
Definition of Investment Operation
• Benjamin Graham defines an investment operation as one that ensures principal safety and adequate return upon thorough
analysis.
Risk-Taking Strategies for Entrepreneurs
• Richard Branson, founder of Virgin Airlines, negotiated a deal with British Airways to buy his first five planes, offering a money-
back guarantee if the deal didn't work out.
• Successful insiders like hedge fund traders Ray Dalio and Paul Tudor Jones look for opportunities with asymmetric risk/reward,
where the reward is drastically disproportionate to the risk.
Risk-Minimizing Approach
• High-frequency traders (HFTs) use the latest technologies to save a small fraction of a second, generating 70% of all trading
volume in the stock market.
• Virtu Financial, one of the largest HFT firms, has lost money only one day out of thousands over the past five years, indicating
that risk is not about investing in faster computers but about minimizing the risk.
J. Kyle Bass's Risk-Taking Strategy
• J. Kyle Bass, a hedge fund guru, turned a $30 million investment into $2 billion in just two short years by taking small risks for
big rewards.
• He taught his two boys that they could buy $2 million in nickels, as the US nickel is worth about 6.8 cents today in its'melt value.'
Financial Creativity
• The same level of financial creativity that propelled high-frequency trading (HFT) into a dominant force in just ten years has
touched other areas of finance.
J. Kyle Bass's Strategy for Strong Returns
• J. Kyle Bass's strategy of taking small risks for big rewards is a testament to financial creativity and effective strategizing.
Three Strategies for Achieving Strong Returns
• Structured Notes: Loans to banks that guarantee a percentage of the upside of market gains.
• Market-Linked CDs: Similar to structured notes but with FDIC insurance.
• Fixed indexed annuities (FIA): Offer 100% principal protection, tax-deferred, and allow participation in the market when it
goes up but not lose it if it goes down.
• Fixed indexed annuities can create an income stream that you can't outlive, like a paycheck for life.
• Accessing these solutions through a fiduciary advisor typically removes all the commissions and fees.
"Word of Warning" Chapter Summary
• Highlights the truths and myths surrounding financial products and strategies.
• Emphasizes that no one beats the market, and low-cost index funds can outperform 96% of mutual funds and hedge funds.
• Explains the difference between a butcher and a dietitian, and provides tax-deductible advice.
• Demonstrates how to reduce 401(k) fees by using a low-cost provider like America's Best 401k.
• Discusses the Roth 401(k) and how to protect against rising taxes.
• Suggests using low-cost providers like Vanguard for Target-date funds (TDFs).
• Discusses variable annuities and traditional fixed annuities for guaranteed lifetime income.
• Encourages readers to shatter their myths and create true financial freedom.
 CHAPTER 2.9
MYTH 9:
"The Myths We Tell Ourself"
• Misconceptions about our limitations and failures are misconceptions.
• The ultimate obstacle to progress is not our own limitations, but our own limiting perceptions or beliefs.
• Fear of failure can hinder execution of plans.
• Stories about why we are not where we want to be are often based on something outside our control or lack of natural talent or
ability.
• Talent and skill are key elements to success.
• The author emphasizes the importance of staying where we are, moving forward, making excuses about what we don't have,
and enjoying the life we deserve.

Breakthroughs
• Breakthroughs are moments when the impossible becomes possible, when massive action is taken to change and improve the world.
• True transformation happens in a single moment, and it may take ten years to reach the point where you were ready or open.
• Breakthroughs can happen in a single moment, such as a change in a job, career, weight, or relationship.

Three Steps to Creating Your Breakthrough

• Financial struggles, relationships, and bodies are the main challenges people face in America.
• Understanding each other's needs and wants can be challenging.
• The body is another area where people struggle with fitness and health, with nearly seven in ten Americans being overweight or obese.

Breakthrough Strategies in Relationships, Finances, and Money Strategy, Story, and State
• Strategy is the starting point for significant changes in life, especially in developing countries adopting similar lifestyles and eating patterns.
• The author suggests that success is best achieved by modeling the behavior of others who have already achieved success.
• The right strategy can save time by converting decades of struggle into days of achievement.
• The author promises that the best financial strategies exist today and are the strategies of the most successful investors in history.

The Power of Story

• Challenges in relationships, bodies, and finances often stem from lack of the right strategy, limiting stories, and the human factor.

• Understanding the psychology of individuals and their values, beliefs, and emotions is essential to overcome these challenges.
• Attaching a new story to the strategy, one of empowerment, "I can and I will," can help overcome limitations.
• Stories can be true, but if they don't help, they must be changed.

Empowering Your Life Through Stress

• Everyone has an empowering story to find what's right or wrong.
• Financial stress is a common concern, with 44% of Americans reporting high levels.
• Health psychologist Kelly McGonigal realized her advice about stress was causing people to die faster than stress itself.
• Changes in perception of stress can alter the body's physical reaction to it.
• Understanding individual psychology and values, beliefs, and emotions can lead to a more fulfilling life.
• Adults who view stress as harmful have a 43% increased risk of dying.
• Physical signs of stress can indicate energized body and readiness for challenges.
• The story we attach to stress can significantly impact our health and longevity.
• The author shares a personal story of overcoming financial apprehensions by focusing on earning more and expanding one's intellectual, emotional, and spiritual
capacity.
• The author explains that financial freedom can be achieved by asking six simple questions about one's current situation, future goals, and willingness to take action
for a financial plan.
• The author shares a personal story of how he and his wife Julie changed their financial life by reevaluating their story and focusing on creating value for others.
• The author's personal story highlights the importance of focusing on both earning and expanding one's intellectual, emotional, and spiritual capacity to achieve
financial abundance.

Julie's Financial Transformation

• Julie attended Unleash the Power Within (UPW) seminar, which uses strategy, story, and emotional change to create breakthroughs.
• She realized her negative beliefs about money were causing constant pain in her marriage and future.
• She realized her story about the evils of wealth was her mother's, not her own.
• She realized that love, relationships, and contribution were the root of all evil.
• This transformation allowed Julie and her husband to discuss their finances, moving their story to financial freedom.
• They moved their IRA to a diverse portfolio of index funds with Vanguard and implemented a long-term financial plan.
• They learned to create an income for life and put an extra $150,000 to $250,000 into their pockets over their investment lifetime.

The Importance of Changing Your Mental and Emotional State

• The author emphasizes the role of changing your mental and emotional state in transforming your life outlook and experience.
• An angry state can quickly change your outlook and story, while a positive state can change your outlook and story.
• The author suggests changing your physiology, such as your movement and breathing, to create immediate change in your state.
• A Harvard University study showed that assuming "power poses" increased testosterone by 20% and reduced cortisol by 25%, transforming your willingness to face
fears and take risks.
• These biochemical changes are not just psychological but actual biochemical changes, hormonal changes.
• The author shares their journey of losing 30 pounds in six weeks and increasing their income from $38,000 to $1 million a year, emphasizing the importance of a
 Chapter3
Understanding the Price of Your Dreams: Making the Game Winnable
• The author encourages participants to guess the price of their dreams, which can range from $1
million to $500 million.
• Five different levels of financial dreams are identified, and at least one or two of these dreams are
within reach.
• A young man named his dream "A billion dollars" and realized that he was trying to meet six basic
human needs: certainty, uncertainty/variety, significance, connection/love, growth, and
contribution.
• The author emphasized that the brain rejects a huge goal in the gut, making it difficult to make it
happen until it sinks deep into the subconscious mind.
• Understanding what drives a person to achieve their financial goals is crucial for personal growth
and success.
• The process of achieving financial dreams involves a balance between the conscious mind and the
subconscious mind.
• The real cost of living at different lifestyle levels is often underestimated, leading to
procrastination and delay in necessary actions.
• The author suggests asking questions similar to those asked by a friend to help a would-be
billionaire identify the real price of their dreams.
Automating Savings and Investing in a Roth 401(k)
• Savings of 10% of income can be automated and invested in a Roth 401(k) with an estimated
growth rate of 6%.
• This approach is an achievable goal, as most people want to do something meaningful and dont want to have to work.

Setting Up an Emergency/Protection Fund

• An emergency/protection fund is crucial for unexpected income interruptions.
• To set up an emergency/protection fund, calculate monthly overhead and memorize it.
• The goal is not for an annual income for life, but to protect oneself until they develop a large
enough nest egg to take care of themselves every year for the rest of their life without working.

DREAM 2: Financial Vitality

• Financial Vitality is a key step towards financial independence and freedom.
• It involves covering half of monthly expenses without work.
• Calculation involves dividing current expenses by half of clothing, dining, entertainment, and small
indulgences costs.
• Annual amount for Financial Vitality is determined by adding monthly Financial Security number to
monthly income and multiplying by 12.
• Achieving Financial Vitality signifies financial stability to cover half of monthly expenses without
work.

Dream 3: Financial Independence

• Money is now your slave, not the slave to it.

Determining Financial Independence Number

• The app or writing down the number can help determine financial security.
• Clarity is power, and knowing a real number helps the conscious mind plan for financial security.

Live Your Dreams

• Ralph Walto Emerson's story of Ron and Michelle demonstrates the potential of financial
independence.
• Ron estimated $20 million for financial security, but realized it would be within reach.
• They estimated they needed $7 million to live without working, which was nearly two-thirds less
than his initial estimate.

Dream 4: Financial Freedom

Understanding Financial Freedom
• Financial Freedom is the idea of being independent and having everything you have today, plus two or three significant luxuries in the future.
• To achieve this, one needs to determine the annual income needed for the lifestyle they want and
deserve.

Case Study: Ron and Michelle

• Ron and Michelle, already living the lifestyle they wanted for $350,000 a year, decided to feel
financially free by donating $100,000 a year to their church.
Calculating Financial Freedom
• Ron calculated his Financial Freedom numbers as $8,333 per month, which includes a monthly
donation to the church, a $20' Bass fishing boat, a family ski condo mortgage, and monthly income for Financial
Independence.
• Multiplying these numbers by 12 gives the annual amount needed for Financial Freedom: $514,920
per year.

