Since starting Financial Samurai in 2009, I've encouraged folks to keep an open mind and embrace as many different perspectives as possible. So often, we get set in our ways and think our approach is the only right way to do things. But I can assure you, you're probably missing something—or could do something a little better—that could significantly improve your wealth or quality of life.
One different perspective I recently shared is how the richest people in the world are not index fund fanatics. I think this viewpoint is important because it helps wealth builders expand their minds to what’s possible. Yes, simplicity sells because it's easy. However, if you want to break free from the herd, you’ve got to take more calculated risks.
Another perspective I offered was highlighting the value of paying someone to manage your money. I try to minimize fees as much as possible. But after managing a relative's investment portfolios for a year, I absolutely see why fees are justified. Managing money for someone else can be incredibly stressful. I’ll never do it again for free.
In another post, I discussed how cultural differences may impede your chances of getting ahead in the workplace. If you're part of the majority, you don't have to spend as much energy assimilating or “sucking it up” to fit in and be liked. You just expect others to conform to you.
The Latest Shocking Perspective That Blew Me Away
While visiting my parents in Honolulu, I came upstairs and found my dad in his recliner watching Wimbledon. I glanced at the TV, which was showing Jannik Sinner vs. Grigor Dimitrov, and immediately asked, “What’s wrong?”
“What’s wrong with what?” he replied.
“Your TV,” I said. “It’s blurry.”
“I don’t know,” he shrugged. “Nothing’s wrong—except this horizontal line sometimes appears at the top.”
“What do you mean nothing’s wrong? It’s totally fuzzy!” I said.
“Oh really? I thought I just couldn’t see clearly anymore,” he answered.
He had gotten cataract surgery a couple years ago, which improved his vision. But he thought maybe it was declining again.
The Blurry 55″ TV My Parents Thought Was Normal
For a year and a half, my parents had been watching this blurry TV and blaming their eyesight instead of questioning the product. Zoom in closely: the name “Sinner” and the score are relatively clear in the top left, but his image is blurry. Even worse, the lower right-hand corner—where another match’s names and scores are displayed—is almost unreadable.
Watching tennis, with a tiny ball zipping across the screen, on this TV would’ve driven me nuts. I fiddled with the antenna just in case, but no improvement. I flipped through multiple channels over WiFI, same problem.
After just three minutes, it was obvious: the TV was failing, and they needed a new one. I couldn’t believe they had put up with this for so long, thinking they were the problem instead of the screen. I've seen this type of situation play out in marriages, but not with something as simple as a TV!
A New TV With A New Perspective
While I was already shopping for a new washer, dryer, and refrigerator for the in-law unit, I figured I might as well replace the old TV too. I hadn’t bought a TV in eight years and was blown away by how cheap prices had fallen. For just $650, I got them a 65″ Samsung, had the old one removed, the new one installed, and all their apps set up. It was $485 without the delivery and extra services that took more than an hour.
When the installers arrived, they confirmed the issue right away—the inverter was broken. That was a relief, honestly. A part of me had started questioning my own eyesight and worried that even with a new TV, things might still look blurry.
The clarity of the new TV was so much better. Given how many hours a day my parents watch TV, I’d argue this was the highest-impact quality-of-life improvement I gave them this trip. The second was fixing the drip in their kitchen ceiling that had been leaking for over three years!
But the real win wasn’t just a clearer picture, it was helping my parents realize that their vision wasn’t deteriorating at a rapid pace after all. I think as we age, we’re sometimes too quick to accept physical decline as inevitable. We stop questioning things and chalk up discomfort to “just getting old.”
This new TV helped restore not just visual clarity, but confidence.
Please Get a Different Perspective On Your Finances
I hope this story demonstrates how having a fresh set of eyes, literally, can dramatically improve your life. We often let inertia push us forward in the same direction, assuming what we’re doing must be fine. And if we have optimized our finances and lifestyle, great. But if we haven’t, the hidden costs can really compound to the point where we wonder where all our money went 10 years later.
It took me five years of underperformance in my son’s 529 plan before I finally shifted a greater asset allocation toward the S&P 500. With an 18-year time horizon, it made no sense for him to be in a target-date fund with a significant bond allocation. That’s not how I would invest my own money over that duration, as evidenced by my rollover IRA being 100% in equities since I left my job in 2012.
