How To Get Rich

world won't get there by making a social media platform. You aren't Mark Zuckerberg. The reason these men got to where they are today is because they took a path that no one else ventured down. They made really stupid decisions that led to better decisions, that led to them being at the pinnacle of society, like creating a hotter knot for girls at their college or just dropping out of college. I wish everyone in the world for financial, physical, and mental health, but just know that only one of these can you be rich in while still feeling completely miserable.

I hope that everyone reaches their goals of being rich just so you can finally see that you missed all the important things along the way. Anyway, here's how to get rich. [Music] You're so smart. Why aren't you happy? Why can't you make yourself happy? Is it the money? Like really, how much would it take for you to be truly happy? Enough to pay rent? Enough to go on your vacations? And live life on your own terms? Money won't make you completely happy, but it'll take away many, many things that can make you unhappy for many. All right, yeah, this is probably going to help you out, but for the rest, it won't, and you'll be even more confused than you were before.

You'll fall deeper into a hole that is getting deeper faster than you can climb. What happens when you solve all the problems that money caused and are still left over with unsolved issues? Then what? The new hyper-focus on these problems, trying to find the roots of them, and you still don't know where it's stemmed from. All the money you've earned and all the riches you feel so entitled to aren't helping, and you're lost. What do you do then? Your therapist doesn't help you. The pills don't help. The money doesn't help. Then what?

For so many people, people that I'm surrounded by, some very talented people who are some of the smartest people I've ever met, they struggle with the very thing that embodies who they are, that knows of its own existence— their own brain. You're absolutely nothing without two things: physical well-being and mental well-being. These will beat you down to your hands and knees until you have nothing left. There's a lot that people want, and it seems like these two are always the last on the list. These two go hand in hand; money is just a supplement to both.

I think that that struggle stems from a lack of purpose and I'm not talking about everyone that's like find your purpose. Okay, obviously, if it was that easy, this wouldn't be an issue. It's not a long-term thing; it's a day-to-day issue. What's the purpose of getting out of bed? What's my purpose? Today in and day out, it's the same thing over and over again. A mundane, static life will slowly drive you into insanity. Becoming rich has its downsides, many of which you won't find until you venture down that path. Having to put the entire business, company, even the world on your back can take a toll on you physically, mentally, and fiscally.

I don't know what you like. I don't know what you're good at. I don't know what you think the world needs or how you're going to improve it, but the one thing that I can tell you for certain that you're going to need to make it big is mental clarity. Slipping into mediocrity and sort of blending in with the rest of the world is terrifying. Failure is scary, and I've never wanted to avoid something so much in my entire life. That's where money comes in; it's a status symbol. You have money, you have everything else, right? It shows you're doing something and you're not a complete failure, so you have to be doing good, right? At least that's what it looks like from the outside, and maybe that's what everyone's chasing. You know, maybe it really is the glamor—the 61 jet skis I just bought, these few bottles I just opened.

All right, I get it; it's fun, it's cool, but after that you still feel unsatisfied. It'll change from day to day. Maybe you're unsatisfied with your relationships or friendships or business partners, or maybe you're unsatisfied with the fact that your interior decorator painted the walls cream instead of white. Okay, it could be anything. You're still gonna be unsatisfied. You're gonna be unsatisfied with something. The people who can make it far, who will make the amount of money that will elevate them to the rich status will almost always be unsatisfied with where they're at. It's a very lonely feeling because no one else will truly get your exact situation except for you.

It's the most alone you'll ever feel. It's also very comforting knowing that no one else will understand how to get you out of the spot, so it's all on you. At least I find comfort in that. There are certain character traits of successful people that are a double-edged sword: not knowing when to quit, persistence, sociopathy, manipulation. You ride a very thin line between an amazing person and an absolute freak, and that's the risk you take. Your entire life is a risk; everything you do, someone is watching. Everything you say, someone is listening. You mess up, you're the first person to be blamed.

The biggest gamble of all is attaching your name to something or someone. Whether or not you come out on top depends on how far you're willing to go. Becoming rich and successful isn't just a mental battle; it's a mental war. How much can you stomach? How far are you willing to go? How much can you take before it's all too much? Can you put yourself in the right spot at the right time with the right people in the right scenario? It's just a lot to handle. You dive in, not knowing whether or not you're going to come out on top, and it's that fear that drives you into insanity, trying to make everything work.

This is why you need to be mentally strong, and that comes with so many underlying and linked conditions that are impossible to generalize for the public. Staying mentally tough is a single-player game. There's cheat codes and buffs and potions that'll help alleviate some of your issues, but not all of them. You have to hope that you can figure out if it's a game that you can actually win. I think that's one of the bad things about me— I turn everything into a game. My life is a game of chess. I'm setting things up for weeks, months, years in advance, taking gambles on everything and kind of just hoping it works out.

I've always loved the idea that you could figure things out, succeed, and come out on top in the end. Smart people are good at figuring out the truth, but this can hurt you and will get you into problems. Curious people won't quit until they get an answer that satisfies them. You have a point to prove, and you'll do anything to prove it to yourself, but you don't recognize how harmful it can be until you get there—until you look back and see how much it took for you to get to where you're at now. Anyone who is rich or successful has at least once questioned their entire existence: why they're doing what they're doing; what's the point of it all? And then they wake up the next day and keep doing what they're doing until something changes.

If it sounds like insanity, it is. You know, many people in the one percent have been publicly ridiculed and shamed for just doing what they think is right. Now, to be fair, most of the hate comes from ignorant and overall just ill-informed people who are just attacking others ad hominem, but regardless, it's still there. It's always talking about getting rich, rich, rich. What's the quickest way? How can I get there? It takes a lot more than what it looks like on the outside. It takes an entire lifetime to blow up overnight. Make sure you read that again. Sure, there are some one-off instances where people just got dumb luck; it happens.

But don't get jealous of that; you don't want that to begin with. You kind of have to think backwards if you want to grow beyond measure. Start big; by that I mean, start working for a large company and work your way downwards. You will have the experience of working with giants but now have the authority and potential to create something new, something different, something that you felt was missing. Try to find things that are mainly available to the rich and distributed downwards; it works pretty well. Cars were seen as things for rich people until everyone had one. Wealth is what you want— the money you make while you sleep. It gives you freedom.

Money is just how we transfer wealth. Money isn't going to solve all of your problems; money is going to solve your money problems. Chasing money means you're chasing status and that's why there's a negative connotation to being rich. Prioritizing status means you're trying to climb a ladder, climb the ranks to the top, and yeah, it seems appealing, but the only way your status goes up is to put someone else's down, and making enemies is ultimately going to make everything harder. The only status you should care about is your own as an individual. You want to be seen in a good light, but you shouldn't have to beg for it. People want to respect you; they will. If they don't, their opinions are irrelevant to you.

True status should be a positive-sum game, nothing else. You constantly have to brag about your status; you're a low-status person. I hate to break it to you. Everyone has a moral code. You didn't read it in a book; you didn't learn it in school; you live it. You experience it. Having true status or reputation makes everything else you do so much simpler. You don't have to worry about getting backstabbed; you don't have to worry about looking for work. People will come to you to work with you because you're you. You see, if you get good enough at one thing or a handful of things, you're going to be one of the top people, if not the only person that others will come to when they need help. They won't have another choice. You are the choice.