Dream 5: Absolute Financial Freedom

Understanding Absolute Financial Freedom
• Allows individuals to live on their own terms, giving freely and without having to work.
• Achieved through investment income, providing for an unlimited lifestyle.
• Example: Ron and Michelle's dream of buying a ranch and turning it into a church camp.
• Example: Ron's dream of owning his own plane, renting a jet for convenience and satisfaction.

Understanding the Price of Dreams

• Dreamers often fail to figure out the price of their dreams.
• Dreaming and unleashing desires can lead to financial security and independence.
• Paulo Coelho's seminars focus on people with big dreams and the price of them

Achieving Financial Dreams

• To achieve Absolute Financial Freedom, Ron and Michelle would need an income of $673,092 per year, a third less than they
thought they needed for security or independence.
 CHAPTER 3.2
WHAT’S YOUR PLAN?
What is Your Plan?; by Henry Kissinger
• Highlights the importance of having a clear financial plan.
• Encourages honesty and candidness in financial planning.

The Power of Compounding and Money Power Principles

• Discusses the concept of compounding and Money Power Principles.
• Stresses the importance of setting a price on dreams and creating an attainable plan.

The Power of Living on Your Own Hand

• Discusses the concept of living on one's own terms and creating a plan that meets one's needs.
• Stresses the danger of chasing others' goals, which can lead to frustration and failure.

The Illusion of Advantage

• Discusses the psychological edge of an advantage, akin to the Olympics.
• Emphasizes that life is a marathon, not a sprint.
• Encourages focusing on the path in front of you, looking ahead, establishing one's own pace, and creating a plan.

The Its Your Money app

• Provides a financial blueprint based on current income, savings, and investment rate of return.
• Allows users to be conservative or aggressive with their estimates, or choose a middle ground.

Wealth Calculator App Overview

• Offers precision through Stronghold's technology platform, providing real-time feedback on
returns and showing the impact of fees on future savings.
• Secure and accessible on any device, allowing users to change returns and save amounts.
• The Save More Tomorrow plan has helped over 10 million Americans grow their savings.
• Offers a comprehensive retirement planning tool considering your home's value as a conservative
cushion.
• The app is available for download and provides clarity and certainty in achieving your retirement
goals.
• The app aims to provide a realistic and achievable financial future by calculating the value of your
savings and income based on anticipated outcomes.

Financial Independence and Late Start: A Personal Journey

• Angela, a 48-year-old financial expert, struggles with starting late in life and achieving financial
independence.
• She needs $50,000 for Financial Security and $34,000 a year for Financial Independence.
• To speed up her goal, Angela could increase her savings and invest it, such as using the Save More
Tomorrow plan.
• She missed out on Social Security, which she would receive at a reduced rate and 17 years from
capturing her full benefit.
• She now aims to be financially secure in 14 years, covering her mortgage, utilities, food,
transportation, and basic health insurance.
• The author emphasizes that it's not about money; it's about choice, freedom, and
living life on
your terms, not anybody else's.
• Making just a little progress each day brings joy and growth.
• Most people overestimate what they can do in a year, and they massively underestimate what
they can accomplish in a decade or two.
• The power of the right actions taken relentlessly can make what seems impossible possible.
 CHAPTER 3.3
SPEED IT UP: 1. SAVE MORE AND
INVEST THE DIFFERENCE
Financial Freedom by Mario Andretti
• Encourages readers to consider their financial picture and create a plan.
• The goal is to make financial dreams come true faster than expected.
• Extra time can provide energy and excitement, especially during busy days.
• Benjamin Disraelli suggests that finding an extra hour can lead to significant savings.
• Five core strategies to speed up financial progress:
- Create a budget and stick to it.
- Set and prioritize financial goals.
- Use tools and resources to achieve financial goals.
- Consider the impact of current plan on future and adjust accordingly.
• The book provides valuable advice for achieving financial security, independence, and freedom.
Strategy 1: Save More and Invest the Difference
• Richard Thaler suggests saving more and investing in compound growth to speed up financial
planning.
• One strategy involves saving a significant amount towards financial freedom in one move, not
refinancing the mortgage at a lower rate.
The Banker’s Secret
• Mortgage payments can be cut in half without involving the bank or changing loan terms.
• Early principal payments over the life of the loan can help cut down interest expenses and save
• The Money Power Principle 3 suggests cutting mortgage payments in half by writing a second
check for the principal-only portion of next month's payment.
• Mortgage expert Marc Eisenson suggests pocket-change prepayments, which can help pay off a
30-year mortgage in 15 years, cutting the total cost of your home by nearly 50%.

Baby, You Can Drive My Car

• A son who loved a BMW X6 could cover an entire house payment by buying a Volkswagen Passat
or Mini Cooper for a more affordable and fuel-efficient vehicle.
• Saving money is not just about saving for houses and cars, but also about creating a spending plan
that gives you the most joy and happiness while ensuring your financial freedom long term.

Four Other Strategies to Speed Up Financial Planning

• Creating a spending plan helps decide in advance how and where to spend your money to give you
the greatest returns today and in the future.
• Financial expert David Bachs book, The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich, includes the concept of creating wealth through
finding your Latte Factor.

Saving for a Sustainable Quality of Life

• Lisa, a Nashville mom, and her husband have implemented a plan to save money by taking photos
of her next "must-have" and sending it to her husband.
• They use online rewards programs like Upromise.com, Extrabux, Debates, and Mr. Rebates to save
money.
• The plan helps them find items at a 20% or 30% cheaper price online.
• Deliberate spending allows for a sustainable quality of life and financial independence.
 CHAPTER 3.4
SPEED IT UP: 2. EARN MORE AND
INVEST THE DIFFERENCE
The Authors Journey to Financial Freedom

• • The author's mother's financial struggles led her to pursue a different life and appreciate the
• differences in people's lives.
• • She became obsessed with the idea of earning twice as much money as her parents, a seemingly
• unsolvable problem.

Investing in Yourself
• • The author, a janitor, attended a seminar by Jim Rohn, which he found to be one of the most
• important investments of his life.
• • Rohn's teachings emphasized the secret to economic success: becoming more valuable in the
• marketplace.
• • The author's focus on self-improvement and serving others led to a never-ending process of doing more for others in less time.
• • The author's journey to financial freedom is a powerful path to achieve this goal.

The Economys Challenges

• • The economy is facing challenges, with two million jobs lost since 2008 and incomes stagnant since

• the 1990s.

• • Continual improvement and becoming more valuable can lead to employment or self-employment,

• regardless of the economy.

• Retooling your skill set can be done through college education, trade education, or self-education.
"Creativity, Contribution, and the Korean Rock Star"
• Kim Ki-hoon, a successful South Korean teacher, has shown that one can add value to more than
just 30 students.
• He has made his classes online, recording them on video and circulating them on the internet.
• His annual earnings topped $4 million last year, and the more value he offers, the more students
sign up, leading to more money.

The Ultimate Multitasker

• Daniela, a talented and ambitious individual in a marketing department, took on three people's
jobs and offered to save 50% of their marketing cost and eliminate three people by taking on their
jobs.
• She proved herself on visual art and marketing, with great copywriting and a successful social
media campaign.
• She outperformed her competitors and added enough value to the company, allowing it to pay
one person twice as much money and cut costs in half.

Riding the Wave

• Nick Woodman, a California surfer, invented the GoPro, a waterproof camera strapped to his wrist,
which is now used by extreme sports enthusiasts worldwide.
• Woodman capitalized on the trend of digital sharing, making the GoPro a valuable product for
millions of people.

A New Category is Born

 CHAPTER 3.5
SPEED IT UP: 3. REDUCE FEES AND
TAXES (AND INVEST THE DIFFERENCE
Taxes and Investment Efficiency for Financial Freedom

• Saving and earning more are key to financial freedom, but reducing fees and taxes on investments
can speed up the journey.
• Hidden fees on mutual funds can cost a decade's worth of life's work, and high fees rarely lead to
increased performance.
• Investing in low-cost index funds can avoid paying fees that can consume up to 50% to 70% of your
future nest egg.
• The single largest portion of savings comes from taxes, with the average American paying over half
of their income to taxes.
• Efficient tax strategy is essential to achieve Financial Freedom or retirement income.
• Asset allocation, diversification, and tax efficiency are the three forces that can help achieve the
greatest returns.
• Tax knowledge can save from unnecessary 30% of earnings and accelerate financial goals.
• Investing in ways that allow you to defer your taxes, such as 401(k), IRA, annuity, or defined
benefit plan, can compound your investments and achieve financial freedom faster.
 CHAPTER 3.6
SPEED IT UP: 4. GET BETTER
RETURNS AND SPEED YOUR WAY TO VICTORY
Asymmetric Risk/Reward in Investment Decisions
• Great investors use asymmetric risk/reward to maximize returns.
• Kyle Bass and Paul Tudor Jones used this concept to turn $30 million into $2 billion.
• Asset allocation is crucial for achieving higher returns while reducing risk.
• Effective diversification reduces risk and maximizes returns.
Fast Investing: Asymmetric Risk/Reward Opportunities
• The rule of 72 states it takes 72 years to double money at a 1% compounded rate.
• Asymmetric risk/reward opportunities can be found in real estate and retirement communities.
• Focusing on these opportunities can speed up the approach to financial freedom in shorter
timeframes.
Investment Opportunities
• The author found an investment opportunity in a $3 billion enterprise run by an entrepreneur.
• Publicly traded REITs can be purchased for those who aren't accredited.
• Lending money with a first trust deed as security can help find better returns with less risk.
Financial Advice
• Focusing on ways to save more, earn more, reduce fees and taxes, and find better returns with less
risk is essential.
 CHAPTER 3.7
SPEED IT UP: 5. CHANGE YOUR LIFE—
AND LIFESTYLE—FOR THE BETTER
Moving to a New City or Town: A Potential Benefit for Financial Freedom

• Moving to a less expensive city or tax-friendly state can increase income by 10% to 30%.
• Changing your savings rate can increase your savings rate by 20% to 40% without spending an
additional dime.
• Many Americans have seen retirement as a time to move to a warmer climate, less expensive city,
or a low-key place.
• California has lost over $30 billion in annual income tax revenue to states such as Nevada, Arizona,
Texas, and Wisconsin.
• Many people are moving from high-tax to low-tax states, saving money that can pay off their new
home in six years.
• Moving to a new city or town can significantly improve financial freedom and quality of life.
• Exploring beautiful and affordable places around the world can cut cost of living by a third or in
half.
• Long-term plans, such as a five-year, ten-year, or retirement plan, can create a better quality of life
for everyone.
• To achieve Financial Freedom, it's crucial to be more efficient with your earnings and savings,
focusing on improving your quality of life while reducing cost of living.
 SECTION 4
MAKE THE MOST IMPORTANT
INVESTMENT DECISION OF
YOUR LIFE
Asset Allocation: The Ultimate Bucket List
Understanding Asset Allocation

• Asset allocation is the most crucial investment decision of one's lifetime.

