Masterfully written, extremely well-organized, and brilliantly insightful, in Richer, Wiser, Happier: How the World’s Greatest Investors Win in Markets and Life, William Green teaches us how to lead richer and more rewarding lives. Through his extensive experience interviewing the most successful investors and money managers on the planet, Green illustrates that true wealth is about so much more than money.
Though I’m sure each and every one of us has heard the message that money does not buy you happiness, the angle William Green takes in communicating it is quite refreshing. He doesn’t argue that we shouldn’t concern ourselves with money. The book actually serves as a manual of sorts for how to invest successfully. Where Green differs is in his approach to money and happiness, and his insights on the relationship between them.
A Brief Synopsis of Richer, Wiser, Happier
“What principles, processes, insights, habits, and personality traits name this tiny minority to beat the market in the long run and become spectacularly rich? More important, how can you and I profit by studying these financial outliers and reverse engineering their winning ways?
— Richer, Wiser, Happier (Green, 2021, p. xii)
The quote above captures perfectly the underlying questions guiding the book.
In Richer, Wiser, Happier, William Green shares with us the mindsets, attitudes, and approaches to life taken by extraordinarily successful investors. Readers gain greater insight into how these people structure their days and their rationale for doing so, how they think about a vast range of topics from money to spirituality, and the different (but remarkably simple) ways they attained their riches.
Each chapter in Richer, Wiser, Happier focuses on a different aspect of investing and life. From resilience to high-performance habits to self-awareness, there are lessons to be learned on seemingly every page in the book.
Featuring over 20 successful investors whom have all been interviewed by Green, readers will feel as if they are “inside the minds of the greatest investors”, the aptly titled introduction of the book. Those who get the opportunity to read Richer, Wiser, Happier are also very likely to learn from Green, himself. Throughout the book, he shares sprinkles of his own personal journey in investing and attempts to lead a life of joy.
Avid readers are in for a special treat. Countless book recommendations are made by Green and the investors to whom he speaks. Included at the end of the brilliant book is a densely-packed reading list associated with the topics Green writes about throughout.
No Need to Reinvent the Wheel
There’s so much to take away from Richer, Wiser, Happier. But of all the insights Green shares, the most important, I think, is the idea of cloning.
In the first chapter, Green traces the journey of his dear friend, Monhnish Pabrai. He notes how Pabrai has built largely all of his success in investing based on the ideas of Warren Buffet and Charlie Munger.
It’s not simply that Pabrai read a book about Buffet and Munger and implemented one or two things the famous billionaire partners did to accrue their wealth. Rather, “consciously, systematically and with irrepressible delight, he has mind the minds of Buffet, Munger, and others not only for investment wisdom but for insights on how to manage his business, avoid mistakes, build his brand, give away money, approach relationships, structure his time, and construct a happy life” (Green, 2021, p. 7).
This seems so simple. Yet as Green reminds readers, so many of us try to reinvent the wheel. We overcomplicate things by trying to find completely new ways and devising complex algorithims to build wealth and lead happy lives.
The message here is not that we shouldn’t try new things. It’s that there is likely someone out there leading a very similar life to the one we want to lead, someone who has everything we desire and does all of the things we want to do. Because of this, we would do well to analyze very closely what this person has done to achieve success, and copy their approach as much as possible.
For Mohnish Pabrai, this meant studying everything he could get his hands on related to Buffet’s investing strategy and subsequently taking those principles and applying them to his finances.
The amazing thing about all of this is that Pabrai has absolutely no shame about how he’s achieved such incredible success in investing. When Green asks him why more people don’t bother to clone, he replies, “They’re not shameless as me. They have more ego. To be a really great cloner, you have to check your ego at the door.” (Green, 2021, p. 16)
We would do well to approach cloning successful people with this same attitude.
Everything Compounds
Another fascinating insight readers will take from Richer, Wiser, Happier, is the idea that money is not the only thing that compounds. The countless investors Green interviews show us that over a long-period of time, activities such as meditation, reading, and exercise build on themselves exponentially.
This means that day-to-day, meditation, for instance, is not going to make a significant difference in your life. The magic lies in the consistently over an extended period of time. In the words of Nick Sleep, one of the investors Green interviews, “The regular practice of meditation will help you handle the hard setbacks and will keep you constantly prepared for them” (Green, 2021, p. 223).
“Resounding victories tend to be the result of small, incremental advances and improvements sustained over long stretches of time”
— Richer, Wiser, Happier (Green, 2021, p. 172)
Though this idea is incredibly simple and straight-forward, like almost all of the ideas presented in Richer, Wiser, Happier, many of us fail to capitalize on it. A lot of us are concerned with the thing that’s going to make the biggest immediate impact, as opposed to taking it slow and building sustainably.
I’m definitely guilty of this. At times I’ve thought about which investment is the likeliest to pop in the next year. What Green and the investors in the book try to get us to see is that playing the long game will give us significantly more returns, in investing and in life.
Simplicity
You might have noticed that the ideas so far presented have not been in any way groundbreaking or insanely innovative. There’s a reason for this.
