Learning from Ray Dalio

I think I've benefited immensely from how the Internet has enabled eminent people to freely share their wisdom and experience. As someone who has not yet found a mentor in real life, I've found a lot of value in utilizing online channels to learn from people who are objectively smart and well-respected.

Perhaps the most generally relevant example is Ray Dalio, whose Principle of the Day on LinkedIn has provided me with regular insights. (Ray is eminent by any measure - he came from a middle-class background, started Bridgewater Associates in his bedroom in 1975, and built it into the largest hedge fund in the world by 2013.)

In today's post, I'll share what I believe to be the three most valuable things I learned from Ray's writings over the years.

Pain + reflection = progress

I'm a growth seeker by nature, so the pursuit of personal progress has been a key pillar of my life. Knowing that progress requires both pain and reflection has provided me with much more clarity whenever I am faced with a major challenge or life-changing decision.

Without pain, there is no progress. Our progress slows whenever we avoid meaningful challenges that carry a risk of failure. The key is to embrace new opportunities even if they might cause us pain.

Without reflection, there is also no progress. Pain is memorable and comparatively easy to learn from. Thus, the most effective way to progress is to reflect on any pain we encounter.

People are not equally believable

One of Ray's observations that has always stuck with me is:

If we ask someone a question, we will most likely get an answer. Therefore, we should carefully consider to whom we ask our questions.

People have different levels of expertise and experience for different topics. It's a mistake to weight everyone's opinion equally, or worse, to ask for everyone's opinion and then let a simple vote decide matters. By learning to identify highly believable people and seeking them out for their perspectives on our current challenges, we can make better decisions and achieve better outcomes.

Everyone has blind spots

We cannot address weaknesses that we cannot sense. It's impossible for us to account for and adapt to such weaknesses by ourselves, so we need to trust in someone who can see our blind spots to even have a chance. This requires us to work with others who have personalities and talents that are different from ours.

As a natural introvert and as someone who has always preferred to be independent where possible, I've had to adjust my behavior and tendencies in response to the irrefutably logical conclusion above.

When I started my current business, I was very fortunate to do it with a partner whom I fully trust, who possesses a very different set of skills and talents from mine. In another post, I described how my wife has had by far the biggest positive influence on my money habits, which were previously atrocious.

To work well with partners, we need to first understand ourselves, and then we need to understand our partners and how they're different from us. Ray recently released a free psychometric test that I've found is designed to do exactly this.

We also need to have trust in others, which doesn't come easily to many people. It certainly didn't for me, but I think I've made progress on this. I may never lose my innate skepticism, but I've found it possible to trust the handful of people who are closest to me.