• It involves dividing money among different classes or types of investments, such as stocks, bonds,

commodities, or real estate.

• The proportions of these investments are decided in advance, according to goals, needs, risk

tolerance, and life stage.

• Asset allocation is the key to success or failure for the world's best financial players, including Paul Tudor Jones, Mary Callahan Erodes, and Ray Dali.

Role of Diversification

• Spreading money across different investments decreases risk, increases upside returns over time,

and doesn't cost you anything.

• Asset allocation protects against financial mistakes and enhances results.

The Security/Peace of Mind Bucket

• This bucket provides financial security and peace of mind, allowing individuals to keep the part of

their nest egg they can't afford to lose without fear of losing.

• Research shows that most people underestimate the pain of losing, and the pleasure of victories is

dwarfed by the pain of failures and losses.

Types of Investments in the Security Bucket

• Cash/Cash Equivalents: Need for immediate access to cash in case of emergencies or sudden

income loss.

• Money Market Funds: Ultra-short-term investments made up of low-risk, extremely short-term

bonds and other kinds of debt.

Structured Notes
• Structured notes, also known as "engineered safety," are market-linked CDs that promise to return the money after a specified period of time, plus a
percentage of the gains in a specific index.
• The security of structured notes depends on the bank that issues it, and it is important to weigh
the benefits against the risk and make your own decision.

Understanding Asset Allocation and Selecting Investments for Security Bucket

Understanding Asset Allocation
• The article highlights the importance of understanding asset allocation and selecting investments
that reflect personal goals and risk tolerance.
• The challenge of choosing the right investments for a Security Bucket is highlighted, especially in
Today world where low interest rates have forced even conservative investors into riskier
investments.

Comparing Investments to Gambling

• The article compares the money in a Security Bucket to an old gambler's trick on the golf course.
Investing in Real Estate Loan
• The author found a residential real estate loan that would pay 10% interest for one year, which he
decided to invest in.
• The author emphasizes the importance of asset allocation in achieving financial freedom and
suggests that a percentage of hard-earned money should be invested in safe investments.
Bonds as a Potential Investment
• Bonds were once considered the safest and most reliable form of investment, but they have taken
a bad rap in recent years due to low interest rates and unstable companies, cities, and nations that
issue bonds.
• There are four different types of Treasury bonds: T-bills, T-notes, T-bonds, and TIPS.
• The value of the bond can be adjusted down, so if another economic recession or depression
occurs, you could potentially lose some of your principal if you need to liquidate and get the value of
your bond today
Further Bonds
• Foreign government bonds have become a riskier deal due to countries like Greece, Spain, and
Argentina teetering on default or falling over the edge.
• Most advisors recommend leaving these investments to expert traders and hedge funds.
 CHAPTER 4.2
PLAYING TO WIN: THE
RISK/GROWTH BUCKET

Risk/Growth Bucket Strategy Overview

• The strategy involves potential loss of savings and investments due to market cycles.
• It is important to remember that what goes up will come down, and vice versa.
Seven main asset classes to consider:
1. Equities: Shares of individual companies or vehicles for owning many of them at once.
• High-Yield Bonds: Bonds with the lowest safety ratings and offer a higher rate of return due to
taking a big risk.
2. Real Estate: Yielding significant returns, with various ways to invest in property.
• Investment options include renting out a home for income, buying property, fixing it up, flipping it
in the short term, investing in first trust deeds, buying commercial real estate or apartments, and
investing in senior housing.
3. Commodities: Gold: A staple of many people's Security Bucket.
• Gold serves as a small portion of a portfolio that serves as a security in case paper money
disappears or if the government collapses under a zombie invasion.
• Currency investing is a pure speculation with both profitable and unsuccessful outcomes.

4. Collectibles: Art, wine, coins, automobiles, and antiques require special knowledge or extensive
Diversifying Portfolios for Long-Term Profitability
• Diversify portfolios between Security and Risk/Growth Buckets, and within them.
• Invest in stocks and bonds from different markets and parts of the world.
• Use low-fee index funds for broad exposure to the largest numbers of securities at the lowest cost.
• Avoid fees and tax efficiency by owning the index.
Burton Malkiel Advice
• Set aside a small percentage of your risk/growth bucket for stocks and day trading, but limit it to
5% or less of your total assets or portfolio.
• Avoid overconfidence and design asset allocation ideally to make money in the long term even if
they are wrong in the short term.
David Swensen Portfolio Recommendations
• Uses six categories, all in index funds, and assigns each asset class to their proper allocation
buckets.
• Top four asset classes are a broad domestic stock index, international stocks, emerging stock
markets, REITs (real estate investment trusts), long-term US Treasuries, and TIPS (Treasury inflation-
protected securities).
• Swensen chose this mix to protect against both inflation and deflation.
• Only 30% of his asset allocation goes into the Security Bucket, while 70% of his assets go into the
Risk/Growth Bucket.
• Swensen believes that equity returns are superior to fixed income.
David Swensen Portfolio: A Wealth-Generating Machine
• The portfolio has consistently outperformed the stock market, with an annual return of 7.86%
from 1997 to 2014.
• During the bear market of 2000-2002, the portfolio remained relatively stable, with a total loss of
only 4.572%.
• Despite its success, the portfolio is aggressive, suitable for young individuals with more time to
recover from losses.
• Investment decisions should consider life stage, risk tolerance, and available liquidity.
• The portfolio success is attributed to its asset allocation mix.
Understanding Risk Tolerance and Portfolio Management
Risk Tolerance Variations
• Risk tolerance varies among individuals, with some being security-driven and others seeking
uncertainty and variety.
• Understanding one personality is crucial before investing in risk-tolerance strategies.
• Rutgers University has developed an online quiz to help identify risk tolerance levels.
Understanding Risk Tolerance
• People don’t know their true risk tolerance until they experience a significant loss.
• Asset allocation alone can significantly reduce the risk of sizeable losses.
• Asset allocation alone can promote a balanced approach to financial decisions.
Motivational Bias
• Humans often underestimate their potential to win, leading to motivational bias.
• This bias can be harmful in money, especially in investing.
Poor Asset Allocation
• Markets can be mesmerized by returns, leading to poor asset allocation and potential losses or
• A system should be in place to prevent seduction into putting too much money in any one market
or asset class or too much in their Risk/Growth Bucket.
Investing Fundamentals
• High-level investors may forget the fundamentals, while those who can't listen to reason may fall into the
irrational exuberance" myth of investing.
• It is recommended to choose a conflict-free, independent investment manager to avoid painful lessons.
Choosing a Number
• The old rule of thumb is to invest your age in bonds, but this is outdated due to increased volatility
of stocks and bonds.
• J.P. Morgan Mary Callahan Erdoes shares her criteria for building an asset allocation for her three daughters.
• The purpose of investing is to ensure economic freedom for oneself and their families, but not at
the expense of stress, strains, and discomfort.
Choosing the Right Investment Percentage
• To make the right investment decision, write down your numbers and make them real.
• Stick with your chosen percentage until you enter a new stage of life or when circumstances
change dramatically.
 CHAPTER 4.3
THE DREAM BUCKET
Malcolm Forbes Dream Bucket Strategy
• The concept of a Dream Bucket is a strategy where one sets aside money for personal and loved ones to enjoy life
while building wealth.
• The bucket can be strategic splurges such as buying new suits or a luxurious vacation.
• The author first Growth Bucket was to buy two new suits at a Men Warehouse-like store.
• The author dream of a resort in Fiji came true when he fell in love with the turquoise waters of the South Pacific
islands at 24 years old.
• The author emphasizes that dreams are not designed to give a financial payoff but to give a greater
quality of life.
• The best jackpots in the Dream Bucket dont have to be just for oneself, but the ones you give to
others.
• Henry David Thoreau shares his story of giving unexpected gifts to his family, teaching them to
give, not just get in life.
• The author emphasizes the importance of fulfilling dreams and focusing on creating wealth
through creativity and service to others.
• To fill the Dream Bucket, one can invest in a fixed proportion: one-third in Security, one-third in
• The third way to fill the Dream Bucket is to save a set percentage of your income and build it up
until you can purchase your dreams.
• The key to filling your Dream Bucket is to make a list of your dreams, put them in order of
importance, big and small, short term and long term, and write down why you must achieve them or
experience them.
• The goal is to reward yourself and enjoy life fully on your path to financial freedom.
 CHAPTER 4.4
TIMING IS EVERYTHING?
Timing in Investment Success
• Timing is crucial for investors and stand-up comedians to avoid destroying their nest egg.
• Diversifying portfolios across different asset classes and markets can protect against volatile
economic conditions.
• Burton Malkiel, an economist, warns against investing at the wrong time, as seen during the tech
bubble.
• Paul Tudor Jones, a renowned investor, predicted the stock market crash of 1987 and helped his
clients make a 60% monthly return and 200% for the year.
• In 2008, Tudor warned his Platinum Partners about a potential stock market and real estate crash,
leading to a four- to six-month jump in stock prices.
• Investors should follow Sir John Templeton motto, "The best opportunities come in times of
maximum pessimism or Warren Buffett mantra, fearful when others are greedy, and be
greedy when others are fearful.
• If investors feel they have to sell during the market collapse, they should learn to lock in their
losses permanently.
• Financial tools, specifically insurance products, can help limit investment risks and maximize
returns.
• Lynch suggests investors can take advantage of market timing by applying simple principles, such
as taking oneself out of the market and automating their investment schedule.
• Burt Malkiel advises getting on automatic pilot to avoid emotions and that more money has been
lost by investors preparing for corrections or anticipating corrections than by corrections
themselves.
Dollar-Cost Averaging: An Answer to Timing Dilemma
Dollar-Cost Averaging
• A technique developed by Benjamin Graham to reduce investment mistakes.
• Involves diversifying across asset classes, markets, and time.
• Helps avoid emotions from delaying investing or ignoring or selling off funds that aren't producing
great returns.
• Advocated by many as the key to ensuring investments will survive unstable markets and continue
to grow in the long term.
• Requires equal contributions to all investments on a set time schedule, either monthly or
quarterly.
Challenges and Benefits of Dollar-Cost Averaging
• Counterintuitive and may lead to less money.
• Takes emotion out of investing, which often destroys investing success.
• Debate about the long-term effectiveness of dollar-cost averaging.
• Allows for market fluctuations to increase gains, not decrease them.
• Example: Investing $1,000 a year into an index fund for five years.
• Burt Malkiel provided an example of how dollar-cost averaging works.
The Lost Decade
• During the first ten years of the 2000s, investors learned a hard lesson.
The Average Person’s Approach to Investment
• Emphasizes the importance of rebalancing your portfolio at regular intervals.
• Rebalancing involves checking your buckets and ensuring your asset allocations are in the right
ratio.
• Carl I example of reinvesting a profit into other assets while keeping 2% of his Netflix shares.
Rebalancing in Balanced Portfolios
• If your portfolio is out of balance, it important to rebalance your investments.
• Rebalancing involves shifting your regular contributions from Risk/Growth to Security until the 25%
is back up to 40%.
• The rules of rebalancing dont guarantee you are going to win every time, but it increases your probabilities of success.

