The 5 Types of Wealth: A Transformative Guide to Design Your Dream Life
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Mark Twain is often quoted as having said, “It ain’t what you don’t know that gets you into trouble, it’s what you know for sure that just ain’t so.”
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The arrival fallacy is the false assumption that reaching some achievement or goal will create durable feelings of satisfaction and contentment in our lives.
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How many times has the thing your younger self dreamed of become the thing you complain about once you’ve gotten it?
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How many folks, in country and in town, Neglect their principal affair; And let, for want of due repair, A real house fall down, To build a castle in the air?[1]
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had prioritized one thing at the expense of everything.
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The greatest discoveries in life come not from finding the right answers but from asking the right questions.
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But reading, I found, can take you only so far—to understand something deeply human, you need to immerse yourself in the human experience.
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Close your eyes and imagine your ideal day at eighty years old (or one hundred, in the case of the ninety-year-old!). Vividly imagine it. What are you doing? Who are you with? Where are you? How do you feel? The exercise forces you to begin with the ideal future end in mind—it establishes a personal definition of a successful life that can be used to reverse-engineer the actions in the present to achieve that desired end.
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We all want the same thing—and it has very little to do with money. From the young entrepreneur to the old retiree, from the new mother to the empty nester, from the rich attorney to the middle-class teacher, the ideal future end looks remarkably aligned: Time, people, purpose, health.
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Spending time surrounded by loved ones, engaged in activities that create purpose and growth, healthy in mind, body, and spirit. Money was an enabler to these ends, but not an end in and of itself.
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The statement implies that the metrics that get measured are the ones we prioritize. In other words, the scoreboard is important because it dictates our actions—how we play the game.
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If we fix the scoreboard to measure our wealth more comprehensively, our actions will follow. We’ll play the game right. Right scoreboard, right actions.
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his lips. In that moment, I had a profound sensation: I had arrived, but for the first time in my life, there was nothing more that I wanted. This was enough. Never let the quest for more distract you from the beauty of enough.
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“Never fear sadness, as it tends to sit right next to love.”
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“Never raise your voice, except at a ball game.”
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“Find dear friends and celebrate them, for the richness of being human is in feeling loved and loving back.”
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“Treat your body like a house you have to live in for another seventy years.” He added, “If something has a minor issue, repair it. Minor issues become major issues over time. This applies equally to love, friendships, health, and home.”
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“Tell your partner you love them every night before falling asleep; someday you’ll find the other side of the bed empty and you’ll wish you could tell them.”
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“When in doubt, love. The world can always use more love.”
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Money isn’t nothing—it simply can’t be the only thing.
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Money improves overall happiness at lower levels of income by reducing fundamental burdens and stress. At these lower levels, money can buy happiness. If you have an income above these levels and are unhappy, more money is unlikely to change that. If you have an income above this baseline and are happy, more money is unlikely to drive increasing happiness.
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Your wealthy life may be enabled by money, but in the end, it will be defined by everything else.
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If you do not change direction, you may end up where you are heading. —Lao Tzu
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The term Pyrrhic victory now refers to the victory won at such a steep cost to the victor that it feels like a defeat. The victory damages the victor beyond repair. He wins the battle but loses the war.
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A Pyrrhic victory is what you need to avoid in your own life. And unfortunately, a Pyrrhic victory could be where you’re headed if you don’t change direction.
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You’re measuring the wrong thing. Money.
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When a measure of performance becomes an explicit, stated goal, humans will prioritize it, regardless of any associated and unintended consequences. You blind yourself to everything else, focusing on the single measure, no matter the costs elsewhere.
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The war you wage is about happiness, fulfillment, loving relationships, purpose, growth, and health. If all the battles you’re fighting are exclusively about money, you may win these battles, but you will lose the war.
Manolo Alvarez
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You stay in a job for the security but allow your higher-order purpose to wither and die.
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Your new scoreboard is the five types of wealth: Time Wealth Social Wealth Mental Wealth Physical Wealth Financial Wealth
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Time Wealth is the freedom to choose how to spend your time, whom to spend it with, where to spend it, and when to trade it for something else.
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Social Wealth is the connection to others in your personal and professional worlds—the depth and breadth of your connection to those around you.
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Mental Wealth is the connection to a higher-order purpose and meaning that provides motivation and guides your short- and long-term decision making.
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Physical Wealth is your health, fitness, and vitality. Given its grounding in the natural world, it is the most entropic type of wealth, meaning it is more susceptible to natural decay, uncontrollable factors, and blind luck (positive or negative) than other types.
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Financial Wealth is typically defined as financial assets minus financial liabilities, a figure often referred to as net worth. On your new scoreboard, there is an added nuance: Your liabilities include your expectations of what you need, your definition of enough.
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As you start to walk on the way, the way appears. —Rumi
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Your Wealth Score is your performance on the new scoreboard.
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In the study of philosophy, the term razor denotes any principle that allows you to quickly remove unlikely explanations or avoid unnecessary steps. It allows you to metaphorically shave away unneeded explanations or actions. Today, the term is broadly applied as a rule of thumb that simplifies decision making.
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Occam’s razor, named for fourteenth-century philosopher William of Occam, states that when weighing explanations for something, the one with the fewest necessary assumptions is generally the correct one. The simplest explanation is the best one. Simple is beautiful. Hanlon’s razor, a tongue-in-cheek adage stating that one must never attribute to malice that which is adequately explained by stupidity. It’s best applied to politics, relationships, and general online discourse. Hitchens’s razor, created by and named for the late author Christopher Hitchens, states that anything asserted without ...more
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This is where the true power lies—in the connection of a single, elegant statement to how your ideal self shows up in the world.
Manolo Alvarez
Importante
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“I will never miss a Tuesday dinner” is Marc Randolph’s Life Razor, his single point of focus that allows him to cut through the noise, maintain perspective and balance, make decisions in line with his core identity, and create positive ripple effects throughout his world. Without one, you’re leaving life to chance; like a mountain climber caught in a blizzard, you’ll become blinded by it, lose all points of reference, and wander aimlessly, praying for the storm to subside. With one, you’ll see clearly—the storms won’t be any less turbulent, but you’ll be well equipped to navigate through to ...more
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A powerful Life Razor has three core characteristics. It is: Controllable: It should be within your direct control. Ripple-creating: It should have positive second-order effects in other areas of life. Identity-defining: It should be indicative of the type of person you are, the way your ideal self shows up in the world.
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The simple statement “I will coach my son’s sports teams” becomes a dynamic defining rule for life—my Life Razor. It’s time to define your Life Razor.
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In each example, the single-statement Life Razor becomes a broad, identity-defining rule for life that covers the entire range of traits and actions. It’s easy to see how the identity the rule shapes can be used to clarify the appropriate, identity-aligned response in a wide variety of life situations.
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I’ve never met Tom Hanks, but he changed my life. If you identify your Earth in the window—your Life Razor—and keep it top of mind, I’m willing to bet he’ll change yours too.
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There is no favorable wind for the sailor who doesn’t know where to go. —Seneca
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Life is about direction, not speed.
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Your Life Razor establishes your identity—who you are and what you stand for—while your compass defines where you’re going, your vision for the future. You will turn to your Life Razor when challenges or opportunities arise, but your compass will dictate your direction as you build toward your dream life.
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Anti-goals are the things we don’t want to happen on our journey to achieve our goals.
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“All I want to know is where I’m going to die so I’ll never go there.”
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