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

16 mins
book summary naval how to live
Author
Shawn L
Builds stuff minimally
Table of Contents

On Love
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If you have nothing in your life, but you have at least one person that loves you unconditionally, it’ll do wonders for your self-esteem.

On Reading
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Books make for great friends, because the best thinkers of the last few thousand years tell you their nuggets of wisdom.

There is no skill called “business.” Avoid business magazines and business classes.

Study microeconomics, game theory, psychology, persuasion, ethics, mathematics, and computers.

Reading is faster than listening. Doing is faster than watching.

Read science, math, and philosophy one hour per day.

The means of learning are abundant — it’s the desire to learn that is scarce.

Read what you love until you love to read.

Reading a book isn’t a race - the better the book, the more slowly it should be absorbed.

I’ll start at the beginning, but I’ll move fast. If it’s not interesting, I’ll just start flipping ahead, skimming, or speed reading.

If they wrote it to make money, don’t read it.

Explain what you learned to someone else. Teaching forces learning.

When it comes to reading, make sure your foundation is very, very high quality.

Stick to science and to stick to the basics. Read originals and read classics.

Start treating books as throwaway blog posts or bite-sized tweets or posts. Feel no obligation to finish any book.

On Time
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Understand How Wealth Is Created
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You should not grind at a lot of hard work until you figure out what you should be working on.

Seek wealth, not money or status. Wealth is having assets that earn while you sleep.

Ignore people playing status games.

You’re not going to get rich renting out your time. You must own equity - a piece of a business—to gain your financial freedom.

Pick an industry where you can play long-term games with long-term people.

Play iterated games.

Pick business partners with high intelligence, energy, and, above all, integrity.

Learn to sell. Learn to build. If you can do both, you will be unstoppable.

Specific knowledge
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Specific knowledge is knowledge you cannot be trained for.

Specific knowledge is found by pursuing your genuine curiosity and passion rather than whatever is hot right now.

Building specific knowledge will feel like play to you but will look like work to others.

Specific knowledge is often highly technical or creative.

Fortunes require leverage. Business leverage comes from capital, people, and products with no marginal cost of replication (code and media).

Code and media are permissionless leverage. They’re the leverage behind the newly rich. You can create software and media that works for you while you sleep.

If you can’t code, write books and blogs, record videos and podcasts.

Keep uncluttered calendar but be too busy to “do coffee”

Even though who you work with and what you work on are more important than how hard you work.

There are no get-rich-quick schemes. Those are just someone else getting rich off you.

Always ask “Is this authentic to me? Is it myself that I am projecting?” And then, “Am I productizing it? Am I scaling it? Am I scaling with labor or with capital or with code or with media?”

Find and Build Specific Knowledge
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Society, business, & money are downstream of technology, which is itself downstream of science.

Escape competition through authenticity.

It’s much more important today to be able to become an expert in a brand-new field in nine to twelve months than to have studied the “right” thing a long time ago.

“What is the foundation required for me to learn this?” Foundations are super important.

Knowing how to be persuasive when speaking is far more important than being an expert digital marketer or click optimizer.

Play Long-Term Games with Long-Term People
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You should be very thoughtful and realize in most things (relationships, work, even in learning) what you’re trying to do is find the thing you can go all-in on to earn compound interest.

Take on Accountability
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There’s not really that much to fear in terms of failure, so you should take on a lot more accountability than you do.

Find a Position of Leverage
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If it entertains you now but will bore you someday, it’s a distraction.

When you do things for their own sake, you create your best work.

The year I generated the most wealth for myself was actually the year I worked the least hard and cared the least about the future.

Follow your intellectual curiosity more than whatever is “hot” right now.

Now, the problem is becoming good at whatever “it” is. It moves around from generation to generation, but a lot of it happens to be in technology.

Code is probably the most powerful form of permissionless leverage. All you need is a computer - you don’t need anyone’s permission.