Understanding Asset Allocation, Dollar-Cost Averaging, Rebalancing, and Tax-Loss Harvesting for
Financial Freedom
• Asset allocation, dollar-cost averaging, rebalancing, and tax-loss harvesting are crucial for financial
freedom.
• Diversification between Security, Risk/Growth, and Dream Buckets can increase returns and
minimize losses.
• Tax-loss harvesting is a legal way to lower taxes while maintaining portfolio balance.
• Understanding these strategies can make investing simpler for everyone.
• The 7 Simple Steps to Financial Freedom include saving a percentage of income, investing it
automatically for compounded interest, learning investing rules, and avoiding Wall Street
marketing myths.
 CHAPTER 5.1
INVINCIBLE, UNSINKABLE,
UNCONQUERABLE: THE ALL
SEASONS STRATEGY
• Sun Tzu The Art of War" emphasizes the importance of understanding our experiences and
events that shape our worldview.
• Ray Dalio, a hedge fund manager, grew up during the 1970s, a time of violent change and the
worst economic environment since the Great Depression.
• He witnessed short bursts of bull and bear markets, creating massive volatility in different asset
classes.
• His investment philosophy was shaped by a surprise address from President Nixon in August 1971,
which changed the financial world.
• The Nixon rally, which followed the announcement, led to a market boom known as the "Nixon rally" but also set up an
inflationary storm.
• Ray developed a lifelong obsession to prepare for anything, the unknown around every corner.
• His strategy for the largest returns possible with the least amount of risk is known worldwide.
• Ray portfolio provided extraordinary returns, nearly 10% annually for the last 40 years (1974 through 2013), with an average loss of
1.47%.
• His greatest genius is applying Warren Buffett rule 1: don’t lose money. Rule 2: see rule 1.
• Ray approach allows individuals to have stock market-like gains while limiting both the frequency and size of losses in nearly every
economic environment.
• The author emphasizes that past performance does not guarantee future results; instead,
historical data is provided to discuss and illustrate the underlying principles.
Ray Dalio Success and Influence in the Financial World
Ray Dalio Success in Supply Chain Management
• Ray Dalio created a custom futures contract that allowed suppliers to sell chickens for a fixed price.
• His firm, Bridgewater, provided advice on structuring inflation-protected bonds (TIPS) in 1997.

Ray Dalio Firm, Bridgewater

• Bridgewater is Ray Dalio personal team dedicated to maximizing returns and minimizing risk.
• The firm has over 1,500 employees and is the world largest hedge fund with nearly $160 billion under its watch.
• Ray observations are read by the most powerful figures in finance, from heads of central banks to foreign governments and even the US president.

Ray Dalio Pure Alpha Strategy

• Launched in 1991, Pure Alpha strategy has achieved a 21% annualized return with relatively low
risk.
• The fund has $80 billion in assets and has investors including the world wealthiest individuals,
governments, and pension funds.
• The strategy is actively managed, seeking opportunistic investments at the right time and place.

Ray Dalio All Weather Strategy

• The All Weather strategy was tested since 1925 and produced stellar results for Ray family trust.
• The strategy was publicly launched in 1996, just before a market correction, and passed with flying
colors.

The All Weather Portfolio

succeed? is to ask better-quality questions.
• Ray Dalio incorporated Markowitz core insights into the design of portfolios and asset allocations.
• His All Weather strategy has produced extraordinary investment advantages for governments,
pension plans, and billionaires.
Gaming Day Interview
• The author spent nearly 15 hours preparing for an interview with Ray, a renowned investment
legend.
Ray Dalio Perspective on Asset Allocation
• Discusses the importance of asset allocation in success.
• Challenges conventional wisdom on a balanced portfolio.
• Encourages the author to use their own knowledge and experience for a more successful portfolio.
• Highlights the importance of the organization of the nonobvious.
• Questions why conventional balanced portfolios dropped 25% to 40% during market crashes.
• Discusses the risky business of a 50/50 portfolio, which exposes investors to more risk.
• Highlights the volatility of stocks, putting 95% of the risk in stocks.
Understanding Balance vs Risk in Investment
• The concept of balance versus risk is often misunderstood, suggesting a 50/50 portfolio with 50%
in stocks is relatively balanced.
• The S&P 500 has lost money nine times from 1973 to 2013, with cumulative losses totaling 134%.
• The conventional approach to diversifying investments is not diversifying at all.
• To be more balanced, money should be divided based on the amount of risk/reward there is, not
The Four Seasons
• David Swensen emphasizes that unconventional wisdom is the only way to succeed in any
investment.
• He believes that every investment has an ideal environment in which it flourishes, and there is a
season for everything.
• Ray investment strategy focuses on four key factors that influence asset prices: inflation,
deflation, rising economic growth, and declining economic growth.
• Ray suggests that 25% of risk should be placed in each of these four categories, as there are good
and bad environments for all asset classes.

Two Down, One to Go

• Tony asked Ray for a simplified version of his All Weather strategy, which uses sophisticated
investment instruments and leverage to maximize returns.
• Ray agreed to give readers a recipe for success without taking anyone money, even if they are
worth five billion dollars today.

Drumroll, Please
• Ray Ray, a self-made man with a net worth of over $14 billion, has created an exact asset
allocation strategy that has been replicated by many funds and strategies.
 CHAPTER 5.2
IT’S TIME TO THRIVE: STORM-PROOF
RETURNS AND UNRIVALED RESULTS
Proof of All Seasons Portfolio Performance
• The All Seasons portfolio has consistently performed well over the past 80 years, with an average
annualized return of just under 10%.
• The portfolio has made money just over 86% of the time, with an average loss of just 1.9% and a
worst down year of -3.93% in 2008.
• The portfolio was selected for its performance during the "modern period" (1984 through 2013),
marking the beginning of the 401(k) plan.
• The portfolio held up in the worst economic winters from 1939 to 2013, including the Great
Depression.
• The All Seasons portfolio destroyed the returns of the market from January 1, 2000, through
February 2, 2015, including the tech crash, credit crisis, European debt crisis, and the largest single-
year drop in gold in over a decade.
Critique of Ray Dalio All Weather Strategy
• The media often downplays best in class" strategies, exploiting any false moves or seemingly
slight cracks in the armor.
• The All Weather approach will take losses, but the goal is to minimize those dramatic drops.
• The All Weather approach involves a large percentage of government bonds in a portfolio, which
may cause a loss if interest rates rise.
Historical Analysis
• The All Seasons portfolio performed well during a period of rising interest rates, with a single losing
year in the 1970s.
• The portfolio had an annualized return of 9.68% during the decade, including a cumulative loss of
40.21%.

The All Seasons Portfolio

• The All Seasons portfolio aims to reduce volatility and risk while maximizing gains.
• It has been criticized for its lack of human element, but it is a fundamental advantage that can be
achieved by making small adjustments in stocks versus bonds.
• The All Seasons approach with more stock exposure outperformed the standard 60%/40%
balanced portfolio, despite accepting nearly 80% more risk.

Investor Risk Aversion

• The average investor appetite for risk is weaker than often perceived.
• For the 20-year period from 1993 to 2013, the S&P 500 returned 9.2% annually, while the average
mutual fund investor averaged just over 2.5%.

The All Seasons Portfolio

• The portfolio provides emotional scaffolding to prevent poor decisions.
• The portfolio is not tax efficient at times, so qualified accounts or low-cost variable annuities are
essential for tax efficiency.

