Category: Emotions

If You’re Not Valued, You’re in the Wrong Place Cover

If You’re Not Valued, You’re in the Wrong Place

Nik

When she graduated high school, the father told his daughter: “I’m proud of you. Soon, you will move out and go your own way. I’d like to give you a going-away present. Follow me.”

The father walked to the garage and pressed a light switch the daughter had never seen before. A single light bulb lit up and revealed: Hidden in the back of the garage, there sat an old car. It was dusty, dirty, and clearly not in good shape.

The father smiled and revealed a set of keys: “I bought this car many years ago. It is old, but now, it’s yours! I only have one request: Take the car to the used car lot and ask how much they’re willing to give you for it. I’d like to know.”

The daughter was happy to have a car, but she wished it was a better one. With a sigh and an awkward half-smile, she took the keys and drove downtown. When she returned, she said: “They offered me $1,000, dad. They said it looks pretty rough.”

“Hmm, okay,” her father said. “Might you take it to the pawnshop and hear what they say?” The daughter rolled her eyes and went off. When she came back, she said: “The pawnshop was even worse. They only wanted to pay $100 because the car is so old.”

“Okay then,” the father said, “only one last try: Take it to the car club and show the members there.” At this stage, the daughter really didn’t see the point anymore, but because the car was a gift, she did as her father asked.

When she returned, the father could see the surprise on her face. “Well?” “Dad! Five people in that club offered me $100,000 on the spot! They said it’s a Nissan Skyline, and every collector worth their salt would give an arm and a leg for such an iconic car.”

The father smiled and said: “If you are not being valued, you’re just in the wrong place. Do not be angry. Do not be bitter. But do go to another place.”

“The right place with the right people will always treat you the way you deserve to be. Know your worth, and never settle where you’re not appreciated. Never stay where people don’t value you.”

The daughter never sold the car — and she never forgot this lesson.

Lincoln's Unsent Angry Letter Cover

Lincoln’s Unsent Angry Letter: Modern Technology Edition

Nik

In 2014, Maria Konnikova lamented the lost art of “the unsent angry letter” in the New York Times. The idea is that if you’re upset at something or someone, you write a detailed, liberal response — and then stick it in your drawer until you’ve cooled off.

US president Abraham Lincoln may be the most prominent proponent of “hot letters,” as he called them, but the stashed vent has a long tradition among statesmen and public figures. Harry Truman, Mark Twain, Winston Churchill — the list of admired characters to prove the tactic’s efficacy is long enough.

It serves as both an emotional and strategic catharsis, Konnikova noted. You can “let it all out” without fearing retaliation while, simultaneously, seeing what proper arguments you have on offer — and what’s just nasty, unhinged thought.

In theory, the tool is as intact as ever: When you’re angry, write a letter. Then, let it sit. By the time you revisit, you’ll be able to learn rather than suffer from it. In practice, however, 200 years of technological progress have undoubtedly left their mark on what used to be a pen-and-paper exercise. Konnikova writes:

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The Japanese Art of Kintsugi: How to Practice Self-Improvement Without Judging Yourself Cover

The Japanese Art of Kintsugi: How to Practice Self-Improvement Without Judging Yourself

Nik

I still remember the commercials: “Clearasil Ultra Face Wash — and in three days, they’re gone!” “They” are the pimples, of course.

Each ad played out the same way: A teenage boy hides from his crush because he has acne. His friend reminds him of the party in three days. “You can’t go with that face!” The boy uses Clearasil, shows up, and gets to kiss the girl.

As someone who suffered three long years of intense acne in high school, those ads hit me right in the feels — first with hope, then with misery. After I tried the product and it didn’t work, Clearasil continued to erode my self-worth in 30-second increments by reaffirming a false belief I held about myself: As long as I have acne, girls won’t be interested in me, so there’s no point in even trying.

Every year, millions of teenagers share this experience, and it reveals a pattern deeply ingrained in Western culture: Find a flaw, worry about it, try a quick fix, and if it doesn’t work, go back to worrying. Repeat this cycle until some magic pill works or you find an even bigger inadequacy. While this may lead to some improvement, in the long run, it inevitably leads to self-loathing.

