MONEY MASTER THE GAME (BY TONY ROBBINS)

Mastering the

money

game

is really like walking through an unexplored jungle, and there are many things trying to kill you or, well... your bank account. Fees Brokers Volatility Taxes and Arrogance In MONEY: Master the Game, Tony Robbins has interviewed many of the best investors of our time and has condensed their best advice into this book. Tony Robbins firmly believes that to be successful at anything, you need the right role models. And who better to guide you through this dangerous jungle than legends like Carl Icahn, Paul Tudor Jones, Kyle Bass, and last but not least, Ray Dalio?

Tony Robbins interviewed them all before writing this book. Let's see what he proposes to us now after learning from these

master

s. Takeaway #1: Climb the mountain of financial freedom Imagine your financial journey as a mountain climb. Like climbing a mountain, there are two different phases in acquiring wealth: The accumulation phase, where

money

is saved and invested to build critical mass. And decumulation phase during which you withdraw money. There are five levels of financial freedom. Imagine the top of the mountain as the absolute pinnacle of wealth creation and the others as base camps along the way. For example... "Financial security" is achieved when you have created a critical mass, or in other words, a portfolio, that can support and pay for all of life's necessities, such as food, housing, and utilities. “Financial independence” is achieved when your passive income can support your current lifestyle, and the pinnacle, “absolute financial freedom,” is achieved when your dream lifestyle is supported by investment income.

I encourage you to calculate how much you would need to accumulate to, for example, achieve financial independence. Clarity is power. When your brain knows a real number, your conscious mind will find a way to get you there, as stated in Think and Grow Rich by Napoleon Hill. Multiply your current monthly expenses by 12 and then multiply that number by 20 and you'll get a rough estimate of how much money you need to reach financial independence. Now we need a plan. Reaching this number won't happen by accident. "The man on the top of the mountain did not fall there." Takeaway #2: Accelerate to Peak Faster To begin your financial journey, you must make the decision to stop being just a consumer.

You must also be an owner or investor. This is how anyone with the right guidance can climb that aforementioned mountain. Here are five tips on how to accelerate your promotion. 1. Save more. We've heard it all before... The most important part of achieving financial freedom is "paying yourself first." It's not about what you earn, but what you keep. Tony Robbins suggests that the best way to save is to not look at the money in the first place. With every increase in earnings you make, save a predefined portion of that. This way you will never get used to the additional income. 2.

Earn more. On the other hand, there is always a limit to how much you can save. But the good thing... it's unlimited! The secret to earning more is to do more for others than anyone else does. They don't pay you for your time, they pay you for the value you contribute (with some exceptions, apparently). A McDonald's team member in Sweden earns approximately $12 per hour, while one of the highest paid in Sweden last year, Stefan Persson, earned approximately $240,000 per hour, just from dividends from his company H&M. . 3. Reduce fees and taxes Fees and taxes are like climbing to the top with a huge and heavy backpack.

You think small percentages don't make a big difference, but over time, they really do. To reduce fees, invest primarily in products that are passively managed. You are required to pay your taxes, but no one says you have to tip. So minimize this expense. In general, use tax-deferred accounts, such as a Roth IRA, and tax harvest. 4. Earn Better Returns Among the investors Tony Robbins spoke to when he wrote MONEY: Master the Game, four principles were dominant. Do not lose. Risk a little to gain a lot. Diversify and never stop learning. For a deeper dive into how to get better returns, check out my overview of, for example, Common Stocks and Uncommon Profits. 5.

Change your life and your lifestyle. Compared to this important decision, every saving effort is like saving money and saving. It is the decision of where to live. If you are a US citizen, income taxes between states can differ A LOT. But also consider what it would cost to live in another country. According to wolrddata.info, living in Sweden, for example, is 5% more expensive than living in the United States. Meanwhile, living in the Philippines is about 60% cheaper. And living in India costs only about 1/3 of what it costs in the United States. Takeaway #3: The All-Seasons Portfolio Complexity is the enemy of execution, and execution trumps knowledge every day of the week.

