SOLO 153 | Optionality


As the year ends, remarkable singles around the world are considering how to make their lives even more remarkable. To help with that endeavor, Peter McGraw speaks to Richard Meadows, a finance writer and the author of Optionality: How to Survive and Thrive in a Volatile World. They have a far-ranging conversation about Optionality (“the right but not obligation to take action”) – something that singles have more of than non-singles.

Listen to Episode #152 here



As 2022 ends, remarkable singles around the world are considering how to make their lives even more remarkable. To help with that endeavor, I speak to Richard Meadows, a finance writer and the author of Optionality: How to Survive and Thrive in a Volatile World. We have a far-ranging conversation about that very topic. Optionality, which he defines as the right but not obligation to take action. This is something that I contend that singles have more than non-singles. I hope you enjoy the episode. Let’s get started.

SOLO 153 | Optionality
Optionality: How to Survive and Thrive in a Volatile World

Welcome, Richard.

Peter, good to be here.

You are here from New Zealand. Is it South Island or the North?

The lovely North Island.

It’s a wonderful place. Speaking of wonderful, you wrote a wonderful book. It’s the kind of book that I wish I could have written, which is the high praise I can give. You did something which I appreciate. You are a great curator. There are all these ideas out there in the world. Smart people are talking about them, whether it would be within scholarly circles, the life-hacking folks or the tech pros. Smart people are mulling over these ideas, and you put them together very nicely. The book focuses on this notion of optionality. I like to say that singles have greater optionality. We should probably start with defining what optionality is, and then you tell me how I’m correct.

Let’s start with the definition. I use optionality basically as a shorthand for having a higher quality set of choices in life and having better choices in your work, in your career, your relationships pertinent to our discussion, and your health and mobility. That’s as distinct from low-quality choices, which would be things like how many breakfast cereals you can choose from or how many TV channels you have.

These are having meaningful life choices. Optionality is an intrinsic good. It doesn’t matter if you exercise any of those choices but it’s still good to have them at your fingertips. That’s something that’s a little counterintuitive. It does show up quite clearly when you look into the literature on human well-being and happiness, which is that naive, pleasure-seeking behavior. Don’t necessarily work that well but what is important is to have high-quality options that you can use to design a life in a manner of your own intention and to have some agency over how you live your life.

If I’m hearing you correctly, you are essentially saying that simply having those options, even if you decide not to exercise them, is enough to enhance your well-being.

That’s exactly right. A very simple example would be if you have no food at home, then probably you are starving, and you are in a very unpleasant situation if you have no food at home because you are deliberately fasting. It’s an intentional form of suffering you’ve imposed upon yourself because it gives you meaning in some way or leads you toward a goal that’s important to you. That’s a categorically different thing. You could eat but you choose not to. You have options but you are not exercising them. That is good. Even though, at the surface level, it’s the same as if you have no food and can’t eat.

You are helping me feel better about the moments I choose abstinence in my life. You use this example and say, “Optionality is the right but not an obligation to take action.” Your fasting example is a nice one. You could eat but you choose not to. You illustrate this notion of optionality with financial invention insurance. The average reader, I hope, has some form of insurance. How does insurance demonstrate optionality?

You could probably think about insurance as a reverse optionality. What you are doing is paying a small price in the form of an insurance premium to protect against potentially unlimited loss. You lose your house, lose your job, lose your health, whatever it might be. That’s a very attractive profile. It might help to talk about what a good option looks like in my framework.


Any decision that you can make where has a small cost or downside, whether that would be money, time or energy. That’s a fixed cost but it opens up a large potential benefit or even a possibly unlimited benefit. You can think of it like a lottery ticket where, let’s say, you pay $5 for a lottery ticket. The most that you can possibly lose is $5. The most that you can possibly win is $5 million or whatever it might be.

Insurance is the same principle but in reverse. You pay a small amount of money to avoid losing a large amount of money rather than to win a large amount of money. A big thing in my book is not just looking for those options that have that positive asymmetry but also taking care to take steps to remove any sources of negative asymmetry where you could have a very large loss.

Use this example of leaving your laptop unattended for a few moments. There’s a small benefit of that, which is that you don’t have to pack it up but the loss of data can be devastating to someone. As someone who writes in coffee shops all the time, I find myself deciding whether to leave it or not in that sense. I think about how devastating it would be.

This notion of asymmetry is a powerful one. It’s one that’s not intuitive. I don’t think the average person picks up on it on their own. They need to be taught it in a sense. Let’s talk about a few examples of positive asymmetries where that “loss” of time, money or energy is small but fixed but the upside might be unlimited or life-changing. What’s an example that you would give? You call these treasure chests, yes?