But ten engineers working ten times as hard, just because they choose the wrong model, the wrong product, wrote it the wrong way, or put in the wrong viral loop, have basically wasted their time.

Knowledge workers function like athletes - train and sprint, then rest and reassess.

Where you don’t want to be is a support role, like customer service. In customer service, unfortunately, inputs and outputs relate relatively close to each other, and the hours you put in matter. Have more accountability.

Avoid is the risk of ruin. Stay out of things that could cause you to lose all of your capital, all of your savings. Don’t gamble everything on one go. Instead, take rationally optimistic bets with big upsides.

Get Paid for Your Judgment
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Judgment - especially demonstrated judgment, with high accountability and a clear track record—is critical.

We waste our time with short-term thinking and busywork. Warren Buffett spends a year deciding and a day acting. That act lasts decades.

Prioritize and Focus
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Value your time at an hourly rate, and ruthlessly spend to save time at that rate. You will never be worth more than you think you’re worth.

Always factor your time into every decision.

Set a very high hourly aspirational rate for yourself and stick to it. It should seem and feel absurdly high. If it doesn’t, it’s not high enough. Whatever you picked, my advice to you would be to raise it.

Optimists actually do better in the long run.

Status is a zero-sum game. It’s a very old game.

The problem is, to win at a status game, you have to put somebody else down.

Spend more time making the big decisions. There are basically three really big decisions you make in your early life: where you live, who you’re with, and what you do.

Figure out what you’re good at, and start helping other people with it. Give it away. Pay it forward.

You’ll never be rich since you’re obviously smart, and someone will always offer you a job that’s just good enough.

Find Work That Feels Like Play
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Lusting for money is bad for us because it is a bottomless pit.

The best way to stay away from this constant love of money is to not upgrade your lifestyle as you make money.

For me, freedom is my number one value.

You don’t need to start a company to be successful. The most successful class of people in Silicon Valley on a consistent basis are either the venture capitalists (because they are diversified and control what used to be a scarce resource) or people who are very good at identifying companies that have just hit product/market fit.

For someone who is early in their career (and maybe even later), the single most important thing about a company is the alumni network you’re going to build. Think about who you will work with and what those people are going on to do.

How to Get Lucky
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Increase luck by:

  • hustle and persist
  • become the best, weirdest, hardest in your area

In a long-term game, it seems that everybody is making each other rich. And in a short-term game, it seems like everybody is making themselves rich.

Business networking is a complete waste of time. If you’re building something interesting, you will always have more people who will want to know you.

If someone is talking a lot about how honest they are, they’re probably dishonest.

Sharks eat well but live a life surrounded by sharks.

Be Patient
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Apply specific knowledge with leverage and eventually, you will get what you deserve. It takes time.

What making money will do is solve your money problems.

Judgment
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To get rich in life in a deterministically predictable way, stay on the bleeding edge of trends and study technology, design, and art - become really good at something.

You get rich by saving your time to make money.

Judgment is underrated.

The direction you’re heading in matters more than how fast you move, especially with leverage.

How to Think Clearly
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If someone is using a lot of fancy words and a lot of big concepts, they probably don’t know what they’re talking about.

If you can’t explain it to a child, then you don’t know it.

The smaller you can make your ego, the less conditioned you can make your reactions, the less desires you can have about the outcome you want, the easier it will be to see the reality.

The problem isn’t reality. The problem is their desire is colliding with reality and preventing them from seeing the truth, no matter how much you say it.

It’s actually really important to have empty space. Have a day or two every week where you’re not busy whole day. 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 conform.

Shed Your Identity to See Reality
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You absolutely need habits to function. You cannot solve every problem in life as if it is the first time it’s thrown at you.

“I’m Naval. This is the way I am.”

To be honest, speak without identity.

Learn the Skills of Decision-Making
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The moment you tell somebody something dishonest, you’ve lied to yourself. Then you’ll start believing your own lie,

I never ask if “I like it” or “I don’t like it.” I think “this is what it is” or “this is what it isn’t.”