Therefore, most investors need an asset allocation in their portfolio that is simple to understand and implement. Ray Dalio's All-Seasons Portfolio delivers on this. Not only does it protect you from any potential economic environment, it also protects you from yourself. When Tony Robbins' team of analysts backtested this portfolio between 1984 and 2013, they got the following results: 9.72% annual return, net of fees. He made money in 86% of the years. The worst drop, which occurred in 2008, was -3.93%. I think most people can stick with an asset allocation strategy that lost only 3.93%, at most, over a year. Now how does it work?

According to Ray Dalio, there are four different types of economic climates, depending on the growth of the economy and current inflation. Different assets work relatively better in different conditions. We can't anticipate what will happen in the future in the market, but if we invest so that 25% of the risk in our portfolio belongs to each of these quadrants, we really don't care what the future holds, because we will prosper no matter what. let it happen To achieve this allocation, Ray Dalio suggests: 40% US long-term bonds 30% stocks 15% US intermediate bonds 7.5% gold 7.5% commodities The All-Seasons portfolio gives you one of the best chances of having a gentle climb to the top of The Mountain of Financial Freedom.

Conclusion number 4: Income is the result All-in Anthony has been investing 100% of his savings in stocks for the last decade and has now turned 65 and is about to retire. He has been able to save $500,000, which is a little more than he will need to retire comfortably, especially if the market continues to move in his favor. Unfortunately, for All-in Anthony it is the end of the year 2000. Just two and a half years away from retirement, All-in Anthony has already lost more than half the value of his retirement portfolio and is withdrawing money while the market has decreased, the damage caused has increased.

Unfortunately, Anthony's invoices don't seem to respect that. Here's a problem that most people will face as retirement approaches. You have made some progress up the mountain of freedom, probably financial independence, but when the time comes put on your skis and enjoy the slope on the way back. , market fluctuations will have a significant impact on your trip. On the way back, the most important thing is not assets, but income. Therefore, Tony Robbins suggests that if you want to have a smooth ride, he can consider a product like an "annuity." An "annuity" is a risk management tool, not an investment.

It is simply an agreement between an insurance company and you where you pay them a lump sum, in Anthony's case it would be $500,000, and in return they will pay you an income. Many times until you die. What are the advantages of an annuity? It pays a steady income stream and is higher than what can be expected from any fixed income security. You will retire comfortably with a known and guaranteed income. Lasts until you die. You can't survive this income. Now, what are the disadvantages? A guarantee is never better than the guarantor; You may want to diversify among several insurance companies.

If you die prematurely, you've made a "bad deal," so to speak, since any payments you miss will go to the insurance company. This is also why the income stream can be so high. Basically, the insurance company pools your annuity with others and bets on an average mortality rate. But since you're dead anyway, that doesn't really matter, right? Conclusion Number 5: Three Ways to Buy Happiness Okay, no, that's probably not how it works. However, here are three ways to spend your money that have been scientifically proven to improve well-being, according to the book "Happy Money, the Science of Smarter Spending." 1.

Invest in experiences. Instead of acquiring more possessions, travel or learn a new skill. 2. Make time for yourself Money can transform the way we spend our time, from completing tasks we may dread to pursuing our passions. 3. Invest in others Giving money away actually makes us happier and also creates a feeling of abundance. which, ironically, can have a net positive effect on the amount of money you'll accumulate in the end. Keep in mind that what matters here is not necessarily how much money you spend, but HOW you decide to spend it. So... Calculate your numbers and start climbing towards your financial freedom goals.

Accelerate your advancement by, among other things, saving a portion of every salary increase, creating more value, and managing fees and taxes. The All-Seasons portfolio will give you a smooth rise. Annuities will give you a smooth ride. Money can buy happiness, but it's a matter of how you spend it, not necessarily how much you spend. Health!