Scott Galloway: We’re Raising The Most Unhappy Generation In History! Hard Work Doesn't Build Wealth

Intro (0s)

• The most reliable way to generate wealth and long-term economic security is through boring methods.
• Scott Galloway's mission is to help millions of people build wealth and achieve economic security.
• To build wealth, leverage your advantages in your 20s: flexibility and time.
• Take risks, find your talent (not just your passion), become an owner (not just an earner), and develop capital that works for you.
• Focus on controlling your spending and appreciate the power of compound interest.

Why Some Become More Rich Than Others (2m0s)

• Scott Galloway wrote a book on wealth, money, and finance to share his insights and experiences.
• Economic security is crucial, especially in America, where there's a stark contrast between the treatment of those with and without money.
• There are specific habits and character traits that contribute to achieving economic security.
• While people tend to become similar to their close friends, one person among them may end up more economically well-off than the others.
• Galloway aims to understand the behaviors of this economically successful individual who doesn't necessarily earn significantly more than their peers.

Where Do We Learn About Money? (3m15s)

• Financial literacy and understanding wealth-building require open discussions about money.
• Rich individuals engage in transparent conversations about money, while middle and lower-class individuals tend to avoid the topic.
• The speaker emphasizes the importance of financial transparency and open conversations about money from a young age.
• Scott Galloway acknowledges his privileged upbringing as a white heterosexual male in California during the 1960s and 1990s.
• Galloway highlights the role of luck and environmental factors, including being raised by a single immigrant mother, in shaping his financial mindset.
• He stresses the significance of economic security and connecting the dots around money early in life.
• Galloway's mother's boyfriend introduced him to the concept of stocks and provided financial guidance.
• At the age of 13, Scott Galloway received $200 from his father and was instructed to buy stocks.
• Intimidated by his first brokerage visit, Galloway met Siero at Dean Witter Reynolds, who gave him his first lesson in the stock market.
• For the next three years, Galloway consulted Siero daily to learn about the stock market and make informed investment decisions.

Where Would We Be Without Those Connections? (8m43s)

• Taking uncomfortable risks can lead to wonderful outcomes.
• Most people are not willing to take risks due to fear of rejection or public shaming.
• Salespeople are often overcompensated because they are willing to endure rejection and take risks.
• Young men are often told not to try hard or express romantic interest, which can lead to a loss of agency and a lack of confidence.
• Spending too much time on screens or at home reduces the chances of having something wonderful happen.
• The current generation is facing significant challenges and may be the most unhappy generation in history.
• Hard work alone does not guarantee wealth or success.
• Many factors, such as connections, luck, and taking risks, play a role in achieving success.
• It is important to take risks, even if it means facing rejection or public failure.
• Young men should not be afraid to express their emotions or take risks, as these are essential for personal growth and success.

No Matter How Old You Are You Can Still Make More Money (13m4s)

• Hard work alone does not guarantee wealth; the ability to endure rejection and spend time away from screens is also crucial for success.
• Having children can bring feelings of failure and shame, and it changes everything.
• Diversification is essential to protect wealth and avoid losing everything, even though it may sound boring.
• The market often outperforms individual performance, so it's important to be realistic about expectations.
• Young people, especially men, are often encouraged to go all in on something, but wealthy individuals diversify their investments once they accumulate capital.
• The American economy continues to grow, and the S&P and NASDAQ act as self-filtering mechanisms, kicking out underperforming companies and bringing in new ones.
• In your 20s, focus on flexibility, finding your talent, and saving money.
• In your 40s, align with a partner on financial objectives and plan for retirement, but don't think it's too late to improve your financial situation.
• Have an adult conversation with yourself about your financial goals and make a plan to achieve them.

When To Take Risks And When To Diversify (20m21s)

• Take risks when you're young and have nothing to lose.
• Diversify your investments as you get older and have more responsibilities.
• Don't go all in on anything when you're older.
• If you're going to start a business, use other people's capital and ring-fence it.
• Slow failure is the worst thing that can happen to you in your 30s and 40s.
• Take advantage of your flexibility and geographic advantages when you're young.

Should We Go For Our Dream Jobs? (23m27s)

• Passion comes from mastery, not from hobbies.
• Being successful at anything requires becoming a ninja at it.
• Many people mistake their hobbies for their passions.
• It's important to set benchmarks and have a realistic understanding of the chances of success in competitive fields like acting and music.
• The majority of working actors don't make a lot of money, and even those in the top 1% may not have health insurance.
• If you're not making enough money to pay your rent within 2 years or to support a family within 5 years, it's time to consider a different career path.

