From Minimalism To Tech

4 Destructive Financial Behaviors

Posted in Money on October 10th, 2016

Money can make us slaves as easily as a lack of money can. More money, just like less money, does not guarantee us success; we will always face temptations with money – whether it’s from a lack of ambition, or the wrong ambition. Fundamentally, we’ll be tempted by four destructive financial behaviors and we can take steps to prevent and conquer each of these.


At its root, laziness is a reflection of low self-expectations. About a decade ago, one of my close friends decided to stop working as he had saved up enough money to take off for a few years and find himself. In the four years he spent avoiding work and discovering himself, he burned through insane amounts of money, only to end up in the same industry and at a lower paying position. He could have amplified his opportunities, but chose to set a low self-expectation and it didn’t work out in his favor. He set his expectation low and he fulfilled it; high expectations require diligence and growth – low expectations don’t.

In addition to low self-expectations, laziness is often missing the full picture of life. For an example, lazy people might be under the impression that someone who travels a lot has plenty of time to travel, when they don’t realize they are only seeing one minute of that person’s life for the month. A video or image does not paint the full picture and can never do so. The reality is that most of what we see is deceit and when we realize this, we begin to realize what is not being account for. A popular example of this is any random TV show – most shows could never occur in real life because the people on the shows don’t work enough to sustain their lifestyle. Also, what percent of a TV show’s time is working versus relaxing, yet what percent of time is normal for both? When you start accounting for the work required for the portrayed lifestyle, very few TV shows add up. Yet, our eyes might think otherwise.

How To Beat It. We can beat laziness with the following action steps:

  1. Account for time, money and energy while measuring where these go each day.
  2. Hold ourselves to timelines that encourage urgency.
  3. Contribute to a community that holds us accountable.

Fear fails to see natural cycles.


Sun Tzu warned in The Art of War, “Do not use arms because of your emotions” and we could say the same about investing, trading, or taking any financial action. Fear is a loss of perspective; for an example, if you fear losing everything, it’s losing the perspective that you will lose everything – that’s guaranteed to happen.

One of my favorite stories of personal finance and fear is Nathan Rothschild’s trade during the Battle of Waterloo. Many conspiracies theories claim that Nathan knew ahead of time that Napoleon had lost, even though history has no evidence of this and it shows how easily controlled most people are by fear. In reality, Nathan knew that Napoleon winning wouldn’t fundamentally change the business value of the stocks he purchased: not only was Napoleon limited on his expansionary vision after multiple losses on multiple fronts, even if he had conquered the United Kingdom, the businesses Nathan purchased would not become worthless. This meant that people’s panic and selling was completely irrational – they lost sight of what businesses existed to do and even today people don’t realize this. When people sell in panics, like they did with gold miners, natural gas, agriculture, etc, they often don’t realize the fear behind their actions.

How To Beat It. We can beat fear by doing the following:

  1. Train ourselves against fear each day, increasing the intensity slowly.
  2. Unlike the sellers in the United Kingdom in Nathan Rothschild’s day, we should reflect over the bigger picture instead of being caught up in a temporary moment.
  3. Identify what we fear and make sure that the fear is rational.


Greed provides the easiest way to control people – more than any other emotion. At its heart, greed is a lack of self-limitation – it fails to grasp that reality involves limits and something “unlimitless” does not exist. If you want to see an example of greed, look no further than the claims that we live in the age of abundance, where we will have access to everything we want. There is no truth to any of this, and at its heart lies greed. Greed foolishly believes that more will satisfy, when in reality, it only creates a desire for more; as Solomon put it, “He who loveth silver shall never be satisfied with silver.”

We should always be on guard against greed, as it seduces us away from our vision. It also provides power to the person who knows how to manipulate others with it, forcing people to turn in their freedom with the promise of more. In the bitcoin community, I’ve seen greed control the community where bitcoinaires lose perspective of the vision and abandon it for greed. How this plays out: someone disingenously points out that if cash and gold are made illegal, the price of bitcoin will rise, therefore the community should support laws against cash and gold so that bitcoin will rise. Do you see how this person or people are trying to make bitcoinaires their useful idiots? Bitcoin’s vision is currency choice and bitcoin is just one example of this, like cash is and like gold is. To support currency restriction and call yourself a bitcoinaire is to miss the vision. Yet, never underestimate the power that greed has over everyone – bitcoinaires desperate for higher prices surrender their freedom and vision because … more. Ironically, when cash and gold are gone, bitcoin will be destroyed too – thus, a greedy person is the easiest person to control as you can destroy his allies and alienate him by his own consent.

This is one of several reasons why in The Decentralized Retirement Plan, I listed other strategies to enhance wealth outside of bitcoin and other cryptocurrencies. We cannot control the greed of others, but many of us recognize the danger this community has when it joins with those who want to restrict freedom.

How To Beat It. Greed offers one of the most formidable opponents ever, but we can beat greed by doing the following:

  1. Sacrifice each day – sacrifice is the inverse of greed.
  2. Remind ourselves of our vision – greed often replaces a vision or reflects a loss of a vision. A reminder of what we’re doing and why overcomes greed. For instance, using the example of bitcoin, bitcoin’s vision is currency choice.
  3. We can remember that greed does not free us, it actually enslaves us.


If you ask an American about Sigmund Freud, you’ll probably hear a response related to his sexual theories – which were actually a small fraction of his work. Freud actually contributed a huge amount of work to psychology and virtue that never sees the light of day, one of which relates to envy (or jealousy). Freud correctly pointed out that the root of envy reflects the desire of what we’d like to achieve or have. A weak person stops at envy, while a strong person uses this as motivation to continue and press on – Freud had another theory about this, the life and death drive – the life drive being the creative drive while the death drive was the destructive drive. In a sense, envy can be more of an ally than an enemy, but only if we are strong enough to use it to our advantage.

How To Beat It. We can beat envy by:

  1. Taking an honest look at why we’re envious or jealous.
  2. Ask ourselves if we have all the information – we might be jealous of a small window of truth.
  3. Use envy to enhance our creative drive, such as ambition, diligence and accomplishment (as Freud would call the “life drive”).

“One Ring To Rule Them All”

At the root of all the destructive behaviors lies a lack of discipline. If you want the “one ring”, cultivate discipline in your life – and it will pay you dividends beyond money. No wealth of any kind exists without discipline, making it more important than wealth itself. From experiencing sacrifices against greed to daily training against fear, we become a reflection of our ability to discipline ourselves. Finally, discipline teaches us that everything can be used for a season and for a purpose, but that these are not the vision or who we are, but rather tools to create our vision.

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