All Seasons + Lifetime Income Strategy Overview

• The portfolio was tested using the annual historic returns of low-cost, broadly diversified index
funds.
• In cases where actual index fund data was unavailable, the team used broadly diversified index
data for each asset class and adjusted the returns for fund fees.
• The strategy assumes investments are held in a tax-free account with no transaction costs.
• The author thanks Cliff Schoeman, Simon Roy, and the Jemstep team for their in-depth analysis
and coordination with Ajay Gupta at Stronghold Wealth Management.
 CHAPTER 5.3
FREEDOM: CREATING YOUR
LIFETIME INCOME PLAN
The Evolution of Retirement and the Importance of Income
Edmund Hillary Success and the Legend of Mount Everest
• Edmund Hillary, the first person to climb Mount Everest, was knighted by the Queen of England.
• However, George Mallory may have been the first to reach the peak 30 years prior.
• Hillary fame and knighting are attributed to his successful descent and successful summit.
Investing for Income
• Income is crucial for retirement security as it provides a consistent cash flow, freedom, and peace
of mind.
• Wealthy individuals can spend their assets, but cash is the most important outcome.
• Income insurance provides a guaranteed way to secure a paycheck for life without future work.
The New Age of Retirement
• Over the past 30 years, retirement has significantly changed, with over 62% of workers having a
pension plan.
• Many are facing a massive retirement crisis due to fees, inflation, and medical surprises.
The New Life Expectancy
• Advances in technology have made life expectancies significantly longer.
• Ray Kurzweil, head of engineering at Google, predicts that by the 2020s, humans will have the
• The current world of globally suppressed interest rates makes savers and seniors increasingly
vulnerable.
The Big Luck of the Draw
• The odds of making it to retirement are significantly influenced by the sequence of returns.
• Mitigating this risk involves finding a fiduciary advisor, reducing fees, investing tax efficiently, and
building up a Freedom Fund.
Retirement Planning and Annuity Benefits
John Bit the Dog
• John, a 65-year-old retiree, takes out 5% of his nest egg/Freedom Fund each year.
• He increases his withdrawal each year by 3%) to account for inflation.
• Early market losses lead to a five-year cut in his $500,000 account value.
• By age 83, his account value collapses, leaving him with an additional $80,000.
• The market averaged over 8% annual growth during John's downfall.
FLIP-FLOP
• Susan, a 65-year-old retiree, withdraws 5% of her income, or $25,000 per year, and adjusts her
withdrawal slightly each year to account for inflation.
• Susan has withdrawn over $900,000 in income payments by 89 but still has an additional
$1,677,975 left in her account.
• Both John and Susan have the same average return (8.03% annually) over the 25-year period.
• If they had income insurance, John would have a guaranteed income check as his account
dwindled, while Susan would have more money to spend on vacations, gifts, or charitable
contributions.
• A study compared how annuities were described and how the shaping of that conversation
changed people perceptions of their need or desire for an annuity.
• Annuities are an essential investment vehicle for Americans who want a guaranteed income for
life.
• The financial industry has revolutionized annuity opportunities, offering returns that mimic the
stock market performance but without downside losses.
 CHAPTER 5.4
TIME TO WIN: YOUR INCOME IS THE
OUTCOME
Understanding the Rise of Annuities in the Financial Industry
Popularity of Annuities
• George Foreman highlights the increasing popularity of annuities in the financial industry, focusing
on income level rather than retirement age.
• Financial advisors recommend annuities as a part of income plans for baby boomers who have
experienced market losses.
• Younger individuals are increasingly using annuities tied to market indexes as a “safe-money”
alternative.

Immediate Annuities
• An immediate annuity provides a guaranteed lifetime income through the concept of “mortality
credits.”
• Insurance companies have successfully guaranteed lifetime incomes for millions of people.
• The buyer who lives a long time receives the benefit, while those who die early leave some money
on the table.

Importance of Income Insurance

• David Babbel emphasizes the importance of income insurance for a long life.
• If a person dies early, they should not worry about losing their money.
• An option where the insurance company will refund their heirs the same amount they put in can
Control as an Illusion
• Control is often an illusion as things can change quickly.
• The focus should be on guaranteed income for life, rather than just asset growth.
Types of Deferred Annuities
• There are two main types of annuities: immediate annuities and deferred annuities.
• There are three primary types of deferred annuities: fixed annuity, indexed annuity, and hybrid
"indexed annuity.
Safety of Annuities
• The safety of annuities is crucial, with a guarantee as good as the insurance company that issues it.
• Insurance guaranty associations run by state insurance departments guarantee up to a certain
amount/deposit of the product purchased.
Understanding Variable and Fixed Annuities
• Variable annuities are a type of deferred annuity often avoided due to their high cost and mutual
fund investment.
• Fixed annuities provide a guaranteed rate of return for a specific period, with the money growing
tax-deferred.
• Longevity insurance is a popular retirement planning approach, allowing individuals to create
income insurance with guaranteed rates of income from age 80 or 85 until their passing.
• The IRS favors advanced-life deferred annuities, which allow tax-free income payments.
The Ultimate Income Solution
• Fixed Indexed annuities (FIA) and two new types of deferred annuities, introduced in the early
1990s, are popular financial products offering upside potential during growth and guaranteed
• Fixed indexed annuities have seen a 41% growth in deposits since 2013.
• FIAs offer a lifetime income rider or guaranteed minimum withdrawal benefit, remain in control,
offer higher annual returns than other safe-money solutions, provide a 100% guarantee of principal,
and are tax-deferred.
• Insurance companies offer unique products that allow customers to keep 100% of market/index
gains without a cap on their upside.

LOCK IN YOUR GAINS

• Stock Investment Accounts (FIAs) offer a unique benefit of locking in gains or upside each year,
ensuring the account remains stable and secure.
• Fixed indexed annuities are attractive for their safe-money return and guaranteed lifetime income
stream.
• The author aims to create an affordable, secure lifetime income plan for younger people in their
20s, 30s, or 40s, allowing them to achieve financial freedom without market stress.

YOUR PERSONAL JACKPOT

• Advisors Excel, a multibillion-dollar company, aims to provide financial advice to top-tier financial
advisors.
• The company proposes a fixed indexed annuity where younger people could contribute monthly,
similar to how they would a 401(k), and know that for every dollar they contribute, they are
guaranteed a lifetime income stream.

The Potential of a New Annuity for Gen X

• Gen Xers, independent self-thinkers, are demanding guarantees, protection, and income from the
• The new annuity would be sold online, eliminating the middleman and making it more
convenient and affordable for younger ages.
• The idea is to invest money per month and have it automatically deducted from a checking
account, allowing individuals to track their income for life.
• Cody, a small-town farm boy, believes that millions of lives could be touched by this solution,
especially the vast majority of America.
• Lifetime Income has established a website to educate and empower individuals about finding
and selecting the right annuity products for their specific situation.
• The right fixed indexed annuity allows deposits to participate in 100% of the market upside
while avoiding losses during market downturns.
• The text also highlights the importance of protecting wealth for oneself and their children, with the
ultrawealthy using sophisticated advisors to protect their wealth.
Fixed Index Annuities: Common Questions and Benefits

• What happens if I die early?

• The entire account balance is left to heirs, not forfeited to the insurance company.
• Can I take out money in case of an emergency?
• Most FIAs allow up to 10% to 15% of the account without penalty or surrender charge.
• If you withdraw before age 59 1/2, you will be charged a 10% penalty by the IRS.
• If you need all your money back, you can surrender the annuity and get your money out, plus any
growth.
• No annual management fees are withdrawn from the account, but a guaranteed lifetime income
rider fee ranging from 0.75% to 1.25% annually depends on each company offerings.
• Can I put my IRA money into an annuity?
• The cap on account growth is typically tied to interest rates, with higher rates resulting in a higher
cap.
• To what underlying markets will my account be “linked”?
• The income from an annuity depends on factors such as your contribution, the duration of your
income stream, and your age.
• The tax treatment of an FIA is tax deferred, meaning you pay ordinary income tax rates on lifetime
income payments.
• The effective tax on income from immediate annuities is dependent on the IRS exclusion ratio,
meaning a portion of income payments are considered a return of principal.
 CHAPTER 5.5
SECRETS OF THE ULTRAWEALTHY
(THAT YOU CAN USE TOO!)
Life Insurance: A New World Record and Rich Man Roth
New World Record in Life Insurance
• In 2014, the Guinness Book of World Records set a new world record for the largest life insurance
policy, a $201 million policy.
• The ultra-wealthy, banks, and large corporations like Wells Fargo are the biggest buyers of life
insurance.
• These corporations and the ultra-wealthy use life insurance as an IRS-sanctioned vehicle to grow
their investments tax-free.
Private-Placement Life Insurance (PPLI)
• PPLI offers unlimited deposit amounts, no tax on the growth of investments, and no tax when
accessed (if structured correctly).
• This strategy removes part or all of the nest egg from the tax system entirely, eliminating the need
to pay tax on growth of investments or the money you access within this structure.
• Policyholders may be able to access their money during their lifetimes by withdrawing or
borrowing funds tax-free from the policy.
Is Life Insurance Expensive?
• PPLI is an institutionally priced policy with no commissions or surrender charges, unlike retail life
insurance.
• It acts as an insurance wrapper around investments, legally sheltered from tax due to a specific tax
Tax-Free Compounding
• PPLI offers a significant advantage over traditional tax-paying methods.
• For instance, a healthy male, age 45, with four annual deposits of $250,000, would have a total
contribution of $1 million over four years. If he wraps the investment within PPLI and pays a small
amount for insurance, his ending balance is just over $30 million, allowing him to have over 400%
more money for himself and his family using the tax code.
PPLI and Life Insurance: Tax Deferral and Quality
• PPLI offers tax deferral on investment gains, but cash withdrawals require tax.
• Life insurance death benefit proceeds are income tax-free for children.
Quality and Investment
• PPLI requires an accredited investor with a minimum annual deposit of $250,000 for four years.
• TIAA-CREF offers low-cost index funds and tax benefits similar to PPLI.
• TIAA-CREF can help investors achieve goals 30% to 50% faster with no additional risk.
The Billionaire’s Playbook
• A rare no-load life insurance policy can provide the equivalent of a Roth IRA without income or
deposit limitations.
• Learning directly from successful financial minds is now available.
Living Trust
• Establishing a living revocable trust is crucial for protecting family.
• Living trusts allow ownership of core assets without probate and provide an incapacity clause.
• Living trusts can be set up for free by organizations like http://getyourshittogether.org or
LegalZoom.
 SECTION 6
INVEST LIKE THE .001%: THE
BILLIONAIRE’S PLAYBOOK
Meeting the Masters
• The author interviews over 50 self-made billionaires, Nobel Prize winners, investment titans,
bestselling authors, professors, and financial legends to understand their competitive advantage in
investing.
• The authors synthesize the insights into a 7-step financial blueprint to help individuals move from
where they are now to where they truly want to be.
• The book features interviews with 12 of the greatest money masters, including Sir John Templeton.
• Despite differing views on the near-term future and investment vehicles, all share four common
obsessions: dont lose, anticipate and diversify, never be done, and never be done giving.
• Losing 50% of capital takes 100% to get back to where you started, which is something you can
never get back: time.
• Asymmetric risk/reward is another common obsession among these financial legends. They live to
uncover investments where they can risk a little and make a lot, called home runs.
• Anticipate and diversify are essential for great investors. They find the opportunity for asymmetric
risk/reward and do their homework until they know in their gut that they are right—unless they're
not.
• The ultimate truth is that life is about more than what you have. It is really about what you have to
give.
• The book serves as a valuable resource for investors seeking to uncover their own path to financial
 CHAPTER 6.1
CARL ICAHN: MASTER OF THE
Carl Icahn Influence and Legacy
• Carl Icahn, a billionaire businessman, is recognized as the most important investor in America.
• His ventures have earned 50% more than Warren Buffett over the past four decades, with a
compounded return of 31% compared to Berkshire Hathaway return.
• Icahn business skills have made him one of the richest men in the world, with a net worth of over
$23 billion.
• He has made billions more for ordinary shareholders who invest in his holding company, Icahn
Enterprises LP (NASDAQ: IEP), or own stock in the companies he targets.
• Icahn challenges the stereotype of a Wall Street caricature, viewing himself as a "shareholder
Activist who aims to improve corporate governance and accountability.
• He buys up shares of top-heavy or underperforming companies and puts them on notice that it's
time to step up their game or face a proxy fight for control of the board.
• Icahn has been criticized by public company boards for his criticism of Coca-Cola, which was
planning to dilute the company stock value by issuing $24 billion in new, discounted shares to
finance huge compensation packages for top management.
• Icahn work has been criticized for sacrificing long-term corporate goals for short-term profits, but
he often holds his positions for much longer than people realize.
• He is not after the head of every CEO in America, but always looking for ways to make the
management—even of the most popular and well-run corporations—more responsive to
shareholders.
• The author suggests that the way public companies are governed is bad for the country, as many
rules keep shareholders from being an activist.
• The solution to this problem is to get rid of the poison pills that issue more stock at a discount if
any one shareholder buys too much and staggered board elections so that shareholders can decide
how they want the company to run.
 CHAPTER 6.2
DAVID SWENSEN: A $23.9 BILLION
LABOR OF LOVE

