The Art of Spending Money
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number ninety one million dollars that so much king Charles the third coronation cost british taxpayers last year. Ed, what does burger king and vagina s have in common? It's gently considered bad form to eat them in the middle of.

Way, happy your way, happy your way.

That wasn't easy to bring burger king and the king into something this profane and you're pretending not to laugh for fear. That job named in the lawsuit, I don't get you can laugh out laughs right? Even Clair is. And Clair is literally the general consult of workstand.

I always laugh at your .

pussy jokes.

Come on, SHE does SHE does clares down with me. We're both were both looking for the same thing, if you know what I mean. That's right.

That's where both were both. We're both on the same team. We both point out the same a cusha.

We're looking at the same. We're seeing the same sites together on the road. Or I need to get out of this.

And what are we talking about today? We're talking about what are we doing today. We're doing something different today.

Here you take this gladly. We got a special episode. I got we are diving into one of our favorite topics.

We're not going to be talking about saving money or even investing money. We're going to be talking about spending money. We're going to be answering questions like one of the best ways to spend money.

How should we think about spending? And most importantly, how do you spend your money? So i'll walk us through a series of questions about spending. You'll give me your honest stances, I hope. And then hopefully, we will learn something along the way.

Just this doesn't like fit my opening joke. I think we might have to rerecord. This sounds very thoughtful and responsible anyways, but yes, said please continue .

IT is going to be very possible. It's practically going .

to be a therapy session.

I'm will start with a pretty easy question and that is what is the worst purchase you .

have ever made oh um when I was I grew up in california and I grew up in this era that you don't relate to but I was kind of california dream and uh american gravity. The only thing you had to express any sort of coolness or wealth or aspiration or mocha with your car. In addition, living in los Angeles, you had literally no aspect of a social life unless you had a car.

There was no public transportation. There was the rtd, but IT wasn't really efficient. So if you wanted to go to friday, on a friday night go and crashed your party that someone was having, you were invited to see above skype.

You needed a car. And so from the age of about thirteen, I say pretty much everything for a car. And I got my dad gave me an old book, swagger rabbit from his old home and finex on the way back from maison with a friend.

The tire blew out and there was no spare tire. Gives you A A bit of a sense for the protective instincts my father did not have but a real a car. And finally, I think the real got code, my fresh manure in the ferny and I didn't go get IT.

I think I just to be sold for scrap. So buying a car, my first cars with the worst purchases hands down ever made, they literally took all of my disposable income and more. It's like twenty five hundred dollars by insurance when you were sixteen, which on a inflation adjustments.

Ed, by ment, ten thousand dollars year, I did not have that kind of money. And yet I found IT. So hands down, the worst purchase I ever made was.

uh, was a car. What about the bmw got off. You got your bonus from Morgan standing.

I'm always kind of blown away by the fact that was how you spent your bonus. I respect IT, to be clear. But oh yeah.

and I think, I think I told you, I think I bought three, twenty five navy blue. I bought IT off out of recycle, I think has fan. And what is my response was like twenty five grand.

I spent twenty ground on a car. But I think of that, I mean, the sounds stone, but a bad car that you don't need in college, in high school, I kindly needed IT, but I just could not afford IT. You know, that's a done purchase.

I would argue that when you're twenty three working in more standing and you're in your meeting years, they'd buying a bmw and hanging swim goggles from the review. Mir IT makes a lot of sense. You're trying to say, trying to signal the women that if you have kids with me, your kids more likely to survive.

And if you date someone who is driving a hn day and you know does water a robic, so I sort of I empathy with what I cost, smart signaling purchases. I I think it's difficult to lecture someone your age on to not occasionally by cold shit and do cool things. You're twenties come and go.

You want to signal attractive this I get sort of the irrational purchases to me, the bmw kindly sense. And also I saw in the page for my european trip. So IT was worth that. I don't think I lost so much on IT.

Yeah, my follow up was going to be, was that every an item that you splodge on that seemed pretty responsible at the time, but ultimately, as you reflect, turned out to be completely worth IT. Perhaps the bmw, perhaps something else? no.

And i'll turn expect to you. But I wish I had earned earlier. And I did learn IT accidentally, but I was more organic than anything I read.

You remember experiences. You don't remember stuff. People over estimate the troy are going to get from things, and they underestimate the joy they're to get from experiences.

When I left Morgan stanly, I initially toys animal gan stani thought about trying to do a third year and maybe making the jump to associated with another firm, because everyone who convinced me that if you have your foot in the door, invest banking, never to leave, because you never get a job. Even, even that despite the fact I hated IT and they hated me, I was not very good at that. I was trying to figure a way to maybe standard. And then the only time of every in the hospital was I got, and I read me, yeah, towards in my second year, know what? And I read me, I had something called the trial lar tack of cardio, which is in a irregular hard by OK.

And the timing was was really unfortunate, because the week before, the guy named was in a hank, others, the best high school or the best college, best ball player gotto remind went down for a monster jam in front of a national audience and then turn back to run up the court and dropped dead on the court and he was diagnosed with uh v tack and a large heart which is quite uh regular for people who your heart is a muscle. And if you work out a lot, which I was doing and crew, your heart actually can get too big for your chest cavity and I can create an electrical and baLance. I was over insured.

I was having this regular hearty had gathered the week before they stuck me in the hospital so while I was in the hospital, uh, this woman I was at same john, I think IT was and he said, why are you SHE looked to me and i'm twenty three, said, you're in the I, C, U. Unit of the car biology unit. She's just like to me, not a darkman said, you shouldn't be here.

