Book notes: The Almanack of Naval Ravikant by Eric Jorgenson

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The Almanack of Naval Ravikant: A Guide to Wealth and Happiness by Eric Jorgenson

Synopsis:

“Getting rich is not just about luck; happiness is not just a trait we are born with. These aspirations may seem out of reach, but building wealth and being happy are skills we can learn.

So what are these skills, and how do we learn them? What are the principles that should guide our efforts? What does progress really look like?

Naval Ravikant is an entrepreneur, philosopher, and investor who has captivated the world with his principles for building wealth and creating long-term happiness. The Almanack of Naval Ravikant is a collection of Naval’s wisdom and experience from the last 10 years, shared as a curation of his most insightful interviews and poignant reflections. This isn’t a how-to book, or a step-by-step gimmick. Instead, through Naval’s own words, you will learn how to walk your own unique path toward a happier, wealthier life.” -Audible

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Opening thoughts:

This book has been on my wishlist since it was recommended in one of Tim Ferriss’s podcast episodes. It seems like an impactful yet relatively short read, though I’m not quite sure what to expect.

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Key notes:

Forward

What Tim loves about Naval is that he’s an independent thinker who is almost never a part of a consensus, and he’s very blunt and honest. You never need to guess what he’s thinking

Eric’s Note (About this Book)

Naval is widely followed because he’s a rare combination of successful and happy

Part One: Wealth

• How to get rich without getting lucky

Building Wealth

• Making money is not a thing you do, it’s a skill you learn

Understand How Wealth Is Created

• Hard work matters, but so is understanding and directing your work in the right way
• Seek wealth (assets that earn while you sleep), not money or status
  • You must own equity, a piece of a business, to gain your financial freedom. You’ll get rich by giving society what it wants but it does not know how to get at scale
• Pick an industry where you can play long-term games with long-term people
• Play iterated games
  • All the returns in life, whether in wealth or relationships or knowledge, come from compound interest
  • Pick business partners with high intelligence, energy, and most of all integrity
• Learn to sell. Learn to build. If you can do both, you’ll be unstoppable
• Arm yourself with specific knowledge, something you cannot be trained for
  • It is found by pursuing your genuine curiosity and passion rather than whatever is not right now
  • Building specific knowledge will feel like play to you but look like work to others
  • When it is taught, it is through apprenticeships, not schools
  • It is often highly technical or creative, and cannot be outsourced or automated
• Fortunes require leverage
  • Business leverage requires people, capital, and products with no marginal cost of replication, code, and media
  • Code and media are the leverage behind the newly rich
    • You can create software and media that works for you while you sleep
  • Write books and blogs. Record videos and podcasts
    • Leverage is a force multiplier for your judgment
    • Judgment is gained through experience but can be gained faster through foundational skills
    • There is no skill called business. Avoid business magazines and classes
      • Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers
• Set and enforce an aspirational personal hourly rate
  • If fixing a problem will save less than your hourly rate, ignore it
  • If outsourcing a task will cost less than your hourly rate, outsource it
• Work as hard as you can, even though what you work on and who you work with are more important than how hard you work
• Become the best in the world at what you do
  • Keep redefining what you do until this is true
• Summary: Productize yourself. You have uniqueness, productize has leverage and specific knowledge. Leverage accountability
• If your long-term goal is wealth, you should ask yourself: is this authentic to me? Is it myself that I am projecting? Am I productizing it? Am I scaling it? And scaling with labor, capital, code, or media?
• Money is the transfer of wealth. Wealth is what you want. Wealth is assets that earn while you sleep

Find and Build Specific Knowledge

• Specific knowledge cannot be taught, but it can be learned
• No one can compete with you on being you
  • Most of life is a search for who and what needs you the most
• Specific knowledge is found much more by perusing your innate talents, your genuine curiosity, and your passion
  • Escape competition through authenticity
• The most important skill for getting rich is becoming a perpetual learner
  • You have to know how to learn anything you want to learn
• It’s important to be foundational in many important things
  • But you can only achieve mastery in one or two things, and it’s usually things you’re obsessed about