Yes. You can call it what you want to call it. The risk profile is what matters, so a small-fixed cost and a large or preferably unlimited upside. For simplicity, I broke down the components of optionality into four domains, which are financial capital, health capital, social capital, and knowledge capital. I can give a quick example from each of those domains.

For example, in the realm of finance, I argue length in the book that one of the best strategies we can use to improve optionality is frugality. The reasoning behind that is that the downside cost of being a frugal person is much smaller than people might expect. It’s because of the way in which we adapt to our levels of spending and new hedonic pleasures, whereas the upside of maintaining a relatively frugal lifestyle is huge.

Both in the sense that it allows you to pay down debt and in the sense that it positions you with a buffer of cash, which is basically pure optionality. You could use it to start a business. You could invest and reap the rewards of compound interest. You could say no to something you don’t want to do. Walk away from a bad job or a bad relationship. That’s very powerful. It’s important to reduce debt and live below your means in such a way that you can build up a stack of emergency cash.

Can I add something to that?

Yeah, of course.

That’s a powerful idea. It’s one that comes up time and time again in this show. In part because most of the audience is single. They may not remain single forever. They may partner up. What I try to remind them is that because they don’t have that hedge of another partner, of a second income while they have sometimes more choices that they can make. They are not limited by someone else’s values, lifestyle, desires, geographic constraints, etc. They need to be much better, especially financially, in case of emergency. In case you get hurt, get sick or lose your job. Insurance is important for that. Things like disability insurance and so on.

To have that emergency fund to be debt free is quite important if you do want to be able to exercise those options. One good way to do this is to find ways to save money, not live beyond your means, not look to consumption, and solve your problems in a sense. I appreciate you echoing that and starting with that one.

That’s a good point. Perhaps we can come back to the pros and cons of finances being in a relationship versus not being in one later. The next one would be in the realm of health capital. This is one where there aren’t many positive asymmetries to look for because you can only be so healthy. You can’t be supernaturally healthy, unfortunately. Irrespective of what certain influences would have you believe.

The best that you can do there is avoid harm, basically. Pay a small price to avoid the chances of ruin to your body and well-being. Some of the examples of that are obvious. A classic one would be smoking. You could think of every cigarette you smoke as a reverse lottery ticket. It gives you a small fixed amount of pleasure. It’s never going to be the most amazing pleasure on Earth.

In exchange, you are rolling the dice that a cell mutates in such a way that you end up with lung cancer. Those trade-offs are no-brainers to avoid. Basically, cutting out any risk of ruin. There are various other things that you can do that I talk about in the book that has an attractive risk profile or mitigate against the risk that is perhaps less known than the smoking example.

The ones that come to mind are obvious ones like wearing your seatbelt, for example. I’m not anti-alcohol but I’m certainly not pro-alcohol. I try to convince people to limit their intake of alcohol for this reason. What are some of the non-obvious ones that might move someone to action?

I might go out on a limb and talk about a couple that I haven’t mentioned in the book because they are a little bit more speculative. Therefore, there’s more information there. Sauna bathing is interesting to me. I got a sauna installed at my house and have been using it religiously. There’s some very promising but early research that suggests that exposing yourself to heat stress, both extreme heat or extreme cold, can be very useful for helping to clean up damaged cells and promote cell turnover.

That’s an example where you could look at it as a minor cost because it’s uncomfortable. Personally, I enjoy it. It’s all gravy. On the other end of it, it could have some fairly substantial longevity and lifespan benefits but it’s more speculative. Things like that are interesting to look into. I put fasting in that category, too.

It’s interesting that you bring this up. I have been exploring this stuff myself. I’m doing a personal longevity project. I have been trying lots of things as a result of it. Some of them, I’ve started doing. For some of them, I have been doing an infrared sauna for 30 minutes and then a cold plunge for 10 minutes. The infrared sauna is quite nice. The cold plunge, not so much.

The problem is that I have been doing all of these things at once. I can say this at the moment. Some of them are pleasurable and fine, and some of them are unpleasurable. In general, I’m feeling better. I don’t know how much of its placebo. I don’t know what is contributing because I’m not doing a clear experiment with it. My rationale is along the lines of yours, which is that there’s enough promise in the research and the clinical experience, and some smart people are doing this.

It may take some time now, but it has the possibility to add ten times that amount of time to my life. The problem is that it’s not a for-sure additive thing. If it staves off cancer, it could add 5, 10, 15 or 20 years to your life, or it might add 6 months. You don’t know. To me, the downside risk, which is wasted time sitting in a sauna, listening to a podcast or pleasant music, seems worth the bet.

