Watch this BEFORE you invest in the stock market or CRYPTO…

Summary

• I've learned that entrepreneurs often face a dilemma about what to do with surplus money, which is a problem that can arise after solving most money-related issues.
• My advice is to recognize that the skills that make you successful in business, like risk-taking and working long hours, do not translate well to successful investing.
• Unlike business, investing should be approached with a low risk tolerance. Putting a significant amount into volatile investments is usually not a wise choice.
• Investment shouldn't consume too much time. Overcommitting time to investments can detract from your ability to run and grow your business effectively.
• Investing is about making smart decisions, not about putting in long hours. Witnessing the investment habits of the most successful investors, they often make calculated, well-researched decisions rather than hard, constant labor.
• When it comes to investing, too much attention can lead to micromanaging and potential losses. The less you tinker with your investments, typically the better they perform.
• I would suggest training oneself to have a low risk tolerance, make investments that don't divert substantial time from business operations, focus on intelligent choices, and avoid the temptation to constantly monitor investments.
• Learning from successful investors and applying their low-risk, low-maintenance strategies has helped me avoid many pitfalls. Emulating these tactics instead of applying high-effort business strategies to investing is key.
• Always remember that success principles in business are not the same as in investing. Apply business principles to your business and investing principles to your investments.

Video

How To Take Action

I would suggest implementing a cautious approach to investing if you're a small business owner or an entrepreneur with some money saved up. Here's what to do:

1. Adopt a low-risk mindset towards investing. Don't think that because you took big risks in business, you should do the same with investments. Big risks can lead to big losses.
2. Make sure your investments don't take up too much time. Overcommitting time can hurt your business. Find investments that are low-maintenance.
3. Focus on intelligence, not just hard work. Successful investing is about smart decisions, not just hard work or long hours. Spend time researching and making informed choices.
4. Don't constantly check on your investments. Too much attention might tempt you to make unnecessary changes. Usually, less tinkering means better performance.

Remember, the skills that helped you grow your business are not the same skills you need for investing. Keep working hard and paying attention to your business, but when it comes to investing, be more hands-off. Learn from successful investors and follow their strategies to manage your surplus funds effectively.

It's not about working more; it's about making the right choices for your investments while keeping your main focus on running your business. So, invest smart, keep risks low, time investment minimal, and attention limited. This way, you can balance growing your business and managing your investments successfully.

Quotes by Leila Hormozi

"Everything that makes you good at making money makes you bad at investing"

– Leila Hormozi

"Money itself becomes a problem because you don't know what to do with the money"

– Leila Hormozi

"The best investors…do not put a ton of money into something that is extremely volatile"

– Leila Hormozi

"Investing is made of smart decisions"

– Leila Hormozi

"Do what really smart people do who make a lot of money in investing and put all those principles of success on your business"