Your genuine curiosity will form a better career than following whatever is going to make you six figures. This year, at the end of the day though, what even is a career? Is it for money? Is it for your happiness? Is it to give you purpose? What you'll find is that the longer you spend alone, the more time you have with your own thoughts and emotions will lead you to finding the things you really want to do. Less external influences, more internal thinking. But I'm not saying you need to completely isolate yourself; I'd actually recommend against it. Observing others, spending time with them, finding out what they want and cross-referencing it with the things you want is one of the best decisions you'll ever make.

The world is shifting; it follows trends. Use that to your advantage, staying local to your environment, to your industry, but seeing the things that everyone else dismisses. It's a mindset. For some reason, it's burned into almost everyone's mind that you need to figure out what you're doing by a certain age, and this is just idiotic. There's millions of jobs in the world, yet we're apparently supposed to pick a career based on studying 10 to 15 subjects by the age of 21. Trying to figure out specifically what you want right away is setting you up for failure. Instead, this might help: find something you enjoy. You don't have to be amazing at it, but just find something that the thought of doesn't make you want to bash your head into a wall.

No matter what it is, if you can put it in front of them, someone else will have an interest in it. You'll find that the niche or the idea, the skill, how much easier things will become if you can sell it, you're golden. Now, I'm not talking about Billy Mays—I'm not talking ShamWow—but sell it by making it your own thing. Everyone else will follow. It's a lot easier to hop on a trend than it is to create that trend. This is why you'll win. You see, they don't have the steel framework that you built from nothing. Sure, they might make a building quicker than you, but in the end, you're the one with the skyscraper.

I'm not trying to be that guy that's like money isn't everything. I get it; everyone likes to seem woke and pretend they don't care about money at all. But really, you know you do. You might not care about the money itself, but you care about the things that it brings you. Wealthy people attract more wealth; it's a compounding effect. If there's one thing you take away from this video, remember compound interest. I'm not gonna sit here and preach it to you like your high school economics teacher did, but hear me out— not just money, but relationships, trust, wealth, your skills—they all benefit from compound interest. Start early. Start now. And long term, you will do well; I promise. I swear success isn't as daunting as it seems. It's an internal battle.

The only problem is no one wants to start the war to begin with, so please do something today, and don't thank me until you're done. If I asked you the question, what is man's greatest invention? What would your answer be? There's a lot of options. Would it be fire because it gives us warmth, protection, and the ability to cook our meals? Or perhaps you would pick the wheel because it's the driving force behind the beginnings of trade, commerce, and travel? While both of these are excellent choices, most of the time when we think about the greatest inventions of mankind, we tend to forget one of the most important ones of all: money.

But unlike man's other great inventions, money is immaterial. Maybe that's why we don't often think of it in the same breath as some of the other great inventions. Things like fire and the wheel are tangible, but not money. Money is merely an idea, an illusion whose value is non-existent, only determined by the importance we place on it, or at least money as we know it today. However, the fact that money is an illusion does not in any way undermine its importance. Before we created money, we were forced to trade goods and services directly in what we refer to as the barter system—people exchanging goods and services for other goods and services in return. Because there was no arbitrary value placed on these items, every single trade was determined by what each party was willing to give up for something that they wanted.

It was kind of like a game. If I wanted some of your vegetables for dinner, but I only raised cattle, I would have to give you one of my animals in exchange for a bag of vegetables. If I wanted shoes to wear but I only made tents, I would have had to give you an entire tent in exchange for a pair of shoes. And immediately, you can already see one of the major problems with the system of trade: it's the asymmetry. As a tent maker, there's no way I wouldn't feel cheated having to exchange an entire living space for simple footwear. Because there was no standardized medium of exchange, it was very difficult to get two people who needed things from each other to come to an agreement. Having to wait until a double coincidence of wants where two people need the exact opposite thing at the same time was also very difficult and inefficient.

And that wasn't all. You see, our money is not only a medium of exchange, it's also considered a store of value. And before the invention of money, some people could never store their wealth for no fault of their own. Think about the farmer who sells tomatoes and the man who makes tents. The man who makes tents can create an entire village of real estate and barter it out with anyone who needs a place to rest their head all year long, and he would probably cash out on that. But the farmer who sells tomatoes can only barter when tomatoes are in season, and because tomatoes are perishable goods, you cannot keep them for a long period of time. So although he would be putting in the same effort into his business as the tent maker, there's absolutely no way for him to remain wealthy all year long.

There's also the problem of having something that only very few people want. Nowadays, when starting a business, you're often told to find a niche—a small group of people who are very interested in what you have to offer. Before, money was the thing that advice would have you left with nothing worth bartering. The people who had the most were those who owned things that everyone wanted—things like weapons, animal skin, and salt. But then, since everyone knew that everyone wanted these things, they started buying them even if they didn't need them at the time just so they could trade with them later. And so, commodity money became a thing—people would exchange goods and services for the most common items, like salt or weapons, and just use that to trade for what they want from someone else.

From salt and weapons to tiny collectibles like shells and beads, humanity had found a better way to trade and transact. Instead of exchanging goods and services for goods and services you may not need at the time, you can exchange your goods and services for arbitrary objects to act as placeholders of value, an IOU. After that, you can use these placeholders to get goods and services you actually want from someone else. The idea was brilliant. So brilliant that the entire world slowly moved away from the barter system to the money trading system. But there was still one problem with this medium of exchange. You see, for money to be worth anything, it needs to be scarce. The more available something is, the lesser its implied value; that's basic economics. If everyone can get their hands on something, it can't be worth that much, right?

So things like sand or shells that you could easily pick up on any beach weren't really a good measure of value. As a result, around the year 770 BC, the first metal coins were created in China as a sort of homage. The Chinese made miniature versions of the tools that were once regarded as currency. They made the coin circular so that it was easy to reach into your pocket and take them out without hurting your fingers. Then they cast the coins in bronze. This was it! Money was finally worth something; you couldn't just go to a beach somewhere and pick up bronze. It was scarce; it had value. At this time, money wasn't yet an illusion. The value of a coin was determined by the value of the metal the coin was made out of. If you had a coin that was made from one gram of gold, it was worth one gram of gold. You could easily measure it and see for yourself that it is in fact one gram of gold.

However, kings and rulers quickly discovered the power of money. They realized that the more of these tiny precious metals you had, the more power you could control. And so in 600 BC, Aliatis, king of Lydia, created the first official money mint. He created the coins using a mix of silver and gold and stamped an image on the coin to act as denominations. Now people could easily tell the value of the piece of metal they were holding simply by looking at the picture on its face. But the kings of the world wanted more money, and precious metals were too expensive to produce more money. They started slimming down the coins, then mixing the more expensive metals with cheaper metals. Soon all the coins in circulation were worth less than what the image on their face said they were worth, and so the illusion of money was born. The value of the coin was no longer determined by the value of the metal; the value of the coin was now simply what the rulers in the bank said it was.

So one British pound sterling represented one pound of sterling silver. However, when international trade became a thing, people realized that metal coins were too heavy to lug around. And so kings around the world started issuing IOU certificates for long-distance trading. Because these pieces of paper were stamped by the king, people trusted its value and believed that they could use it to get back what it was worth in coins, and that was true for the time being. As more of these IOU certificates flooded the market, people needed coins less and less until finally, the paper was worth what we believed it was worth, even if we no longer exchanged it for physical pieces of gold and silver.