I agree with that. I would also understand if someone else made that trade-off differently because it is speculative. If it turns out to be as good as cardio but you are sitting on your butt doing nothing, then that would be amazing. You would be a fool not to take advantage of it. As you pointed out, if you are sitting around sweating and you are not even sure whether or not it’s going to add six months to your life or something, I don’t know. It’s probably more tinkering on the margins.

The classic health interventions are far more powerful exercise and resistance training, things like that. Some of these things are fairly obvious like, “You should save money and exercise.” No one has thought of that before. People don’t do these things. Common sense isn’t all that common. If you set out ways in which it makes sense to do certain things within a certain framework, it can provide an extra motivating factor. If you see the logic, the rationale behind it, and the structure in terms of what you are trading off and what you expect to benefit can become a bit more clear that the costs are often quite small, and the potential benefits are often quite enormous.

I agree with you. Understanding the model is the most important thing because then it’s up to you to seek out and make those choices in part. We are going to digress for a moment. Not every decision that people make has that asymmetry. It’s probably worthwhile to contrast a different set of choices. You talk about dead ends. Uber driving has no asymmetry there.

That’s not being mean to Uber drivers but to any profession where you get paid an hourly rate.

Especially a low hourly rate.

Uber, in particular, I’m not sure if the mass of it works out well for the drivers. It would apply to any situation where you have linear returns for your time invested. You can only earn so much money. You produce 1 widget, you get $1. You produce 2 widgets, and you get $2, and so on. There are a lot of scenarios where we do make trades like that.

Everyone has to earn a living. Quite often that is the model by which we earn our livings but it doesn’t fit the pattern for the options that we are looking for. It’s not exposing you to the unlimited potential upside. That’s the default pattern in many areas of life. It’s not a coincidence that you have to make a ton of decisions every day, and most of them are inconsequential.

How consumer capital has worked is to bamboozle you with a lot of low-level decisions where the outcome doesn’t vary all that much. It doesn’t matter if you have rice crispies or Weet-Bix for breakfast. It does matter so far as to the extent that you spend a lot of time agonizing over those decisions. It’s taking you further away from the more meaningful decisions and taking action on the options which do have the asymmetric risk-reward profile. That’s why I call it data. Not because they are inherently bad. There are lots of things in that category that I do all the time and enjoy but there is an opportunity cost if those are the only decisions that you are making.

Watching television might be one of those. Thanks for indulging me in that digression. It’s useful for people to understand the difference between these asymmetric bets and non-asymmetric bets. Let’s get back to this third form of capital, knowledge capital.

Knowledge capital, I define as being all of the skills, knowledge, and experience that you have at your disposal. In terms of cheap options or attractive options in that domain, my favorite example was something obvious but not obvious, which is reading books. If you think about a book, the cost is small in terms of the literal financial cost. Maybe it’s $0 if you can borrow it from the library which I highly recommend.

In terms of the time and energy cost, if you read a book correctly and it’s low, that means you have to bail out of it at the earliest opportunity if it’s not working for you. On the other side of the equation, reading books has a transformative open-ended upside. It’s something that has completely changed my life. Having a systematic practice of reading as widely as possible.

It seems like a total no-brainer. It’s analogous to the lottery ticket. Each book you read is a lottery ticket. A lot of them will be fine. You might learn a little something, you might be entertained, and probably nothing else happens. Some of them you won’t like. They will be super boring where you have to slog through them. You should quit those as soon as possible.

Every once in a while, you will come across a book that gives you a new idea that synthesizes for something else in your life or a new practice to try or a new philosophy. Those ideas can take over your mind and completely change the course of your life. That would be one good central example of knowledge capital. Just read books.

I’m so glad you said this. I’ve taped an episode on how to read a lot. I’ve made nearly the exact same argument for why books are worth reading. The right book can change your life. The right book could be worth $100,000, it could be worth millions of dollars to your well-being, business, and relationships. In that way, it’s worth 100 other books that you had to read to get to that 1.

I’m going to tease. We are going to finish talking about the downside of goals. That’s how I got to know your work. I read an article that you wrote that changed my life. We are going to share that at the end. We are going to get people to stick around. You are sitting, talking to someone who has experienced this asymmetric bet, and you were the person who made it happen for me. Thank you. This doesn’t have to be just about reading. This could be other skills that people have. The ability to fix things with your hands to make food. What are some of the other examples?

I have a whole section in the book where I look at skill acquisition. I try to figure out what skills it makes sense to focus on acquiring. The basis for doing that is an option pricing model. How much does it cost you to obtain this skill in terms of time, money or certification? What is its expected payoff over the course of your life and career?

