Investing tips, negative interest rates, how to become financially rich, the power of compounding , beautiful state vs. lousy state and more



Guest: Tony Robbins

Tony Robbins is an entrepreneur, best-selling author, philanthropist, and the nation’s #1 Life and Business Strategist. Robbins has empowered more than 50 million people from 100 countries through his audio, video and life training programs. His work has also touched the lives of top entertainers, such as Aerosmith, Green Day, Usher and Pitbull. Billionaire business leaders seek his advice as well; casino magnate Steve Wynn and Salesforce.com founder Marc Benioff are among those who call on him for coaching.

More info: Scroll to the bottom for more info on Where to Listen (or watch), Lewis Howes – The School of Greatness Podcast, and where to Connect with Tony Robbins.


0:33

Lewis introduces Tony

“Tony Robbins is one of the most inspirational coaches in business and life in the world, also in finances and how to make money.” — Lewis Howes

This is Tony’s 3rd time on The School of Greatness podcast. Here are the past two episodes:

Tony wrote two books on finance

  1. MONEY Master the Game: 7 Simple Steps to Financial Freedom — #1 New York Times bestseller monster book (689 pages!), based on extensive interviews with 50 of the smartest people in finance, including legendary investors Warren Buffett, Ray Dalio, Carl Icahn, and more.
  2. Unshakeable: Your Financial Freedom Playbook— a step-by-step playbook (much shorter, 256 pages) taking you on a journey to transform your financial life and accelerate your path to financial freedom. In this book, Tony wants to replace fear with facts.

Book proceeds go to a great cause — Feeding America

100% of profits from the books don’t go to Tony. Every book helps to feed 50 people, and Tony matches funds to feed even more. He’s on a mission to feed a billion people in the next 7 years!


1:52

Tony’s Wealth Mastery program

Tony briefly mentioned his wealth mastery program, where you can learn strategies that will take you beyond financial independence and towards financial freedom. According to Tony, the program/event features “20 speakers, including five self-made billionaires– and we go deep.” Past Speakers include:

“Ray Dalio — most successful hedge fund guy in the history of the world, produced more money to investors than anybody alive… President Clinton… Top guy who became a billionaire in bitcoin… Fed chair Alan Greenspan, and I spent three hours with him getting in his psyche over supposedly lunch that was supposed to be 30 minutes… He’s 90 years old, he’s been the most powerful man in finance for 19 years across four presidents.” — Tony Robbins

Tony Robbins and Ray Dalio

2:41

Negative interest rates

In 5,000 years of banking history, we’ve never had negative interest rates! Negative interest rates are normal interests rates, except the lender (the bank) pays the borrower (you). Everything You Need to Know About Negative Rates.

In 2008, when the market was crashing, Howard Marks from Oaktree Capital was buying $1 billion worth of stocks a week!

“We’re in the 8th year of a bull market– 2nd largest bull market in the history of the world! And we all know there’s gonna be a crash, but while you’re busy worrying about the crash, a lot of people are missing on bull market. It’s up 250% since 2008! It’s up 14% since Trump was made president in November.” — Tony Robbins


5:58

Financially rich vs. financially poor

Someone who’s financially rich is an owner. He’s also a consumer, but not solely a consumer. Someone who is financially poor is (only) a consumer. You need to become an owner!

“We’re all financial trades. We trade time for money — worst trade you could make in your life.” — Tony Robbins

How do you become an owner?

You decide on a percentage of money you’re going to keep forever — percentage of income will never be touched. That will grow and compound and will provide income for the rest of your life, so you don’t have to work.

“Someone’s who’s wealthy has made money their slave, and they’re no longer a slave to money.” — Tony Robbins


6:58

Rich people who don’t have to work end up working harder than ever

The majority of us want to make enough money so we don’t have to work, but older rich people, who never have to work again, like Steve Wynn, Warren Buffett, and Peter Guber work harder now than ever before because they truly care about what they work on.

“Make enough money so you don’t have to work, and then you’ll do what you love, and you’ll put your time and energy into it.” — Tony Robbins

Start saving NOW

Tony mentioned a study where blue collar workers were saving small percentages of income that translated to big savings within 14 years, thanks to the compounding effect. But even though most investors understand the concept, they fail to tap the power of compounding.


9:00

Avoid the fees

You want to pay 1% fees total! Most people pay 3% on average. When you hear 1% at a mutual fund that’s the expense ratio. Often times there are other hidden fees, and for every 1% you overpay (because of compounding) you lose a decade of income.