David Swensen Legacy and Investment Strategies

• David Swensen, known as the Warren Buffett of institutional investing, has transformed $1 billion
in assets into over $23.9 billion over his 27-year tenure as Yale chief investment officer.
• He has achieved 13.9% annual returns, a record unmatched by many high-flying hedge funds.
• Swensen Yale model, also known as the endowment model, favors broad diversification and a
bias toward equities, with less emphasis on lower-return asset classes.
• He avoids liquidity, arguing it leads to lower returns on assets that could otherwise be invested
more efficiently.
• Prior to his tenure, Swensen worked for bond powerhouse Salomon Brothers and is credited with
structuring the world first currency swap, a trade between IBM and the World Bank.
• He believes that the profit orientation in the mutual fund industry conflicts with fiduciary
responsibility, leading to lower returns for investors.
• Swensen suggests three tools to increase returns and make better portfolio decisions: asset
allocation, market timing, and investing in bonds, stocks, or real estate.
• Asset allocation is the most important tool in investing, explaining more than 100% of returns.
• Diversification is crucial for generating higher returns with lower risk or generating a lower return
• A straw-man portfolio in Swensen's book includes 70% of the assets in the
portfolio being equities, and 30% being fixed income.
• DS emphasizes the importance of understanding the amount of money needed to save for
retirement and the importance of education for making informed decisions.
 CHAPTER 6.3
JOHN C. BOGLE: THE VANGUARD OF
INVESTING
Jack Bogle: A Pioneer in Investing

• Born in 1929 in New Jersey, Bogle received a scholarship to Princeton and wrote his senior thesis
on mutual funds.
• After graduating, he joined the Wellington Management Company in Philadelphia and became
president.
• During the mid-1960s, Bogle merged with a management group that ran the mutual funds into the
ground and fired him.
• Bogle decided to start an unmanaged fund, Vanguard, which was initially viewed as a joke.
• Bogle vision of giving investors a fair shake came from his early memories of working at nine
delivering newspapers.
• Bogle belief that investing is 95% luck and 5% skill has been a driving force behind his success in the investment industry.
• Tony J. Berman, an investment expert, argues that people buy stocks for dividend yield and
earnings growth, which is where all the fund expenses come from.
• Despite the high expense ratio of the average equity fund, there are still 100 million people
invested in actively managed mutual funds.
• Berman discusses the conflict of fiduciary duties between the manager of a publicly held firm and
the public owners of the company.
• Berman predicts that corporate America will continue to grow and the stock market will be a
derivative of the value created by corporations.
• He advises investors to use common sense and not get carried away by the fads and fashions of
the moment.
Berman Investment Principles and Portfolio Approach
• Berman emphasizes understanding the long-term impact of the stock market on investors.
• He advocates for a balanced approach to investing, paying attention to historical trends and
avoiding distractions.

Jack Bogle View on Money

• Bogle views money as a means to an end, not an end itself.
• He shares a story about Kurt Vonnegut and Joe Heller success, highlighting the advantages and disadvantages of money.

JB Portfolio Principles
• Bogle portfolio includes asset allocation based on risk tolerance and objectives, diversification
through low-cost index funds, and having as much in bond funds as one age.
• He has 40% of his total portfolio invested in bonds, 60% in stocks, and the rest in Vanguard stock
index funds.
• Bogle aims to avoid drawing on money in his taxable portfolio, which has good tax-exempt yields.
• He is satisfied with the consistently positive returns on his total portfolio, averaging almost 10% per year after an 17% decline in 2008.
 CHAPTER 6.4

WARREN BUFFETT: THE ORACLE OF

OMAHA
Warren Buffett Economic Success and Philanthropy

• Warren Buffett, the third wealthiest man in the world, participated in a roundtable discussion with
Matt Lauer on the Today show.
• Buffett success strategy is "value investing," which involves looking for undervalued companies
and buying stock with the expectation of long-term price rise.
• Buffett pursued insurance holdings that offer less cash flow and investment opportunities.
• He is a generous philanthropist, pledging 99% of his fortune to charity through the Bill and Melinda
Gates Foundation.
• Buffett advocates for indexing as the best investment strategy in a volatile economy.
• He advised his wife and trust to invest 10% in short-term government bonds and 90% in a low-cost
S&P 500 index fund.
• Jack Bogle, America most respected investor, endorses this strategy.
 CHAPTER 6.5
PAUL TUDOR JONES: A MODERN-DAY
ROBIN HOOD
Paul Tudor Jones: A Successful Trader and Philanthropist
• Paul Tudor Jones, a renowned trader, started his firm at 26 and has produced 28 consecutive full
years of wins.
• He is known for predicting Black Monday, the 1987 stock market crash, which saw a 22% drop in a
single day.
• Jones is a macrotrader who studies the impact of fundamentals, psychology, technical analysis,
flows of funds, and world events on asset prices.
• He is sought out by influential financial leaders such as finance ministers, central bank officials, and
think tanks.

Strategies of Warren Buffett and Bill Gates for Investing

• Buffett approach involves being defensive and running a portfolio with no great expectations.
• He shares two strategies for protecting his portfolio: staying with the predominant trend and not
being a contrarian investor.
• Buffett money came from holding Microsoft, which went up eight hundred times, and staying
with the trend.
• Gates made his money from the cash flow of all his insurance companies, surviving one of the
greatest bull runs in history.
• Buffett uses the 200-day moving average of closing prices as a metric for everything he looks at.
Investing Principles for Parents
• 40% should never invest their own money in their entire life due to the contrarian bug.
• The second thought is five to one, risking one dollar to make five, allowing for a hit rate of 20%.
• The author suggests that passing on money to their kids would be a specific portfolio and a set of
principles to guide them.

Paul Turner Philanthropic Work

• Turner shares his personal experience of losing his mother at a young age, which sparked a lifetime
of trying to repay that kindness.
• He believes that financial stress never goes away and that it is never enough to give to causes that
bring happiness and passion in his life.
• Turner is determined to make a difference in someone life by working hard and making a
difference.
 CHAPTER 6.6
RAY DALIO: A MAN FOR ALL SEASONS
Ray Dalio All Seasons Strategy
• Renowned hedge fund manager and investor.
• Manages $160 billion hedge fund, Bridgewater Associates.
• Trusted advisor for world leaders and financial institutions.
• Created an investment plan for individual investors that works in all seasons without risking life
savings.
• Strategy only available to clients and shared globally.
• Book first two chapters, "Invincible, Unsinkable, Unconquerable: The All Seasons Strategy and It Time to
Thrive: Storm-Proof Returns and Unrivaled Results,& provide detailed account of Dalio journey.
• The strategy can be applied to anyone looking to grow their nest egg without risking life savings.
Mary Callahan Erdoes: CEO of J.P. Morgan Asset Management
• Mary Callahan Erdoes, CEO of J.P. Morgan Asset Management, is a prominent figure in the
financial services industry.
• She has grown J.P. Morgan Asset Management Division by over half a trillion dollars since 2009,
overseeing the management of $2.5 trillion invested by foundations, central banks, pension funds,
and some of the world wealthiest individuals.
• Erdoes leadership style is described as "loyal," "team-oriented," and "caring."
• She is known for her extraordinary leadership and extraordinary leadership, going out of her way
to know each of her employees.
Dr. Robert Shiller Perspective on Financial Institutions

• Dr. Robert Shiller, the Nobel Prize-winning economist, highlighted the positive impact of financial
institutions on the world by providing capital for growth, fueling employment, helping individuals
save and invest their money, and supporting local communities financially.
• He highlighted the importance of active management in investing, buying and selling companies
they believe have added insight.
• He highlighted the biggest opportunities for investors today and the largest challenges they need
to prepare for.
• Shiller also highlighted the industry changes in rules and regulations to ensure better conditions
for the future.