From ancient kings to modern-day governments and central banks, money has remained an illusion— a mere representation whose value is determined by the importance people place on it. The most valuable banknote in circulation today is the 10,000 Singapore dollar note. Although not being produced anymore, this single piece of paper worth 7,345 US dollars at the moment is still regarded as legal tender. So you can still use it to buy things—valuable things like houses, cars, and even metals like gold. The banknote itself costs less than 20 cents to produce, but the illusion of the fiat currency system means it's as valuable as 120 grams of gold.

Fiat is the fancy word we use to describe the modern-day illusion. It's a Latin word that translates to "let it be done." It's a decree by the government that, in the case of money, determines what its value is and enforces it as legal tender. The illusion of money is one that we never really think about, but just like the kings of old, the governments of today understand the power of money and, as always, want more of it. They know that the more of these pieces of paper you have, the more power you have. So what do they do? Well, they can simply create more pieces of paper out of thin air. Yes, if, for example, the United States government wanted 340 million dollars for, I don't know, maybe another F-22 jet, they can simply print the money to do so.

But there's one problem with this— inflation. The thing about money is that primarily it needs to be a means of exchange to be considered valuable. So the amount of money in circulation needs to reflect the output of the goods and services that are being produced. When more money is printed than there are goods and services, all other things being equal, the prices of these goods and services increase, and the value of the money itself drops. This is why many economists and even everyday people like you and me are worried about the current global reserve currency: the United States dollar.

2020 was a terrible year for the entire world. In the wake of the pandemic, most economies had to be shut down. The goods and services available in the general output of the economy were reduced to mere trickles, and the world kind of came to a halt for a while. Because there wasn't as much money flowing around to keep the economy from going under and basically our world falling apart, the US government started printing money at a rate faster than has ever been printed before in its entire existence. Right now, 40% of the US dollars in existence today were printed in the last 18 months alone. That's outrageous. And because the output of the country hasn't really increased by that much, eventually, the prices of the goods and services might start to skyrocket. You can see this taking place in the price of commodities such as lumber, which had as much as tripled in price from just a year ago.

If you haven't noticed, some of the prices of the things that your favorite restaurants are now slightly higher than they were last year. It's an ever so small increase. Maybe the guac at Chipotle is 20 cents higher, but it's happening right there under your nose. On the surface, it seems like a good thing that governments decided to send out stimulus and unemployment checks to their citizens, but the reality is it's a double-edged sword. Of course, it helps those most in need and that's a good thing. We're at the point where, because of inflation in a slowed economy, people really aren't able to get the right jobs at the right times. Sometimes it's not even because they don't want them, but because it's simply worse than the alternative.

For example, in the United States at least, if you're a waiter or a waitress, you aren't required by law to be paid even minimum wage. Some are literally paid two to three dollars an hour, with the rest of their income coming from tips. But with a lot of restrictions and rules in place around the country and not as many people going out, there's less customers. Less customers with less money means less tips. If your employees aren't making enough money, they're gonna quit. Simple as that. If your business doesn't have employees to help you run it, you're going to go under. It's a domino effect. But what can you even do when you can earn more money from unemployment and stimulus checks than you would from being employed? Why even look for a job in the first place?

You see, the Federal Reserve for the United States is a very sneaky way for the government to essentially create money out of thin air and pump it into the economy without people thinking too much about it. Before 2020, the United States was 29 trillion dollars in debt—it's an unbelievable and inconceivable amount of money to even begin with. This debt is obtained in the form of bonds and treasury notes, which are basically just pieces of paper that say the government will pay you so and so amount plus interest. Right now, a 10-year U.S. treasury bond will return you about 1.23% on your investment at expiry. So if you put in a thousand dollars today, you will have made twelve dollars and thirty cents by 2031. That sounds terrible already, but to add icing onto the cake, it doesn't even keep up with inflation, which is targeted to stay around two percent a year—it's a lot higher than that, but that's for another time.

By investing in government notes of your own country, which issues the currency you use every single day, you actually lose buying power over a decade; it is weakened by the day. But regardless, banks, businesses, and individuals around the world buy these bonds and treasury notes, and the government uses all that money it gets back how it sees fit. However, when it's time for the government to pay its debt, all the money they made has already been spent. So they buy back all the treasuries and bonds, but only from the big financial institutions and then pay them back with new money created out of thin air.

Since March 2020, the Federal Reserve has bought back over one trillion dollars in bonds and is planning to continue to do so for the foreseeable future. With all the new money pumped into them by the government, banks can now give out more loans to people, earn more interest, and help grow the economy. But this increases the total amount of money in circulation, reducing the value of each dollar. With multi-trillion dollar stimulus payments and infrastructure packages, it makes you wonder how long the stuff can go on for. New money steals value from old money. The amount in your bank account doesn't change, but because of the new money the government has just printed out of thin air, your money is no longer valuable as it once was.

Basically, every second you store your wealth in any fiat currency, such as the US dollar, it is being devalued. You could stare at your bank balance, and day by day, you'll be able to buy less and less things with whatever you have left. The reality that money is nothing but an illusion is one that we must all embrace because only then will the path to financial freedom become clearer. It's all a game—a game that never truly ends. Understanding that money does not have any intrinsic value in itself, but instead only inherits the value we give to it, will prevent you from trying to store up your wealth in currency. Instead, using that money to acquire assets that will appreciate faster than inflation is the only way to win the game.

And it's not really winning—it's avoiding total loss. As more and more money is printed each and every day, the value of each dollar in your pocket will continue to decrease, but the dollar value of the assets around the globe will continue to appreciate in value. But it's all a mirage; it's smoke and mirrors. A stock market that is literally in up-only mode may make it seem like it's all okay, but it isn't. It's all denominated in the same currency that is slowly dying each and every day. For example, if you were to denominate the Dow Jones, which is just a performance measurement of 30 large United States companies, in terms of gold instead of USD, you'll see that we're basically at the same place we were in 1997. Smoke and mirrors.

What's the end goal of all of this with fiat and an unlimited supply of money? Well, the value of each currency just continues to decrease until the end of time. Will the gap between the rich and poor just continue to grow wider and wider? Or are we finally going to fix the problem as old as man itself and stop placing our financial success in the hands of those who are destroying it day by day? Only time will tell, but just know there is a way out. Money—how does that word make you feel? Is it a rush of adrenaline, dollar signs running through your head like a slot machine? Perhaps you feel motivated, ready to send those work emails you've been putting off or spend an extra hour writing that movie script that you're certain will be a hit.

But maybe you don't feel so good when you hear that word. Maybe the mere mention of money causes your hands to go clammy, your heart rate to rise, and your brain to start doing somersaults. Surround all the ways in which you don't have. Need more; want more money! Whatever your response is, we all have one because, as they say, money makes the world go round. Whether it's your five-dollar coffee every morning to start your day or the three-thousand-dollar loan payment you just made, not a day goes by for most of us that we don't consume, spend, study, or merely think about money. You could be the driver of a sports car wearing a diamond necklace or the homeless person who watches that car drive by.

On one level or another, money matters to us all. Yet for as much as money matters, it's surprising that there's so much we don't know about it and a lot of things that we think we do that are just plain wrong. This is a crash course on how your world and the world of high finances intertwine, and hopes that in the end we know that much more about this illusion that keeps the economic world spinning. Contrary to what you might think, money as we know it today, at least in its physical form, has remained largely unchanged for millennia. The first sign of what we might think of as a banknote took the form of a piece of leather in China in 118 BCE, and 900 years later, paper currency came to fruition.