Green shows readers that more often than not, ideas that are predicated on simple principles are much more likely to have the greatest impact than those that are complex for complexities-sake.
Investing in low-cost index funds is the best example of this dynamic between simplicity and complexity. Rather than trying to beat the market with “hot” stocks, Green reminds readers that investing in low-cost index funds has been one of the most effective ways to compound investments.
“You don’t need the optimal strategy. You need a sensible strategy that’s good enough to achieve your financial goals”
— Richer, Wiser, Happier (Green, 2021, p. 137)
There is a lesson here for life. Why do many of us over-complicate things when the simplest ideas tend to provide us with the biggest returns in everything from health to finance? I think it’s because we’re after perfection, or the most optimal strategy. But in most cases, we don’t need the absolute best strategy to be successful in whatever it is that we’re doing.
For Charlie Munger, the simple principle is to always invert. For Will Danoff, it’s to buy stocks for which the companies are consistently posting profits. For me, it’s to keep adding to my positions that continue to grow, along with making sure to read for at least 2 hours every single day.
So, a question I’ll pose to you all: What is one very simple and logical principle that you could apply to your life to be richer, wiser, and happier?
Designing Our Lives Intentionally
What I gathered from all of the investors Green spoke to is the importance of designing one’s life intentionally. Each and every investor thought deliberately about how to structure their days, such that they increased their chances of being richer, wiser, and happier.
Whether it entailed scheduling blocks of time for contemplation and reading or ensuring they were home by a specific time to have dinner with their kids, all of them thought consciously about what they find most important in life, and set themselves up to be happier by doing those things.
“To attain knowledge, add things every day. To attain wisdom, subtract things every day.”
— Lao-tzu
What’s just as important, though, is that they subtracted the things that didn’t bring them closer to leading their ideal lives. For example, Matthew McLennan, head of an investment team responsible for hundreds of billions of dollars, makes sure to keep meetings to an absolute minimum on Friday and schedules time to walk in nature on the weekends.
It’s the systematic approach to subtracting things that don’t ultimately get us to where we want to be; that’s the take-home point.
Surely, you might argue that the people Green covers in Richer, Wiser, Happier have loads of money and are thus able to make these types of decisions, whereas the vast majority of us are unable to do so.
“First, to be successful and fulfilled, we need to decide what we care about most and be honest with ourselves about what we best. Second, we need to adopt daily habits that enable us to improve continuously where it truly counts–and to subtract habits that divert us.”
— Richer, Wiser, Happier (Green, 2021, p. 197)
But take our phones, for example. How much time per day do you spend scrolling through your phone? Is whatever you find yourself doing—whether it’s social media, checking emails, etc.—bringing you closer to the goals you want to achieve in life?
This was a huge light-bulb moment for me. Since reading Richer, Wiser, Happier, I’ve put my phone on do not disturb mode for most of the day. By subtracting, I’ve felt more productive and present, which has postiviely affected not only my work, but my relationships with others and my own thoughts.
What can you subtract from your life that will make you richer, wiser, or happier?
Anti-Fragility and Preparing for the Worst
“In markets, as in life, so much hinges on our ability to survive the dips. “
— Richer, Wiser, Happier (Green, 2021, p. 106)
Richer, Wiser, Happier made me realize that the way I was looking at investing was all wrong.
Prior to reading the book, my main goal in investing was to pick a few stocks that would lead to outsized returns. However, I recognized that for the vast majority of investors Green interviews, the approach is vastly different.
The investors set up their accounts in a way that lessens the likelihood they’ll be exposed or fragile, just at the time when others’ accounts look most bleak. This doesn’t mean that their positions are necessarily conservative. Rather, they “place greater emphasis on becoming shock resistant, avoiding ruin, and staying in the game” (Green, 2021, p. 107).
In other words, the key to winning is not losing, or at the very minimum, not losing significantly more than you’ll lose when markets naturally take a turn for the worst.
We can apply this to life, as Green shows us. We’re mostly uncertain about the future. We know bad things are likely to happen, just as good things might occur. But we have no clue when and in what order. The only thing we can do is focus on what we know will keep us playing the game (of life, or of markets) longer.
Drawing parallels to what Paul Millerd says about staying in the game in The Pathless Path, I walked away from this key chapter in the book with a sense of calmness. I know I don’t have to have it all figured out right now. But I do need to do the things that will help me effectively weather the storms of life
For me, that boils down to meditation, journaling, exercising, and investing and saving money.
What are the things you will do to prepare for the inevitable downturns in life?
Conclusion
William Green does a tremendous job at synthesizing dozens of ideas and concepts from the greatest minds in the investing world and communicating them with readers in a clear, accessible, and engaging way. His passion for helping others lead happy and fulfilling lives is apparent on every page of the exceptionally well-written book. I recommend Richer, Wiser, Happier not only for anyone with the slightest interest in financial markets, but also for those who are keen on learning the skills and behaviors of some of the greatest minds of investing. You, too, can be Richer, Wiser, Happier.
Rating: 8.5/10
‘Till Next Time, Travel Friends!
