Book Summary: The Algebra of Happiness by Scott Galloway

A book summary of the key lessons from The Algebra of Happiness by Scott Galloway, along with informal notes and quotations from the book.

Book Summary: The Key Lessons

#1: Get ahead while you’re young. Your early working years are the most important for setting yourself up for future success, wealth and happiness. Invest, embrace compound interest, work hard, and avoid unrewarding status games.

#2: Your partner is your most important life decision. Your choice of partner in life is the most important determinant of your future success and happiness. Out-of-sync relationships make everything harder.

#3: You don’t have to follow your passion. Don’t get sucked into the narrative of following your passion. Find something you’re good at and become great at it. Once you’re great at it, the emotional and economic rewards of being great at it will make you passionate about it.

#4: Stay fit, present and grateful. Exercise regularly, develop the ability to be truly present in the moment, and cultivate gratitude. All of these things are strongly correlated with greater happiness.

Book Notes: The Key Lessons in Detail

Premise of the Book

Scott Galloway is a professor of marketing at the New York University Stern School of Business, perhaps best known as the author of bestselling book The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google.

The Algebra of Happiness is Galloway’s second book and it outlines his perspective on the fundamentals of a happy life. From our money to our health to our love lives, lessons are given in the form of short anecdotes from Galloway’s personal experience.

Key Lesson #1: Get ahead while you’re young

Work hard while you’re young. The slope of you career is unfairly set in your first five years of working. Galloway suggests we need to work hard to make that trajectory steep in our early working years.

“The world does not belong to the big, but to the fast. You want to cover more ground in less time than your peers. This is partially built on talent, but mostly on strategy and endurance.”

Embrace compound interest. We should embrace the benefits of compound interest from an early age, not only in investing, but as an overarching principle for self-improvement. Marginal gains accumulate into life-changing successes when consistently delivered over the long run.

Equity = Wealth. We should own our slice of the economy as early as possible. Galloway suggests that we shouldn’t have more than one third of our assets in any one asset class when younger than forty and we should focus on passive income over the long run.

“Always be in the stock market, because you aren’t smart enough to predict when to jump in and out on your own.”

Credentials + Zip Code = Money. Being in an economic growth zone and having educational credentials are sadly very good predictors of how much money you will make over the next decade. Position yourself accordingly.

Money only brings happiness to a point. Find the things that don’t cost a fortune but bring you joy. Invest in experiences over things. Studies show that we overestimate the happiness that material things bring us and underestimate the long-term happiness that experiences bring us. Avoid conspicuous consumption and instead invest in those things with greater long-term utility.

Key Lesson #2: Your partner is your most important life decision

Choose the right life partner. The most important decision you will make is not work or friendships; it’s who you partner with in life. Out-of-sync relationships make everything harder. The three most important areas that should be synchronised are physical attraction, values (e.g. on religion) and attitudes to money.

“To love someone completely is the ultimate accomplishment. It tells the universe you matter, you are an agent of survival, evolution, and life. You are still just a blink of an eye, but the blink matters.”

1 + 1 > 2. Partnerships are (generally) advantageous economically and allow us to focus on our careers and utilise the wisdom of crowds to progress. Don’t underestimate the synergies of a well-synchronised relationship and the damage of a poorly synchronised one.

Take affection back. Galloway argues that modern culture has robbed us of affection somewhat, particularly from males. But touch is a hugely important part of our well-being, stemming from our evolutionary need for affection. We should embrace it with our loved ones.

Take care of your parents. It’s rewarding to become the adult in the room. Look after your parents as they did for you.

Your last home matters more than your first. To paraphrase Galloway, your first home signals future and possibility, but your last home is a signal of the people who love you.

End of life. When the end is approaching for loved ones, help them be at home, surrounded by loved ones in their final moments. Respect your own happiness and set boundaries, help them relive their life, and leave nothing unsaid.

Key Lesson #3: You don’t have to follow your passion

Embrace adulthood. Don’t get sucked into the narrative of following your passion. Find something you’re good at and become great at it. Once you’re great at it, the emotional and economic rewards of being great at it will make you passionate about it.

Stay hungry. Whatever that thing is, it must sustain your hunger. Chasing symbols of success that don’t make you hungry will simply wear you down in the long run.

You are (probably) not Mark Zuckerberg. Before you dive into entrepreneurialism, think through the implications carefully. Are you comfortable with public failure? Are you an adept seller? What is your risk profile?

Resilience / Failure = Success. Success in our chosen field requires us to embrace failure and learn from rejection. As Galloway puts it, “Serendipity is a function of courage.”

Get the easy stuff right. But if we don’t get the basics right, we stand little chance of significant success. The fundamentals: Show up early, have good manners and follow up.

Know how to react to an economic crisis. Even when we get it all right, economics can imperil our success. We must respect the inevitability of economic crashes and recognise when we’ve overpaid. We must know when to sell and seek to maintain diversification. Keeping some cash aside can enable us to exploit upcoming opportunities.

“You, not the market, should be the arbiter of diversification of your assets.”

Track your key metrics. As we progress, we should track our key performance indicators. Galloway uses the example of net worth, but there are a range of worthwhile metrics to track for individual habits.

“Accountability and insight are the by-product of math. Numbers yield insights about markets, how value is created, and how we want to live our lives.”

Believe you deserve it. Finally, we must get over impostor syndrome and believe we deserve our successes. Give yourself some deserved credit.

Key Lesson #4: Stay fit, present and grateful

Be strong. The most common trait among CEOs is that they exercise regularly. Be mentally and physically strong and feel confident with it.

“The ratio of time you spend sweating to watching others sweat is a forward-looking indicator of your success.”

Drink less. Longitudinal studies show that alcohol consumption may predict unhappiness better than any other factor.

Get lost in the moment. Sometimes it is important to appreciate the present moment and stop worrying about tomorrow.

Praise others. Gratitude has been associated with well-being and even longevity. It is consistently correlated with greater happiness in research (more on gratitude here). Some tend to feel that complimenting others is a zero-sum game, but acknowledging the achievements of others doesn’t take away from our own.

“We all have good intentions that don’t lead to action. We have an even greater reservoir of admiration and good thoughts about others that get caught in the filters of insecurity and fear. To not let that dam burst is to cut life short and shortchange joy. There are so few absolutes. One of them: Nobody ever says at a funeral, “He was too generous, too kind, and much too loving.” Nobody. Ever.”

Sustenance > Addictive Substances. We are easily addicted to random, unpredictable rewards. But the addictions that matter most are food, sex and kids – in other words, the things we are wired to for our survival. Choose sustenance over addiction to meaningless dopamine hits.

In the end, relationships are all that matter. Ultimately, it is our connections to other human beings that matter most and define our long-term happiness and health.

You can buy the book here or you can find more of our book notes here. For further related reading, try Together by Vivek Murthy, The Subtle Art of Not Giving a F*ck by Mark Manson, and Essentialism by Greg McKeown.

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