It would be another several hundred years before this kind of currency would make its way to Europe and then the rest of the world. Centuries have now passed, yet the basic concepts invented by the Chinese aren't that distinguishable from what we have today. In fact, the only real difference is what these notes and coins represent. The first real global system of value and currency was the gold standard, which began in England in the early 1800s. It tied a currency's value directly to the established value of gold. So in a country like the United States, one dollar was pegged at exactly one-fiftieth an ounce of gold. This system was set up in such a way, ideally, that it would provide a stable monetary environment around the world, and it did for a while.

But as with all natural resources, the supply of gold was not as fixed as we originally thought. As a result, countries began dropping it as a means to measure the value of the money. In 1971, U.S. President Richard Nixon officially severed the convertibility between dollars and gold. "I have directed Secretary Conley to suspend temporarily the convertibility of the dollar into gold or other reserve assets." By that time, the U.S. dollar was seen as the global standard currency. So once the dollar was no longer dictated by the value of gold, pretty much nothing else was. If the value of the dollar is no longer determined by the value of gold, what exactly makes one dollar worth one dollar?

Well, instead of a commodity-backed system like the gold standard, we now have something called fiat currency, which has no intrinsic value and is instead backed by a government. What gives today's dollar its value is the economic supply and demand in the United States and who controls that—governmental financial systems. In the case of the United States, it has the treasury and the U.S. mint in charge of printing its money. But as we can see in the growing number of digital businesses and pie pads in place of cash registers, money printing is a dying business. So if a government isn't literally printing money, how exactly does cash come into circulation?

The vast majority of money exists only as numbers on a computer— incredible amounts of money digitally credited to commercial banks by a country's central bank. This central bank controls how much money it deposits into the commercial banks based on the economic situation of the country. During the earlier stages of the pandemic in the U.S., some of that money was sent directly to bank accounts in the form of stimulus checks. But that's an extreme case and most of the time that's not how the money ends up with us. Here's how it usually works: a central bank sends money to banks and credit unions nationwide, and they in turn distribute that money into the economy by lending it to their customers.

Which brings us to the topic of debt. Around 80% of Americans are in some kind of debt, yet many people don't know what exactly debt is and how its moving parts work. What they do know, and what is backed by several studies, is that even the idea of paying off debt can be a severe emotional strain. No one wants to owe anyone anything. But with the cost of living vastly outpacing the money we earn for a living, loans are the necessity everyone hates yet most can't live without. You get a loan to purchase your car, start your small business, go to college, or buy a house. Very few people can afford a house with the money in their bank accounts.

Yet all of us need a roof over our heads. So some people choose to rent while others decide to take out a loan from the bank in the form of a mortgage. But banks aren't charity organizations; they're built to make a profit, and the way they do that is through interest. Interest is the amount you, the borrower, pay to use the money a bank or financial institution has loaned you. Think of it like the rent you pay on your apartment every month. You don't own the apartment, but you get to use it for a fee. In the same way, you don't own the money you use to purchase your house, but you get to use it for a fee.

This buy-now, pay-later model does not only exist for big purchases like a house and college; it has permeated our entire society so much that most things we purchase now exist on this model— especially since the creation of the credit card. Don't have enough cash for that new couch? Put it on your credit card. Want to get that new iPhone? Pay a monthly fee to your internet service provider. Heck, even consoles like the Xbox follow the same model. We now use credit to pay for even small things—like a sandwich, a new pair of pants, or food for our dogs.

If we pay our balances on time for those purchases, we can avoid the interest rates that credit card companies charge, and we'll be fine. But for a lot of us, especially in hard times, we tend to build interest on our cards, which can quickly lead to a pretty bad spot financially. Credit cards can help provide a financial buffer in a bind if needed, but they also come with an element of risk. So are they worth it? There's some mixed feelings about this. Some people think that using credit cards is a surefire way to send yourself straight into sinking debt, but others see frequent credit card use as a way to build good credit.

Which, if you've ever leased an apartment or bought a car, is an important part of daily life these days. Whichever side of the fence you're on, one thing we can all agree on is that you need to be careful when using credit cards so that you don't overspend and dig yourself into much deeper debt than is necessary. By being wise with your credit, savings, and increasing your income, you can have enough disposable income to finally do with your money what every financially stable person suggests: invest. Investing basically means committing your money into something to earn a financial return—it's making your money work for you.

One mantra in the investing world is, the greater the risk, the greater the reward. Investments like bonds are safer but offer lower returns while investing in individual stocks can provide incredibly high returns but are also extremely risky. And let's not even get started on cryptocurrency; we'll need an entire video to go over investing properly. But in the end, if we get the opportunity to do so, our goal is to build our wealth to increase how much we're worth, and that's the entire point of money—to show how much something or someone is worth.

How much is a carefree retirement to you? That will inform how much money you put away in your retirement account. What about a car? We might splurge on a luxury vehicle because it's worth it to us to enjoy the extra comfort and social status. The byproduct of this is that as a society, we become obsessed with the idea of worth, from material goods and worldly possessions to personal worth and even that of others. Publications like Forbes and Bloomberg publish wealthy individuals' net worths, assigning a number to someone's success to create these lists.

Dozens of reporters track down millionaires and billionaires all across the world, collect their personal information, add up all of their presumed assets, and subtract their liabilities. So if Jeff Bezos owns approximately 10% of Amazon, and we subtract his jet, his yacht, and any other creature comforts that he enjoys from that 10%, we should be able to identify his net worth. That simple addition and subtraction seems deceptively easy, doesn't it? Well, that's because it is. It's hard to get reliable data, and it's hard to figure out exactly where wealthy people store their money.

Many of the wealthiest people in the world are investment bankers, but on a day-to-day basis, there's no way to know the composition of their firm's portfolios, which directly dictates the wealth of those who run it. There's also discrepancies when it comes to celebrity wealth—perhaps where most of our obsession lies. Kylie Jenner was said to be the youngest self-made billionaire at one point, but her business isn't just valuable because of how much money it makes; it's valuable because she is involved with it. The business's worth is reliant on her involvement; her wealth is wrapped up in her business and vice versa. So the equation becomes even more complicated.

I hate to break it to you, but most celebrities' net worths are basically guesses and not really an accurate portrayal of how much they control. So why are we glued to these lists? Are we ultimately comparing ourselves to the world's richest people, allowing ourselves to be fascinated by financial wealth at our own expense? The truth is, while learning about money and understanding how our economic system works will not guarantee you a spot on Forbes' billionaire list, it can give you peace of mind knowing a thing or two about money can help us see the world a little more clearly and not feel so overwhelmed by economic news. Because although having money isn't everything, not having it is.

In October 2008, a paper titled "Bitcoin: A Peer-to-Peer Electronic Cash System" was published, announcing the creation of one of the world's first cryptocurrencies. This paper was written by Satoshi Nakamoto, the inventor of Bitcoin. Nakamoto then created a message board called Bitcoin Talk and wrote, "I've developed a new open-source P2P e-cash system called Bitcoin. It's completely decentralized with no central server or trusted parties because everything is based on cryptographic proof instead of trust. Give it a try." Obviously people did, but who is Satoshi Nakamoto? The short answer is no one knows.

