From: alexhormozi
This article outlines 28 common pitfalls and mindsets that can lead to and perpetuate poverty, framed using the concept of “inversion thinking” [00:00:16]. This approach, inspired by Charlie Munger, suggests solving problems in reverse. Instead of asking how to achieve wealth, the focus is on identifying ways to remain poor and then avoiding those behaviors [00:00:24]. Our brains are often better at identifying problems than solutions, making this an effective method [00:00:30].
28 Rules to Remain Poor
The following are 28 ways one might ensure they stay poor, as identified by Alex Hormozi, owner of Acquisition.com [00:01:11]:
1. Start Tomorrow
To guarantee poverty, continuously postpone actions like losing weight, saving money, or starting a business. Always defer until tomorrow [00:01:37].
2. Read Lots of Books and Then Do Nothing
Consume knowledge without ever applying it. Many people boast about reading numerous books but remain in the same position for years, failing to act on what they learn [00:01:50].
3. Take Advice from Poor People on How to Be Rich
Seek financial guidance from individuals who have no idea how to achieve wealth. Listening to their judgment on your ideas can be detrimental [00:02:06].
4. Pick a Spouse Who Will Make You Feel Guilty for Working
Choose a partner who discourages your dreams and aspirations, making you feel guilty for pursuing them [00:02:33]. This relinquishes control of your destiny, leading to resentment if your dreams aren’t achieved [00:02:48].
5. Fail Once, Quit Forever
If you encounter a setback after starting something, immediately give up, assuming success or business isn’t for you [00:03:11]. This reflects an incorrect view of failure, which is a necessary part of learning [00:03:26].
6. Think That the World Is Fair
Believe the world owes you fairness. Complaining about unfairness is unproductive and does nothing to change your circumstances [00:03:37].
7. Blame Your Circumstances and Complain
To stay poor, continually blame your circumstances and complain about things you cannot control [00:04:01]. This attitude prevents any activity that could lead to improvement [00:03:54]. Strong character is built through hard times, so lamenting them hinders personal development [00:04:38].
8. Expect the Government to Save You (or Others)
Rely on external entities, like the government or other people, to solve your financial problems [00:05:05]. The reality is, no one will save you but yourself, and many people spend their lives waiting in vain [00:05:12].
9. Value the Opinion of Others Over Your Own
Prioritize the opinions of others above your own [00:05:22]. True success is a personal decision; if you seek external validation or specific monetary targets, you will constantly move the goalposts and never feel successful [00:05:35]. Success is a process, not just an outcome [00:06:18].
10. Avoid Discomfort
Always steer clear of uncomfortable situations, new risks, or learning opportunities [00:06:29]. The discomfort often stems from self-imposed judgment about not being good at something you’ve never done, which is irrational [00:06:43]. Avoiding discomfort guarantees you won’t accomplish your life goals [00:06:57].
11. Tolerate Mediocrity from Yourself and Others
Allow mediocrity to persist in your own work and in the performance of those around you [00:07:02]. This leads to degradation over time instead of improvement. Successful people hold themselves and others to a high standard of excellence [00:07:20].
12. Make Promises, Break Promises
Routinely break promises made to yourself and to others [00:07:56]. This destroys your reputation with others and, more importantly, your reputation with yourself [00:08:02]. Losing self-respect by knowing you didn’t push as hard as you could have is a guaranteed path to staying poor [00:08:12].
13. Wait for Perfect Conditions
Always delay action until everything is perfectly aligned for success [00:08:54]. Perfect conditions never arrive, and if you require them, you’ll cease to be successful the moment conditions change [00:09:04]. Starting in adverse conditions proves resilience and ability to succeed regardless of circumstances [00:09:13].
14. Prioritize Looking Rich Over Being Rich
Focus on outward appearances of wealth rather than building actual wealth [00:09:31]. This often means spending excessively to impress others, prioritizing their approval over your own [00:10:00]. Be willing to appear poor if it means building actual wealth [00:10:17]. This aligns with living_frugally_to_save_and_invest.
15. Avoid Working on What Matters Most
Stay busy with trivial activities that give the illusion of progress, without moving the needle on important goals [00:10:29]. The wealthiest individuals don’t do the most; they ensure the right things get done [00:10:44].
16. Say You’re Going to Do Something and Then Don’t Do It
Similar to breaking promises, this involves consistently failing to follow through on stated intentions [00:11:17].
17. Do What Everyone Else Is Doing
To stay poor, emulate the actions of the majority [00:11:28]. If you aspire to be in the top one percent, you cannot follow the path of the 99 percent [00:11:34].