Collect Mental Models
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Evolution
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I think a lot of modern society can be explained through evolution. One theory is civilization exists to answer the question of who gets to mate.

Inversion
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It’s not about having correct judgment. It’s about avoiding incorrect judgments.

Complexity
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We are very bad at predicting the future.

Economics
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Microeconomics and game theory are fundamental.

Principal Agent problem
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The principal-agent problem is the single most fundamental problem in microeconomics.

When you are the principal, then you are the owner—you care, and you will do a great job.

You optimize for yourself rather than for the principal’s assets.

The more closely you can tie someone’s compensation to the exact value they’re creating, the more you turn them into a principal, and the less you turn them into an agent.

If you cannot decide, the answer is no. And the reason is, modern society is full of options.
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If you find yourself creating a spreadsheet for a decision with a list of yes’s and no’s, pros and cons, checks and balances, why this is good or bad…forget it.

Run uphill
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If you’re evenly split on a difficult decision, take the path more painful in the short term.

When solving problems: the older the problem, the older the solution.

Happiness
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Happiness Is Learned
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Happiness is there when you remove the sense of something missing in your life.

Happiness is the state when nothing is missing.

If I say I’m happy, that means I was sad at some point. You have to view the negative before you can aspire to and appreciate the positive.

Happiness is not about positive thoughts. It’s not about negative thoughts. It’s about the absence of desire,

More important than meditation is acceptance.

Happiness Is a Choice
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Happiness, love, and passion…aren’t things you find—they’re choices you make.

Happiness Requires Presence
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A lot of our unhappiness comes from comparing things from the past to the present.

Happiness Requires Peace
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How I combat anxiety: I don’t try and fight it, I just notice I’m anxious because of all these thoughts. I try to figure out, “Would I rather be having this thought right now, or would I rather have my peace?” Because as long as I have my thoughts, I can’t have my peace.

Every Desire Is a Chosen Unhappiness
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The fundamental delusion: There is something out there that will make me happy and fulfilled forever.

It’s way more important to perfect your desires than to try to do something you don’t 100 percent desire.

Success Does Not Earn Happiness
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To me, the real winners are the ones who step out of the game entirely, who don’t even play the game, who rise above it.

If you could just sit for thirty minutes and be happy, you are successful.

Today, the way we think you get peace is by resolving all your external problems. But there are unlimited external problems. The only way to actually get peace on the inside is by giving up this idea of problems.

Envy Is the Enemy of Happiness
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One of the things I’m trying to get rid of is the word “should.” Whenever the word “should” creeps up in your mind, it’s guilt or social programming.

Perhaps one reason why yoga and meditation are hard to sustain is they have no extrinsic value. Purely single-player games.

Happiness Is Built by Habits
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When working, surround yourself with people more successful than you. When playing, surround yourself with people happier than you.

How does someone build the skill of happiness? You can build good habits. Not drinking alcohol will keep your mood more stable. Not eating sugar will keep your mood more stable. Not going on Facebook, Snapchat, or Twitter will keep your mood more stable. Playing video games will make you happier in the short run—and

You’re being fed dopamine and having dopamine withdrawn from you in these little uncontrollable ways. Caffeine is another one where you trade long term for the short term.

The first rule of handling conflict is: Don’t hang around people who constantly engage in conflict.

Just being very aware in every moment. If I catch myself judging somebody, I can stop myself and say, “What’s the positive interpretation of this?”

Every time you catch yourself desiring something, say, “Is it so important to me I’ll be unhappy unless this goes my way?” You’re going to find with the vast majority of things it’s just not true.

Recover time and happiness by minimizing your use of these three smartphone apps: phone, calendar, and alarm clock.

The more secrets you have, the less happy you’re going to be.

A personal metric: how much of the day is spent doing things out of obligation rather than out of interest?

Politics, academia, and social status are all zero-sum games. Positive-sum games create positive people.

Increase serotonin in the brain without drugs: Sunlight, exercise, positive thinking, and tryptophan.