There's at least one real person behind this alias because someone wrote the code for Bitcoin, published a paper about it, sent emails, and made forum posts about the new digital currency. But beyond that, Nakamoto's identity remains a mystery. Some think it's Elon Musk, though he's denied the rumor. An Australian computer scientist named Craig Wright claimed to be Nakamoto and was awarded copyrights on the original paper published on Bitcoin in its early code, although the validity of his claim has been called into question by many journalists and lawyers who have followed him through multiple court cases.

There was even a Japanese American physicist named Dorian Nakamoto who many thought might be the elusive crypto God, but alas, he insists it wasn't him. Perhaps one of the reasons that Satoshi Nakamoto will never come forward is because they own about 25 billion in Bitcoin—Bitcoin that has never moved. And sometimes anonymity is the only way to feel safe. It makes sense that one of the largest contributors to the cryptocurrency world would want to remain completely hidden from the public. After all, anonymity is one of the biggest selling points of the entire invention.

Cryptocurrency are digital currencies that verify and record transactions to a decentralized blockchain. A blockchain is essentially an immutable public ledger. Once transactions are completed, it is final and irreversible, and every person on Earth can view it for themselves. Despite not having an identity tied to it, it offers a way to move money outside of central banks and financial institutions, giving people a perceived sense of freedom and safety in their financial lives. But the reality is that although anonymity can give a sense of safety to some people, it can also be extremely dangerous. The anonymity promised by cryptocurrency isn't only appealing to those who are skeptical of traditional financial institutions; it's also a useful tool for criminals—dangerous people who want to bypass banking systems and move money anonymously, dealers and users buying and selling drugs and even darker illegal goods on the internet while avoiding the watchful eye of law enforcement.

This works because although all transactions are tracked and recorded, there's no personal information tying an individual to their crypto keys. It's just a random hash of numbers and letters hardly representing any information at all. This has led to terrorists, people involved in human trafficking, and drug dealers to seize upon the technology for nefarious gains. The Silk Road, one of the most famous online drug markets on the dark web, used crypto for its transactions. The U.S. justice department has also dismantled at least three terror finance campaigns that were soliciting cryptocurrency funds.

The rise of cryptocurrency has fueled growth in global ransomware attacks, which have seen a 485% increase in recent years. In 2021, the FBI seized 2.3 million dollars worth of crypto from the R.E.V. ransomware group who hacked U.S. security and IT management software provider Kaseya. Not only do these cyberhackers demand crypto as payment, but crypto makes their whole business possible. And it isn't just large companies that have to watch their back. Online crypto scams coercing people to invest in fraudulent crypto funds or fake cryptocurrencies are rampant. Last February, Satish Kambani of India, the founder of BitConnect, was indicted by the U.S. Justice Department for creating and running a fraudulent cryptocurrency investment platform.

The Monetary Authority of Singapore suspended a crypto coin illegally named after the world-famous South Korean boy band BTS. And after the success of Netflix's Korean hit "Squid Game," scammers used the series popularity to create fake crypto coins. The value of the coin skyrocketed 310,000 in just 11 days, which does sound appealing. The catch though is that this coin is what was known as a honeypot. Essentially, you were able to purchase it, but you weren't able to sell it. Because of this, you traded your dollars for this squid game coin, and the scammers escaped with millions in cash from unwitting investors, leaving them with a token that couldn't be sold and is literally worthless.

Now, you might say, "Well, scams happen at all financial institutions," and you'd be right. But at least with many third-party backed institutions, you get protections that crypto just doesn't offer. If your regular credit card gets hacked, you'll usually get your money back since your bank or financial institution has consumer protections. With crypto, those protections don't exist. So when hackers get access to your private keys or you get scammed into buying a fake coin or you invest in a fraudulent exchange, once you give them your crypto, it's gone forever. In 2021, there was a reported three point two billion in crypto stolen—a 516% increase compared to the year before.

And as new technologies involving crypto and blockchain technology become more popular, a new wave of crypto and NFT scams will inevitably rise. One of the most popular beliefs of crypto and NFTs is that you can make a lot of money trading them. But every experienced financial advisor and trader will tell you that trading isn't a great way to earn a regular income. If you want to start a high-paying career in the technology industry—one that offers a more stable income but don't have previous experience or a degree—Course Careers is here to help. All you do is go through an affordable online course where you learn everything required to actually do the job. Once you're done, you have the incredible opportunity to work with one of the hosts of the companies they're partnered with.

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Back to our story: NFTs, or non-fungible tokens, are blockchain-based tokens that represent a unique asset like a piece of art, music, or other digital content that can be purchased with cryptocurrency. They're meant to give artists more control and freedom over their work, but we don't live in an ideal world, do we? Although NFTs were, in a sense, invented in 2014 with the creation of Ethereum, the real NFT revolution began to boom in 2021 with the help of artist Mike Winkelmann, also known as Beeple. His digital artwork "Everydays: The First 5000 Days" sold for 69 million dollars and helped put NFTs on the map. Since then, artists and collectors at every scale have benefited from the creation of NFTs, but they've also experienced the same rampant scamming in all areas of the crypto world.

A crypto investor who goes by Metakovan bought Beeple's NFT for 69 million in 2021 and also happens to be the owner of the world's now-largest NFT fund, which studies data to provide analysis on various NFTs. Is 69 million a lot to pay for a digital piece of art? Yes! But what if it brings in far more than 69 million to your business? Some say that Metakovan's purchase of Beeple's NFT allowed him to drive up prices in his own NFT business. NFTs have, in a sense, become a game of who could tell the most believable lie. It was once reported that an NFT called CryptoPunk 9998 of a white-haired, green-eyed, pixelated character sold for 532 million. It was said to be the most expensive NFT of all time until it turned out that the buyer and the seller were the same person, creating a fake valuation for their own benefit.

In the crypto world, buyers and sellers remain fully anonymous on the blockchain. The wallets involved in the transaction are known, but who they're owned by is not. However, due to the open nature of cryptocurrency, anyone could check the change and see for themselves that these two wallets had interacted in the past. If overestimating the value of digital art was the only problem, then maybe NFTs wouldn't have such a terrible reputation. I mean, who even determines the worth of physical art anyway? Sadly, with NFTs, overestimation of value is just the beginning. NFTs are embroiled in more scams than you could possibly imagine.

In February of 2022, a small but reputable NFT marketplace called Sent had to suspend sales after rampant fraud was discovered on the platform. Its users were minting counterfeit digital assets despite the marketplace's best efforts to ban them. This is just one example of issues around the authenticity of crypto art and reinforces one of the most popular sayings in crypto: "Don't trust. Verify." With an entirely public blockchain, you are entirely capable of checking every single transaction you make to ensure that what you're purchasing is coming from the original creator. Unfortunately, many seem to forget this crucial part of what makes cryptocurrency important.

In another example, someone sold a fake Banksy NFT for over three hundred thousand dollars. One of the particularly dark sides of NFTs is that people who get into digital art for creative purposes are easily exploited. Enthusiasts communicate on apps like Discord, Twitter, and Instagram, but these same apps allow hackers to lure ignorant NFT aficionados into scams by using fake links that look like an opportunity to mint NFTs for cheap, get free airdrops, and much more. The targets are asked to invest their crypto into NFTs that won't ever be created, and then all of that money just disappears from their wallets, never to be seen again.