What's going with your life? And I had me so hard. I was, I was, I became very emotional because i'd obviously tried to push down all these emotions about a fucking free doubt.

I was that I was in the the, I see unit of the cardiology unit and jos, and basically neta t that afternoon, I decided I was going to leave in best from backing and do something different. I move back with my mom, and I saw my car, and I went to europe, that money with my friendly lost. And we got a backpack, a rail pass.

And that still remains as evidence by anyone who watches this podcast. I do amazing travel. I travel to the best places. Uh, I have an extraordinary life with respect to travel.

The best trip i've ever taken was, uh, when I was twenty four, right out of Morgan, standing with the irae pass, sleeping in hostels with my good friends lee lotus and David king sel joined us and I connected with a woman I was dating at the time, and to making else no money. But with someone you were into, that was, is the best expanded rap ever made. And I I spent everything and more.

I think I had to call my mom and ask her to wire me some money. But IT was, hands down the best expand itself have ever met. So i'll put IT back to you the dominant best purchases you've made today other than like a big wheel and that glass till do I saw you out on your show? Turn off the camera choses Christ, i'm sure. Go head.

Now that almost was that yeah, I think it's experiences for me too. It's it's funny. I I the first thing that comes to mind for me is also me. Once there was one night in me and I went, lost someone with bunch of friends, and there was one night was probably the most amount ever spent in a single night. And IT was ridiculous.

We decided that, you know, we had picked out what the best club on the island was and that club as alama o and we decided, okay, me, my boys got to everything, okay, we're onna pay for this whole thing. We we're onna get all the girls and then i'm onna pay a penny and we're onna just spend like crazy on this one night. On thursday night, we'll going really, really hard.

And so we got the best table at the club. We got one of the biggest bottles that they have on offer. And we kind of decided like this is this is all a big night.

And you know, I turned were having a great time. I turned my left and we're in the VIP section sitting next to the table that is occupied by paul, George cole, Anthony towns and basic, just all of the biggest N. B.

A stores in the world right now. Um and that was a moment where I liked OK. This is this is the amount of money that I don't have clearly, but i've made a very intentional choice.

And an intentional decision like this is something that I know i'm going to enjoy. I know it's going to be special. We had we set up till sunrise. IT was like the greatest night ever. Not to me, is like a moment where IT was very irresponsible when you think about IT numerically but in terms of like the intention the purpose behind IT well as like I know that i'm spending a lot right now and i'm going to be very irresponsible when I get home to new york. Um that was probably my number one.

It's arise my dad occasion would says something that I was close to insight. He was said to me doing nothing as fine as long as its plant and I I remember another saying that angers. Angler's aca productive emotion as long as its plan.

And I think what you're saying is you made a responsible decision to be a responsible and I think that's OK. You know, occasionally it's fun to splurge. You know, when I would argue the splurge when your Young are, I think you remember them more, especially if they are around experiences.

Anyways, I my advice to Young people, you know, Andrew huberman en and Peter, I will say, drink alcohol, I don't see. Drink S, I see together. And I just love the image of you and your your homework and Michaels um doing your thing and then at late at night getting shut down by every woman in the clock.

Still IT was worth IT. That was definitely what that okay. What about the best purchase you've ever made?

Probably the best purchases both financially and emotionally for me, were homes. And that is right out of business school. I was very much in love, and we bought a home together.

And I just represented like a commitment to each other. And we got a dog. And I, just at the age of twenty seven IT, just felt really nice. They have some of that, my feeling that the domestic bliss to be committed to someone, to be making a mortgage payment and owning a home and in the home was just a vehicle, I think, for kind of that commitment to each other. And I felt really was emotionally very rewarding.

And then going back to the privately last house purchase I made when I sold, i'll too, I had, you know, a big windfall, and my partner said we should buy this, you know, beautiful home. Minute is a beautiful home on the beach. And and one of my flaws, many flaws, investors, I think nothing is ever cheat enough in the home was they were asking fifteen million.

SHE said, trust me, we get. I was SHE offered, ended up getting up for nine and a half, and I didn't want to buy. I might not. It'll be were six in two years were going into recession. This is twenty nine, i'm sorry, twenty seventeen.

And IT took three years to one of the shit on a money and then covet comes and we have, uh you know, a really nice home on the beach. And then again, about, see above, Better be lucky than good, this mass migration of people to floor a from covet all these masters in the universe who all want to live in the same same area beyond the sand. And that home is probably doubled their triple and value.

And more important than that, in in an environment where people had a sequester and isolate with their families, I was in a beautiful home, more time than that flix, more time than my boys. And my stocks were sky rocket. And covet was, in my opinion, the most unfair pornographic gross transfer of wealth and health from the already wealthy and incomes from people who are unhealthy or poor.

And I was I was on the right side of that. And I just strikes me, I just feel so uncomfortable to say, covered was the best two years of my life, but this is a long winter way of saying the best purchases I have made. And i'm not suggesting that is right for everybody because a lot of this timing, but emotionally and financially, the best purchases I have made were my first in my last home.

Are there any categories of spending that you kind of refuse to skip on that you pretty consistently go all out on something where you look at the Price tag and you say, doesn't matter, i'm gonna buy this .

no matter what. I'm sitting in a room that cost five thousand dollars a night. I mean, enough sad.

I I don't own a car. I don't spend a lot of money on cloth. I spend a crazy of money on travel. The next store in the next room is my friend August. And a good is like this greatest guy, easy going, super nice.