You wouldn’t think a pimple commercial reveals so much about a nation’s culture, but if you watch a few Japanese skincare ads for reference, you’ll see — because unlike Clearasil, they do clear things up.

The Japanese Perceive Problems Differently

The first thing you’ll notice about Japanese beauty commercials is that they’re not directed at teenagers. There’s no Justin Bieber claiming zits are intolerable, no before-and-after pictures, and no shrill voice prompting you to “get acne out of your life.”

All you’ll see is adults going about their day, feeling good because — and this is the part the commercials focus on — every day, they practice their skincare routine. Pimples aren’t presented as a flaw to be overcome, just a part of everyday life. “If you consistently take care of your skin, acne might still happen, but it won’t have enough power over you to ruin your day.” That seems to be the message.

This is radically different from how we approach obstacles in the West, and it’s no coincidence. The Japanese perceive problems differently. They don’t view them as stumbling blocks to be eliminated. Instead, they see them as stepping stones on a never-ending journey. They empathize with problems.

The Japanese cultivate this worldview at an early age, thanks not just to their commercials but also their teachers.

“He did it!”

Jim Stigler is a psychology professor at UCLA. He once observed a fourth-grade math class in Japan. Surprisingly, the teacher called the worst student, not the best, to the board. The task was to draw a three-dimensional cube.

Every few minutes, the teacher would ask the rest of the class whether the kid had gotten it right, and the class would look up from their work and shake their heads no. At the end of the class, he did make his cube look right! And the teacher said, ‘How does that look, class?’ And they all said, ‘He did it!’ And they broke into applause. The kid smiled a huge smile and sat down, clearly proud of himself.

Imagine this scene in a Western classroom. Based on 13 years of going to school in Germany, I can tell you: It would not have gone this way.

Usually, if a student is called out and doesn’t immediately get it right, they are branded as stupid — if not by the teacher, then at least by the other students. They’ll return to their desk with their head lowered in shame and, instead of discovering the solution, go back to worrying about their pimples.

In Japan, mistakes are seen as valuable. There’s not just something to learn, there’s something to learn for everyone. Instead of being left behind, people who struggle are pulled into the light. Solving the problem becomes a joint effort, and if the student succeeds, everyone wins.

You might say, to the Japanese, mistakes are worth their weight in gold — sometimes literally.

Kintsugi: Don’t Fix — Integrate

Kintsugi is an old Japanese art. It is the craft of repairing broken pottery using seams of gold. Instead of trying to hide the object’s cracks, it accentuates them. The message is simple but meaningful: Our trials and flaws are not scars on our character — they are the very fabric that makes us human. Each obstacle, each mistake becomes a building block of a better tomorrow, thus making us a little more unique and beautiful.

In the West, we tend to throw things away when they break. Each year, millions of perfectly usable products end up in landfills. To some extent, we do the same with people. This is sad but unsurprising, given the perpetual message in our education and media: If you struggle in even the slightest, you’re not good enough. You can buy some Spanx, muscle supplements, or an online course to fix it, but until you have, don’t bother, and definitely don’t bother others with your problem.

But what if our mistakes are just for learning? What if our flaws aren’t flaws at all — just puzzle pieces that make us different and, thus, lovable?

There’s a difference between fixing and integrating: One is done to compensate, the other to move forward. When we obsess over correcting our flaws, we may succeed, but we’ll never feel content. It takes a general appreciation of life’s transience to focus on learning, accept what we can’t change, and even see beauty in our little imperfections.

The Japanese call this appreciation “mono no aware” — an empathy toward things, a sense of impermanence. Mono no aware is at the heart of kintsugi, and it can make the difference between a laid-back, joyful pursuit of growth and a never-ending spiral of self-flagellation — just like a golden thread can make a repaired plate look more beautiful than it was before it broke.

Summary

From your skin to your mind to your bank account: A desire to improve your life is a wonderful thing. It’s less wonderful if that desire leaves a constant taste of “I’m not good enough” in your mouth.