For example: if you invest $100,000 today in the market (index) and never touch it for 35 years, you will have $762,000 in 35 years as long as you pay 1% total fees. But if you pay 3% in fees, you will only have $452,000.


10:05

Compounding is king

Crazy story how a UPS guy who made $14K a year retired with $70M!!! – Retiree Donates Fortune to Education


11:26

Is there a way to be financially free just by earning more every year, as opposed to investing every year?

“You are never going to earn your way to wealth.” — David Swensen, Chief Investment Officer at Yale since 1985

Even stars who made boatloads of money went broke – Johnny Depp and 11 Other Celebrities Who Have Badly Mismanaged Their Money

“78% of NFL players go bankrupt 2 years after they retire.” — Lewis Howes

Tony suggests creating an income for life without working, no matter how good you are in business. And keep in mind, diversification is your only free lunch— every market crashes at some point, and whatever you invest in will drop 50–70% in a day. 


16:24

How do we invest without fear?

“Winter is coming and it’s the best time on earth.” — Tony Robbins

People don’t invest because they’re afraid of failing. In January 2016, we had the worst stock market opening in the history of the market:

Ray Dalio’s All Weather Portfolio Strategy

Tony recommends a method shared by Ray Dalio called the All Weather Portfolio, which made money 85% of the time in the last 75 years! Average return 10%; average loss -1.6%. His method was up 2% when the market was down -9%.


Market correction vs. crash

Correction

  • Correction is when the market drops from high, by 10%-20%
  • Corrections happen every year and lasts 56 days on average
  • Average correction market drop has been 14% over the last 30 years
  • 80% of corrections never become a bear market

Crash (a.k.a. bear market)

  • Crash is when the market drops from high by 20% or more
  • The bear market in the last 100 years happen every 3–5 years (we just went 8 years without one) and lasts one year on average
  • Average drop is 33%, (1/3 of those go 40% or above)
  • For the past 200 years every bear market in the US led to a bull market.
  • Scary thing to anyone, but also greatest opportunity

“I want to be greedy when people are afraid, and afraid when people are greedy.” — Warren Buffett


26:57

You need to be in the market

“The stock market never took a dime from anybody. Only you can take it from you… If you are not in the market — it’s the most dangerous thing… You get nothing from cash.” — Tony Robbins

A Schwab study showed that over the past 20 years (1996–2015), the S&P index made 8.2% return (past 30 years return was 10.3%), but:

  • If you missed the 10 best trading days, you drop from 8.2% to 4.5% 
  • If you missed the 20 best trading days, you drop from 8.2% to 2%

“It’s not about trading, else about investing. 6 of the best 10 trading days in the past 20 years happened within two weeks of the worst trading day. You got to be in the market. The worst days will bring you the best days!” — Tony Robbins


32:34

One World Academy

One World Academy is a wisdom and meditation school for transforming consciousness. Lewis went to One World Academy in India for 2.5 weeks, which changed his life. Tony also had the experience years ago and is a friend of the co-founder — Krishnaji:

Beautiful state vs. lousy state

  • Beautiful (peak) state is a high energy state when we feel love, joy, gratitude, drive, courage, faith, playfulness, fun.
  • Lousy state is a poor energy state when we feel frustration, sadness, loneliness, anger, loneliness, worried, concerned, pissed off.
  • Tony’s advice is to end suffering as soon as it arises because our brains are designed to make us survive, not happy.

“If you make the least amount of money in this country (US) and you’re in total poverty, you’re in the 1% earners of the earth. Cause 75% of this planet lives on $2.50 a day.” — Tony Robbins


36:30

The three triggers to suffering are loss, less, and never

  • Loss: lost opportunity, lost time, lost money
  • Less: less love, less money, less freedom
  • Never: never have love again, never be free, never be wealthy

“The only time you have stress or suffer is when you believe a stressful thought. Once you believe it, it’s true… and the antidote is to realize it’s not you… When you suffer, you really suffer about yourself. It’s the ‘me me me’ that makes us suffer. The real reason you suffer is because you think you failed. The antidote is appreciation. Trade your expectation for appreciation and your whole life changes.” — Tony Robbins

How to avoid suffering and stay in a beautiful state?

  • Identify why you’re suffering — warrior, pissed off, angry?
  • Decide you’re gonna kill this monster while it’s little. Break the pattern when you start to feel stress, take note of your thoughts, and then focus on something you appreciate, enjoy or love
  • You can’t be grateful and angry simultaneously

45:30

Success without fulfillment is the ultimate failure

Of the billionaires I interviewed, the rarest commodity was somebody who is happy all the time. Richard Branson is one of those rare people who is having the time of his life. He’s still hungry, driven, always growing, expanding, having fun. His phrase is: “give it a go!”