There are some other factors that you could throw into the mix as well like what your natural talents and inclinations are, what industry you are in, and so on. It’s better to have a broad model than to have specifics. Very often, the math does work out for learning how to do something yourself because it ties in with frugality. Perhaps it takes you an hour or two to figure out how to do something. If it’s something that you will end up having to do a lot of times throughout your life or outsource to someone else at a vast expense, then the math works out to do it yourself. There’s a category of skills that you might call the dead-end equivalent skills where you learn how to cut your own hair or something like that.

It’s a finite amount of money that you are going to make from it. Unless you start giving black market haircuts or something but it’s not going to have transformative upside. It’s still often worth doing. There are other different classes of skills that can have open-ended upsides like things that act as force multipliers on whatever else you are doing in your life or your career.

The big contenders would be things like writing, programming, basic statistics, and math. The idea of you doesn’t have to be the best in the world at whatever it is that you do. You can take a broad set of skills and fuse them together into your own unique offering. If you are a pretty good plumber but you have good SEO and web design skills, then your website will get more clicks.

You will have a very successful plumbing contracting business, even though perhaps technically like the guy down the street is slightly better than you or whatever. You can improve your impact by doing things that multiply the base effect. Running the option pricing model over that is quite a useful exercise if you are at a little bit of a crossroads and want to develop new skills but you are not quite sure what it makes sense to do.

I had a Solo Cooking episode. To be honest, I haven’t done that much Solo Cooking since doing the episode, a slight uptick. You might have convinced me of the value of truly learning how to cook versus prepare food. The amount of money that gets spent at restaurants, Uber Eats, and so on can add up. The last one is social capital. I would like you to talk about that, and then let’s segue into some of your thoughts about optionality for singles versus non-singles.

Social capital is the breadth and depth of all of your relationships. It’s an important component of optionality insofar as it protects you from the asymmetric downside. When life gets hard, it’s super important to have a strong network of people around you, and it opens up the upside. It’s valuable to have certain names in your contact book and be connected to people who can improve your life for the better. Hopefully, it goes both ways.

What would be an example of that? One that is quite personally relevant to me and our conversation is simply going out to do events, meetups, parties, and things like that. I always have things on my calendar. I don’t want to go. I want to sit at home. When it rolls around, I want to stay at home and watch Netflix but I make myself go out because I’ve learned from past experience that I almost always have fun. Ninety-five percent of the time, I have fun.

I like meeting people. Every once in a while, I meet someone who becomes a new friend, a business partner or a collaborator. Again, the course of my life changed and some of my closest friends have come from putting myself out into the world, even though I don’t feel like it. Those people would not have fallen into my lap magically.

If you think about this through the optionality framework, you go to an event or a meetup. It’s a relatively small cost to pay. You can leave if you don’t like it. You go for an hour or whatever. Sometimes maybe, it will be a dud. You can apply this to dating as well. Sometimes it will be pretty fun, and then every once in a while, you will make some connection that changes your life.

It’s important to keep doing that and exposing yourself to those situations. The parallels to dating are pretty obvious, which is a numbers game. Unlike in the movies, things don’t tend to happen without putting in some effort or having some systematic practice. Rather than having a goal to find a partner or whatever it might be, you simply have a habit. Be in the habit of meeting new people and going to events, and then, whatever happens, happens.

That’s a good one because most of the time, they are pleasant enough. The people are nice. It’s interesting but it’s not life-changing. You leave and go, “I could have just stayed home and watched Netflix, and I would’ve had as nice a time.” Every so often, you meet that character or person and can remain connected to them for years. I’ve had that happen. I appreciate you saying that.

I have a friend, John Levy, who does a bunch of work on influence, and he hosts these influencer dinners. He curates a group of impressive people for a meal. You make the meal and are only allowed to use first names. You are not allowed to talk about what you do. You get to know this group of 10 to 12 people. You dine with them.

At the end of the meal, everybody goes around and guesses what each person at the table does for a living, and then people reveal who they are. There was a writer from The Simpsons, one of the ones that I went to, and stuff like that. These are interesting people. John said to me one day, we were having lunch, “Peter, you are knowledge-rich but you are relationship poor. You don’t have a big enough Rolodex,” is essentially what he was kindly saying to me.

He suggested that I start doing something like his dinner. I experimented with something I called the Dilemma dinner, where I would bring a small group of 5 or 6 people together and workshop each other’s ideas. They would get feedback from smart and creative people about it. It was such a winning thing to do. I’ve let it go because I’m obsessed with this Solo project and don’t have time for it. Immediately my Rolodex exploded because not only were these impressive people but they had an impressive time. When I reach out to them, they respond now in a sense.