– Leila Hormozi

Full Transcript

today what i want to share with you is a conversation i had with one of our head coaches in one of our companies um about investing and entrepreneurs and so i want to share with you what i told him um and then some frameworks to use to think about if you are struggling with do i invest my money do i not invest my money should i what should i be doing with it right now right and this is for people that probably haven't started investing yet not heavily and maybe you're not sure if you should right here's what normally happens right so i was talking to the coach and he was like you know a lot of them are just trying to make more money than they've ever really made in their entire lives and so it's stacking up month after month and now their whole focus is kind of going to like what do i do with this money this is something that i know all too well it's something that me and my husband have had many sleepless nights over because what happens is this right so you start a business you usually don't have money before you start the business you get good at making money right you get good at making money and eventually you solve most of your money problems meaning problems that occur because you don't have money right the problem of not being able to live in the house you like not a problem of not being able to eat out when you want to eat out the problem not being able to fly when you want to fly right they're like small inconvenient problems money solves those money problems after all of your money problems are solved and then what happens is money itself becomes a problem because you don't know what to do with the money and so there's an excess beyond what you need to live like reasonably off of you know your means and then you don't know what to do with it and so it actually becomes a problem because people mismanage it okay and it's really common with entrepreneurs and here's why everything that makes you good at making money makes you bad at investing and this is something i think is so interesting because i actually would say that i'm probably better on the investing side than the making money side um just because of who i am inherently as a person like i've had to do more training and practice on the make money side rather than the investing side and so here's what i want to break down for you so you can understand and then you can understand also how to think about investing so you don't make poor decisions about it okay so the first is that with business right what does it require in the beginning well it requires risk taking right now if you've done any sort of research on investing what you will see is that people who beat over time do not they have a low risk tolerance what does that mean that means that they do not want to put a crap ton of money into something that they don't know will work right the best investors on the world in the world and i've gotten to talk to a decent amount of them they do not put a ton of money into something that is extremely volatile yet for some reason entrepreneurs are like they're gonna come and i had this one uh one time and he's like i don't know man like should i put half my money into this investment like it's i could lose it all and i'm like why on earth would you do that you do not have to do that like nobody's forcing you and there's no problem like what are you solving by doing this you're literally just adding to your stress which sometimes i do believe that is actually the issues they just want to do more things that cause stress for them because they are just used to being stressed right but that's the thing is that risk taking makes you good at business because you have to take risks to start a business and it makes you bad at investing because then you're probably going to lose more of your money than you need to just out of the fact that you think you should be taking risk in order to progress which is silly you don't need to take huge risk in order to be good at investing most of the best investors look like warren buffett for example does he take risks no not in his mind so that's the first piece to this the second piece of this is long hours right lots of working all the time and so people think that once they have this money and they need to invest it it should take a lot of time and that the more time you spend investing the more valuable and the smarter your investments will be when in reality that is not the case at all you want low time commitment on investments right anything that takes a lot of your intention attention for investing well what is that going to do for a business owner it's going to take their time away from running their business that's the thing that you're good at that's the thing that made you all your money and so all of a sudden you say oh i should be good at investing and so what i see a lot of people do especially like some clients that we have is then they start actively investing so they've made a ton of money and now they're actively investing in things that are volatile risk and then their attention for their business goes down and so then they make less money and then they feel worse about investing because there is more risk at that point because you have less money that you're making the third thing is just hard work and you could kind of equate this with long hours but i feel like it's worth talking about the two which is hard work and this one does not require hard work what does it require is smart decisions okay and so a lot of the times where business owners are when they get to the point where they feel like they should be investing is still the place where they're working hard right there and that is probably why they're in a reactive state enough to think that working hard is also what you must do to having to be investing your money when the reality is that investing is made of smart decisions if you look at the best investors in the world they spend a ton of time researching analyzing uh making spreadsheets doing all sorts of modeling right because it's decisions that dictate if you're good at investing it is not your amount of work ethic there's not a work ethic in investing rather it would be tolerance for less work i would say in fact i think the people that i know that have the most money from investing don't work much at all and that's why they're so good at it and then the last thing i would say is attention what do i mean by this for your business to grow and thrive right you as a ceo typically have to pay a lot of attention to it or at least a decent amount i would say the same to be true with like raising a child lots of attention versus over here you do not want a lot of attention why do you not want a lot of attention right because you're probably going to with it okay so if you put a lot of attention on your investing you're probably going to mess up your investments how often do we see this people with stocks right this is something that uh our one of our really good friends who's been doing this for say 40 years working with stocks the people who make the most money off investing in stocks are the ones who don't look at it right dead people do the best with stocks versus what most entrepreneurs do is that then they take the attention they've been putting on their business they put it on their investments and because of that they're literally changing and moving stuff all day and doing trades and blah blah and in the end you don't beat the person who just let it be so i hope that this framework was useful or this breakdown for thinking about investing if you haven't before first understand these principles if you are a business owner you should be taking risk in your business working long hours in your business working hard in your business paying attention to your business if you start to look at investing and you're trying to think how do i want to take upon investing you should have low risk tolerance it should not take much time from you it should only be uh focused on making smart decisions and it should not take a ton of your attention attention however i do believe it's something that you can train because many people if you look at like the crypto market right now for example people pay so much attention to crypto well i just left my crypto in and guess what it's gone up more than most others who've been trading it every day all day right and their businesses half of them have gone to because they've just been trading crypto all day yet we bought crypto a while ago let it sit let it appreciate it's up right am i like oh crypto this and that mobile like i don't care about this stuff like i just put some in because i want to see what would happen but that is to say if you're thinking about investing remember do not apply the same success principles from business to investing it will not work i have luckily learned this the easy way which is i listen to people who are smarter than me and who have more money in investing than me and i just do what they're doing right i've gotten to avoid a lot of downside of investing because i've heard this from the get get-go and i believe it and so i think that there's a phrase and it was something to the matter of humans are only smarter than animals because they can learn from other humans mistakes and animals can't and so i say take that to heart when it comes to investing do what really smart people do who make a lot of money in investing and put all those principles of success on your business do not equate them to success in investing and so if you like this video go ahead and hit subscribe i will see you on the next one