And when i'm doing a lot of traveling and i'm lonely and my partner can come with me, my kids can be with me, I call one of many friends and I say, come join me. And if it's not easy for them, logistically, financially, I make IT easy for them. And we go out and we go to the best place.

I mean, and I feel so kite, it's so funny. I i've always, i've had this weird shame around money. I've until the age of thirty or thirty five, I was ashamed that I didn't have more money.

I was always, I was broke because I was in school at student loans. I was really self conscious about how much, how little money my mom and I had and made me feel very insecure. And then student loans, starting businesses never had enough money, even when my friends were starting to make money.

So I didn't have enough money. I was embarrassed by that. I think from about the age of thirty to have kind of forty five, I had just the right amount of money.

I'd enough money to do nice things, but I wasn't self conscious. Then I got exception lucky. And by the way, i'm i'm not humble.

I think i'm a fucked and monster. I think i'm exceptionally talented, but I also got really lucky. There are a lot of exceptional, talented people out there. And now i'm not embarrassed but little self conscious by how much money I do have. And you're not supposed to talk about IT. I think that is nothing but a bullshit construct to keep poor people poor because when you speak a different language, rich people talk to other rich people about money all the time. They talk about taxes, they talk about investments, and they get more literate.

And then we're told not to talk about money in case you decide to share your salary with someone else or you figure out how much money I haven't decided if I can, you know, show up with a gear team or actually vote for people who have a progressive tax structure or maybe demand more compensation because you realized the person down the death from you is making thirty percent of more because i've been in there ten years or their different sexual orientation. I mean, basically the asymmetry of information and this inclination that you're not supposed talk about money keeps the financially literal literate and also keeps rich people richer. So other than bragging IT IT is, I think, important to talk about money even when you have IT.

But hands down, where I go a shit with money now that I have IT and spend more than I should is on travel. I'm going to africa. I'm taking my sister and her family and they didn't want to go. They have responsibility, lie s their kids inquire.

They are working hard and i'm called her and like, you're gonna dead soon when you next going to africa, like you're gonna with me when you're onna roll in to africa, like you're gona roll with me what the fucker you thinking? And that was the right lecture for me to give my sister these experiences, if there's anything the research shows her on spending money at the following, drive a hunter and take your husband to africa. I don't really buy a lot of things.

I'm not i'm just not into that. I don't. By star.

do you look the Price tag much when you buy things? So if you dinner, we walk into a nice clothing story, you thinking about how much I cost.

I do, because I can't get out of that habit. I was in, I forget what I was, but there was just an insane Price on something. And I like, this is offensive.

I can't I can't bring myself to spend money on this thing. It's like, that is ridiculous that you would even try and charges amount of money. I can buy IT.

I really need IT. I really like IT. IT doesn't make any difference to me, but I there's that part of you.

You just can't do IT you just you you remember back when you didn't have enough money and you establish a value system and you I just can do that. I can, I can. No, I can't spend this kind of money.

What do you think is the difference then? What do you think makes justify is like a good purchase for us as .

a bad purchase like this is the majority people, nine, nine point nine percent of the planet doesn't have these problems. They they have a much bigger problem, and that is their constantly trading needs versus wants. And that is the majority of our planet.

I think only about one third of the planet are consumers. What does that mean? That means that they have enough money to buy things beyond basic food, shelter and education.

So only a third of us even get to make these decisions. So do I want a scar? Or do I going to make an answer? Or do I want to take my spouse after a nice dinner?

Yeah, it's I think you're in a unique position because you have experienced for him much every economic class there is to experience in a way and we have an experience poverty, but you did not grow up wealthy and now you're extremely wealthy.

And the way I kind of think about like and he talked about there are certain people that, that can make those trade ffs, that we describing IT feels like there's a progression when IT comes to spending its sake in a certain economic wake class. You can't make trade, ffs, because you have to survive and you have to get by. And then you there's another class, which is you start being able to make trade, ffs.

And then there's another one where I feel like you are where it's like you don't even really need to be making trade ffs that much. I mean, that sounds like you can, generally speaking, have your cake and eat IT too in most situations, I would say. So I what I would be arced to know is, like, how has the psychology of spending money change for you as you have breached each of those economic way classes? Like did did spending money take on a different gravitates to you as you got richer or as you ve got pora?

So I think it's important that everyone have a certain code of values that they want on their tombstone and then trying live their life across those two or three values. And one of my values is I pride myself on being generous, and i'm generous with everything. But my time, I like spending money.

I like treating people. I like buying things for people. I know that virtually circling, but anyone who knows me knows that is true.

And the reason why is not? Because I, I have this internationally IT was because I was deeply traumatized by my father's relationship with money. My father was born, raised in depression, our scope, where you could literally starve if you didn't have enough money.

And so he was painfully cheap. He was the guy when my parents were divorce. He came and took me and my friend, best friend adam, to see greece amazing movie in one thousand hundred and seventy six after the movie.

He collected two box to my friend adam because he had bought the tickets and I had to sit there and wants to go down. I went to who I went with him on a big golf action. Or he was the crown circle I, T T.

Salesman in the year, and he got to go on the sculptural and take his family. And we went to basket and romans. They got ice cream iod to shake. And then for two days, my dad didn't speak to me.

And your thirteen years old, and you're a guy you're locking up to your father and your light, why is my dad not speaking to me? Like, just ignoring me and finally, I ask Linda, his third wife, my stepmother, wonderful woman, and my, what's going on wead, madam, like he's upset you order to shake backing arms that cost three dollars. You to ask him, my dad didn't speak to me for two days.