Even Beeple's fans haven't escaped unscathed. In May 2022, scammers hacked Beeple's Twitter account and stole 438 thousand dollars’ worth of crypto and NFTs from his followers. They impersonated the artist, claiming to have launched a new line of digital art with Louis Vuitton, and posted a raffle for the fake collection in his Twitter bio. The hackers used a phishing scam, deceiving people into revealing sensitive information or unknowingly installing malware once they clicked the link in his bio. All the crypto and NFTs in their wallets were completely wiped out. The fragility of the crypto universe was clearly evident in the recent collapse of the cryptocurrency exchange FTX.

FTX was the brainchild of Sam Bankman-Fried; he was the founder of the quantitative trading firm Alameda Research in 2017 and then FTX two years later. As the majority owner of both firms, there was initial concern over his conflict of interest, but he assured people that they were separate entities. Fortunately, that turned out to be a lie. Contrary to what Bankman-Fried said, FTX used its customers' money to fund risky bets made at Alameda. They would take customers' deposits, sell them on FTX to regular traders, and then use the cash to invest in other companies. To take it even further, these companies they invested in would often be forced to store their treasuries and accounts on FTX, where the funds could then be used again by Alameda, and the snowball continued to roll.

On November 6, 2022, the world's largest crypto exchange, Binance, which was also a leading angel investor in FTX, said it would unload hundreds of millions of FTX tokens. This was also around the time a leaked balance sheet came out showing that the majority of FTX's collateral was in their own FTX token. As you can imagine, if Binance were to sell hundreds of millions of this token, it would drive down the price and in turn drive down the value of the collateral that FTX held— collateral that was supposed to be customers' assets. An OTC or over-the-counter deal was offered by Alameda to purchase them at 22 a token, but this wasn't taken; the market called their bluff.

Within 48 hours, FTX's token was down 93 percent. Days later, the U.S. Securities and Exchange Commission and the Justice Department began investigating FTX, and on November 11th, Bankman-Fried resigned from both companies, and FTX filed for bankruptcy. In many ways, the FTX collapse seems like a traditional financial catastrophe—the kind we saw during the 2008 financial crisis. Split crypto with its promise of anonymity and its assurance of no go-betweens makes the FTX disaster very different. Millions of dollars in FTX funds were stolen during the bankruptcy process. No one knows by whom.

The collapse of FTX has led other crypto exchanges to tell their cash reserves and call for greater transparency. Because even if you're not out there buying and trading crypto, you know it's had its fair share of pretty bad PR moments. And just a couple weeks ago, one of the largest banks backing crypto clients, Silvergate Capital, collapsed during the disastrous Silicon Valley bank run. Silvergate got into the game very early and was willing to work with many tech and crypto companies, which led to a six billion dollar valuation in 2021. But as they say, oh how the mighty have fallen.

And the loss in value isn't the only narrative that needs damage control. As crypto has grown in popularity, especially amongst young people, environmental concerns around what it takes to sustain the industry have become widely discussed. In 2021, Cambridge University researchers calculated that Bitcoin mining was using more electricity than the entire country of Argentina! This huge carbon footprint of blockchain technology has alerted people, especially those who care about sustainability, to crypto's sizable contribution to climate change. However, the Cambridge Center for Alternative Finance estimates that Bitcoin uses just over 100 terawatt hours of energy per year to facilitate transactions and keep the network running.

In reality, this is actually less energy than what is used for gold mining in a year. In fact, the iron and steel industry uses over 10 times this amount of energy on an annualized basis. If Bitcoin was a country in terms of energy usage, it would rank 32nd out of 59 tracked by the Cambridge Center. So yes, while Bitcoin mining does use quite a bit of energy, it is far from the biggest problem on this front. What effect this will have on the future of cryptocurrency depends on people's continued desire for the anonymity that crypto provides. The anonymity that allows you to transact back and forth anonymously with anyone is the same anonymity that allows criminals to run rampant and scammers to run off with millions. It's a double-edged sword.

However, it's getting easier for investigators to track crypto exchanges by deciphering patterns in the blockchain. There's a small group of detectives who have become proficient at tracing cryptocurrency crimes for law enforcement agencies. A crypto tracing firm, Chainalysis, has emerged to find these patterns. They find groups of blockchain addresses that come from a single person or service, follow the money from those clusters, watch it move, and eventually figure out which exchange the money came from. In the U.S., crypto exchanges are legally required to retain identifying information about users under KYC rules, standing for Know Your Customer.

So the promise of anonymity, the one that the entire argument of crypto hinges on in the first place, isn't always so certain. There are currencies on the market that appear to be more untraceable than their competitors. Monero, which has been adopted by dark web markets, claims to be untraceable. Zcash is another that gives even the best tracer trouble, leading many to fear it will provide safe harbor to criminals and people evading taxes. The question is, will law enforcement and other agencies be able to catch up as new blockchain tech is created? So far, they're not doing too badly. In 2021, criminal investigations by the IRS seized over three and a half billion dollars in cryptocurrency.

There was a 56 million dollar seizure by the Justice Department, and 2.3 million was seized from the ransomware group behind the Colonial Pipeline cyberattack, which alerted the American public to the real potential danger of these cybercriminals. Then, in 2022, a New York-based couple was arrested for laundering money they'd stolen by allegedly hacking a large crypto exchange, Bitfinex. They had turned some of the money into the apparently untraceable Monero, but law enforcement apparently could trace it and found exchange accounts in their name. They found the private keys of a wallet holding over 100,000 Bitcoin and seized it—being worth about 3.6 billion dollars at the time.

As of today, it's not known if or how these addresses were tracked. However, one thing is certain: this was the largest cryptocurrency seizure in history. So while crypto has its positive aspects for those seeking complete control over their finances, its trustless and anonymous nature requires extreme caution because the negatives can cut quite deep if you aren't careful. If you are going to get involved, be wary of scams, hold your own keys, and remember: don't trust, verify. Governments across the globe continue to look at how to regulate cryptocurrency before it gets too out of control, but their measures unfortunately tend to move very slowly while technology, especially crypto, moves at breakneck speed.

Money. Our lives revolve around it. We all want it; we know we all want it. Most of it doesn't even exist beyond the heavy-duty servers of some bank, and yet the pursuit continues for this elusive thing. Despite its presence in everyday life, despite the fact that we spend most of our waking hours working towards money, it's still somehow taboo to talk about. We like to pretend that money is not important to us. And sure, money is not the end goal—in fact, one of the most common regrets of people on their deathbeds tends to be that they worked too hard chasing after money.

Of course, for all its value, however, money still can't buy you a meaningful relationship or an experience. But while money can't buy any of those things, it can make them more accessible. Is happiness not easier to achieve once you know the bills are all taken care of? Is happiness not easier to achieve when you are able to give a loved one something you know they deserve? At the very least, more money often equates to more choices in terms of how you want to spend your time—whether that is with your loved ones or in chasing a passion you had as a kid. And even if you disagree with everything I just said, in order to change the world, you will still need the backing of financial capital.

Now with that said, and hopefully having navigated through the awkwardness of introducing such a topic, let's cut right to the chase: how much money should you be making? How much is enough? And mind you, there is a very good reason to ask such a question. This is not just for curiosity's sake. Studies show that when you have actually put a metric to a goal and maybe even written it down, you are more likely to achieve it. People who vividly picture a goal are 40% more likely to successfully achieve it. So how much? What does the literature say?

Well, the relationship of money and happiness is a complicated one. First of all, emotions are generally hard to track. And second of all, this question has not been researched all that much. However, anyone talking about this topic has to bring up a piece of literature from 2010 authored by Daniel Kahneman and Angus Deaton. Their paper looks into the relationship between income and happiness, but it goes a bit beyond that. The authors decided that simply looking into one metric as a measure of subjective well-being would fail to capture the complete picture and confound the findings.