Work-Life Integration and Balance

• The speaker discusses the importance of maintaining balance in personal, professional, family,
friends, mind, and body aspects.
• They suggest that if they could pass on a set of rules or portfolio strategy to their children, they
would invest for the long term and only withdraw money when needed.
• The speaker believes in work-life integration and works at a company that supports families and
provides flexibility for people to do what works best for them.
 SECTION 7
JUST DO IT, ENJOY IT, AND
SHARE IT!
The Future of Technology: A Positive Perspective

• Technology is a hidden asset that is transforming our lives every day.

• Technological breakthroughs are happening today and in the coming years, revolutionizing the
quality of life.
• The cost of technology is decreasing while its capacity is geometrically expanding, offering
opportunities for wealth accumulation.
• The author takes a positive view of the technological future, reflecting the work of some of the
greatest scientists.
• Some people have a skeptical view of the future, envisioning a Terminator-style dystopia, while
others look forward to a world of flying cars, android helpers, or single-cell-grown food.
• New technologies are being used to enhance human life, solving global challenges like air
pollution, fresh water scarcity, and farmland scarcity.
• Some people fear the new and unknown, but actual scientists and futurists see advanced
technologies as opportunities for humanity to evolve.
• The best way to predict the future is to invent it.
• Techniques like harvesting healthy cells from skin and using them to heal wounds are being used
to improve the quality of life.
• The world today is a place of everyday miracles, with change happening so fast that sometimes we
dont even notice it.
• Change is exponential, making huge leaps forward in shorter periods of time.
• The average person today has options that the richest pharaoh in Egypt never dreamed of.
• The lifespan of humans has doubled from 31 to 67 years old in the last 100 years, and the average
per capita income tripled.
• The concept of email was first introduced by President Bill Clinton in the early 1990s.
The Future of Scarcity and Technology
The Evolution of Scarcity
• Technology is changing the concept of scarcity, which is the fear of not having enough of essential
resources.
• Peter Diamandis, founder of the X Prize Foundation, believes that technology can change scarcity.
The Growth of the World Population
• The world population has increased by over 3 billion people in the last 40 years, a 300% increase
from the original 200,000 years.
• Scientists estimate that the population will reach 9.6 billion by 2050 if current growth continues.
The Consumption of Natural Resources
• According to Jim Leape of the World Wide Fund for Nature International, we are using 50% more
resources than the Earth can sustainably produce.
• By 2030, even two planets will not be enough.
The Future of Energy
• The future of energy comes from alternatives such as wind power, biofuels, and solar energy.
• Easton LaChappelle, a pioneer in robotics, used the internet to find faster, better, and cheaper
ways to do things.
The MakerBot Era
• The MakerBot Era or the Maker Revolution has opened up new possibilities for people worldwide.
• The New Industrial Revolution" is fueled by the explosion of do-it-yourself (DIY) innovation.
Maker Faires
• Held annually around America, Maker Faires bring together inventors, hobbyists, engineers,
students, teachers, artists, and entrepreneurs.
• President Obama recently hosted a Maker Faire at the White House, where he met Marc Roth,
who started his own laser-cutting business.
The Internet and the Maker Revolution
• The internet has expanded beyond our craziest dreams, with computers and sensors embedded in
everyday objects.
• 3-D printing is how this internet will be transformed and expanded beyond our craziest dreams.
Ray Kurzweil Impact on Technology and Healthcare
• Ray Kurzweil, an inventor, author, and entrepreneur, has significantly impacted our lives through
digital music, reading machines, and regenerative therapies.
• He applied Moores law, which states that the processing power of computers doubles every two
years while its cost decreases at the same rate, to all information technologies and all aspects of our
lives.
• Kurzweil predictions of exponential growth have significantly impacted our lives.
• Despite skeptics initial belief that the project would take a century, Kurzweil predictions were
accurate, with the genome successfully sequenced in 2003.
• New food technologies are emerging to overcome challenges such as lack of arable land and
agricultural pollution.
• Craig Venter, the human genome pioneer, created artificial life in 2010, which took five years and
thirty million dollars to find out.
• Advances in nanotechnology and 3-D printing are transforming healthcare by turning cells into
software programs that can be programmed to build more of themselves.
• Advances in genetically enhanced red blood cells are being used to treat conditions like Parkinson

Disease and dementia.

Scientists are working on ways to create custom organs and body parts using 3-D printers,
eliminating the need for donor transplants.
• "Extracellular matrix or ECM, made of cells from a pigs bladder, is being used to regrow muscles, tendons, and bone.
• Kurzweil encourages people to take care of themselves right now to take advantage of these
medical breakthroughs and extend their lives.
Future of Computers and the Singularity

Ray Kurzweil Predictions

• Predicts a $1,000 computer by 2020 to have the full capacity of a human mind.
• This could lead to a world where computers become part of us, making us smarter, more powerful,
healthier, and happier.

The Singularity
The Impact of Technology on Happiness
• From 1981 to 2007, happiness rose in 45 of the 52 countries studied due to the digital revolution.
• Economic development, democratization, and rising social tolerance have increased the perception
of free choice, leading to higher levels of happiness.

The Future of Work and Technology

• 47% of the current US labor market is at risk of being mechanized in the future.
• Society will need to reboot to create meaningful work for everyone, and everyone will have to step
up to learn new skills.

The Potential for a World of Abundance

• Kurzweil shares a story about a gambler who wakes up to play blackjack, highlighting the potential
for a world of abundance.
• Peter Diamandis emphasizes the importance of finding meaning in life, bringing joy in both
challenging and abundant times.
 CHAPTER 7.2
THE WEALTH OF PASSION

Benjamin Disareli Journey to Financial Freedom and the Importance of Actio

• Benjamin Disareli, a financial expert and author, shares his journey to financial freedom and the
importance of acting from passion.
• He has met financial geniuses and human beings such as Ray Dalio, Paul Tudor Jones, Mary
Callahan Erdoes, Carl Icahn, David Swensen, Jack Bogle, and Charles Schwab.
• Disareli emphasizes that happiness comes from ones own actions and that true wealth is not
measured by the size of your bank account or the number of assets you have acquired or grown.
• The final secret to a rich life is to enjoy and share it, but first you must take action.
• The book focuses on creating an extraordinary quality of life, not just about money, but also on
mastering relationships, fulfillment, and health.
• Major achievement and winning the game require a balance in our lives, and chronically angry or
unhappy individuals are often the result of an unbalanced life.
• To cultivate gratitude, start by looking at the force that controls your mind and emotions. Three
key decisions that determine the quality of our life are: Embrace gratitude, focus on the present
moment, and practice gratitude.Focusing on Quality of Life and Emotional Well-being
Focus on What We Can Focus On
• The environment and advertising can influence our focus patterns.
• Two patterns that can shift our level of happiness, frustration, anger, stress, or fulfillment are:
focusing on what we have or what is missing from our life.
• Focusing more on what we can control or what we cant control can lead to more stress and
frustration.
• Self-esteem is measured by how much we feel we control the events in our life versus feeling that
lifes events are controlling us.

Understanding the Meaning of Life

• The quality of our lives is controlled by the meanings we give to events, financial conditions, and what has or hasnt happened to us.
• Meanings affect all of our relationships and interactions.
• A slight shift in perception, in meaning, can change our whole life in a moment.
• Depression is one of modern society biggest afflictions, with many rich and famous individuals still suffering from depression.
• A change of focus and a change in meaning can literally change your biochemistry in a matter of
minutes.

What Am I Going to Do?

• The act of creating meaning in our minds leads to an emotion, which in turn creates a decision:
what are we going to do?
• The fastest way to change these decisions is to change what we focus on and change the meanings
to something more empowering.
• To enhance the quality of our life, we can use these three decisions to train ourselves to live in
• Taking time to be grateful is crucial to prevent the "weeds of life"—frustration, anger, stress,
and achieved and feeling a sense of celebration and gratitude.
loneliness—from creeping in.
• To truly be happy, we must step outside of ourselves and take control of our human mind.
• Growth and contribution are essential for personal growth and the deepest meaning of life.
• The author believes that everyone can be great because everyone can serve.
• Real wealth is unleashed when one finds something they care deeply for and gives it their all, even if necessary.

The Wealth of Passion

• Pakistani teenager Malala Yousafzai, who was shot in the head by Taliban terrorists, exemplifies
the power of passion.
• Despite the injuries, Malala has mastered her three decisions: focus on what matters, find a
mission beyond herself that gives her life meaning, and act fearlessly.
• To master the meaning in our own lives, we can follow the final secret: the final secret.
 CHAPTER 7.3
THE FINAL SECRET

The Power of Money and Happiness

The Importance of Investing in Experiences
• Spending as little as five dollars a day can significantly increase happiness.
• The real power of money comes not in the amount but how we spend it.
Three Key Ways to Increase Happiness
• Investing in experiences like travel, learning a new skill, or taking courses.
• Buying time for oneself by outsourcing tasks.
• Investing in others by giving money away.
The Impact of Giving
• People get more satisfaction spending money on others than spending it on themselves.
• The benefits extend to subjective well-being and objective health.
• This phenomenon spans continents, cultures, income groups, and age groups.