The last thing I will say is, and I’m curious what your thoughts are about this. I have an episode about the all-or-nothing marriage. This is a very common marriage, especially in North America, in which your partner is supposed to be your everything. They are supposed to be your workout buddy. They are supposed to support your career. You are supposed to socialize with them. You are supposed to vacation with them. They are supposed to be there helping you, challenging you, and helping you grow in a sense.

Single people don’t have that model. That is an onerous model, and the data are pretty clear that having that model, in some ways, makes you less satisfied with your relationship. It’s difficult for your partner to be all of those things. What I like about being single and having friends, and this is a call to action for people who don’t have that many friends, is that I have a friend I can go work out with. I have several.

I have several friends I can call for financial advice. I have several friends to call when I’m under duress. I have several friends to call for career advice, etc. There’s not that one person who, if they are having a bad day, sick, has decided to divorce me or doesn’t have the skills, then I’m left in the lurch. I have the optionality that I can call 1, 2, or 3 people to ask them this financial question, or 1, 2, 3, 4 or 5 people to ask them this career question, and so on. That seems to me to be rich social capital.

That’s one of the points that I briefly touched on in the book but didn’t go into in full. This common trap that you outline happens to men in particular, whereby you get tied up in your relationship, and you start expecting all your needs to be met by one person. Your other relationship’s atrophy. You put less energy into cultivating new ones.

Especially as you get older, if your friends move away or they start dying, you end up with a much less diversified friendship basket. That’s an unhealthy dynamic and an important trap to avoid. I totally agree with what you are saying. One big advantage of singleton would be that it forces you to maintain a diverse set of relationships and not to overinvest in any one person.

It’s also important for the mundane reason that relationships fail. You don’t want to be that guy or that girl who ignores all their friends because they are smitten with someone. As soon as you get dumped or break up, you try and come running back to your friend group, who you’ve left on red for months or years. That is important.

I want to quickly respond to that. There’s a lot of talk about this loneliness epidemic and how devastating loneliness is. It’s mischaracterized often. The average single person is not lonely. We tend to think of them that way but they are not. There is a group that is lonely and they tend to be older adults who have lost their friend group, contacts or a spouse especially. They have already been isolated because they were relying on that one person.

My heart goes out to those people because they made a series of decisions that now is almost irreversible. When you are 80 years old and highly isolated, it’s difficult to bounce back from that versus the person who sets up a Golden Girls scenario for themselves and can. I hate to say this but withstand some losses in their life, which is going to happen naturally if you live long enough. I wanted to do a little editorializing on that.

It’s an important message to get out there. There is a gendered aspect to it where a woman in a relationship or sexual relationship bears most of the brunt of maintaining social connections as well as putting the work in. Men don’t necessarily have those skills. Hopefully, that’s changing. It’s certainly something to keep in mind.

I might as well make my position clear, which is for me and perhaps for other people. I want to have it all. I want to have a spouse or a partner, and I want to have lots of friends and some close friends who I can confide in, and so on. I do think that’s possible. I want to talk about two things. One of which is keeping your options open from the perspective of being on the dating market and not wanting to settle down, which is a bad idea, in general. I want to talk about an alternate version of the way in which it does make sense to keep your options open even when you are in a relationship.

The first thing is that I do a bit of a sleight of hand in the book, where I talk about optionality and why it’s a better metric to shoot for as opposed to simplistic measures of happiness. Toward the end, I switch it out and say, “What is important is building up optionality so that you can sacrifice it for some worthy alter.” You want to cultivate options so that you are in a position to be able to use them to do something meaningful or something cool. If you apply that in the world of dating, you want to keep your options open initially because you are still in an exploratory phase. There are two reasons for that. One is that, hopefully, you are making yourself a better prospective partner, so you are learning.

You are saving your money. You are getting out of debt.

You are sauna bathing.

You are lifting heavy weights, so you look good naked. I get it.

You got to work on yourself, and maybe that gets you a better potential partner than whoever you went to high school with or the first girl that caught your eye. The second more important reason is that you are also learning about your own preferences. I will speak for myself. When I was seventeen, I was some kind of lava. I don’t think I was a fully formed human being.

I don’t want to be locked into the preferences of seventeen-year-old me. You have to explore. You have to date different people. You have to figure out what you are about. I know some people get lucky early on, and that’s fantastic. As a general principle, it makes sense to keep your options open throughout your teens, early 20s, and maybe 30s.

The data is clear about this. People who marry later essentially fare better.

Interesting. After a certain point, you don’t have to but it is a good thing to switch from exploration to committing to some person if you possibly can. The reason for that is that there are distinct types of romantic love. You might have talked about them on the show before. There’s the early infatuation phase, and then there’s the mature companionship phase.

