From: alexhormozi
Many 20-year-olds remain in poverty because they prioritize immediate earnings over learning and skill development [00:00:00]. A survey found that 52% of high school seniors believe they will be millionaires by age 25, a belief described as a “delusion” [00:00:06]. While some might roll the dice for a slim chance at quick wealth, a guaranteed path to becoming a millionaire within a decade exists through sustained personal growth and skills acquisition [00:00:15].
Learning vs. Earning
The foundational mistake early in one’s career is to focus on earning rather than learning and developing skills [00:00:00]. When you choose to prioritize earning prematurely, you halt the process of learning [00:02:52]. This decision essentially tells the universe that you have achieved enough [00:02:56].
Case Study: Two Young Professionals
Consider two individuals of similar age who took different career paths [00:00:24]:
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The “Earning First” Approach One individual learned basic video editing from an older peer [00:00:30] and secured a job offer for 3,000 [00:00:54], prioritizing immediate earnings over the opportunity to learn [00:00:57]. He eventually became the lead video editor at a small business lacking mentors or senior colleagues [00:01:08]. Within 12 weeks, he found himself in a position where the company was extracting as much as possible from him, rather than investing in his growth [00:01:17]. This choice hindered his long-term net worth maximization [00:01:28].
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The “Learning First” Approach Another individual, at 17 years old, possessed no specific skills but sought guidance from a mentor [00:01:43]. Recognizing his potential in sales, the mentor advised him to double the minimum daily activity quota [00:01:51]. Though required to make 100 calls a day, he made 200, compensating for his lack of experience with sheer effort [00:01:59]. He also spent significant time observing and learning from the top performer [00:02:08]. He rose to become the youngest top closer in the company [00:02:14], acknowledging that respect had to be earned through hard work, not age [00:02:21]. Later, he accepted a lower-paying role at a more prestigious company for the superior experience and continued learning opportunities [00:02:39], demonstrating a long-term strategic mindset [00:02:50].
The Dunning-Kruger Effect and Ignorance Debt
Early in the skill development journey, individuals often overestimate their knowledge, a phenomenon known as the Dunning-Kruger effect [00:01:31]. The more one learns in a specific skill, the more one realizes how much they don’t know [00:01:38]. Socrates famously stated, “The more I know, the more I realize I know nothing” [00:04:40]. By committing to intensive skill development and volume-based practice (e.g., doing two to four times the standard workload), individuals can accelerate their learning and rapidly “pay down their ignorance debt” [00:03:52].
The Power of Compounding Skills
Skills compound over time, leading to disproportionate growth in value [00:05:57]. One skill combined with another does not simply add up; they multiply. For example, knowing math, then bookkeeping, then accounting, then taxes and insurance, can lead to becoming a CFO [00:06:37]. Adding knowledge of M&A and entity structures transforms a CFO into a “Rainmaker” with earning potential tens of millions of dollars higher annually [00:06:48].
A prime example is Jay-Z, who first learned to rap [00:06:02], then promotion [00:06:14], then record label distribution [00:06:17], and finally artist recruitment [00:06:21]. His early skills, though not heavily monetized initially, became invaluable as he stacked more advanced abilities [00:06:25].
Seeking Mentorship and Learning from the Best
Respect is earned, especially for younger individuals [00:04:04]. The drive to learn and work is a universal currency, always respected [00:04:14]. True “killers” in their twenties are those hungry to learn and work, not those seeking immediate displays of wealth [00:04:22].
Examples of Learning-Oriented Mindsets
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Warren Buffett: Despite finishing top of his class at Columbia Business School, Warren Buffett offered to work for free at Ben Graham’s investment firm [00:07:03]. Graham, a titan of investing, deemed Buffett “overpriced” even for free, recognizing the immense value of the skills and knowledge he would impart [00:07:30]. Buffett’s willingness to invest in his personal growth by learning from the best, even for no monetary compensation, was a critical decision that shaped his professional life [00:07:25].
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Kobe Bryant: The legendary basketball player was famous for doing two practices a day, believing that doubling his efforts would lead to faster improvement [00:03:07]. This consistent, compounded effort eventually made him unbeatable [00:03:34]. His “hunger, motivation, and desire to be the best” were discovered during lonely hours of self-practice [00:03:22].
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Personal Story: Even as a Magna Cum Laude graduate from Vanderbilt with a consulting background, one individual chose a lower-paying consulting job to work directly with the CEO and learn more [00:08:01]. Later, when transitioning to fitness, he asked 40 gym owners if he could work for free [00:08:17]. Despite his impressive credentials, he understood the value of the exchange and was willing to “swallow his pride” for minimum wage to learn from the best in the industry [00:08:32]. He recognized that the learning opportunity was worth more than any immediate salary [00:08:54].
The decision of a 20-year-old to reject a learning opportunity for a higher short-term earning is akin to refusing to be Elon Musk's assistant for 200,000 [00:09:02]. Such a choice is short-sighted and detrimental to long-term growth [00:09:16].
Employer Perspective
From an employer’s viewpoint, someone seeking immediate high earnings in their “earning season” will be managed based on a strict exchange of value [00:04:47]. However, an individual who comes in with a “learning hat” on is seen as a long-term investment [00:05:10]. Businesses are often generous with reinvesting in such individuals, offering mentorship and pairing them with experienced colleagues, effectively paying them to learn [00:05:15].
Conclusion
The most crucial realization for those in their twenties is to understand what “season” they are in [00:05:27]. Avoid comparing yourself to those earning more, as they may be sacrificing long-term earning potential for short-term gains [00:05:32]. While there is a time for earning, making the “red hook” turn towards maximizing income too early can make it difficult to return to a learning trajectory [00:05:40]. Start at the bottom and learn every skill along the way [00:03:01]. Cultivating a track record of undeniable proof through experience leads to genuine respect, as people will value what you have done, not just what you say [00:09:25].