The Size of the Gift

• The size of the gift doesnt really matter.
• Studies show that people who spend money on someone else report significantly happier moods
over the course of the day.
The Power of Giving
• A young boys life was reignited after his heart and soul were nearly crushed in the aftermath of
the horrific school shooting in Newtown, Connecticut.
• The author met 13-year-old JT Lewis, his six-year-old brother, on the first anniversary of the
massacre to help survivors cope with the ongoing impact of the tragedy.
The Power of Giving and the Impact of Charitable Giving
Chantals Journey and the Role of Charitable Giving
• Chantal, a young girl who witnessed her parents deaths, shared her story of healing and living a
happy life.
• She taught JT that healing and living a happy life required training oneself to be grateful, forgiving,
and compassionate.
• Chantal mission became her mission, freeing her from focusing on herself or any sense of loss Commitment to Charitable
Giving
• JTs example of service to others inspired him to give back to Chantal.
• He worked tirelessly to raise money to send Chantal to college for a year.
• Chantal passed on this gift to her best friend, Betty, who also supported JT.
The Power of Giving and the Transformation of Society
• Giving is not just about money, but also includes time, emotion, presence, and labor.
• Studies show that giving improves physical and mental health, with volunteering associated with
lower rates of depression, higher reports of well-being, and a 22% reduction in death rates.
• Giving in any form builds wealth faster than ever-lasting will.
The Story of Carnegie
The Authors Life Transformation
• The authors life was transformed when he was 11 years old when a stranger cared for him.
• He has continued to feed 42 million people over the last 38 years, starting with what little he had.
• Today, he is able to donate 50 million meals and in partnership with others, provide more than 100
million meals.
The Authors Book and Charitable Giving
• Simon& Schuster, Simon & Schuster, has donated his book, Notes from a Friend, to Feeding
America, the nations largest network of food banks.
Using Your Share Change to Change the World

• SwipeOut, a technology developed by Bob Caruso and Marc Benioff, aims to empower individuals
to create lasting financial security, independence, or freedom.
• SwipeOut allows users to donate their pennies to charities, providing stories of the lives they have
touched.
• Users can contribute to hunger, waterborne diseases, and other pressing issues globally for about
$20 a month.

What’s the Price of Freedom?

• The author emphasizes the importance of achieving financial freedom and the potential impact of
investing a small fraction of ones monthly income to help secure freedom for one of the 8.4 million
children in the world trapped in slavery.
• The author believes that by focusing on sustainable ways to feed 100 million people each year, we
can provide 3 million people with clean water a day and grow it from there, or free 5,000 children
• The author encourages readers to take a small portion of their money or time and consciously
choose to invest it in something that doesnt directly benefit them but goes to someone in need.
The Power of Giving
• Giving outside of ourselves, even small gifts can increase happiness, potentially stirring a domino
effect of generosity.
• The author shares a simple system that Dan Ariely and his wife implemented as a family to divide
their allowances among three jars: one for themselves, one for someone they know, and one for
someone they dont know.
• Philanthropy is the third jar, and it can be the most satisfying and important form of giving.
• Sir John Templeton, the worlds greatest investor and one of the greatest human beings, shared
that he never known anyone who tithed—meaning the person gave 8% or 10% of what they earned
to religious or charitable organizations who didnt massively grow their financial wealth.
Anne Franks Story
• Anne Frank, a financially poor woman, realized that the secret to living is giving.
• She started doing well for a while but soon faced more challenges and financial loss.
• She was always pragmatic and thought about how she could get by when she was seventeen and
homeless.
The 7 Simple Steps to Financial Freedom: A Comprehensive Guide
The Power of Giving
• The author shares a personal experience of feeling free from fear of money, leading to a significant
financial success.
• The authors story serves as a reminder of the importance of giving and living a life of joy, passion, challenge, opportunity,
The 7 Simple Steps to Financial Freedom
• The book provides a comprehensive guide for individuals seeking financial freedom, including
steps to become an investor, commit a specific percentage of savings towards your Freedom Fund,
and automate it.
• It also includes a wealth calculator to help stay on track.
Investing and Financial Planning
• The book emphasizes the importance of evaluating cash flow, determining the ratio of security
versus risk/growth, setting short-term and long-term goals for your Dream Bucket, and establishing
a way to fund it with either a small amount of savings or a portion of the profits from windfalls from
successes in your Risk/Growth Bucket.
• It also emphasizes the importance of rebalancing and dollar-cost averaging for optimizing returns
and minimizing volatility.
Creating a Lifetime Income Plan
• The book provides a lifetime income plan that ensures that one will not run out of income as long
as they live.
• The secret to the ultrawealthy involves investigating how to drastically cut the time it will take to
achieve financial freedom by 30% to 50% through tax-efficient life insurance strategies.
• The book also highlights the importance of asymmetric returns, the $100,000 MBA given by Paul
Tudor Jones, and the $100,000 MBA given by Warren Buffett.
Author's Life and Acknowledgements
• The author expresses gratitude to his wife, Bonnie Pearl, and brother-in-law Scotty for their
• The author thanks Sam Georges and Yogesh Babla, Mike Melio, and General Jay Garrity for their
support and protection.
• The author thanks the personnel at San Diego HQ and beyond who work with them daily across
departments at RRI.
• The authors life has been shaped by deep friendships with four brilliant men: Paul Tudor Jones,
Peter Guber, and Marc Benioff.
• The authors brother, Steve Wynn, is praised for his love and brilliant creation skills.
• The author acknowledges the influence of over 50 extraordinary souls whose insights and
strategies have shaped his life.
• The author is eternally grateful to Ray Dalio for providing an "all-seasons" investment approach.
Gratitudes for Contributions to Investing
• Jack Bogle: credited with changing investing worldwide.
• T. Boone Pickens, Kyle Bass, Sir John Templeton, Marc Faber, Carl Icahn, Mary Callahan Erdoes, and
others recognized for their contributions.
• Dr. David Babbel: praised for his focus on lifetime income and living example.
• Burton Malkiel: praised for his original focus on indexing.
• Alicia Munnell, Teresa Ghilarducci, Dr. Jeffrey Brown, and Dr. David Babbel praised for their
insights into the retirement system.
• Steve Forbes and Harvard professor Larry Summers: Provided a lively debate on the current state
of investing.
• David Swensen: Opened Yales doors and shared his effective investment approach.
• Warren Buffett: praised for his straight shooter approach.
• Elliot Weissbluth: tackling the challenge of democratizing opportunities for the average individual
• • Partners at Simon & Schuster: Moved heaven and earth to meet the insane timeline.
• • Spreading the word about the book: Heidi Krupp, Jenifer Connelly, Jan Miller and Shannon Marven,
• Susanne Donahue and Larry Hughes, Mark Thompson, Mat Miller, Frank Luntz, David Bach, Dean
• Graziosi, Praveen Narra, Cliff Wilson, and app development partners.
• • Media icons: Oprah Winfrey, Ellen DeGeneres, and Dr. Oz.
• • Partners at Impact Republic: Dedicated to the book and helping refine their ability to reach millions
• more people.
• • Mission of the book: Serves those who will be reading it and the many that society has forgotten.
• • America: Coordinated a never-before-attempted approach to provide 100 million meals.
• Anthony Robbins Foundation and Companies

The Anthony Robbins Foundation

• A nonprofit organization that empowers individuals and organizations to improve the quality of life
• for overlooked societal groups.
• Founded nearly 40 years ago, it provides global impact through an international coalition of donors
• and volunteers.
• The foundations 100 Million Meal Challenge is a global initiative where individuals, corporations,
• and philanthropists compete to match Tony Robbins donation of 50 million meals to hungry families.

SWIPEOUT
• The SwipeOut app connects credit/debit cards to a system that automatically rounds up each
• purchase to the nearest dollar, allowing 100% of the spare change to be channeled towards pressing
• problems facing children and those affected by extreme poverty.
The Global Youth Leadership Summit
• A five-day program designed to equip 14-17-year-olds with the skills and knowledge to take on
leadership roles.
THE CHALLENGE
• Aims to make a difference in the lives of the less fortunate through these programs.
Stronghold Wealth Management LLC and Stronghold Financial LLC
• SEC-registered investment advisors offering fiduciary advisory services with transparency and no
commissions.
The Anthony Robbins Companies
• A group of impact-focused organizations that aim to provide world-class events, programs,
products, and services that enhance the quality of life for individuals and organizations worldwide.

Human Elevation Companies

• Roberts Research International (RRI) conducts seminars on topics such as peak performance, life
transformation, business growth, and financial mastery in over 100 countries.
Tony Robbins Partnerships and Services

Namale Resort and Spa

• A 500-acre private island in the South Pacific, Tony Robbins's personal escape.
Fortune Practice Management
• Combines Tony Robbins expertise with Fortune Management's business expertise.
• Offers coaching, consulting, and training to enhance a practice's brand, increase referral-based
business, and improve patient volume and retention.
Unlimited Tomorrow
• Founded by Easton LaChappelle, focuses on creating affordable, lightweight, and low-profile "exo-
suits and exoskeletons that enable paralyzed individuals to walk again.
• Has traveled the world, including a TED Talk, and worked on the Robonaut project.
CloudCoaching International
• An award-winning behavioral integration service that uses the cloud to drive targeted sales
increases and sustainable growth for enterprise-level organizations.
Advisors Excel
• Launched in 2005, aims to provide value to independent financial advisors across all 50 states.
Lifetime Income
• Offers personalized guaranteed lifetime income plans using guaranteed income annuities and new
forms of longevity insurance.
Americas Best 401K
• Offers a cost-efficient, high-value, and high-touch 401(k) plan.
MyPowerCFO
• Helps business owners maximize growth and save costs.
• Offers virtual CFO services at a fraction of full-time equivalent costs.
Marcum LLP
Hall Chadwick
• The fifth largest accounting group in Australia, serving clients in major capital cities since 1886.

ABOUT THE AUTHOR

Tony Robbins: Author, Entrepreneur, and Philanthropist
• Known for his 37-year advisory career.
• Consulted with top athletes, entertainers, Fortune 500 CEOs, and presidents.
• Founded or partnered in diverse industries, including a 5-star Fijian resort and custom 3D-printed
prosthetic limbs.
• Feeds 4 million people annually in 56 countries through his foundation.
• Initiated programs in over 1,500 schools, 700 prisons, and 50,000 service organizations.
• Lives in Palm Beach, Florida.
• Online bibliography available at tonyrobbins.com/masterthegame.