If you look at the curves of how they develop over time, they mirror each other. You start off euphoric and have a ton of honeymoon period happiness but don’t have any deeper meaningful happiness. The euphoria tapers off fairly quickly, and then in the background, the long-term life satisfaction love keeps steadily increasing.

If you hop from person to person, you will get a lot of euphoria but you will never get the enduring, long, lifetime version of love. There would be a good case to be made on that basis alone. At some point, you want to stop constantly looking around, settle down, pick someone, and make the relationship work, especially if there are other considerations around having a family or anything like that, which are good pro-social things to do for the world.

There’s another sense in which it’s important to keep your options open but not in the sense of hopping around or always checking out the next attractive person who you meet. More in the sense of what we talked about earlier about not putting all your eggs in one basket and not investing too much in your partner or expecting too much from them. Keeping your social capital bucket filled even when you are in a relationship. I would personally also want to keep my financial bucket ticking along if I was in an early relationship or maybe any relationship.

They say, “A man is not a financial plan.” That’s good advice that you should make sure that your own skills and personal finance is sorted out because, sadly, some relationships end. You don’t want to be left in the lurch. It’s important to have skills, opportunities, and high-quality options should the worst happen. Hopefully, the worst won’t happen but sometimes it does.

I’m glad you brought this up. In the first part, I understand the idea of if you are searching for a perfect, you are not likely to find it. It’s such a heavy lift to find the perfect person. The perfect person, according to this new-fangled marriage that has emerged since the mid-‘60s, is what Eli Finkel calls the self-expressive marriage, this all-or-nothing marriage.

It’s such a tall order. It’s unreasonable to expect someone to be good in bed, be able to help you, advise you on your new business, want to do exactly the same vacations, want to eat the same kind of food, have the same hours as you, and so forth. If you want to have a relationship, there is some rationality where you say, “I have enough experience. I’ve developed enough. I can bring a lot to this relationship,” and this person can, too. They are of high integrity. They make me feel good. I’m attracted to them.” All these things.

Not everybody in my community is looking for that but there are. What is interesting is of the people who are about 50% of the single population, are looking for what you described. The other 50% are not, at least not at the moment. The single people who are solos, as I call them, who believe that they are already complete individuals and have a sense of self-reliance and autonomy want exactly what you described.

They want a partner but don’t need that person to be everything. They don’t want to risk the ruin of that person one-day gambling away all the money, divorcing them or whatever that might be and then leaving them in the lurch with no friends, no money, and also emotionally devastated. I’m wondering how much you’ve thought about this. Solos are unconventional. They can recognize this all-or-nothing marriage and that it doesn’t work for them but their partner has to go along with it in some way.

The question is, is this a selection problem? Do you need to find someone else who has that same kind of independence, doesn’t need to spend every Saturday night with you, and doesn’t get jealous when you go on vacation with your friends? Do you have to be able to negotiate this, teach this, and require it gently but firmly?

That’s a great point. That’s not something I’ve thought a lot about. Perhaps I have been unusually lucky in my partners in it not necessarily being a huge issue. I can totally see that it could be. It’s going to be a case-by-case thing. It’s going to be very contextual. If you meet someone who you are a huge fan of in every other way, except that they are somewhat clingy, controlling or whatever. Maybe you bite that bullet and do it anyway and then regret it later. I don’t know. These are matters of the heart. How much does cool logic and reasoning become into it?

I have this happen at times when I meet someone. I get excited about them, and I’m feeling it would be nice to have a little more romance in my life and have something a little more steady. It’s easy, especially when you start catching feelings, to acquiesce because you want that person to like you and you like them. It’s easy to acquiesce. It’s easy to spend lots and lots of time with them.

The problem is that at a later date, you want to spend less time with them, and you’ve established, for example, this norm. It’s hard to walk it back. It does take a little bit of self-control and, frankly, a lot of communication. I have a saying, “Ask for what you want.” If you are a high-value person, they care about you and are interested in you, let’s be honest, the full-on conventional people who have this one model are probably never going to be a good fit for the solo who reads this show.

They are going to end up butting up against too many things there. It sounds like your partners are open-minded, a little bit flexible, and haven’t been completely inculcated into this type of thing. When you say to them, “I want to take off for a month and go do this thing.” They say, “I’m going to miss you but I will be excited to see you when you get back.”

You are right. It is a matter of communication and give and take. With good communication, you can make anything happen. It doesn’t necessarily mean that everyone gets the exact outcome they want, as anything can be on the table. That is true of my own experience. It’s interesting. I hadn’t heard about the Solo community or identity prior to you inviting me on this show.

That’s because I made it up.

It’s a good coinage. I would identify not as a solo but rather be alone than compromise too far on my values. That’s for sure. I relate.