If only someone had reviewed the portfolio with me in 2017 and walked through the logic, his 529 would be over $100,000 larger today! The compounding effect of a suboptimal decision can become enormous over time. Ugh. Back then, I thought I was doing everything right—but I suppose it’s still better than not contributing at all.
When it comes to your finances, please seek out a different perspective. You are likely missing something that could cost you a fortune over time. Maybe it's being stuck in a high-fee active fund that’s long past its prime. Maybe it's choosing an expensive target-date fund over a cheaper index version. Or maybe it's simply forgetting about the idle cash sitting in an old rollover IRA you haven’t touched in years.
Don’t wait 1.5 years watching a blurry financial picture before realizing something’s wrong. A clearer perspective could make all the difference.
Get a Free Financial Check-Up From Empower
If you have over $100,000 in investable assets—whether in taxable accounts, savings, 401(k)s, or IRAs—you can get a free financial analysis from an Empower financial advisor by signing up here. There’s no obligation, just an opportunity to have a seasoned professional review your finances with a fresh set of eyes.
Empower’s advisors build and analyze portfolios for a living. They may uncover hidden fees, inefficient allocations, or overlooked opportunities to optimize your financial plan. Even if you think everything is in great shape, getting a second opinion might help you spot what you’re not seeing—just like my parents with their TV.
The referral is brought to you by Financial Samurai, who has a partnership with Empower Advisory Group, LLC. You can read more about how it works here.
When it comes to your money and your future, don’t go it alone. One conversation could be worth tens or even hundreds of thousands of dollars over time.
To expedite your journey to financial freedom, join over 60,000 others and subscribe to the free Financial Samurai newsletter. Financial Samurai is among the largest independently-owned personal finance websites, established in 2009. Everything is written based on firsthand experience and expertise.
On the subject a flat screens. We bought a 52″ Panasonic Plasma about 18 years ago from Costco for about $1200. It’s still going strong! lol. I had done a TON of research at the time and almost pulled the trigger on a Pioneer Plasma screen that promised “The blackest blacks” for the top brightest color contrast technology could buy. Alas, I could not justify the $5000 price tag and went for the “slightly inferior” Panasonic, which has been great for movies and games for the kids.
On the subject of index funds, I hold quite a on Vanguard ETFs (and others) but in in measured amounts. They’ve performed quite well.
For the equity side of my portfolio (which is about 33% of total net worth) I maintain two brokerage accounts. One that’s fully managed, and one that I manage myself as a hobby. I guess that’s a form of a hedge, or at least reducing the impact of a 0.79% brokerage fee on managed assets). I don’t pay any trade fees on the brokerage account that I manage myself. The past 5 years, I’ve outperformed the managed brokerage firm, but I intend to stay with them as eventually the there will be a downturn and I’d rather have a pro managing 50% of my investments. But, I saving probably $10k a year in fees by doing some of it myself (and I enjoy value, dividend investing).
Also in my case, I was self employed in the tech space and physical real estate for the past 20 year, so I had greater risk, greater reward in those areas and a certain amount index funds seemed prudent.
Just retired last month and my wife and I are exploring legacy wealth for our kids, which will likely include a few more physical rental properties over the next 5 years.
Sam- I followed your advice and invested a good amount into Fundrise, so overall I’m pretty well diversified across a number of investment class, not just pure play equities.
The “I’m just getting old” mindset can be fatal. My grandmother had a tumor growing inside her that got to grapefruit size. There’s an actual NEJM article about it. She must have been in great pain later in this process, yet said nothing and didn’t go to the doctor until years had passed. When asked why she didn’t get this checked out earlier, she said: “I thought I was just getting old.”
Oh wow what a story. Glad you fixed the issue! A blurry TV would have driven me insane. I know I’ve had similar moments with my mother I just can’t think of the details off the top of my head. Usually it has something to do with technology like something she had no idea about or was doing completely wrong. Perspective is great.
I am all about appreciating a change in perspective (see the scene in Dead Poet’s Society when they are told to stand on top of their desks), but suggesting people avoid index funds and hire money managers? Yikes. Poor John Bogle is rolling in his grave.
I don’t often disagree, Sam, but I do today.
Setting aside my mantra of “don’t let perfect be the enemy of good,” how about embracing the (different) perspective that successful/rich people are not smarter than you?