So they looked at two things: emotional well-being, which is defined as the day-to-day satisfaction, and life evaluation defined as the thoughts that come to mind when one thinks of life as a whole. You could also think of emotional well-being as the sort of short-term happiness and life evaluation as the long-term happiness. Now, what did the research find? It turns out life evaluation rises steadily with income. The more people earn, the more positively they tend to think of life in general. Emotional well-being, on the other hand, seems to plateau after an annual income of around 75,000, meaning till that figure, for the majority of people, each bit of raise in income will feel great, but after it, your day-to-day happiness won't go up by that much.

So, there it is, right? That's the magical number. Well, not quite. For one, this is a study from 2010. Because of inflation, today that amount is closer to around 93,000. And I should also mention that this study was conducted with U.S. residents as participants. What is considered a good life will definitely vary drastically in other parts of the world. Let's get that right. Just recently, in the first few weeks of 2021, researcher Matt Killingsworth published the latest findings on the very same question: how much money should you be making to be happy? His findings? Experienced well-being continues to rise even beyond the Kahneman 75,000 mark.

Not just that; it continues to rise just as deeply as before, meaning the return on investment isn't any worse off the more money you make. [Music] Why does this research disagree with the previous findings? Well, for a paper by Kahneman and Deaton, the data that was collected for emotional well-being were answers to questions about the previous day that has the potential to fail to capture what a person was actually feeling in that moment of happiness or sadness because our minds tend to play tricks with us. Killingsworth's research, meanwhile, is collected via an app which pings users at various times of the day.

It is more convenient than the traditional forms of surveying, and as such, he had a significantly larger pool of responses to base his findings on. This also allowed him to more truly capture what participants were feeling. So if we are to accept Killingsworth's findings, then most people's day-to-day happiness as well as their general outlook on life tend to improve with higher income. So does that mean we should all just aim for an astronomically high salary in search of happiness and hope that we get there someday? Is that a realistic target?

There's a thought experiment to try and answer that question for us as individuals. Author Brad Stoller, who came up with the idea for the experiment, goes like this: how much money would you have to be paid right here, right now, to never receive another dollar of income from anyone else? Now, you might think that's a straightforward experiment—you just aim for a really, really high number, somewhere in the hundreds of millions or billions. For most people, I guess the catch is that this experiment will be run in groups of five people, and whoever has the lowest figure in mind will actually walk away with the money.

The game theory at play here is actually quite cool. The interesting thing about this experiment is that it pits two of your impulses against each other and in doing so, forces you to be reasonable. Because of course, you want to aim for a high number, but you also want to win and have the money, so you can't just aim for a stupidly large number. Of course, this experiment is talking about money paid as a lump sum while most of the research looks at salaries; the perceptions of well-being might as well be different for the two of them.

But it's hard to see what the thought experiment won't work with salaries too. Go ahead and ask yourself that question and see what you come up with. The answer might help you more vividly visualize a target that you can actually work towards. Of course, we all want to achieve happiness, but more income is easier said than done. When should we really stop trying, and what if the circumstances are simply not there for a raise or a commission? Well, that's where the other part of the puzzle comes in—our adaptation.

Don't get me wrong; it's a wonderful thing—being able to adapt is what allowed our species to come so far. But at the same time, it also means that whenever presented with an improved quality of life, we rapidly adapt to it and begin taking it for granted. It would explain why most people live their lives from nine to five, chasing after that next raise because staying where you are, regardless of whether you make five figures a year or seven, brings with it a heavy feeling of obsolescence.

Then there's obviously an element of comparison— we've known this for a while—that comparison is the thief of joy. You might have a seven-figure salary but you won't be anything close to happy if you compare yourself with Jeff Bezos, who has more money than brain cells. Literally, studies also show that for the same salary, people living in a rich neighborhood feel worse than people in a poor neighborhood. While both participants likely take joy from their salaries, they also compare them with that of the Joneses. If the Joneses make less than you, you're happy; if they make more, you're not.

Research also says easily accessible money improves well-being more than money that is stowed deep inside someone's pension. The closeness of a number that you can glance at in your pocket can be a reassuring breath of air. Having only five hundred dollars worth of disposable money in a bank account can improve life satisfaction by up to 15%. Then, of course, there's the question of what you do with the money that eventually leads to happiness. If you simply make more money for making money's sake, you might still get some joy out of it, assuming you're successful.

It's much like a game, but the elation will pale in comparison to that of a person who spends his hard-earned cash in a better way. Buying time is often seen as one of the best ways to spend your money and that it allows you to focus on the most joyous aspects while offloading the more laborious aspects to someone who will happily do them. The gig economy has made this more accessible than ever before, allowing people to spend more of their time for the things that truly matter, even if it means having a little less in the bank account.

This might mean paying someone to do the dishes so you can read a book to your child in bed, or it could mean purchasing a more expensive ticket to be able to spend some time with family. Material possessions also draw a lot of attention when it comes to the relation between wealth and happiness. The research is clear on this too—spend on experiences, not things. The reason is that experiences are exclusive. Nobody can feel what you felt on that trip with your best friend; nobody can buy that exclusivity.

Despite the fleeting nature of an experience, it can last a lifetime. Unlike the value of objects which tend to depreciate over time, experiences only seem more enjoyable in hindsight. Our minds tend to overlook the small bumps in an experience—the delayed flight, or the poor Wi-Fi—and remember only the good parts. So instead of aiming for a certain salary figure, it might make more sense to aim for experiences and pursue the ability to afford those experiences.

Of course, this is not to say that material possessions cannot be an experience. A song might be an experience; a cup of coffee might be an experience; an expensive car might be an experience. That's really up to the individual to decide, but people generally overestimate how happy they'll be once they have that one new thing. However, once we have it, the feeling of satisfaction slowly erodes, and we are back where we started. On some level, it might be a bit troubling to accept that money does indeed buy happiness, or at the very least buys ways towards happiness.

But really, haven't we known this all along? More importantly though, this realization has to be qualified with the ideas of what's really important: people, experiences, and time. Not only can it inform our career choices and how much we want to invest chasing after this thing, but it also tells us why generosity is important; why a more equitable future is one to strive for. Because remember, the only reason any of us want money is to inevitably get rid of it in the end. [Music] What would you do if you won the lottery? Personally, I'd pay off my debt, quit my job, and move to Japan. It's a fun scenario to think about, even if it's never going to happen. Statistically, you're more likely to give birth to quadruplets or be crushed by a meteor than win the lotto.

That is unless, of course, you're Evelyn Adams. In 1985, Adams won a 3.9 million dollar jackpot from the New Jersey State Lottery. Just four months later, she won again, bringing her total payout to 5.4 million—nearly 15 million in today's money. Adams was basically the first person in American history to ever win multiple million-dollar prizes. Basically overnight, she went from working in a convenience store to being worth more than some CEOs.

With her newfound wealth, Adams paid off bills, set up a college fund for her daughter, bought a car, and lavished friends and family with gifts. You'd think a story like this would come with a happily ever after finale, but you'd be very wrong. Soon after winning, Adams noticed her privacy rapidly disappearing. She felt that she couldn't go anywhere without being recognized, and while some people celebrated her good luck, others resented her for it. Still, people came to her asking for money. She put a stop to her plans to go to school and study music, made several bad business deals, and ended up giving away a substantial portion of her wealth.