Having Money Is Fun! (27m5s)

• Having money provides opportunities for experiences, relationships, and romantic opportunities.
• Economic security reduces anxiety and allows for a focus on deep and meaningful relationships.
• The speaker spends most of their money on travel and experiences with family and friends.
• The speaker's initial financial goal was $1 million, then $10 million, and eventually $100 million.

Why Should You Have A Number Of How Much Money You Need? (31m18s)

• Creating a financial goal is important.
• Knowing the amount of passive income needed to cover expenses is crucial.
• The definition of wealth is having passive income greater than expenses.
• Working out of choice, not necessity, is a sign of wealth.
• Backward integrating from desired annual income to required savings is essential.
• Having a specific financial goal helps in planning and achieving financial freedom.

How To Make 9-Figures (32m41s)

• Scott Galloway, a renowned speaker and entrepreneur, reflects on his journey and offers valuable advice to young people.
• He stresses the significance of luck and being born in a favorable location, like California, which is more tolerant of entrepreneurial failures compared to regions like Europe or China.
• For those seeking economic success, Galloway recommends relocating to one of the 20 super cities, where most economic growth is projected to occur in the coming decades.
• Credentialing, particularly a college degree, is crucial as it unlocks access to industries that would otherwise be inaccessible.
• If college is not a viable option, Galloway suggests moving to a super city to capitalize on the opportunities and stimulating environment that cities provide.
• Galloway encourages young individuals to embrace risks and surround themselves with successful people to enhance their professional and personal growth.

Where You Should Live To Be Financially Successful (37m18s)

• San Francisco has seen immense wealth creation in recent times, particularly in the AI sector.
• Nvidia, a leading AI company, has experienced rapid growth, making many of its employees wealthy.
• Young people seeking significant financial success should consider relocating to cities that offer opportunities in growing industries.
• Focus on developing skills and expertise in a field with a high employment rate (90% or above).
• Avoid side hustles and distractions. Use them only to explore new main hustles.
• Once you find something you're truly good at, commit fully to it.

How Do You Get Out Of Your Current Job Situation (40m2s)

• There is a downside to the notion that we live in a meritocracy as it creates rage and shame among young people who don't make it.
• There is dignity in every work and opportunities for those who work hard, act like owners, and are good people.
• Working in a fast-food chain like Burger King can be a means to an end, providing an income while pursuing further education, training, or a better job.
• It's important to start making money, even if it's a low-paying job, as it provides a taste for flesh and allows for planning and saving for future goals.

Good Places To Make Money Vs Bad Places To Make Money (42m39s)

• Consider growth potential when choosing a job.
• Working for a fast-growing company like Google can be more beneficial than being great at a slow-growing company like General Motors.
• Look for opportunities to learn and develop skills that challenge you.
• Stressful and tense work environments often indicate learning opportunities and potential for higher earnings.
• Seek out mentors and sponsors who are emotionally invested in your success.
• Prioritize working in a city with economic vitality and a flow of interesting people and potential relationships.
• One-third of all relationships begin at work, so consider the social aspect of your job.
• Assemble a "kitchen cabinet" of trusted individuals who can provide honest advice and guidance about your career.

How Do You Find A Mentor? (45m19s)

• Don't directly ask someone to be your mentor, as it can be intimidating and overwhelming for them.
• Instead, start by asking for advice or help on specific issues.
• As you build a relationship, the mentorship can develop naturally.
• Many people are willing to help younger individuals and view it as a compliment.
• Seek advice from people who are ahead of you in life or who have qualities you admire.
• Don't make significant decisions without consulting others, as it's difficult to have a clear perspective from within a situation.
• There is dignity in all work, and even low-brow jobs like fast food require talented individuals to succeed.

The Psychological Formula For Networking (49m10s)

• The key to success lies in taking risks, reaching out to strangers, and developing social skills like making eye contact and having conversations.
• When sending emails, brevity and personal connections are crucial for increasing the success rate of requests and leading to life-changing opportunities.
• Young people today face challenges such as anxiety, depression, obesity, and addiction, despite living in a prosperous society.
• Social media and constant exposure to others' success can contribute to feelings of inadequacy and unhappiness.
• Opportunities for professional and romantic success are declining, with many young men struggling to find girlfriends.
• Scott Galloway emphasizes the importance of emotional investment in others' success and the fulfillment that comes from being emotionally invested in by others.