Tony’s goal is to find ecstasy in each moment — to find something to be passionate about in each moment.


47:50

Does Tony have vulnerabilities despite his success?

Tony’s vulnerability (like most of ours) is health. Tony had mercury poisoning, which mimics dementia — makes you lose your memory in the middle of talking or unaware of where you are. Tony said he even forgot what he was speaking about twice during this podcast interview. His mercury levels were 123 mercury on a 0–5 scale! But now he’s down to 9

“Everything is a habit. Worrying is a habit. Fear is a habit.” — Tony Robbins


50:20

Does Tony believe he made the choice to live the life he’s living or did it choose him? How does he rationalize choice?

  1. Tony’s chosen very consciously what he wants for his life and continues to do so. He believes our creator has given us a choice.
  2. Tony doesn’t rationalize choice. He knows it is one of the great gifts in his life that he can make it at any moment — the one power we have is the decision to change anything. We live in a world that’s full of answers, and you can learn from anybody on the planet (through the internet).

Whatever you’re gonna focus on, you’re gonna feel.

Tony’s three patterns to check your focus:

  1. Have or missing — do you tend to focus on what you have or what’s missing?
  2. Can vs. can’t control — there’s nothing to do about things you can’t control
  3. Past, present or future — there’s nothing to do about the past, except for learning from it. Present is where joy is. Future is how you do business.

If you focus on what’s missing, like things you can’t control or the past, then you’ll get depressed. Focus on things that make you grateful, not suffer.

“I’m 10 times smarter when I’m not stressed.” — Tony Robbins


55:12

Is it possible for women to become powerful leaders without making men feel emasculated? How?

Tony talks about Mary Callahan Erdoes, CEO of JP Morgan Asset Management — the most powerful woman in finance at JP Morgan, who manages $2.3T! Mary believes in meritocracy, she’s not focused on herself, and what makes Mary successful (which makes anyone successful– male or female) is focus on adding value to anybody else. 

“In the marketplace, all that matters is your ability to have value.” — Tony Robbins


58:06

Americasbest401k.com

Tony created an America’s Best 401(k) so people can see what fees they actually pay:

Financial advisors and brokers

Tony recommends working with a financial advisor who is a fiduciary, which means legally responsible to support you.

There are 310,000 financial professionals in the US. 90% of them are brokers, and brokers work for the house. Their goal is to maximize profits for shareholders, and their only way to get more money to shareholders is to charge you more fees. 

Tony warns about the people who tell you they’re not going to recommend anything to you, but show you what to do (as they are not incentivized). Before you know it, they switch hats and become brokers, and they sell you horrible assets that make them the most money.

Getasecondopinion.com

Peter Mallouk, Tony’s co-author and partner, and number one registered investment advisor in the country, will create a plan for you for free, and if you want to do business with him, it’s less than 1%.


1:02:54

Tony’s three truths

  1. The secret to life is… get outside yourself and find a way to add value to others — nothing is more fulfilling than doing something beyond yourself. When you tap into that, you have more energy, joy, and excitement because life supports whatever supports life. There’s nothing wrong with supporting yourself, but when you support your family, community, and the world — you are getting more insights. Being obsessed with learning, growing and adding value is the most important thing in life.
  2. If you are gonna be alive and you are not enjoying yourself, you wasted your life — everyday, the gift is to find something to appreciate, enjoy, love, and give thanks for. That sense of aliveness comes from gratitude.
  3. Love is everything — Tony wouldn’t trade the love he has for his wife, children, dear friends, coworkers, audiences for all the money in the world. But he appreciates the money because it gives him portable power — Tony helps with fresh water in India, feeds 100M people a year, XPRIZE and more. His labor is an expression of his love.

“Love is everything. Make sure, every single day, you strive to be a blessing in the lives of the people you meet.” — Tony Robbins


Where to listen (or watch)

All Lewis Howes School of Greatness video episodes are free to stream on YouTube:

And also free to listen on: iTunes, Stitcher, School Of Greatness.

Note: timestamps are based on YouTube version (no sponsors).


Lewis Howes — The School of Greatness Podcast

I was introduced to The School of Greatness podcast (by Lewis Howes) in 2013. Carl Paoli, my CrossFit and gymnastics coach at the time, was interviewed in Episode #26. Since then, I’ve been loving the School of Greatness show because the focus is aligned with my passion to learn more about business, entrepreneurship, health, fitness, personal development, and relationships. Lewis is also one of the most positive and driven people in the world — his energy gets me fired up!


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