Welcome to Wise & Wealthy: A weekly newsletter full of proven ideas to become smarter and wealthier. I send this every Monday.
#130 – June 24, 2024
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Wise: The “Nocebo Effect”
Your mind is extremely powerful. Your thoughts determine your actions. The “nocebo effect” is a great example of that.
The placebo effect happens when positive expectations lead to improved health outcomes. But the nocebo effect is the exact opposite. It’s when negative expectations or beliefs lead to harmful or adverse effects on health.
Here are a few examples:
- Feeling sick — When you have a runny nose and immediately think you have the flu or something worse.
- Assume your day sucks — Some days we wake up tired or “on the wrong side of the bed.” When we think our day will be bad because of that, it generally comes true.
- Thinking you’re bad with money — When you think that you probably will never invest, then you miss out on building wealth.
Nocebo simply refers to your self-talk. Particularly when you want to do hard things, don’t make everything worse in your mind by talking negatively about it.
In my latest article, I share tips for overcoming that.
↳ The Nocebo Effect: Why You Must Eradicate Negative Expectations
Wealthy: Financial resilience
Financial resilience means you can weather any type of monetary catastrophe, like getting fired or losing your business. Here are a few tips to become more financially resilient:
- Change your mindset: Think of opportunities instead of competition. Life is not a zero-sum game. In this world, you can make money with just your mind.
- Acquire skills: Pick an income-generating skill like coding, speaking, selling, and writing, and then aim to become the best in the world. The best get paid well.
- Don’t try to be cool: So many people destroy their bank accounts just because they want to be accepted by others. Cars, clothes, jewelry, big houses. Don’t play that game.
- Get used to not spending money you earn: This is obvious, but to become financially resilient, you need to build wealth. And you start doing that by not spending your money.
- Invest: Once you have good financial habits, start investing so you can divorce your income from your time.
More on this process in my other new article.
↳ On Financial Resilience: The Stoic Way to Survive Money Challenges
One interesting thing
This is a quote from the late Jim Simons:
“Sometimes I look at this and feel I’m just some guy who doesn’t really know what he’s doing.”
Simons is widely considered the greatest hedge fund manager of all time. His fund returned 66% a year for 30+ years.
Some people mistake that quote for self-doubt. I see it as a healthy way of looking at life. No one truly knows what they’re doing!
Thanks for reading! I hope you found this edition of Wise & Wealthy useful.
All the best,
Darius
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