Not always but often, Western self-help wants you to feel self-conscious. The industry points out your problems, twists the knife, and then happily sells you a plethora of quick fixes to combat them. Whether they work or not, in the long run, this will damage your self-image.

While it’s good to confront our problems head-on, the Japanese aim to do so without negative connotation. They stress consistency and effort in their marketing, parenting, and education. Mistakes are a valuable source of learning for everyone, and our flaws are not just not so bad, they make us unique and beautiful.

The next time you spot a pimple or give the wrong answer, remember the art of kintsugi: Don’t fix. Integrate. As long as you make them steps to something bigger, not a single one of your obstacles will go to waste.

Hit Rock Bottom? Don't Waste It

Don’t Waste Your Rock Bottom

Nik

On August 1st, 1976, Formula One racing legend Niki Lauda crashed at the Nürburgring. In an instant, his car burst into flames, his helm flew off, and he was trapped in the wreckage.

Other drivers were able to pull him from the car, but because of the burns he suffered and toxic fumes he inhaled, he fell into a coma. A priest showed up to perform his last rites but, luckily, Niki survived.

When he woke up, he was in pain. He had lost half his right ear, and his face would never be the same. Just shy of a miracle, Niki recovered in six weeks — and got back into his car. He missed a mere two races of the season, and yet, to add insult to injury, he lost the title of world champion to his arch nemesis, James Hunt, by one point.

Imagine how that must have felt — to nearly die and then come back — and lose by one point. For Niki Lauda, this was it: rock bottom. He had been destroyed physically and psychologically. What did Niki do?

On the first day of the next season, he showed up for practice. He drove. He studied. Niki tweaked his car. And by the end of the 1977 season, he became world champion.

The universe works in mysterious ways. Common sense will tell you: Wow, here’s a guy who succeeded despite his setbacks. Here’s an interesting question: What if he succeeded because of them?

It’s nearly impossible to see it when you’re in the middle of it, but there’s true beauty in hitting rock bottom: It’ll break you into a thousand pieces, but then, you’ll be on solid ground — maybe for the first time.

You won’t need further dampers. There’ll be no more uncertainty. You’ve lost. In fact, you’ve lost so much, you’ve got nothing left to lose — so you might as well start building.

In 2009, after decades of hard work, late night talk show host Conan O’Brien achieved his dream: He took over The Tonight Show from Jay Leno. It took just nine months for the network to fire him. It was a PR disaster of epic proportions. Leno came out of retirement and grabbed the show right back. Can you feel the humiliation?

Two years later, O’Brien gave a commencement speech, in which he said:

“There are few things more liberating in this life than having your worst fear realized.”

After his failure, O’Brien shunned the spotlight. He went on tour, made an album, and filmed a documentary. He claims he never had more fun or conviction in what he was doing. O’Brien used rock bottom to completely reinvent himself. “No specific job or career goal defines me, and it should not define you,” he told the students.

Don’t have such a fixed idea of where your career should go. This is very common in high achievers. Accept your dreams will change. Sometimes, they might have to — and so will you. It’s great to shoot for the stars, but you can’t let your identity drift through space when you miss.

You know who else hit rock bottom? A woman who, in her 2008 Harvard commencement address, said:

“Failure meant a stripping away of the inessential. I stopped pretending to myself that I was anything other than what I was and began to direct all my energy to finishing the only work that mattered to me.

Had I really succeeded at anything else, I might never have found the determination to succeed in the one area where I truly belonged. I was set free because my greatest fear had been realized, and I was still alive, and I still had a daughter whom I adored, and I had an old typewriter and a big idea.

And so rock bottom became a solid foundation on which I rebuilt my life.”

In 1994, J. K. Rowling was broke, divorced, a single mom, living on welfare, and had just filed a restraining order against her ex-husband. She was the biggest failure she knew.

Whether it was despite or because of everything that had happened, she decided to turn rock bottom into fertile ground. She watered it, sowed some seeds, and slowly built new footing to start from. A “solid foundation,” as she called it. After all, rock bottom is made of rocks.