How To Be A Great Decision Maker (56m58s)

• Important decisions should involve input from others to ensure their effectiveness.
• Focus on decisions where you can add significant value and seek diverse perspectives from trusted individuals.
• Be open to adapting decisions based on new information.
• Relationships require generosity, forgiveness, and patience for long-term success.
• Divorce can result in a substantial loss of net worth, including legal fees and unfavorable asset sales.
• There are numerous reasons to prioritize staying together in a marriage and working through challenges.

Is Marriage Good For Wealth? (1h1m48s)

• Marriage can be a great way to build wealth as it allows couples to pool their resources and work together towards financial goals.
• However, the divorce rate is high, so it's important to consider getting a prenuptial agreement to protect your assets in case of a divorce.
• Wealthy people are more likely to stay married than poor people.
• The team of a married couple is more powerful than the individual, and this can lead to greater wealth accumulation.

Relationship Investing Is The Key To Wealth (1h3m39s)

• The myth that rich people are bad people is not true.
• Wealthy people are often kind, generous, and civic-minded.
• One of the reasons wealthy people are successful is because they have collected allies along the way.
• Small investments in relationships can pay off in the long run.
• To be successful, it's important to be kind, generous, and helpful to others.

Can Anyone Start A Company? (1h6m17s)

• Most entrepreneurs (70%) are immigrants who don't have access to corporate opportunities.
• To be a successful entrepreneur, one must be risk-aggressive and willing to take risks.
• Successful entrepreneurs must be great salespeople who can convince people to invest in their products and believe in their vision.

The Power Of Storytelling (1h8m11s)

• The greatest skill one can develop is storytelling, the ability to craft a compelling narrative that engages people.
• Storytelling is key to success in various fields, including business, leadership, and communication.
• Great CEOs, like Jensen Huang, are great storytellers who can communicate their vision and inspire others.

How Does The Average Person Develop The Skill Of Storytelling? (1h10m1s)

• The average person can develop storytelling skills by choosing a medium they're good at and practicing storytelling daily.
• Examples of mediums include Instagram, TikTok, podcasts, writing, and public speaking.
• The rise of platforms like TikTok has democratized storytelling, with 850 million creators competing with traditional Hollywood storytellers.

What Is The Algebra To Storytelling? (1h12m54s)

• To be a compelling storyteller, one must evoke emotions in their audience.
• Tapping into people's emotions is more effective than simply being smart or saying interesting things.
• Find a niche and develop domain expertise to stand out from the general crowd.
• Commit to excellence and continuously improve your craft.
• Galloway's career success came after 35 years of hard work and a series of small improvements.
• The secret to success is iteration and continuous improvement.
• Galloway recommends drinking Diary of a CEO Cup energy drink for sustained energy and focus.

How Has Scott Changed Over The Years? (1h16m25s)

• Scott Galloway used to go all-in on investments, which led to him going broke multiple times.
• He learned from his mistakes and now diversifies his investments to minimize risk.
• He recommends young people invest in low-cost, diversified ETFs to avoid high fees and the risks of day trading.
• Scott Galloway recommends diversifying investments to minimize risk.
• He suggests investing in a low-cost, diversified ETF to avoid high fees and the risks of day trading.
• He also recommends investing in different types of businesses that are not correlated to each other.

Where Should I Invest My Money? (1h18m56s)

• The current generation faces significant challenges and may be the most unhappy in history.
• Hard work alone does not guarantee wealth building; investing in a diversified portfolio, such as an index fund like SPY, is recommended for long-term wealth growth.
• The "Magnificent 7" tech companies represent a small portion of the market, and relying solely on them is risky.
• Most alternative investments underperform the S&P 500 after accounting for fees.
• Saving and investing should be prioritized, and various saving schemes and apps can facilitate this process.
• Young people tend to overestimate their investment abilities; investing in index funds is advisable for long-term success.
• Focus on developing in-demand skills and practice stoicism by accepting certain uncontrollable factors.
• Controlling spending and finding a partner can contribute to financial stability.
• The speaker emphasizes saving money and investing early, rather than spending excessively on material possessions.
• Time and compound interest can significantly grow small investments over time.
• Diversification is crucial to reduce risk and protect mental health; allocate a portion of savings to risky investments while keeping the majority in safer options.
• Invest in low-cost index funds, such as the S&P 500, for simple and effective long-term wealth building.
• Focus on personal fulfillment and happiness rather than seeking external validation through material possessions.