By 2012, she had lost her entire fortune after gambling away the last of it at the casinos in Atlantic City. Today, she lives in a trailer park. Adams would later say about her experience, "I won the American dream, but I lost it too. It was a very hard fall." It's called rock bottom. The story of Evelyn Adams isn't unusual. Multiple lottery winners have found their supposed good luck quickly turned sour.

I guess the saying is true: money can't buy happiness. Except it isn't scientific research has demonstrated a positive correlation between wealth and individual happiness. The key, it turns out, is knowing how to use that money to buy happiness and not just having it. But to understand this, we need to answer the question: what is happiness? You'd think it would be fairly simple to define, but from a psychological perspective, happiness is actually quite complicated. There are hundreds of different neurotransmitters that contribute to our unique understanding of what feels good. Each one plays a specific role and is responsible for a range of different emotional experiences. But by far, the most important of these are dopamine, serotonin, and oxytocin.

Dopamine is strongly tied to our reward center. Serotonin helps us relax. Oxytocin helps us bond and form relationships. Taken together, these three molecules could be called the happiness trifecta—a potent chemical cocktail responsible for feelings of excitement, bliss, contentment, and every other positive emotion. Neurochemistry aside, our subjective interpretations of happiness can roughly be divided into two categories: pleasure and purpose. Pleasure is the short-term day-to-day happiness that we get from a good meal, spending time with friends, or going for a jog. We might refer to this more simply as mood.

Purpose is the harder to define sense of fulfillment we gain when we feel that our life has meaning. This delineation goes all the way back to Aristotle, and scientists today still use it as a way of evaluating an individual's overall happiness. There is a significant difference between pleasure and purpose, and just because a person has one doesn't guarantee the other. Take a new college student for instance; they may experience frequent daily pleasure in the form of spending time with friends, attending social events, and enjoying a much greater level of personal freedom and independence. Yet the same person may struggle to figure out what exactly they want to do with their life. This causes them stress and contributes to low levels of life satisfaction.

Conversely, a successful CEO or entrepreneur can feel that sense of purpose in their work while having low amounts of daily pleasure, the burden of running a massive company weighing on them and sucking the joy out of even their favorite hobbies. Happiness then is when we experience both pleasure and purpose simultaneously. A truly happy person is someone who is able to find enjoyment in their daily experiences while also working towards larger goals to give their life meaning. If we're going to use money to increase our happiness, we should then consider using it to enhance both our pleasure and purpose.

You may think the simple solution is to just make more money. I mean, if I have more money, I can spend it on things that give me pleasure while using those same resources to pursue my purpose. Well, kind of. You see, there's actually some evidence that supports this. Unfortunately, once you really start digging into the data, the picture gets a bit messy. A now-famous 2010 Princeton University study has often been cited as finding that there's a limit to the amount of happiness money can bring us. Specifically, that seventy-five thousand dollars appears to be the ceiling and that beyond that, the benefits plateau.

Except this isn't what that study found at all. What it actually demonstrated is that while daily pleasure caps at 75K, overall life purpose continues to grow alongside income. It's a classic case of the media focusing on the sensational while ignoring the larger context, and here especially the larger context is key. Another study conducted in 2018 reinforced the original 75,000 figure for pleasure, but also reported that a second ceiling of 95,000 for purpose.

It's important to note that the 2010 study only evaluated around 450,000 people in the United States. The 2018 survey, meanwhile, included 1.7 million individuals from around the world and found substantial variation between cultures. In wealthier countries, for example, caps appeared higher, and in certain regions, incomes beyond this limit were actually associated with decreased happiness. As if all of this wasn't confusing enough, a more recent 2021 study from the University of Pennsylvania reportedly found no ceilings whatsoever. However, the survey drew from a relatively small sample size of just 33,000 Americans and it also placed a greater focus on pleasure than the previous studies.

What all of this data supports though is that the more money you currently have, the less that the future increases in wealth will contribute to your sense of pleasure and purpose. Essentially, every dollar you earn buys you a little less happiness. Think of it this way: if a person earning twenty thousand dollars a year and a person making two hundred thousand dollars a year both get a ten percent raise, each will experience a similar boost to their happiness. For the first person, a two thousand dollar raise represents an increase in their standard of living and potentially their level of comfort, but for the second person, twenty thousand dollars is a proverbial drop in the bucket with a much less dramatic effect on their daily life.

What this means is that while there is a positive correlation between money and happiness, it's one with diminishing returns. Once you've passed a certain threshold, it takes increasingly larger amounts of money to trigger the same neurological release of feel-good chemicals as when you had less. So if chasing money for money's sake isn't an effective strategy for buying happiness, then what is? Well, in a few words, spending what you already have wisely. Positive psychology is an entire school of study devoted to quantifiably figuring out what makes life worth living. Its goal is to analyze positive experiences, traits, and institutions with the aim of improving quality of life.

Not incidentally, it is extremely concerned with happiness. In terms of the best way to spend money, the school of study divides potential purchases into two categories: pleasures and comforts. In some ways, this reflects the Aristotelian distinction between pleasure and purpose. Pleasures by their nature are transient and short-lived, like biting into a chocolate bar. Comforts, on the other hand, are more permanent but are largely taken for granted, like running water and electricity. We tend to not notice them until they're gone.

In general, investing in comforts tends to be a sure method of raising our baseline level of happiness. They help to prevent and alleviate suffering, ensuring you're able to focus your attention on other pursuits rather than spending all your time simply trying to survive. Things like a reliable vehicle, a house in a safe neighborhood, and for nations without socialized medicine, quality health insurance are all comforts essential for improving an individual's quality of life. Perhaps the most important comfort a person can invest in is leisure time.

Leisure time is, after all, the only resource we can't get more of. As such, it has a much higher value than any currency. Having leisure time means we're free to pursue the kinds of experiences that give our life both pleasure and purpose. Studies have found that these kinds of activities are a more reliable source of happiness than any material purchase. No matter how excited you were when you bought that new smartphone, eventually it'll age, the screen will crack, and the battery will die, and a new model will come along and become the new object of your desire.

Just watch my entire video on planned obsolescence and you'll kind of understand what I mean. On the other hand, a once-in-a-lifetime trip to a foreign country will be remembered for years afterward. What starts out as a trip will become a story you share again and again, providing you with a continuous source of joy. Of course, you don't have to spend a fortune on an overseas vacation just to find a little happiness. Going to a concert, taking a hiking trip, or simply getting dinner with friends offers the same benefits.

Perhaps the best experiences to invest in are those that allow us to improve ourselves at the same time. Learning a new skill or taking classes at a local university creates feelings of personal growth and progress. In fact, skill mastery is an important tool used in cognitive behavior therapy to help combat a variety of mood disorders, from borderline personality disorder to depression. This strategy can be adopted by anyone in order to boost our self-confidence and sense of purpose. If you can participate in these kinds of experiences alongside loved ones, which is far and away what makes humans the happiest is their connection with one another, we are innately social creatures.

We want to feel like we belong, that we're loved and accepted. The best way then to spend our money is by using it to nurture our relationships. A great way to do this is through experiences where we can spend time with those that we love, engaging in hobbies and other fun activities. But what's even more powerful is giving. You don't have to give all your money away to reap the rewards, so be smart with what you give and make sure that it's well within your means. Psychologically speaking, the benefits of giving can be observed in children prior to the