Rowling put all her energy into the one thing she cared about beyond her daughter: the Harry Potter books. Eventually, she didn’t just find greener pastures; she became the first billionaire author in history. All because she accepted rock bottom.

So here you are. Another weekend sacrificed at the altar of alcohol. Another afternoon wasted in front of the screen. Maybe, you’re embarrassed to tell your children you can’t afford a nicer place. Maybe, you feel ashamed you’re late on paying back a friend.

Whatever your big failure that stings right now, in the long run, it will set you free. Once you’ve given up your expectations of yourself and the ones others put on you, you’ll finally be able to genuinely try new things. No more fake attempts. Truly break with convention, and create a new self-image.

You can’t envision it right now, but the next iteration of you is the exact person you need to be to reach new heights.

No matter how harsh your rock bottom feels, don’t punch it until your fists bleed. See it for what it is: Rough terrain, sure, but one that won’t give way beneath your feet. Don’t waste your rock bottom. Let it be the foundation of something new; the start of better.

Be grateful you’ve arrived, and then start climbing.

You’ll Never Love Your Past as Much as You Love Your Future Cover

You’ll Never Love Your Past as Much as You Love Your Future

Nik

A 15-year-old’s greatest wish is to be 18, and yet, most 21-year-olds will say their 18-year-old selves were kind of dumb — even though both are just three years away from that age.

No matter how you change the numbers, this phenomenon will apply almost universally in one form or another.

When I was 8, I desperately wanted to be 10, like my neighbor who seemed so much stronger and smarter than I was at the time. When I was 10, I didn’t feel any different — maybe because I had no 8-year-old neighbor to compare myself to.

When I was 20, I thought by 30, I’d have life figured out. It was only at 23 that I looked around and wondered: “Why is nothing happening?” Nothing was happening because I wasn’t doing. I started right then, and, seven years later, I’m still going. I will turn 30 in two months, and now my 20-year-old self looks like an idiot.

I’m sure in my 30s, I’ll think my 40s will be much better, only to realize I’m still nearly as clueless about life at 45, yet not without that same patronizing smile back at my 30-year-old self that I now hold whenever I think of my early 20s.

Why is that? Why do we enjoy looking forward so much yet can only laugh and shake our heads when we look back? Well, in a nutshell: You’ll never love your past as much as you love your future. No one ever does.

In your future, the perfect version of you always exists. Everything is wide open. You feel as if you can achieve anything and everything, probably all at the same time. Your plans are intact. Your goals are in reach. Time is still flexible.

In your past, everything has already happened. There are no more pieces to be moved around. They’re all in place, and no matter whether you like the puzzle you’ve pieced together or not, you’ll always spot many places where you could have done better.

The perfect version of you never materialized. Most plans went to hell. Many goals fell out of reach. And time is just gone altogether. That can be demoralizing, but it’s just part of life.

Retirees don’t get as much satisfaction out of their past careers as college graduates expect from their future ones. Twenty-somethings don’t feel as autonomous as their teenage selves would have hoped to feel. Stressed moms don’t have it together as much as they believed they would before they gave birth.

This is a frustrating game you can play all your life — or you can realize that “all this looking back is messing with your neck.” At the end of the day, it matters not how well your past stacks up against your once imagined future. It only matters that you were content with the present as you lived through it.

At what age are we the happiest? That’s an impossible question, highlighted by the fact that you can find a theory for each major age bracket to back it as the answer.

There’s “the U-bend of life,” a theory that suggests happiness is high when we’re young, declines towards middle age, bottoms at 46 on average, then goes back up and reaches new heights in our 70s and 80s.

The idea is that family stress, worries about work, and anxiety about how our peers perceive us peak when we’re in the thick of life. As we get older, we care less about opinions and find contentment in what we have rather than what we hope to achieve.

When Lydia Sohn asked 90-somethings what they regretted most, however, she found the opposite: People were happiest when they were busy being the glue of their own social microcosmos — usually in their 40s.