Investing $1000 A Month In S&P Visual (1h27m12s)

• The speaker uses a bucket of sand as an analogy to illustrate the power of compounding interest when investing in S&P 500 companies.
• Investing $1,000 a month in the S&P 500 from age 25 to 65 can lead to significant wealth accumulation.
• The speaker emphasizes the importance of starting early and not waiting to have a large sum of money before investing.
• Compound interest is a powerful force that can help grow wealth over time.
• Don't focus too much on your investments, put your money in low-cost, low-energy ETFs, and start early.
• Time is your advantage when you're young, take advantage of it.
• The speaker argues that the current generation is the most unhappy in history despite having access to more opportunities and wealth than previous generations.
• Hard work alone does not guarantee wealth or happiness.
• The speaker criticizes the current economic system for presenting irresistible offers that encourage people to spend money rather than save.
• It is difficult to hold on to money in a capitalist economy.
• The speaker suggests finding ways to force savings, such as through a house, company options, or government-matched savings schemes.

Is Real Estate Worth Investing In? (1h30m42s)

• Real estate offers tax advantages, leverage, and potential psychic value but is currently overvalued, making homeownership less affordable.
• Holding onto a home for at least seven years is generally advisable to weather economic cycles.
• Renting is a good option for those who plan to move frequently or have unreliable sources of income.
• Homeownership is situational and should be carefully considered based on individual circumstances and financial goals.
• The current generation of young people is being raised in a way that is making them the most unhappy generation in history.
• Hard work alone does not build wealth in today's economy, and the idea that it does is a fantasy for many young people.

Playing The Tax Game (1h34m59s)

• The wealthy use various strategies to avoid taxes, such as buying stocks and never selling them, borrowing against them, and passing them on to heirs to avoid capital gains tax.
• Some wealthy individuals relocate to states with no income tax to further reduce their tax burden.
• The US tax code has become increasingly complex, primarily benefiting the wealthy, with the addition of 3,600 pages of tax laws.
• While high-income earners pay a disproportionate amount of taxes, the top 25 wealthiest Americans pay a significantly lower tax rate (6%-8%) compared to the bottom half, who pay almost 50% in consumption taxes.
• The "super earners" or "workhorses" pay a lot of taxes, but their tax rate drops dramatically once they transition to owning assets and become "light speed."
• One practical strategy for the average person is to invest in stocks and use them as collateral for tax-free loans, as stocks appreciate over time and are not taxed until sold.
• Notable examples include Elon Musk, who borrows tax-free against his companies and plans to move to Texas to avoid taxes when selling his stocks.

The Importance Of Tax Advice (1h41m37s)

• Getting good tax advice is crucial for wealth creation.
• The difference in outcomes between those with good tax advice and those without can be significant.
• Tax strategies and thinking about taxes play a vital role in financial success.
• Tax avoidance is not inherently bad, it's a strategy used by wealthy individuals.
• Seeking professional tax advice is essential, especially when setting up a company or receiving large payments.
• The traditional notion of hard work leading to wealth is outdated.
• Becoming an owner, not just an earner, is key to building wealth.
• Developing an army of capital that works for you is more effective than relying solely on earnings.
• Starting early and accumulating assets is important for future financial success.
• Once you become a super owner with significant assets, you can explore advanced tax avoidance strategies.

Last Guest Question (1h43m53s)

• Scott Galloway, a business professor and author, developed a love for Premier League football to connect with his sons and plans their lives around attending games.
• He views football as a rare space where men can openly express emotions and forge meaningful connections.
• Galloway discusses the trend of wealthy individuals purchasing football clubs to enhance their social status and influence within their communities.
• However, he cautions that owning a sports team comes with challenges, such as the likelihood of not achieving success and dealing with fan tribalism.
• Galloway believes that the current generation faces significant unhappiness, and hard work alone does not guarantee wealth accumulation.
• He cites the example of Dave, a passionate football fan, to illustrate the emotional toll of high expectations and the pressure to succeed.
• Galloway recommends NordVPN as a tool to bypass geographical restrictions and access content from different regions, ensuring security when using Wi-Fi networks worldwide.
• A special offer is available for podcast listeners, providing a substantial discount and four additional months when signing up for a 2-year plan.