Play Long Term Games With Long Term People 

• Compounding not only works in money, but also in business relationships and reputation
• Intentions don’t matter, actions do
  • That why being ethical is so hard

Take on Accountability

Build or Buy Equity in a Business

• Ownership is really important. Everybody who really makes money at some point owns a piece of a product, business, or some IP
  • Usually, the real wealth is created by starting your own companies or even by investing

Find a Position of Leverage

• We live in an age of infinite leverage, and the economic rewards for genuine intellectual curiosity have never been higher
  • Following your genuine intellectual curiosity is a better foundation for a career than following whatever is making money right now
• Knowledge only you know or only a small set of people knows is going to come out of your passions and your hobbies
  • If you have hobbies around your intellectual curiosities, you’re more likely to develop these passions
  • If it entertains you right now, but it’ll bore you some day, it’s a distraction. Keep looking
• Art is something done for its own sake
  • Ironically, when you do this, you create your best work
• The new generations’ fortunes are made through code or media
  • Media and code are permission-less forms of leverage
• You’re never going to get rich renting out your time
• If you want to be part of a great tech company, then you need to be able to sell or build
  • If you don’t do either, learn
• Earn with you mind, not your time

Get Paid for Your Judgment

• Solve via iteration. Then get paid via repetition

Prioritize and Focus

• Value your time at an hourly rate and ruthlessly spend to save time at that rate
  • You’ll never be worth more than you think you’re worth
• Status is a zero sum game and very old game
  • Avoid status games in your life because they make you an angry, combative person
  • You’re always fighting to put someone down so you can put yourself and others you like up
• Spend more time making the big decisions
  • There are basically 3 big decisions in your early life:
    1. Where you live
    2. Who you’re with
    3. What you do
• Figure out what you’re good at and start helping other people with it
  • Give it away, pay it forward
  • Karma works because people are consistent. On a long enough time scale, you attract what you project
    • But don’t measure because your patience will run out if you count 

Find Work That Feels Like Play

• Retirement is when you stop sacrificing today for an imaginary tomorrow

How to Get Lucky

• To get rich without getting lucky, we want to be deterministic
  • We don’t want to leave it to chance
• Prepare the mind and be sensitive to chances others might miss
  • Become the best at what you do. Refine what you do until this is true
  • Opportunity will seek you out. Luck becomes the destiny
• Build your character in a certain way then your character becomes your destiny
• One of the things that’s important to make money is having a reputation that makes people do deals through you
• The worst outcome in this world is not having self-esteem
  • If you don’t live yourself, who will?
• Be careful of doing things you’re fundamentally not going to be proud of because they will damage you

Be Patient

• Generally, great people have great outcomes. You just have to be patient 
• The only way to truly learn something is by doing it
  • Listen to guidance, but don’t wait
• You have to do hard things to create your own meaning in life

Building Judgment

Judgment

• You don’t get rich by spending your time to get money, you get rich by saving your time to make money
• Wisdom is knowing the long-term consequences of your actions
  • Wisdom applied to external problems is judgment

How to Think Clearly

• “Clear thinker” is a better compliment than “smart”
• The smartest people can explain things to a child. If you cant, then you don’t know it
• You need to budget one or two days a week to just think
  • It’s only after you’re bored you have the great ideas
• Very smart people tend to be weird since they insist on thinking everything through for themselves
  • A contrarian reasons independently from the ground up and resists pressure to confirm
    • Cynicism is easy, mimicry is easy
    • Optimistic contrarians are the rarest breed

Shed Your Identity to See Reality

• Tension is who you think you should be. Relaxation is who you are

Learn the Skills of Decision Making

• Reference: Richard Feynman

“Praise specifically, criticize generally”

• Charisma is the ability to project confidence and love at the same time
  • It’s almost always possible to be honest and positive
• If you can be more right and more rational, you’re going to get nonlinear returns in your life