Every single one of these 90-something-year-olds, all of whom are widowed, recalled a time when their spouses were still alive and their children were younger and living at home. As a busy young mom and working professional who fantasizes about the faraway, imagined pleasures of retirement, I responded, “But weren’t those the most stressful times of your lives?” Yes of course, they all agreed. But there was no doubt that those days were also the happiest.

At what age are we the happiest? It’s not only an impossible question, it’s an unnecessary one to ask. The answer will be different for every person to ever live, and our best guess is that it’ll be a stretch of days on which you felt fairly satisfied with life rather than a singular event or short period of exuberant bliss.

What we do know is that your best shot at stringing together a series of such “everything is good enough” days is neither to get lost in future castles in the sky nor to constantly commiserate how unlike those castles your past has become. You’ll have to abandon both the future and the past in favor of the present.

Imagine you have two choices: You can either be happy every day of your life but not remember a single one, or you can have an average, even unsatisfying life but die wholeheartedly believing you’re the happiest person in the world.

It matters not which one you choose because in both scenarios, you’ll die on a good day. One sacrifices the past, the other the future, but the present is what counts.

You’ll never love your past as much as you love your future, but that’s okay because life is neither about tomorrow nor about yesterday. It’s about today — and if you make today a good day with your thoughts, actions, and decisions, the idea of age will soon fade altogether.

Your Brain Is Your Ally, Not Your Enemy Cover

Your Brain Is Your Ally, Not Your Enemy

Nik

It’s a myth that we only use 20% of our brain, but I can see why it’s popular: It’s the perfect excuse.

How can I excel if the tools I need to do so are in a place I can’t access? If only there was a miracle drug…

In reality, even a single task can easily demand 35% of your brain’s capacity, and, over the course of a single day, most of us will access all 100% — just different areas at different times.

Still, many a movie has been made about said miracle drug, including Limitless, a film starring Bradley Cooper as a hard-up writer. After he discovers NZT-48 and finishes his book in a day, he makes millions in the stock market and enjoys his newfound life as a genius — until the side effects kick in.

It’s a nice movie to fuel our daydreams, but it also makes for a strong wake-up call because, as Lars van der Peet says in a video essay about the film, “it explores something we are all aware of: The perception that we are unfulfilled potential; that we aren’t doing everything we could and should be doing.”

Our frustration with our brains shows on many levels: You might be angry that you can’t remember what you wanted to say, feel depressed after being stuck on an important project for months, or watch movies like Limitless in lack of motivation to write your novel.

As understandable as these frustrations are, they are born out of misconception: Our brain was never something we were meant to have 100% control over — it is simply a partner we must work with.

There is no exact science on how much of our brain activity happens “below the surface,” but chances are it’s a lot more than what we process and register in a conscious manner. Whether it’s 80–20 or 60–40, the point is: Your subconscious is much larger than your consciousness, and you can’t force everything into the realm of awareness. Even if you could, you’d probably feel overwhelmed and wouldn’t be able to synthesize the information in a useful way.

Your brain is an iceberg. Most of it is under water. It is not your job to try and turn it upside down. Your job is to navigate whatever lies above sea level. Even the small terrain up top is constantly changing, and in order to navigate it well, you must trust in whichever part the iceberg decides to reveal.

“Make your unconscious your ally instead of your enemy,” Lars says.

Accept that creativity requires breaks, and that in those breaks, your subconscious is working for you, not against you. Your mind can process even when you don’t, and usually, it does its best work while you do none at all.

Organize your surroundings. Give your brain every chance to structure what it sends you by structuring your sensory input. A brain fed with views of a chaotic room will only feed you chaotic thoughts. Clarity on the outside, however, breeds clarity within.

Make new connections. Structure and routine lead to insights on the regular, but if they become too rigid, only a change of pace can provide stimulation. In the long run, your brain can only give you new ideas if you give it new input.

Finally, never let a good idea go to waste. I can’t tell you how many times I’ve scrambled for my phone to make a note, and I expect myself to do so many times in the future. Inspiration can strike anywhere, anytime, and it is foolish to think it’ll repeat the favor just because you’re too lazy to take note right now.