And so when my parents got divorce, he immediately went to the upper middle class. Immediately went to the lower middle class. He was so awful to us financially.

He could our lives so much easier with just a little bit of money. I really struggled in college, and I like to go on a build. Great bullshit was really fuck and stressful, not knowing if you are going back to college every summer.

And he could have made my life so much easier. And so I remember just explicit and implicitly deciding if I ever have money. I am not gonna this guy.

I mean, and I can't stand, and now I can't stand. I have friends who are really wealthy, who always find reasons not to pick up the bill or well. And I just find IT such a grow task attribute.

And some of IT is responsible. They would just raise that way. I I find, being cheap, one of the groceries attributes, especially for men, i'm sexy this way.

I just, I can't even be around these people. If I if if everyone of my friends is in fighting over the bill, you we're not friends. But my my spending right now in large part or some of IT is i'm just god, I just don't want to be my dad. He was awful. The money just awful when I was thought, if I ever have money, i'm not only to enjoy IT.

i'm going to share IT. Yeah, I feeling people don't seem to understand how good IT feels to be generous. I think I started only something to realize this recently that IT IT does actually feel really, really good to get the check and give someone a nice experience. I mean, I did that recently with my dad for the first time, and I was kind of like a IT.

Felt like this sort of exciting, important moment where a sake, no, I can get this like I can I can give to you and yeah I mean, it's not IT sounds so trite when you say, but the reality is just as you say, it's like IT actually just makes you feel really good and it's almost the same as getting something for yourself. It's all as you say, it's all it's selfishly motivated IT makes you feel good, but IT seems like i've just done. I'm surprised by how many people don't realize that, that like it's really enhances your life and your own personal experience to be generous.

There's all sorts of different ways to garner emotional reward for money. If you handle IT well, you know the money is, money is nothing but the transfer of time and work. And there's few things you can do that are more generous than give someone time and work.

I I was the services I was. I used to park cars. I was a waiter. I remember I was waiter in the mondrian hotel. And this lovely old lady was a character actor, suffered, get her name every time he was there. Every time I would walk by, SHE would put five or ten box in my pocket like little.

Every time I walk by a table, SHE come over and SHE d like slip five or ten box in my and you're going to U, C, L, I, and you can barely afford your books. It's like changes your fucking day. This, like nice sold lady, gives you a thirty or forty box.

I mean, it's a difference between being able to go on a date or buy lecture notes or whatever is IT is wealthy people who do not typic and make just ABS fuck completely no sense. IT is so easy to give a liquid economy time and worked to people by giving the money. And IT has nothing to do with the ability, ethics.

And just like you said, you just feels really good. The other thing that you inspired is that I think even more, I love spending money. I am really good at IT.

It's one of my core confidence. I'm outstanding at spending money. I would say spending money like a gangster in the fifties just diagnosed with ask cancer. I am just I am just going large and i'm loving every minute of IT. I'm really good at IT and IT create a lot of joy and helping us for people near me and around me, for me myself.

I do think though that even more rewarding than spending IT or having IT was making IT specifically making IT with someone else, both both professional and personal partners. And my x wife and I, we were working so hard, we were trying so hard, we were making good money. We had setbacks.

And then business has failed. At businesses, work SHE got promoted. SHE didn't get promoted, but we were saving money. And we bought a house together and we started saving money together, and we really built economic security together. And IT IT was just so rewarding to do with someone.

And then where you also get a lot of that reward is, let me be clear, the business as i've started and sold, my first obligation was for me to make the most money. And I was have that felt Better than anything? But IT also just felt fuck and off to bring a really good people who had worked really hard with you a long siety you ago. Hey, I know you're twenty seven, but you're going to make five hundred and fifty thousand dollars next week when this transaction clothes and then just looking at you like they couldn't believe IT, you know like I get huge word out of underpaying you.

Um no but look, no one ever .

feels overcompensated before the last ten or fifteen years in my life. Since i've gotten wealthy, i've made IT objective to say, okay, what is this person's more market rate and how do I pay them twenty, thirty, fifty percent more than market? And IT just feels good. So building is spending IT is great. But I found I found actually the making IT, specifically the making IT with other people was actually the .

most rewarding part. Yeah, wow, I hundred percent agree with that. I think that's one of the things that make relationship so fine as that you're building something together is just so much more exciting than doing IT on your own.

Well, by the way, I just done on me that it's no accident that you've asked me to do all this virtue signalling around generosity right before bonus season. It's clear that everyone has figured this out and there's eight people on this line taking notes that the reviews are about to come out. You is so I find the money away and I find I find it's all about grid and helping people realized their inner child and saved by not by underpaying them. That's how you build character. I'm planning to build everyone's character here.

We've got more off the break. And by the way, we'll be recording and asked me anything episode very soon. So please send in your questions for me in Scott to office hours at profit media dot com or leave a comment on our youtube channel will be right back.

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We're back with property markets. I'm going to go through some individual situations where spending is very important. And I just want to get your reaction on how you deal with these little situations i've come up with.

So the first one is restaurants. You're out to dinner with friends and let's imagine you're not as wealthy as you are right now for this. One of your friends orders a really expensive bottle wine.

They order like a bunch of plates for the table. And then when the check arrives, it's way more expensive than you thought. It's one of those checks.

When you see IT and you start to feel kind of anxious and uncomfortable, you don't know what to do. So what would you do? Would you still offer to get the check? Would you split equally?

How do you handle that? Is this a group? Guys are just friends.

Group of guys is friends.