Collect Mental Models

• You want principles and mental models by which you can make better decisions 
• Mental models are really just compact ways for you to recall your own knowledge
• Reference: Black swan theory and probability statistics around tail events. Extreme probabilities
• If you can’t decide, then the answer is no
• Don’t say yes to big decisions unless you’re very certain
• Run uphill
  • If you’re evenly split on a difficult situation, take the path more painful in the short term
  • Most of the gains in life come from suffering in the short term so you can get paid in the long term
• Reading science, math, and philosophy one hour per day will likely put you at the upper echelons of human success within seven years

Learn to Love to Read

• Read what you love until you love to read
• Explain what you learned to someone else
  • Teaching forces learning
• Math, hard sciences, and microeconomics are solid foundations
• When solving problems, the older the problem, the older the solution
• A calm mind, a fit body, and a house full of love cannot be bought, they must be earned

Part Two: Happiness

• The three big ones in life are wealth, health, and happiness. We pursue them in that order, but their importance is reversed 

Learning Happiness

Happiness is Learned

• He believes happiness is a default state
  • Happiness is there when you remove the sense of something missing in your life
  • Happiness is not about positive or negative thoughts. It’s about the absence of desire, especially for external things
• If you ever want to have peace in your life, you have to move beyond good and evil
• The world just reflects your own feelings back at you
  • Reality is neutral and has no judgments
• The neutral state is actually a perfection state, which is why children tend to be happy and in the moment
• A rational person can find peace by cultivating indifference to things outside of their control

Happiness Is a Choice

Happiness Requires Presence

Happiness Requires Peace

• Externally inflicted purpose by family or society will not make you happy nor give you peace
• Anxiety makes you unhappy, and it’s just a series of running thoughts
• A happy person isn’t someone who is happy all the time. It’s someone who effortlessly interprets events in such a way that they don’t lose their innate peace

Every Desire Is a Chosen Unhappiness

• The fundamental delusion: there is something out there that will make me happy and fulfilled forever
• Desire is a contract you make with yourself to be unhappy until you get what you want

Success Does Not Earn Happiness

• If you could just sit for 30 minutes and be happy, you are successful
• Peace is happiness at rest, and happiness is peace in motion
  • You can convert peace into happiness at any time, but peace is what you want most of the time
  • If you’re a peaceful person, anything you do will be a happy activity

Envy Is the Enemy of Happiness

• The enemy of peace of mind is expectations drilled into you by society and other people

Happiness is Built by Habits

• Peace and happiness are skills
  • There is a generic range and a lot of it is conditioning from your environment, but you can uncondition and recondition yourself 

Find Happiness In Acceptance

• Only have one main desire in your life at a time
  • It’s too difficult to manage multiple and they cause unhappiness
• You’re going to die someday and it won’t matter
  • So enjoy yourself, do something positive, project love, make someone happy, laugh, appreciate the moment

Saving Yourself

• Ultimately you have to take responsibility

Choosing to Be Yourself

• Be yourself with passionate intensity

Choosing to Care for Yourself

• When you throw a health habit at someone and they say “I don’t have time” they really mean “it’s not a priority“
• For workout and activity, just do something every day
  • It doesn’t matter what it is, as long as you’re excited about it

“Easy choices, hard life. Hard choices, easy life”

Meditation + Mental Strength

• Most of our suffering comes from avoidance
• Meditation is intermittent fasting for the mind
• Life hack: when in bed, meditate
  • Action: Try 1 month of meditation for 1hr a day first thing in the morning
• Awareness alone calms you down

Choosing to Build Yourself

• The greatest superpower is the ability to change yourself 
• To have peace of mind, you have to have peace of body first 
• When you really want to change, you just change
  • But most of us don’t really want to change and go through the pain just yet
• Impatience with action, patience with results

Choosing to Grow Yourself

• Set up systems, not goals
  • Use your judgment to figure out what kinds of environments you can thrive in 
• The returns in life are being out of the herd
  • Social approval is inside the herd

