I recently read a list of financial rules by Morgan Housel called “Little Money Rules”.
It’s 18 key lessons regarding the accumulation of wealth and (being a bit of an investor myself) I found them to be powerful, simple truths. As I read on, however, I couldn’t help but see the application to leadership.
Below are his “Little Money Rules” and my corresponding “Little Leadership Rules”.
LITTLE LEADERSHIP RULES
1. Emotions can override any level of intelligence.
It’s amazing how really smart leaders can make some really dumb decisions.
2. Confidence rises faster than ability, especially among young men.
Your ego will only get you so far before it derails you.
3. An asset’s ability to let you do what you want, when you want, with who you want, is an ROI that can’t be found on a spreadsheet.
The purpose of leadership is to give you more life (and those around you) not to suck the life out of you.
4. About once a decade people forget that bubbles form and burst about once a decade.
It won’t always be marketing day.
5. Your investing ability is unproven until it’s survived a calamity.
You’re unproven as a leader until you’ve managed to survive a downturn.
6. Spending money to show people how much money you have is the surest way to have less money.
Always leaning on your positional power is a surefire way to lose your personal power as a leader.
7. Avoid disaster, be patient, and you don’t need many smart decisions to do well over time.
Think constantly about the long-term shared interests of your key stakeholders.
8. Big words mask little thoughts.
Say less, stand behind it more.
9. You will adjust to most positive financial circumstances, except when it causes you to lose control over your time, which will always hurt.
Never complain about needing more time, you have all there is.
10. The only way to build wealth is to have a gap between your ego and your income.
If your self-worth as a leader is based on your net worth, you’re stuffed.
11. The goal of investing isn’t to minimize boredom, it’s to maximize returns.
Focus, focus, focus.
12. It’s easier to lie with numbers than words. As the saying goes, more fiction has been written in Excel than Word.
Tell the truth, the whole truth and nothing but the truth.
13. Your circle of competence is smaller than you think. Your susceptibility to bias is larger than you think.
We don’t see the world as it is, we see the world as we are.
14. Reducing your desires has the same effect as leveraging your assets, but with no downside risk.
The secret of happiness may just be to lower your expectations.
15. Solutions to problems can be shockingly simple; Getting people to adhere to simple solutions can be shockingly difficult.
Make the complex simple, the simple sensational, and the sensational “sizzle”.
16. Debt removes options, savings add them.
Add value!
17. Compounding requires absorbing damage so you’re never forced to quit.
Never give up.
18. No one’s impressed with what you have.
The title you hold as a “leader” and real leadership are very different things.
Hope you enjoyed the quick read. That it both helps you as a leader and just maybe with your money.
Until next time…
Find the passion.
Develop the skills.
Make the numbers.
Make a difference.
Paul Mitchell
“APAC’s most respected transformational leadership performance coach”
Paul Mitchell (@Paul_S_Mitchell) is a speaker, author, transformational leadership coach and founder of the human enterprise. Through leadership coaching, leadership development programmes, keynotes and facilitation, Paul works with organisations to build cultures where everybody leads.
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