I mean, I brow with a different crew. I just don't. We were I never had friends who were in the fancy one until I got rich. And now I have friends who are trying to like, inject class or some air of prestige of the life by ordering stupidity, expensive bottles of wine and buying art.

If you want to talk about, you know, if you want to signal for someone with a little dick, find someone is older, something really into art, and or, you know, orders orders anything above a hundred box a bottle, the bottles wine, unless you're really I mean, if you're really into art and you're really into wine, find my friend atam is really into cars, so he buys expensive cars because he's always been rilling to cars. Fine, fine, I get IT, but if someone ordered an expense, the bottle wine and I was with a group of guys and we don't have a lot of money, I mean, okay, if he's a bowler and he's paying for k the general form is the following. General in general, like manners, if you order to express the bottles wine, that means your pink for dinner, you're basically signaling I am going to pay for dinner, you can be generous with other people's money. And then when the check comes, if it's a group of guys your age, you, our friends, you all split the bill unless someone went crazy.

And what what about if you like in in your thirties, like it's it's not as absurd to be in late thirties. Everyone is making good money. Maybe everyones with their partners. Like what do you do in that situation?

I personally feel like with friends, I mean, Young people split the checker, whatever they is, then me, or send me a request. I get IT right? I think if you're in the authorities, in your blessing, some reasonable economic security general form match should be the following.

We get this one or the next one, they get IT. And if people aren't if if things aren't kind of evening out over time, you have to decide what they want to play friends with these people because you generally what I have found is that you're out with couples. I I can't stand splinting the check.

I'm at a point now where if people say you did this and like boss, either pay for IT or I am pank for IT but not splitting the check, we're fucking grown men. I just and i'll get this when you get the next one, whatever is, and especially when you're out with couples, I I think your mind full of each other. Uh h but for the most part, I think one couple gets the check and then the other couple gets the next one.

I don't I think the moment I think it's always a strange moment when the bill comes. I think it's awkward. It's very OK. But you should all come out on the wash if you have good friends. They're not going to be stupid in terms of over ordering.

And you realize that you trade off two or three couples, two earth or friends, and if they, if if their turn never seems to come around, you call them out on their boss. Shouldn't be like, how can you never see? How come you always seem to find a way not to pay? Okay, this one's .

particularly relevant right now. Christmas is around the corner. Let's say again, you in your late thirties, you've got like two children, a partner, two parents you got on, you got uncles, you've got friends, god, children, eeta.

Who gets presence? And how much do you think you should be spending on these presence? And do you spend more on one person? Do you spend less on another person? How do you think about presence and Christmas as IT relates .

to spending? I think about hanka un. timi. Actually, the hole is not true. I think about Christmas. And this is personal, how you approaches mending the holidays when the kids were little IT was funded despite them a tuna ship, and have this consumer org that morning with a rapping shit, and then playing with IT for two minutes. And that was fun as we've got older.

What I do with my boys is they make a list of stuff we try and connected to torture or something or something, and we we pull stuff off their list, and maybe we wrap one or two gifts. We just know I don't want that kind of consumer law of pollution in the morning. And then with my partner, I ask her to occasionally we don't buy each other stuff here on the holidays or for birthdays. I buy her stuff random like, because I think it's just more fun that I think so love and SHE drops and everyone's a .

while that he want sudden oh yeah, I said, i've been looking at this or a side. You haven't given me a present in a while.

Now show you some me in, show some a photo of a broken bag with the exact color and be like, hey, what do you think of this? And like kay message is, and what I tried to just wait just long enough starts as he forgets about IT. It's a surprise.

But i'm not a big, i'm not a big gift giver. I don't want, I don't want gifts of the gifts I like. You know, for me, I want meaningful gifts.

I want, you know, my sons will write me a note, or they will give me a book that was meaningful male, that gets a picture of us frame. That's the shit I want. I can buy anything I want personally.

And I don't not stuff know the gift said, I mean, sounds like a remark commercial, but I don't want stuff I want want automatic thiihng. A cream shade heater. That's what we got.

My dad wove the three back in the seventies. You put shaving cream and a heated. I love that. And you'd you'd have the delight and the supple feeling of warm lather on your beard.

That's a great a problem.

Get a rotating, tired. I have so many times. I need, I need to see them electronically with by me.

I love that .

I would give.

So who gets present then? This is a question i've been thinking about, I can't tell, but it's not totally clear to me who i'm supposed to be getting presence forward during holidays and most so how much was first be spending .

first and for most boss?

okay. So I will say, by the way, you get presence for us at the end of holidays. I don't know if you know what you're getting us, but we we have received Christmas guests from you and I would assume that that sort of part of you know, you build that into the budget, okay, over the holidays, I need to put aside this amount of money to get my employees some gifts and to get these people gift like I feel like it's an important part of the the income statement, if you will.

but it's strategic and its selfish. So employee gives and it's the following first, if I don't buy anything, I don't know what it's going to be in that fucking bag. M, J, who has much Better takes on me.

He does a great job. You will say I want to buy five hundred or thousand box, employ gifts per person like fine and she'll figure out the latest cool thing and sh'll do a great job and merchandise IT. And I just give him my credit card number.

And the reason is strategic is that a vice men, a thousand dollars on a gift or gifts for employees, it's worth more than a thousand dollars. If I gave them a thousand dollars in compensation, one the'd have to pay thirty, thirty four percent taxes on IT. Whether if I give you a thousand dollars of the whatever airports in the scarf for something, you it's, it's pretax income.

And also it's more meaningful. The the psychological benefit is greater than if I just given you a thousand dollars cash. My first business partners would always be like together.