Richard, you are a Solo. Solo is independent of relationship status. If you hold these values, you can move in and out of relationships. You can move out in and out of them without feeling like moving out of them is a failure, for example. Believing that you are a completely whole individual is optionality because now you don’t need someone to complete you. You may choose someone, coexist together and may have an intimate relationship but they do not form one being. It’s a partnership rather than a melding of sorts. That’s why this is a powerful idea because if one of my readers gets married, we are not going to ban them from the community.

You let me come on.

I’m curious if my guests are single because it may change the tone of what we talk about. I want to finish with a couple of things here. You say that volatility is your friend. That’s a counterintuitive notion. People are constantly trying to lessen volatility, and they resent entropy. It creates anxiety. They are trying to control the world. I find myself guilty of that. The idea that you would embrace and welcome chaos seems counterintuitive. Let’s make it intuitive for people.

I will have a crack. The first refinement is that volatility is your friend to the extent that you have optionality. It’s certainly not true if you don’t have any high-quality choices available to you. We’ve seen a lot of that in the last couple of years. It also depends on the domain in question. I will probably limit it to the financial and knowledge capital type domains.

The thesis is that if you have a broad set of skills and money in the bank, if you are nimble, flexible, and streamlined, you can hop on whatever opportunity presents itself. Volatility is moral. It’s not good or bad. Great momentous events happen, and terrible momentous events happen. Often, they are interrelated, so volatility begets more volatility. When it happens, only people who have optionality are positioned to take advantage of it if it’s a good outcome or avoids the carnage if it’s a bad outcome.

Let me think of an example. The model for this would be startup investing, which is quite intuitive. When you have a large technological disruption or some big innovation like engineering, crypto or things of that nature, and gene editing will be big, it creates this whole new growth set of possibilities. A fast, nimble company that can be exposed to those changes can profit enormously from it.

If you are a startup investor and own a stake in a whole bunch of different startups, you don’t want the world to continue exactly the way it is. You want there to be all kinds of chaos and crazy stuff happening. It’s going to destroy a bunch of your portfolio companies if they can’t innovate fast enough. It’s also going to create opportunities that your other portfolio companies might be able to take advantage of because of the nature of those bets, which have that same asymmetric profile. If you invest a small fixed amount and your potential returns are internet, then volatility is your friend. You own the option. Whenever you own an option, volatility makes it more valuable in a strictly financial sense. Does that clarify it?

It does. I’m curious, for the average reader, is there something that they could be thinking about that might get them embracing this notion of volatility?

Perhaps it’s a bit prosaic, but the importance of collecting broad life skills or the cooking we were talking about earlier, home maintenance, yard work, or hair cutting. In the event that there is volatility, you have fallback options. Here’s the reductio ad absurdum. If there is a zombie apocalypse, who are the most useful people? It’s people who have broad skills. They know a lot about agriculture, hunting, gathering food, defense, building things, and engineering. Basically, they are tinkerer kind of people.

The same is true in non-absurd scenarios where zombies don’t take over the Warth. Where we have a global pandemic, massive supply chain disruptions, huge layoffs unexpectedly, and technological innovation which wipes out entire industries, that’s more of a defensive example but there are some skills that are never not useful to have. It doesn’t exactly benefit you.

On a more personal level, on the positive side of things, maybe reuse a startup example. Let’s say you are a computer programmer. That is a valuable skill to pursue. It’s a valuable option to take out. In the event that another industry gets disrupted and goes from being primarily hardware to software or whatever you want to call it, if that benefits you, you are even more valuable than you were before.

By the way, if there’s a zombie apocalypse, I want to live on the South Island.

You and all the rest of these US billionaires. There are all these bunkers built down there. Maybe you can hitch a ride on Peter Thiel’s private jet or something.

Let’s finish with the tease that I made, which is that you wrote an article that changed my life. It’s actually how I ended up reading your book, reaching out to you, and asking you to appear on this show. It was an article on Medium. I can’t exactly remember the name of it but it’s something like goals are overrated or the downside of goals.

I want to set the stage for this and have you talk about it. I have built my career and much of my achievement around goals like classic goal setting, and I have been incredibly successful in doing that. Just grind it out. This could be athletically, and it certainly was academically, and so on. I read that article at exactly the perfect time for me to make some changes in my life.

You make a strong case and one that’s not obvious in a world that is goal-oriented. There are lots of books that tell you how to do it. “These are the processes. These are best practices.” In a world that’s achievement-oriented in particular, which was the world that I was living in, it can be quite helpful. What I hadn’t realized was that I was outgrowing that, and there were other ways to go about working and living where I could forego goals, and it was going to enhance my well-being. What’s the case against goals?