Towards the end of the movie Limitless, the main character realizes he never needed a smart-drug in the first place: His limitations were mostly self-imposed. Instead of blaming his brain, he starts using it.

Your brain is not you. It will never define who you are, and yet, you must live with it every day. Treat your brain like a partner: You don’t control them, but together, you can achieve a whole lot.

In that sense, I think the real message of the movie is this: We have everything we need. We just have to work with it rather than against it.

If You’re an Intellectual, Act Like One Cover

If You’re an Intellectual, Act Like One

Nik

In seventh grade, my history teacher asked if anyone knew what the huge, fancy, painting-like carpets covering the walls of the Palace of Versailles were called. His question was met with silence and puzzled faces.

Eventually, I raised my hand and said: “Gobelin.” My teacher was thrilled. So was my neighbor. “Ooooh, go-be-liiiiin, Mr. I-know-everything.” The class erupted in laughter.

There’s something to be said here about shaming intellectuals and about a system in which being fun is cooler than being smart, but at 13 I was oblivious to both of those things — so I too erupted in laughter. If you can’t beat ’em, join ’em, right?

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If You Drove Half as Fast, You'd Still Get There on Time Cover

If You Drove Half as Fast, You’d Still Get There on Time

Nik

When he lived in Santa Monica, Derek Sivers found the perfect bike path: A 15-mile round trip along the ocean with almost zero traffic. In his afternoons, he’d get on his bike and race full speed ahead. On average, the trip took him 43 minutes to complete.

After several months of arriving with a red face, a sweaty head, and feeling completely exhausted, Derek decided to take it easy for once. He looked at the scenery. He saw some dolphins. He casually pedaled along. It took him 45 minutes.

At first, Derek couldn’t believe it, but he double-checked his numbers, and, sure enough, he achieved 96% of the result with 50% of the effort. Reflecting on the experience, he writes:

When I notice that I’m all stressed out about something or driving myself to exhaustion, I remember that bike ride and try dialing back my effort by 50%. It’s been amazing how often everything gets done just as well and just as fast, with what feels like half the effort.

A few years ago, my Dad and I used to do something similar: We raced home in our cars. It’s about five miles from the city to the suburbs, and we too used to speed, catch yellow traffic lights, and overtake anyone in our way.

One day, we did the math: If you go 50% over the limit on such a short trip, you’ll save about one minute. We’ve been cruising ever since.

Life is like that a lot. You go all out to be 50% faster, better, stronger, only to arrive one day early at the finish line.

It’s easy to get caught up the everyday hustle. “Let me queue in the other line.” “I can cut a corner here.” “Maybe, I can get them to approve my application faster.” Switching lanes often feels efficient in the moment but won’t make a big difference in the end.

This applies to our daily to-do lists as much as it applies to our biggest goals. If you get the report one day sooner, the company can go public one day earlier — but all that means is that its shares will trade one day extra. On a 10-year-timeline, who cares about that day? No one.

You can stay up till 2 AM and post one extra article. But in your five-year-plan of becoming a writer, does it really matter? Sometimes, it will. Most of the time, however, it won’t. But if you don’t get enough sleep, you can’t see through your five-year-plan. That part always matters.

You can race to your friend’s BBQ and honk and yell at every other driver along the way. Or, you can drive half as fast and still get there on time.

You’d arrive relaxed, happy, and in a positive state of mind. You wouldn’t be exhausted from all the stress that took so much from your mind but added so little to your outcome. This is what Derek learned from his frantic bike rides:

Half of my effort wasn’t effort at all, but just unnecessary stress that made me feel like I was doing my best.

Sometimes, doing your best means having nothing left to give. Usually, it doesn’t. More often than not, feeling completely spent is a sign that you wasted most of your energy.

Energy is precious. Conserve it. Direct it efficiently. Take pride in doing your best in a way that lets you do your best again tomorrow. Life is short. Enjoy it. Don’t burn through it too quickly. Be content with the 96%.

After all, what good are two extra minutes if you can’t use them to gaze at the sea?