Choosing to Free Yourself

• The hardest thing is not doing what you want, it’s knowing what you want
• Courage is not caring what other people think
• Value your time, it is all you have
  • It’s more important than your money or friends or anything
  • As long as you’re doing what you want, it’s not a waste of your time
• Don’t spend your time making other people happy, that’s their problem not yours
  • If you are happy, it makes other people happy
  • Other people may ask you how you became happy and might learn from it. But you’re not responsible for others’ happiness

Philosophy

The Meanings of Life

• Answer 1: It’s personal. You have to find it for yourself
• Answer 2: There is no meaning or purpose to life 

Live By Your Values

• Honesty – If you can’t be fully yourself around someone or in a certain environment, they’re not worth being around or that’s not a place worth being in
  • Before you can lie to another, you must first lie to yourself 
• He only wants to treat people and be treated by others as peers, not above or below anyone
• He doesn’t believe in anger anymore
  • Anger is a hot coal you hold in your hand while you wait to throw it at someone
• If you’re arguing about something, it’s because your values don’t line up

Rational Buddhism

The Present Is All We Have

• Inspiration is perishable. Act on it immediately

Bonus

• The best book is the one you’ll devour
• Book reference: Sapiens by Yuval Noah Harari
• Book reference: The Rational Optimist by Matt Ridley
• Book reference: Skin in the Game by Nassim Taleb
• Book reference: Six Easy Pieces by Richard Feynman
• Book reference: Thinking Physics by Lewis Carroll Epstein
• Book reference: The Sovereign Individual by James Dale Davidson
• Book reference: Poor Charlie’s Almanac by Charles T. Munger
• Book reference: The Book of Life: Daily Meditations by Jiddu Krishnamurti
• Book reference: Siddhartha by Hermann Hesse
• Book reference: Striking Thoughts by Bruce Lee
• Blog: The Day You Became A Better Writer by Scott Adams
• TV show: Rick & Morty

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Closing thoughts:

This was such a great book. I dare say it was almost too good because it made taking notes on this book very difficult. Almost every line in every chapter was a nugget of wisdom, but it’s impossible to just copy the book line by line into notes. Therefore, I had to forgo some of the points and just take notes on the best and highest-level ideas. Nonetheless, it was a fantastic book.

I can see why many of the guests on Tim Ferriss’s podcast highly recommend Naval Ravikant and his wisdom. A lot of his points are very concise but impactful. In this book, it also covers a wide-range of topics, from wealth building to happiness. It’s one of those personal development books that covers a broad range instead of specializing in one topic. I think both have their place, but this book does a great job getting to the core fundamentals of what’s most important in each aspect. A reader new to personal development could easily start on this book and dive deeper into topics that interest them in other works. However, if you implement the ideas in this book (many of which are very actionable) it can be very powerful. The advice cuts right to the heart of the suggestions and some practical starting steps.

Overall, I highly recommend this book to everyone across the board. It’s an easily digestible read for anyone and can have a profound impact no matter the area.

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One Takeaway / Putting into practice:

As I’ve mentioned, this book has a lot of great takeaways. Despite this, my takeaway is something I’ve already been sharing with others and trying to put into practice myself. It’s not a singular idea, but a combination of three related ideas that changed the way I think about them in conjunction:

• Happiness is there when you remove the sense of something missing in your life
• Peace is happiness at rest, and happiness is peace in motion
• Desire is a contract you make with yourself to be unhappy until you get what you want

I like the idea that happiness is essentially a lack of desire because the author defines happiness as peace. And that we should only choose one desire/unhappiness at a time, or else we’ll be living a life full of unhappiness when we’re desiring many things. And lastly, I like the idea of pursuing peace because it can always be converted into happiness, as a peaceful person doing any activity will be happy.

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Nutshell:

A collection of Naval Ravikant’s wisdom and experience from the last 10 years, shared as a curation of his most insightful interviews and poignant reflections.

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Similar books:

• Awaken The Giant Within by Tony Robbins
• Think Like A Monk by Jay Shetty
• The Subtle Art of Not Giving a F*ck by Mark Manson
• Awareness by Anthony de Mello
• Stillness Is the Key by Ryan Holiday
• Make Time by Jake Knapp & John Zeratsky

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Rating:

5/5

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