Find Happiness in Acceptance
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Pick one big desire in your life at any given time to give yourself purpose and motivation.

Choosing to Be Yourself
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Certainly, listen and absorb, but don’t try to emulate.

Your goal in life is to find the people, business, project, or art that needs you the most.

What you don’t want to do is build checklists and decision frameworks built on what other people are doing. You’re never going to be them.

To make an original contribution, you have to be irrationally obsessed with something.

Choosing to Care for Yourself
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Eat vegetables with a small amount of meat and berries.

In nature, I find carbs and fat together in coconuts, in mangoes, maybe in bananas, but it’s basically tropical fruits. The combination of sugar and fat together is really deadly. You’ve got to watch out for that in your diet.

If bacteria won’t eat it, should you?

Ditch the extremists and any food invented in the last few hundred years. When it comes to medicine and nutrition, subtract before you add.

The harder the workout, the easier the day. Daily morning workout positively impacts your life.

“I don’t have time” is just another way of saying “It’s not a priority.”

One month of consistent yoga and I feel 10 years younger. To stay flexible is to stay young.

The important thing is to do something every day. It doesn’t matter what it is. The best workout for you is one you’re excited enough to do every day.

If you make the easy choices right now, your overall life will be a lot harder.

Meditation + Mental Strength
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And I did so by using the Wim Hof breathing method. It involves hyperventilating to get more oxygen into your blood, which raises your core temperature. Then, you can go into the shower.

Choiceless Awareness, or Nonjudgmental Awareness.
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You don’t make any decisions. You don’t judge anything. You just accept everything.

Life-hack: When in bed, meditate. Either you will have a deep meditation or fall asleep. Victory either way.

I recommend meditating one hour each morning because anything less is not enough time to really get deep into it. I would recommend if you really want to try meditation, try sixty days of one hour a day, first thing in the morning.

The ability to singularly focus is related to the ability to lose yourself and be present, happy, and (ironically) more effective.

Hiking is walking meditation. Journaling is writing meditation. Praying is gratitude meditation. Showering is accidental meditation.

Choosing to Build Yourself
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Every six months (depending on how fast you can do it), you’re going to break bad habits and pick up good habits.

Impatience with actions, patience with results.

Choosing to Grow Yourself
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Set up systems, not goals.

If there’s something you want to do later, do it now. There is no “later.”

Everything that people read these days is designed for social approval.

View yourself as a loser, then you’ll do your own thing and you’re much likely to find a winning path.

One principle to pass down to kids: Read everything you can. Mathematics and persuasion.

Choosing to Free Yourself
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Be aware there are no “adults.” Everyone makes it up as they go along.

My old definition was “freedom to.” Freedom to do anything I want.

Now, the freedom I’m looking for is internal freedom. It’s “freedom from.” Freedom from reaction.

Advice to my younger self: “Be exactly who you are.” Holding back means staying in bad relationships and bad jobs for years instead of minutes.

I don’t measure my effectiveness at all. I don’t believe in self-measurement. I feel like this is a form of self-discipline, self-punishment, and self-conflict. [1]

Courage is not caring what other people think.
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I don’t like to wait. I hate wasting time.

If you’re not spending your time doing what you want, and you’re not earning, and you’re not learning—what the heck are you doing?

Anger is its own punishment. An angry person trying to push your head below water is drowning at the same time.

I think it’s actually very bad for your happiness. To me, the mind should be a servant and a tool, not a master. My monkey mind should not control and drive me 24/7.

The modern struggle: Lone individuals summoning inhuman willpower, fasting, meditating, and exercising… Up against armies of scientists and statisticians weaponizing abundant food, screens, and medicine into junk food, clickbait news, infinite porn, endless games, and addictive drugs.

Live by Your Values
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Before you can lie to another, you must first lie to yourself.

I don’t believe in hierarchical relationships. I don’t want to be above anybody, and I don’t want to be below anybody.