There are so many problems with goals. I’m not a fan. I am in small doses. First of all, psychologically, the problem with goals. I am a type-A personality, maybe similar to yourself, where I have to achieve things by some external metric.

I’m type-AAA.

You set your goal, you achieve it, and then theoretically, that’s when you pat yourself on the back, and you are happy and proud. No. Maybe you are for a short period, and then immediately, the unease ratchets back up. You are thinking, “What now?” You don’t feel any different about yourself or at least I don’t. I’ve noticed that in my life, I’ve had a reasonable amount of modest success. No matter what happens, it ratchets higher.

I achieve a goal, and it doesn’t mean anything to me. The best way I’ve heard this framed is by the Dilbert guy, Scott Adams, who said, “Goals are for losers.” In the sense that you set a goal, every point up until which you’ve achieved it, you are a loser because you haven’t achieved your goal. You achieve your goal, and then as soon as you set a new goal, you are right back to be a loser again. You are in a perpetual state of dissatisfaction.

Psychologically, it doesn’t work well for many people and me, perhaps. The other huge factor is that depending on the type of goal you set. There may be circumstances outside of your control that dictate whether or not you achieve your goal. Therefore, you are essentially tying your sense of pride, satisfaction or happiness to randomness, which is also stupid.

Let’s give a concrete example to bring people with us. If I’m playing a tennis game and my goal is to win the game, I might play well and still lose the game. I might play perfectly, do nothing wrong, and still lose the game. I failed my goal. That doesn’t make any sense. If I reframe it to be that I want to play my very best tennis, then the actual external outcome doesn’t matter. It’s about controlling what is within my power to control, and then whatever will be will be.

This is a powerful idea that crops up a lot in both Eastern and Western philosophy. You focus on what is within your locus of control, manage your daily inputs and experiences, and let the external outcomes be whatever they will be. It’s a systems-based approach where you work on the things that should, in general principle, move you towards some desirable outcome but you don’t pre-define them.

With the optionality framework, the way that I talk about it is that you are basically making your own luck. You look for all those asymmetries, take those bets where you can pay a small premium and have a possibility of a large outcome, and then luck has to come to the table. You may or may not win. Maybe you will collect a lot of bets, and all of them will fizzle but you are giving yourself the best possible chances of something great happening to you. Keep getting runs on the board, keep taking shots on goal, and have a systematic approach to achieving the life outcomes you want. That’s much healthier. I’ve got other beef with goals but maybe that’s enough.

I will add one that resonated with me. That is that when you set a goal, you are making a prediction about the future and how you are going to feel in the future. The problem with that is that we are notoriously bad at making forecasts and anticipating how we are going to feel about things when they happen, especially if it’s a long time from now. To do that, you are living in the future, and then you may get there and were wrong.

Being a New York Times best-selling author doesn’t make you happy. It creates a whole bunch of headaches for you because now you are in a box that’s ten times as large. There are all these people asking you for things, and you want some peace and quiet because you want to be able to write a book. That’s a very nice thing as someone who, early in his career, was studying anticipated emotions and how they can be connected to goals.

What I liked about it, and some of this is probably a bit of a luxury of where I am in my career in terms of having had some success and not having to be on the academic rat race quite as much, is that I have been focused much more on systems, on the process, and f on leaning into things that feel right, the feel good. This show is a perfect example of having a process-based approach rather than a goal-based approach. I could set a goal to make this show among the biggest relationship podcasts in the world. Reach as many people as possible, turn it into a form of income, and do all these things. Again, that puts me in that loser mindset until that happens.

That’s a smart idea. Now, I’m in deficit. There’s a good chance that never happens because it’s so hard to do that, statistically. I might be frankly too early with this idea to be able to do it. What happens instead is that I make episodes that I want to work on and that my small community would appreciate. The value of doing an episode is doing the episode. It’s not the number of people who read.

It’s not how it propels me to a Joe Rogan-style level of success or anything like that. I want to say thank you for writing that article. It has readjusted what used to be a natural thing to do, which is to set a big, hot, hairy, audacious goal and then work tirelessly, grind my way to it, and miss a lot of the joy in the creation process.

I’m glad that it had that impact on you. I’m happy to be able to pay that forward a little bit because I certainly didn’t figure any of this out myself. I’m sure I got it from some blog article or book somewhere as well and pasted it together.

You are modest. Richard, thank you for writing a great book. Thank you for taking some time to talk to me. These are powerful ideas. They can be a little bit abstract and theoretical but this is a good step for people to hear this stuff and to start thinking about it for their own life, whether it would be for their finances, knowledge, health or social life. Thank you very much.

Thanks for having me, Peter. It was fun.



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