Phy, like just got cash. And now they like gifts that kids like gifts. You know for me, the holidays, I don't I can't stand the holidays.

They were not an enjoyable time for me growing up, so i'd literally loads them. It's so personal though you might find. I mean, so for example, I think gives them more important for women.

Cocaine, jury cocaine and jury women have a special relationship with that and maybe you don't like cocaine, maybe you don't like joy, but if you don't and your twenty years offers that to women and in your thirties and forties offered just to women, you are not a good first and mostly the jewelry um like I can never imagine spending all I guess I buy watches now. I never to buy watches, but I can't imagine people spending this money on joy. But you've got to to determine what's important to people in your life. That's what he means. Be generous is you're doing something for someone else you wouldn't do for yourself that makes no sense to you, but IT, but it's important of them.

So you'd do IT for them. Do you think that people don't value gifts enough?

What I have found is that, and I wish I figured this out earlier, writing somebody and complimenting them and recognizing them, or telling them you are thinking about them, or telling them how impressive you, you, you are with them, or or taking the time to say you you handle this situation so well, or congratulations, this is just such a, is such a nice achieved for you, or taking the time just to recognise their achievement in a very thoughtful, explicit way, especially man and man. I think that's the best gift you can give another man, my best friend lee, on a regular basis. He will tax me when IT, he choked up thing .

apart IT.

He'll he literally text me. He'll say, me and my parents are you and do mr. And were just so proud of you.

Yeah, that is so nice.

Those are the gifts like, and everyone's is different. Maybe people like stuff like that. The that's the, should I remember and wouldn't know, my friendly is gay, and I think gay men have an easier time expressing their emotions and straightness en and and and just registration, how more than meaningful that stuff has been from me as help help me be much more generous with my emotions. But that, in my opinion, that's true giving.

We'll be right back after the break if you're enjoy the show so far, hit, follow and leave us a review on property markets or if you get your pot costs.

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We're back with prophete markets. I want to move on to some things around what is essential to spending, like what what kind of things in your life you find essential. I mean, we we dog a lot about like directionally that is non directionally and the the technical definition of non discretion areas like the stuff you can't live without.

So you know food and housing, custom health insurance such a um but I I could imagine that as you get richer, that category is sort of stalls to expand. Like you know I sort of feel like I can't live without an iphone at this point like that sort of the way I think about IT. So I guess my question view is like what stuff can you not live without at this point? What do you have to spend on? And what is your approach to spending on those items?

This is gna sound under the under the title of infinite dish bag. IT would be really hard to lose my plane. I've got a very you having a plane.

So I mean, there's something around ramming your spending behind making sure you're spending lags your economics because it's the joy you get from having something isn't as great is a disappointment. If you lose IT and can no longer do IT you get used to that should really fast. So when I when I bought a plane seven years ago, the best piece of advice I got was a front of mine.

He said, just make sure you have way more money than you need for this, because you do not want to give IT back is like, don't buy IT until you know you can. You can keep IT. And that was what so been so rattling about, being richer than poor in the two thousand, being rich ten in poor again in two thousand and seven and two thousand and eight, because the kinda step backwards, and I didn't really act. I didn't step back materially because I never, I was libel my means. But you step back from an emotional security standpoint that is really frightening.

Yeah, I was going to ask, like, have you ever sort of downsize to your lifestyle because you just can't afford anymore?

Yeah, I did. And after the great financial recession hit in two thousand and eight, I I had a lot in new york, I, D to sell that. I just didn't have any money.

I was making any money. And all of a sudden, and I was had negative networks. So I had to saw my laugh. I was very disappointing I loved IT was kind of just humility to be whatever I was forty three and have to sell my house to pay my bills.

I was never in debt and now I was single at that point and but I felt really fuck and humility um so you i've had to step back and I think most people have to step back at some point. Maybe I mean, if you're really responsible hopely ly, not. But I got crushed. Yeah.

I think that's a really that's a big one for me, just the prospect of downsizing and for the way I have IT in my head right now is like I I have i'm doing for saving. So i'm i'm good. I'm being responsible.

How are you doing that? How are you doing for savings?

I have the automatic five percent that goes into four one k and then you matched that. And then i'm also just immediately when I get at the beginning of V R, I just take a chunk of cash is put IT in the I R A.

And and that's the end of IT. I just years ahead where I was when I was twenty five, and I wasn't been thinking that way.

Part of the reason I do that is like, I want to spend a lock and this might come dumb. But I, I, I, I like nice things and I like nice restaurants. I like going out cool places. And I spend a lot of money on on all of those experiences.

And part of IT for me is that I want to kind of surround myself in that world and and get myself deep in that position such that I have no choice but to go on and make a lot of money. And I think the scary thing for me is the idea that at some point this this podcast stops being successful, and I sort of find myself with cross road, and suddenly I can't do of this anymore. I can't live this cool life in new york, and that's the that's the thing that i'm gambling with. I need to make sure that i'm working so hard that I can keep up and I can sort of see how this is going to be a potential slippery slope in the future when he gets bigger and bigger, when you start dealing with kids and, you know, i'm going to start thinking, oh, they need to go to the best school and I need to have a house in this area where all the cool people are. I can feel that sort of like trug mill feeling, but I almost don't want to get off because I don't want to give myself permission to stop working really hard in a way I wouldn't look .

at in that way. I mean, you go to the playbook you played when I was your age. I didn't appreciate or had access to nice things and nice restaurants. I just didn't.