I’m rich. $30+ million invested in public markets. I’m not smarter than anyone else here (I may be more learned, however, because I spend a lot of time reading on the topic, but it’s something anyone else can do). I can certainly afford money mangers of various stripes, but no one will care as much as me and I enjoy managing my own money.
I only invest in “index funds” of one kind or another (VOO, DGRO, SCHD, VGT, VUG, etc) for equity purchases (bonds, if you want them, are different). I won’t restate the myriad of reasons diversified, low-cost index funds are ideal for most people (they are), but I’ll say that rich people:
The other thing that’s changed is AI. Financial advisors, such as they are, are among the most replaceable jobs due to AI (there’s a recent Microsoft study on this). ChatGPT can very astutely evaluate your portfolio and give excellent advice. It can even work with you to determine your risk/volatility tolerance and evaluate your perceived risk/volatility tolerance based on your past transactions. It’s incredible.
The only reason most people need a money manager is if they are not disciplined–i.e., if they need some human hand holding during tumultuous times. There’s nothing wrong with that but, if you have the time and interest in handling your own money as well as the intestinal fortitude to go through tough times and stay the course, you simply do not need a money manager any more than you need a travel agent.
The thing index funds will not do is “make you rich,” at least in the way we often think of it in the stock market. To get rich in the stock market you have to concentrate risk, to stay rich in the stock market you have to diversify. They are inherently at odds.
That said, people who successfully concentrate risk–think early investors in TSLA, NVDA, PLTR–are not only exceedingly rare, they often cannot pull it off repeatedly. So they get trapped like the “dog who caught the car,” with huge amounts of concentrated wealth that leaves them exposed sentiment changes. Moreover, if they sell to diversify they suffer large tax exposure.
Wanna talk about stress? Consider having $10 million is LTCGs in some diversified index fund versus TSLA, for example. Who do you think sleeps better at night?
How about considering that perspective?
Congrats for being rich and having $30 million. You have mentioned this multiple times, but haven’t shared how you got there. How old are you? Can you elaborate on your income, what you did, and how you got to $30 million? That would be helpful for perspective.
Index funds and ETFs should be a core part of one’s investing portfolio. I’m a fan and have held them for years. Please don’t confuse my suggestion to look elsewhere for potentially greater returns. I’m not even close to saying don’t invest in index funds.
My softball buddy is 36 years old and now worth between $35-$50 million after the Figma IPO. He joined when the company was worth about $550 million after making several million at Uber. Then the general partner of Kleiner who invested in Figma’s Series B is likely worth about $1 billion now at age 48.
So there are varying levels of wealth and various ages. The $30 million is nice, but it could have potentially been $100 million by now.
I still don’t know anybody who got rich mainly investing in index funds. Instead, the wealthiest people I know tend to take concentrated bets and build businesses. So maybe you are the exception! But I won’t know until you share some details on the sources of wealthy.
Im assuming you are actually disagreeing to this post instead of my suggestion that people get different perspectives. https://www.financialsamurai.com/the-richest-people-are-not-index-fund-fanatics/
Sam, I don’t want to give out too much info to dox myself, but you can see almost everything here: https://www.networthshare.com/user/EscapeVelocity
As you can see, I am a “get rich slow kind of guy,” although I had some very high earning years for a period of time when my business took off–and then I took off!
Also, I didn’t get initially rich investing in index funds (and, as said above, “index funds will not … ‘make you rich’), but I’ve gotten even richer from them and am currently sitting on 8-figure LTCGs. To get traditionally rich in the stock market alone you need concentration, like your Figma friend. We agree on that.
What I mainly disagree with is worrying that “you’re probably missing something—or could do something a little better—that could significantly improve your wealth or quality of life.” That’s toxic. Do not let “perfect be the enemy of good” and do not think that by mimicking rich people you will have the same result.
Altering perspectives is healthy, but attempting to mimic the “richest people in the world [who] are not index fund fanatics” is also not the pathway to “getting rich.”
[I am not accusing you of mimicking, but your readers likely want to do so.]
Getting rich, aside from inheriting it, typically means owning businesses and/or concentrating wealth. Staying rich typically means owning businesses and/or diversifying wealth.
What’s the common denominator of the self-made rich? Owning businesses.
What’s the common denominator of people who got rich from the stock market alone? They took “more calculated risks” (your phrase) which is another way of saying they concentrated wealth and, in many instances, got lucky. Indeed, often times their luck was a far greater factor than any other thing, yet many are in denial about it.