What I Learned Losing $300,000 Cover

What I Learned Losing $300,000

Nik

In January 2018, my crypto portfolio showed a value of $350,000. At the time, I had invested about $20,000, making the multiple a cool 18x.

A smart man might have cashed out some of that money; a genius would’ve cashed out all of it. I was neither smart nor a genius, and so I watched that $350,000 shrink into $30,000 at its lowest point over the last 2.5 years — all while continuing to invest. My portfolio has recovered a good bit since then, but it’s still far from its all-time high.

The only way to learn how to act in a financial bubble is to live through one. You can read all the psychology and trading books in the world — how you’ll handle the real experience is written into none of them.

Me, I had to go up and down to learn. I don’t regret anything. I had a lot of fun, and I learned a great deal in an extremely compressed period of time. Some of my initial theses crumbled to bits, but I believe others are still valid.

I wanted to take enough time to reflect on this story. It’s been three years since I first began studying cryptocurrency, and today is a good day to tell it.

Here are 9 lessons I learned about money and investing.

Disclaimer: I’m not a financial advisor. This post recounts my personal experience as an individual. If anything, it’s probably a tutorial on what not to do rather than what to do.

1. Don’t count your chickens before they hatch

I guess technically, I didn’t “lose” $300,000 — because you can’t lose something you don’t have. The money never hit my bank account.

To this day, I haven’t cashed out a single cent. I’ve sold assets to buy others, but whether at a profit or at a loss, I always used that money to buy more assets. That’s a fine strategy to have, I think. They always say, “Treat the money you invest as if it’s gone forever.”

On some days, however, I pretended to have that money. I felt and behaved like someone with $300,000 in the bank. That’s not good, because that’s what leads to feelings of remorse when you later do realize that, actually, you don’t have the money. Never count your chickens before they hatch.

2. Think about profit before you think about taxes

In Germany, any gains from cryptocurrency you held for more than a year are tax-free. That’s a tempting promise, and so my plan from day one was to hold everything for at least a year.

(Un)fortunately, the profits came and went much quicker than that. Paying taxes on $100,000 in profits is a lot better than having no profits to pay taxes on.

But the flip side of the German tax rule — any gains you make from selling within a year become part of your overall taxable income (and thus drag up your tax bill for everything else) — clouded my thinking.

You have to take profits when there are profits to take, period.

3. A good time to take profits is when they feel too good to be true

Looking at old screenshots, I realized my portfolio hit $100,000 on December 23rd, 2017. On January 7th, 2018, it hit $300,000. When your portfolio triples in two weeks, it’s probably a good time to take profits.

For months, I spent 2–3 hours every day studying blockchain technology and the crypto markets. There were enough signs. I listened to smart Youtubers every day. I distinctly remember one of them pointing at a vertical chart, saying: “Anyone who doesn’t tell you to take profits on a chart like this is probably trying to scam you.” But since it didn’t align with my plan, I didn’t understand the urgency of taking profits. And so I never took them.

In hindsight, I would always take some profits when times are so good you know they won’t last. Planned or not, it’ll still give you peace of mind.

4. Have an exit plan before you enter

My investing philosophy is compounding every dollar I can spare indefinitely. I’m not in a rush, and I know the biggest jumps on an exponential curve happen at the very end of said curve.

That said, you should always have a contingency plan. In my case, “What do I do if my portfolio grows a lot before I hit the tax-free holding period?” I never asked myself that question, and that’s why I didn’t have an exit plan to follow.

The best time to come up with an exit plan is before you even invest. “If this grows 100% in a year, I’ll sell 50%.” Making these plans won’t guarantee you execute them, but if you don’t have them, you definitely won’t do anything.

5. Numbers rarely reflect reality

Most people are frustrated with the markets because they want them to reflect reality — but that’s not what markets do.

The stock market is a discounted version of the expected future economy. The crypto market reflects the expected value of future blockchain networks. When people have bleak expectations, prices are bleak too. And when people are euphoric, so are the prices — regardless of our current reality.

On any given day, some crypto networks are grossly undervalued, whereas others are worth more than they should be. The same applies to companies in the stock market.