In a year at the point where you shouldn't saving five percent, you should be saving ten percent and then the five percent, you know, fifteen percent because if you just do the math, it's like good brand chester from marian bias. You can have IT all. You just can have IT all wants.

And the reason why I have so much baLance in my life and so much opulence was because I had a lack of IT when I was your age. And that is, I was very discipline. I worked a lot, I didn't spend a lot of money, you know occasionally went out to dinner, whatever he took you went to club, met in mexico, that was my big vacation when I was your age.

Um but you just got to recognize that some of the that indulgence now and i'm not gona tell you not to do IT, it's just a trade off if you can find a way. I mean my my ac control options now is a function of the fact that didn't have IT when I was Young, I could have had more of IT, but I wouldn't have been able to. You know, for the most part, I was constantly investing, reinvesting in startups, reinvesting in the stock market.

And then sometimes i'd lose IT. All would. But I was always putting myself in the position that if the winds kicked up in, my sales were up, I was going make a lot of money because I was constantly investing in my own companies, constantly in investing in the markets and not consuming a lot.

I think IT is very difficult when you're a guy, you're age especially. I know a girlfriend, but you guys live together right now. We do.

You do live to get jesus Christ. yeah. okay. So you're on your way.

By the way, that's been a big that that's helpful in terms of just creating a more .

response alth of other one. Your ability to attract and retain really talented people is especially an entreaty or just find them go to a place we are working with other talented people you want to be able to wear you. If you look left and write and think these people are talented.

you're going to make more money. That sort of what I mean, right? Like I kind of I feel like I need to spend to be to be there, you know I need to go out with my friends and go to these social events like one one of the questions I have on this list here of like situations um i'm not going to be special about who is that fit. You know just here's a situation.

Your friend is getting married and has planned a very big bachelor party and you look at the agenda and you realized you're you going to have to spend a lot of money on flights, a lot of money on meals, on alcohol and going out and it's all beginning to get a very a lot pretty uncomfortable um but this is a really good friend and you don't want to just not show up and and let them down. So in a way, it's sort of like you need to you need to be spending in order to maintain relationships at a certain point in life. I feel like so I guess how do you think about that .

if he's a really close friend, you should be able to set on pass. This is a string for us. I make really good money. And a strange for me, I can't imagine what it's like for some of the other guys.

And quite Frankly, you're being a little bit self is here you're putting us in a difficult position because nobody wants to say no as anywhere you can reached this back a bit. So I don't think that's not unreasonable. You're at that age, we just going to spend a disproportion amount of money on the wedding industrial complex. She's gna happen and it's going to be worse for your partner because .

she's enough to .

buy bride's maid stress and over Price. Yeah that just part of that just a tacks that .

you paid a Williams oma, my tax I love .

that's right as part of IT.

Yes, I guess it's just I bringing up because I find that interesting how as you age, it's like just the the financial burdens just accumulate in ways that you didn't really expect, like the wedding tax that you just described as a very real tax and planning for those things. I'd like to do IT as best I can, but I think IT is very difficult because costs just so come up out of nowhere.

The one I am going to bring that up, bring up now, which is probably the biggest one, is children like children are a huge cost. So my question for you is, were you surprised by how much kids cost um and to do you toward extent you sort of budget in the cost of your children, like how do you think of your kids as that line item on on your income statement? Well.

this is not financial advice for my experience with kids was that when I had them later in life. So I was a little bit more economically secure. Now I my son, when I was forty two, forty one, forty two, and for me that was IT was actually, i'm I think part of the reason i'm wealthy, I am now because I had kids.

And the reason why is because I just scared the ship out of me and got me very focused. I think having kids when you're Younger, if you don't have dual income, would be early, financially stressful. Also, something I did once I kids was in, what I would recommend is asked yourself, can you make a lifestyle? And this was my partner's idea, SHE said, lets me to florida.

We're going to be able to cut arrant in half, if not by sixty percent. We're going to cut our private school tuition for our two boys. By two thirds, Grace church wanted fifty eight thousand dollars a year and for me to bring that lady muff s and then they ask you, are you fill ananta pic? Like, are you going to give us more money anyways? So we immediate cut our burn and and that was her idea and he was smart like, no, we're going to love flor. It's not stopping such a snob and I got not going to florida. Are all e hos now there driving f one fifties and shooting at each other and guns and everything is like to pedia.

T you love that stuff anywhere?

Yeah, the Better. Things like what I did do smart. I took all of the money that we saved, and I put IT into the market. And so immediately, I think, combined with problem make, always making between, I don't know, four hundred thousand and seven hundred thousand year between the two of us. And then we took that fourteen percent wing and savings and all the other savings, we took about one hundred and fifty two hundred grand a year. And we put IT into stocks for ten years from two thousand and you know ten to two thousand and twenty.

Yeah I mean, the thing that really shocks me is that I mean, just how crazy is gone. Four, four hundred and seven hundred thousand dollars a year and you got Price out of new york like it's unbelievable. That's the part that I currently wrapped my head around in, especially living in new york. And that's sort of what this this tread metal feeling is. It's like in order to just get some basics done in new york, you need crazy amounts.

There is a reason why people moving at taxes, and there's a reason why the south is economically booming. The people a lifestyle arbitrage is you should always be thinking about a lifestyle abbat's, especially in a world remote work. Where can I move? Don't be. A lot of people are really happy in atlantic, and economic security is an enormous ointment for stress and anxiety. And if you are blessed with mobility, you want to take a manage of IT.

I start wrapping us up here. I know you've gotten a lot into philanthropy recently. We are talking about what is essential in life.