As for the data you shared, I have no basis to dispute it but I’d go back to my bulleted list above about rich people.
Personally, I think the bulk of your readers are best served by not “break[ing] free from the heard,” as there is “safety in numbers” (i.e., diversification). But yeah, if you want to get rich using the stock market alone, you have to play the lottery and concentrate wealth (either in individual stocks or private equity).
So we agree on that, we seem to disagree on whether that’s wise advice for most people.
Thanks for sharing. OK, so I still haven’t met anybody who got rich off index funds.
“ I had some very high earning years for a period of time when my business took off–and then I took off!”
Don’t estimate the power of you building a business and getting rich off of it. This is consistently one of my messages since 2009, and in my latest post on rich people not being index fund fanatics.
Index funds are often used by the rich to park money to get general exposure to economic growth. But it’s not the way most, if any of them got rich before 60.
But as always, you do you and people should feel free to do whatever they want. That’s the beauty of it all.
As I said: “To get traditionally rich in the stock market alone you need concentration, like your Figma friend. We agree on that.”
But how many of your readers are trying to “get rich” quickly? If they are, where is the advice on how to do that? I must have missed it.
I suspect most readers are here to understand how to responsibly grow their money and I think you generally provide good advice on that topic along with interesting personal anecdotes and ideas.
I simply take issue with suggesting that, because really rich people allegedly allocate more of their money to other investments, regular people should “break free from the herd” and reconsider index funds.
No problem. I can put together a post or write in my newsletter a compilation of the posts beyond investing in index funds if you wish? Hopefully the search bar on my site can help as well.
Following the herd and investing in index funds is great. I’m just interested in investing in other things as well.
Don’t forget, I helped kickstart the FIRE movement in 2009. A lot of people are actually looking to do something different from the mainstream to live different lives or try to build wealth sooner than their 50- and 60s. This is why I’ve written so much about entrepreneurship, venture capital, growth investing, venture, debt, and more.
Can I agree with both of you? Made my money with my business. Put most of it in index funds. Now I’m making more money with my index funds than my business. Depends what you define as rich. Too many variables to argue what’s right.
You sure can. But what do you disagree with regarding me encouraging people to look at other ways to get rich, besides just investing in index funds? Great to have another business owner pipe in.
The thing about getting rich before traditional retirement again 60 is that you’ve got to find some way to get a big nut relatively early. It can be through a business, a high salary, an IPO windfall, etc. Once you’ve got that relatively large nut, then you can just park the money in index funds to build wealth more methodically.
There is that crossover point. And getting to $10+ million just through index funds before 60 is very hard to do, unless one has a very high income.
I’m not disagreeing with you at all. I made my money owning a business, now I make more owning index funds. I’m not disagreeing with Zen either. What is rich? You threw out 10 million. Is 10 million rich? Or is it 20 million, or 30 or 100. It’s up to the individual to decide. My warehouse guys would say 1 or 2 million is rich. My salespeople would say 5 million is rich. Some contemporaries would say 10 or 20 but the truly rich would laugh at that number.
Your both right, and your both wrong. As you’ve said personal finance is very personal.
Cool. I’m happy to be wrong. It means there’s always something to learn.
But I will stand by my main argument of this post is having a different perspective is important if you want to optimize your finances and your life. And if one doesn’t, then that’s great to. That means they are happy with their lives and finances since everything is rational long term.
What is something you’re wrong about?
The biggest thing I’m wrong about is money will buy you happiness. It definitely makes some stuff easier. But when you have enough or too much it definitely complicates things.
True, I agree with that. After a certain amount enough to take care of all your basic needs, money doesn’t move the needle that much more.
I think I’d be really pissed if I was still in banking and didn’t leave in 2012.
Why do you think you are so against Sam suggesting building wealth through other means beyond index fund investing, when you yourself built most of your wealth through a business? What am I missing here? Are you saying regular people investing in index funds will also go to $30 million? I would beg to differ.
Personally, I loved getting a different perspective and portfolio analysis about the funds that I owned that have excessive fees and getting highlighted the alternative. It’s probably saved me over $50,000 in fees over the past 10 years.
Maybe it’s the classic case of do as I say, not as I do. Believing other people couldn’t possibility get rich like Zen Master and others through entrepreneurship or investing outside of index funds. I’ve noticed that certain amount of arrogance, some call it bigotry of low expectations.
