Category Archives: Friendships

Socioeconomic Mobility and Friendship

The purpose of this post is to highlight the difficulties in maintaining friendships when you wish to change your socioeconomic status and detail the trade-off decisions that are occurring.

“You are the average of your 5 best friends” is a common phrase based on the idea that the people closest to you have the greatest influence on who you become.  Therefore, if you want to move up the socioeconomic ladder, your goal is to make sure your 5 best friends are where you want to end up, and not where you currently are.  So you avoid being friends with people in your income bracket and you seek out the rich.  This behavior introduces several problems: 1. because the people around you don’t share your background, they think and act differently from you.  This makes it harder to be friends with them (but not impossible: with communication and relationship skills it can be done).  2. If you stick with them and learn their ways, it becomes harder to be friends with people who do share your background because your background has been replaced with the value system of your new friends.  This causes problem 3. you have difficulty being friends with your income bracket because you’re social skills are different, and 4. you have difficulty being friends outside your income bracket because they may do things that cost way more than you have budget for so you can’t participate in activities, making it harder to maintain friendship.

Problem 3 has potential to do very bad things to you, for instance it can tear your family apart because while you have become more like successful people, your family has not and so you find it more difficult to relate and be friends with them. The family also embarrasses you in front of your richer peers because your family has a different set of values and social skills.

Trade-off decision and problem 5: When you learn the ways of an income bracket above you, you can either spend the next few years teaching your family and lower income bracket friends how to move up, or you can spend that time moving up even higher on the income scale.  Problem 5 is poignant because what’s really happening is the following: You can either stay emotionally close with your family and friends and move them up one or two income brackets over your lifetime (an income bracket to me is 10x increase in income.  From $1,000 per month to $10,000 per month), or B you can alienate them from distracting you on your path to moving up multiple income brackets, perhaps achieving $1,000,000 per month at the cost of spending time with your family and friends.  Which do you want?  To provide time, or money?

5B can be a road of Ambition, Loyalty, Disappointment, Sadness.

“A rolling stone gathers no moss”  is credited to Publilius Syrus, who in his Sententiae states, People who are always moving, with no roots in one place, avoid responsibilities and cares. Another interpretation equates “moss” to “stagnation”; as such the proverb can also refer to those who keep moving as never lacking for fresh ideas or creativity.  -Wikipedia

Friendship teaches us to hang out with people we like, and to accept them as who they are.  With a socioeconomic mindset, to move up the ranks, you must learn to judge, criticize, and be selective with who you hang out with, according to what you want to achieve. (Major Categories of Relationships Business vs. Personal). Furthermore, you treat every opportunity as a business opportunity and every personal interaction as a wasted business opportunity, a mentality which gets in the way of spending the quality time necessary to make friends.  Many people sacrifice Emotional Health to squeeze out more time in their day for achievement…this is a major reason why many successful people are either very lonely, depressed, and sad, or just bad people with no emotional skills.  

Problem 6. As you move up the income levels, your mentors need to change if you reach or exceed their achievements.  However, the idea that you should always trade up for someone better only works in the short term: in the long term, both of you will grow to be much more than what you started out as (hopefully), and you’ll definitely grow at different speeds.  As such, to become really good, it’s more important to find someone to work with long term, than to find the best option short term.

People are constantly changing, and as they change they want different things. As the world changes, the way they get what they want changes, as well as who they get help from.  What happens to a relationship when two people are no longer “related?”  More often than not, the relationship weakens and fades, with new ones to take their place.  This can be seen often when it comes to socioeconomic mobility.  However it does not have to be the case if you take the initiative to maintain friendships.

All these problems can be overcome, they are just difficult to.

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Friends as an Asset Class – An Investor’s Take on Friendship

The purpose of this post is to highlight the huge impact social skills can have on wealth inequality by showing how much wealth is gained when you have the skills to make and maintain friends, and how much is lost when you don’t have social skills.

For this exercise, we forget the humanity of friendship and instead focus only on the financial aspects.  In that sense, friendship can be modeled as a subscription model business with an initiation fee.

Invest: Money, Time, Thought, Emotion, Options, and Opportunities

Return on Investment: access to resources, social and career network, all at extremely discounted prices.  Asking a friend for help is cheaper than paying a professional full price for help.  Meeting someone you have mutual friends with costs less resources than meeting a stranger.

Also, your wealth now increases indirectly through your friends: if each friend earns 10k per year and you have 10 friends, then your network is earning 100k per year.  If your friends gain skills, you indirectly gain them too: you now have easy access to expert skills at a discounted price.  You are encouraged to help each other because you all benefit together as friends.

This is in contrast to a life without friends, where everything is full price, and you have no incentive to help others because it won’t benefit you, it will just raise the competition and the prices on you, making your life more difficult.

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Conversations Friendship

A collection of indicators of friendship that can be found through conversation.

Example 1: Bob mentions he has been promoted, but is concerned and tired at the large amount of work he has now been given.

  • Acquaintance response: congrats on the promotion!  Surface level conversation about positive issues
  • Friend response: how are you feeling?  Caring conversation about deeper issues; feeling the friend’s concern and exhaustion and empathizing.

If you don’t know what to say, think of a compliment and say it.

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