Is philanthropy essential to you at this point? Is at something that you budget for. And now you trying to make more room for giving.

I've always said that my my one of my biggest locks is my atheism. Because I I really think having a strong sense of the finite nature of life creates a lot of courage and a lot of boldness to share your emotions, to take risks, to tell people you care about them, to seize the moment, to embrace now.

And one of the things I decided when I sold my company in twenty seventeen, I saw that for one hundred and sixty million box, I was worth somewhere between fifteen, one hundred million, depending on how you would calculate my private investments. And I thought, all right, i'm going to put in twenty five million dollars. I'm going to go raise two, fifty or three hundred and start a private.

I actually fun because I thought I need to be a billionaire the time i'm sixty five. I was my goal. And I thought the only way I going to do that is through a pride, equality, fun.

I have the credibility to contact. I'm going to raise the fund. I got the first, I think I got about fifty million, hundred and commitments, just three ls going to start a consumer pride.

I could be fun right at first. So though, too, and then I thought a friend of I got sick, passed away. And I thought, okay, this is going really fast.

I have enough money to live really well. I didn't have an have money for a plane, but I don't enough money for everything else at that point. And okay, why do I need to be a billionaire? I, but I have more influence, maybe not much more.

Would I be able to do anything else now? I can not do anything I want right now. So I made a conscious decision that I would change my approach to money.

And I was the following. Once I hit my number, which I was about to anything above that, I would do one of two things. I would either spend IT or I would give IT away.

I love spending money. I'm selfish. I like nice, thanks, nice experiences. But every year I look at my network, and if it's up seven million dollars and i've spent four, i'll give three away. I do not need to increase my network.

Hoarding is a disease that, in fact, a lot of americans, there's just no read, though I don't prejudge billion's. I don't think there is happy as me. I don't think there's any reason to hord money, spend IT in a capital of society. There's so many amazing things to spend IT on. And then if you still have more money, then what you need to spend to have an amazing life.

For god sakes, why would you find if you believe Young men are struggling and IT freaks you out, that four and five people on a more could die from suicide or man, why wouldn't you give money to an amazing uh, charity with really talented people focusing on mental health, you know, the jet foundation. Why would you, if you are constantly lecturing at people about about the misgiving of the moral corruption of the university system and how we need more vocational training, if you have the money to start a location problem, might a fuck with you. And you know what, IT feels really good and makes me feel strong and makes me feel nice.

I know it's not even an ethical thing that makes me feel like a waller. And also just some of IT is and over do not the california taxpayers. I ve ve a lot of money back to U C.

A and berkely, because they spend so much money on me, despite the fact that was such a fuck up. You know, california taxpayers kept giving me another chance. So this is a great position to be in. But once you hit your number, why on earth would you not do wanted two things, spend IT or give IT away?

Well, this has been great final thought for me. So I I feel like spending is kind of like the toughest, most accurate reflection of ourselves. Like now we tell ourselves these stories.

But oh, this is who I am and this is what I like. And then we take these personality tests to sort like figure out, oh yeah, i'm kind of like A E Q Z O, whatever the fuck that test is. But it's like if you just look at how you spend, it's like this data set testimony that says with no biases like this is who you are.

This is what you care about. This is what you want to achieve in these, the people who you want to impress. Like, I don't like if you want to understand who you are, you just look at look, a bank statement.

So we've been talking about your spending. We've been discussing IT on this podcast. So i'm wondering what do you think your spending says about who you are as a person?

I'm an aist. I'm generous and i'm a father. I I break out the finite nature of life.

I'm spending a lot of money on experiences. I think i'm a generous person. I give away a lot of money.

I am generous with my friends, and i'm very focused on on being a really generous provider for for my kids and my partner. There's all the things I aspire to. IT also says, quite Frankly, i'm indulgent.

I'm selfish. I spent a lot of money on my own comfort and my own joy and my own, you know, I do privileged things that make me feel important and good. I spend money, things know, has spent money on dumb shit because I am a bit of a narthex that's an international way to look at things.

So there's some very good things about my spending. There's some things i'm also probably not that proud of in terms of how I could. I spent too much money on my life and alcohol um that's not good at my edge.

I I have nice things, quite Frankly, to probably impress other people that I couldn't need to impress. How do you know i'm building a house and asked I tell you that sort of poking pathetic isn't IT. So you're right.

IT does say a lot of things about me. IT says a lot of good things, a lot of bad things. 哎呀， 别问。

This episode was produced by clear Miller and engineer by Benjamin Spencer. Our associates producer is alison vice, message aria is our research lead, Jessica lang is our research associate, true burrus is our technical director, and Katherine Dylan is our executive producer. Thank you for listen to profit markets from the vox media podcast network. Join us on thursday for our conversation with Michael sailor. Only on the property markets feet.

What you're saying is you are responsible, but IT was plan. You made a conscious decision to be a responsible. That's my room service.

It's speaking of the responsible. I'd started a should turn of beef. They probably cost a little millions second.

You can leave IT there because i'm going i'm on a podcast. You can leave IT and they'll bring IT out. Thank you, sir.

Thank so what you're saying is you made a responsible decision to be a responsible and I think that's OK. You know occasionally it's fun. The spurge you know when I would argue the spurge when your Young are, I think you remember them more.

Is clearly bonus time. You guys plan this. You guys so planned the Scott, do you think it's important to be generous with your employees who .

don't have as much money as you? What is that rank in your priorities?

It's how do you think your employees get by and what could you do to .

make their lives easier. You something to think.

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