I’ve got 80% of my investments in index funds, and actively look to try and hit home runs with the rest. I appreciate the different perspectives and investments ideas Sam has.
I can also think for myself, which some people don’t think is possible.
I appreciate your perspective Zen Master, I got relatively wealthy by starting 3 businesses in different industries over 30+ years. I sold the last business to PE and still hold some equity (hopefully I’ll get a double dip).
Other than that, my wife and stayed married for 30+ years and lived within our means. I ended up diversified across equities, PE, physical real estate, and business ventures. I too was a slow burn to wealth; I often stated that, “You can make mistakes, but just not fatal mistakes.” when it came to taking risk.
I don’t gamble in Vegas, but I gambled in entrepreneurship and it paid often fairly well.
I mostly invest in dividend equities, but an array of index funds are a decent hedge against something going south.
Next venture is building legacy wealth for our kids.
Hello Zen Master,
Have you considered how you became rich through investing in index funds? It is often said and has been shown that most active fund managers cannot beat the indexes. Many reasons are suggested: active fund fees erode compounding, active management has biases, too much fund repositioning…
Maybe the reason index funds have outperforned active funds and stockpicking in general is due to the relentless passive bid that comes from periodic 401(k) inflows, IRA dollar cost averaging, that simply buys stock at whatever price the market offers, not caring about the underlying business cash flows or non-infinite growth prospect.
This idea is not new and has been presented a few times in the past, yet the stock markets rise ever higher and SPY buyers look like geniuses and value investors look like fools.
I think it is good that someone is at least presenting the idea that index investing has issues.
Great job on this one, Sam! Purely from a writing/posting standpoint, leveraging the story about your parents’ TV to introduce the “perspective” idea was both elegant and engaging!
I continue to be impressed by your ability to draw upon daily life to populate the blog. Coming up with content ideas week after week is HARD. So just sending a note of appreciation/admiration. Well done!
I appreciate your recognition! There is always something interesting going on that’s worth writing about. So much of it ties into finances and life in general.
I feel that if we can speak forever, we can write forever. The difference is just writing things out versus keeping things inside. We all have a story to tell.
I would be interested in techniques you use to analyze financial issues that free you from preconceptions.
For instance, I have read in FS how you consider financial or geographic arbitrage in some investment situations.Are there other techniques you use when counseling others or considering their finances to counter your own biases?
Great question—appreciate you picking up on the arbitrage concept, which I do often revisit in different contexts. One technique I try to use to counter my own biases is first-principles thinking—breaking a financial issue down to its core components and rebuilding it from the ground up, rather than relying on convention or past experience. This forces me to question assumptions like “you must buy a primary residence” or “retirement means stopping work entirely.”
Another is what I call the regret minimization exercise. I imagine myself in 10 or 20 years looking back on the decision—will I regret not taking this risk? Or will I wish I’d been more conservative? This helps me balance the emotional side of money with the analytical.
When advising others or reviewing a situation, I also try to shift perspectives deliberately—viewing a decision as a parent, then as a 25-year-old investor, then maybe as someone approaching 70. Each lens brings out different blindspots or overlooked risks.
Finally, I find it useful to run “what if” scenarios that include black swan events or outlier outcomes. This helps combat recency bias and overconfidence in “normal” markets.
At the end of the day, we can measure our financial performance to that of an index or any other metric. If we are happy with our relative performance, then great. If we are not, then we must take steps to change.
Indeed. Being open to different perspectives and welcoming them will always help you grow as a person.
If you’re cruising through life, it’s both a blessing and a curse. On one hand, you’re more self-sufficient, your finances, relationships, and self-care are generally well-managed. But on the other hand, complacency creeps in. You become more set in your ways, i.e., more stubborn), and resistant to change. So fresh perspectives often take a backseat.
Anyway, that’s $650 well spent! You know what else is a high-impact quality-of-life improvement for people who enjoy watching TV? A good sound system. Whenever my family and I have movie nights, we dim the lights, and let the surround system take over. It really enhances the experience–much more than I thought.
Good call on a good sound system! The TV speakers really aren’t that great. I’ll look into it next visit.
I’ve got a 5:1 sound system at home and it’s great. Maybe I just buy a nice center speaker and two sides.