Numbers rarely reflect reality — but that doesn’t matter as long as you adapt to what the numbers are. Don’t let cognitive dissonance get it in the way of managing your money as best as you can.

6. When you have “a number,” nothing else matters

In finance movies like Wall Street, there is often the question of, “What’s your number?” Allegedly, everyone in the business has an exact sum of money for which they would retire and quit competing in the markets.

Unlike trading, wealth is not a zero-sum game. The things you create can add value to everyone’s benefit and at nobody’s expense. That said, a number can still be your guiding star in a positive sense. My number is $10 million.

Naval Ravikant is a thinker, philosopher, and investor. His net worth could be anything from $4 million to $4 billion, but I’ll never forget him saying, “Every time you see one of these billionaire founders giving away to a hospital or whatever, you know they overshot. They didn’t need that much money.”

$10 million will pay for the lifestyle I want to have until I die. It’s a lofty goal, but it’s also comforting. I don’t need a $600 million yacht. I need freedom.

The good thing about determining your number is you know exactly where you’re headed. Nothing else matters. It’s much easier to take profits — or stomach losing money if you don’t — when you know your long-term goal.

7. When you believe in something, commit to it

One of the conclusions I drew after hundreds of hours of research is that, yes, blockchain has lots of potential, but, like the internet in 1993, the mountain of unlocking it still lies ahead of us.

It’ll take years to build the infrastructure upon which good blockchain apps can attract a large share of the population, and there are many ways the effort could fail. If it works, however, the rising tide will lift all boats.

Amazon’s stock went down 95% after the dot-com bubble burst — from $100 to $5. 20 years later, the drop looks like a blip on the radar, and one share costs $3,000.

At the end of the day, what matters in investing is taking out more money than you put in. Right now, I’m down 20%. I used to be up 1,650%. Will both look like a rounding error in two decades? I don’t know, but I believe in the industry, and that’s why I’m still in the game.

8. Make risky investments when you’re young

When I tell people that I invest most of my money into cryptocurrency, they often tell me I’m insane. I think investing in risky assets when you’re young is actually quite reasonable.

When you’re young, you don’t need a lot of money. You still have the energy to recover from financial setbacks. And every extra day of being invested early will add exponentially to your compounding returns decades later.

I want to buy my riskiest assets first, not last. If I lose $100,000 now, I can recover. If I’m late to the party, most of the returns will have already happened. The more my crypto portfolio grows, the more I’ll invest into stocks. Then, I can look at index funds, real estate, and so on.

The older you get, the less risk you should take on in exchange for safer returns. Start bold, grow more timid. You don’t want to bet the house when you’re 60. You want to bet it while you can still build another house.

9. Save early and aggressively

As my friends are starting their first jobs out of college, some go from earning $0 to earning $4,000. I often tell them: How you spend your first paycheck will determine how you spend every paycheck.

It only takes one month of spending it all to get used to spending it all. Five years later, you’ll still have $0 invested, and you’ll have lost the last five years of your exponential growth curve — the years with the biggest returns.

Even if you don’t earn a lot, chances are, you can take away 10% and it won’t hurt at all. Maybe even 30%. Or 50%. However much you can put aside without feeling pinched, do it and do it now.

Whether you first save for a while or invest all of it right away, the only way to learn to manage and grow your money is to commit some of it to that end.

No One Is Coming to Save You Cover

No One Is Coming to Save You

Nik

Your parents aren’t coming to save you. They’ve done that often enough. Or maybe never at all. Either way, they’re not coming now. You’re all grown. Maybe not grown up, but grown. They’ve got their own stuff to take care of.

Your best friend isn’t coming to save you. He’ll always love you, but he’s knee deep in the same shit you’re in. Work. Love. Health. Staying sane. You know, the usual. You should check in with him some time. But don’t expect him to save you.

Your boss is not coming to save you. Your boss is trying to cover her ass right now. She’s afraid she might get fired. She’s fighting hard to keep everyone on the team. She’s worried about you, but she has no time to save you.

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