18. Do Your Best, Not What It Takes
Focus only on “your best,” even if your best is insufficient to meet the required outcome [00:11:58]. The world cares about what is required, not just effort. To succeed, you must become better until your “best” surpasses what is required [00:12:16].
19. Talk More, Do Less
Spend excessive time talking about your goals, affirmations, and routines, but accomplish very little actual work [00:12:35]. This is prevalent in online communities. Instead of preparing endlessly, simply start doing [00:12:56].
20. Start Something New Today, Start Something New Tomorrow, Repeat
Continuously begin new projects or ventures without ever seeing them through to completion [00:13:09]. This creates a pattern of “half-built bridges” driven by uninformed optimism, where you abandon projects once the “work” and “downsides” become apparent [00:13:27]. This cycle prevents achieving any significant outcome [00:13:49].
21. Believe What Other People Think About You More Than What You Think About You
Give more credence to others’ opinions of you than your own self-perception [00:14:01].
22. Make a Mistake, Then Repeat the Mistake
Consistently repeat the same errors in relationships, business, or other areas of life [00:14:16]. If your current actions lead to being poor, continuing them will yield the same outcomes [00:14:41].
23. Be Replaceable
Develop skills and capabilities that are common and easily replicable by others, especially those willing to do the same work for less [00:15:07]. To avoid poverty, you must learn things others cannot, making you less replaceable [00:15:20].
24. Find Something That Works and Then Stop Doing It
When you discover an effective method for generating income or achieving a goal, cease doing it as soon as immediate needs are met [00:15:50]. Many people have the ability and knowledge to make money when necessary (e.g., to pay bills), but stop once the immediate crisis passes, demonstrating a willingness to pay others’ bills but not their own [00:16:14].
25. Hire Dumb People
Deliberately choose to hire incompetent individuals for your business or team [00:17:14]. This is an excellent way to make your life miserable and ensure a bad business [00:17:17].
26. Assume You Are Always Right
Maintain the belief that you know everything and are always correct [00:17:44]. This prevents learning from others, even those more successful than you, and ensures you remain stuck [00:17:53]. A voracious desire to learn, coupled with humility, is characteristic of highly successful individuals [00:18:08].
27. Spend More Than You Make
The simplest economic rule for staying poor is to consistently spend more money than you earn [00:18:49]. It doesn’t matter how high your income grows; if your lifestyle expenses always adjust to or exceed your income, you will remain poor and in debt [00:19:04]. This relates to personal_finance_strategies and the financial_mindset_of_wealthy_individuals.
Inversion Thinking: The Path to Wealth
By identifying these 28 ways to stay poor, one can use inversion thinking to understand the steps to avoid poverty and the strategies for escaping poverty. The human brain’s natural ability to find threats can be harnessed to reveal the pitfalls to avoid [00:19:47]. By making the reverse of these rules your principles for living, you can succeed almost by accident, simply by avoiding the common mistakes most people make [00:20:03]. This forms a blueprint for becoming a millionaire and is key to building and maintaining wealth.
The inverse of these 28 rules, which represent steps to achieve financial independence, include:
- Starting today [00:20:25].
- Reading books and then applying the knowledge [00:20:26].
- Taking advice from rich people on how to be rich [00:20:28].
- Choosing a spouse who supports your work and dreams [00:20:30].
- Failing and trying again [00:20:33].
- Assuming the world is unfair and acting accordingly [00:20:36].
- Never blaming circumstances; instead, thanking them for shaping you [00:20:38].
- Taking action instead of complaining [00:20:42].
- Expecting no one but yourself to save you [00:20:45].
- Valuing your own opinion over others [00:20:48].
- Seeking out discomfort [00:20:51].
- Tolerating nothing but excellence [00:20:52].
- Making and keeping promises [00:20:54].
- Acting on your goals even in imperfect conditions [00:20:57].
- Prioritizing being rich over looking rich [00:21:00].
- Working on what matters most and ignoring the rest [00:21:05].
- Following through on what you say you will do [00:21:09].
- Doing what no one else is doing [00:21:11].
- Ensuring your “best” exceeds what is required [00:21:14].
- Talking less and doing more [00:21:19].
- Starting something new and persisting until you are good at it [00:21:22].
- Believing what you think about yourself more than what others think [00:21:30].
- Learning from mistakes instead of repeating them [00:21:32].
- Becoming irreplaceable [00:21:34].
- Finding what works and continuing to do it, even when bored [00:21:36].
- Hiring smart people [00:21:43].
- Assuming you are always wrong and being willing to learn [00:21:45].
- Making money and spending less than you make [00:21:48].
By focusing on avoiding these common mistakes keeping people poor, one can significantly increase their chances of financial success [00:20:16].