How Much Ignorance Tax Are You Paying... Ep 126

Summary Notes


In the episode, the host, inspired by Myron Golden, delves into the concept of 'ignorance tax,' the cost individuals pay for lacking knowledge, particularly in financial earnings. The host emphasizes the importance of investing in knowledge to reduce this 'tax' and criticizes the habit of reading popular self-help books without applying their content to one's business. Instead, the host advocates for acquiring practical skills through courses and masterminds, sharing personal experiences of reinvesting in learning, which has yielded high returns. The host also discusses the significance of teaching skills and the process of talent stacking, where combining skills increases one's value. The episode concludes with a call to action for entrepreneurs to focus on relevant information and skills to grow their businesses and reduce their ignorance tax.

Summary Notes

Ignorance Tax Concept

  • The term "ignorance tax" refers to the metaphorical cost individuals pay for not possessing certain knowledge or skills.
  • Myron Golden introduced the concept during a presentation, using it as a powerful closing statement.
  • The idea suggests that not knowing how to make a million dollars, for example, is equivalent to paying life $950,000 each year.
  • This concept is used to highlight the financial impact of ignorance and the importance of acquiring knowledge.

"How much do you make, sir? And he was like, I make 50 grand. He's like, okay, cool. He's like, did you know that you have paid life $950,000 every single year of your life because you do not know how to make a million dollars, right? You do not possess that skill."

The quote exemplifies the Ignorance Tax concept by quantifying the cost of not having the knowledge to earn a higher income. It serves as a rhetorical device to stress the value of financial education and skill acquisition.

Implementation of Knowledge

  • The frustration expressed by Speaker A stems from individuals not utilizing available knowledge to improve their situations.
  • Speaker A cites an example from a legacy group, where a gym owner reads a book about customer retention but ignores the group's proven retention system.
  • The group's retention system has a track record of success, reducing customer churn to under 4% in twelve weeks.
  • The point made is that ignoring available, effective solutions in favor of seeking new ones is a form of paying the ignorance tax.

"I see someone reading a book, right? It's like I'm reading how to never lose a customer again, right? And it drives me nuts because I can almost guarantee that that person has not consumed the content about our retention system, which every single gym that has ever implemented has cut their churn from whatever it's at to under 4% within a twelve week period, right?"

This quote highlights the issue of not applying existing, effective knowledge and instead seeking new, potentially less effective solutions. It serves as a practical example of how ignorance tax can be incurred even when solutions are readily available.

Personal Investment in Knowledge

  • Speaker A emphasizes the importance of investing in oneself, particularly in knowledge and skills.
  • The speaker shares a personal approach to investing, which involves reinvesting profits back into their business, which is growing at a 400% annual rate.
  • Speaker A prefers investing in a familiar market (their business) over unfamiliar markets that offer lower returns.
  • The speaker values knowledge acquisition and prefers buying courses over reading books, suggesting that active learning through courses is their preferred method of reducing ignorance tax.

"And so specifically, people ask me, like, alex, then, what books are you reading? And I thought more about them. I don't read that many books. I really don't. I buy courses and I go through, like, that's what I spend my money on. I go through courses and I go through them and I acquire the knowledge."

This quote indicates Speaker A's personal strategy for knowledge acquisition and reducing ignorance tax. It underscores the speaker's belief in the value of investing in practical learning experiences over traditional reading.

Entrepreneurial Growth and Learning

  • Entrepreneurs often feel the need to grow and make progress.
  • Many entrepreneurs fall into the trap of reading "brain candy" or "mental masturbation books" that are too general and do not provide a return on investment (ROI).
  • True progress requires applying knowledge in a specific and consistent manner to one's business.
  • The process involves taking a general concept from a book and applying it to a specific business context.
  • Consistent application is necessary, but not a guarantee of success as it's an untested execution of a concept.

"And for me, reading a book about the one thing, let me summarize it for you. It's about doing one thing. Let me save you 2 hours of your life." "If you can find it, Barnes and nobles, it's probably too general to actually get you an ROI in your life."

These quotes emphasize the idea that many business books offer general advice that isn't directly applicable to one's specific business needs. The speaker suggests that many books can be summarized quickly and may not warrant the time investment they require.

Application of Knowledge

  • The key to success is not just acquiring information but applying it effectively.
  • Entrepreneurs should take a concept and apply it consistently to their business over a significant period of time to measure its effectiveness.
  • The speaker criticizes those who accumulate knowledge without applying it, referring to it as an "ignorance tax."

"And so if you for some reason have all of the information that is in front of you and you have not applied it and executed and gone through it, shame on you, there's no point."

This quote criticizes the inaction of acquiring knowledge without applying it, implying that knowledge without execution is wasteful.

Real-World Example: Rob's Success

  • Rob is highlighted as an example of a successful entrepreneur who applies knowledge effectively.
  • Rob's success is attributed to his commitment to seeking knowledge and applying it to his business.
  • The speaker implies that the pursuit of knowledge and its application is a key differentiator between successful and less successful individuals.

"And so rob group was over here, and he's one of our top gyms. He sold $100,000 in just physical products in the last quarter just at his gym, right?"

This quote provides an example of a successful entrepreneur who has effectively applied knowledge to achieve financial success.

Investing in Adjacent Skills

  • The speaker advocates for investing in skills that are adjacent to one's current skill set.
  • The concept of "talent stacking" is introduced, where combining multiple skills increases overall value.
  • The speaker advises to invest money in learning new skills after securing a base level of security.

"So what do you do to pay down your ignorance tax? You learn adjacent skills, which means you take the money that you have..."

This quote advises on the strategy of reducing one's ignorance tax by investing in learning skills that complement and enhance one's existing abilities.

Talent Stacking

  • Talent stacking is the process of acquiring multiple complementary skills to increase value.
  • The speaker gives examples of how combining skills like math, bookkeeping, accounting, and tax law can make an individual more valuable to a business.
  • This strategy is presented as a means to become more valuable and successful in one's career.

"You have one talent, and then you have a second talent. And when you have two talents that put together, both become more valuable."

This quote explains the concept of talent stacking and its benefit of amplifying the value of individual skills when they are combined.

Ignorance Tax and Learning

  • Ignorance tax is a metaphorical concept implying a cost paid for lack of knowledge.
  • Reducing ignorance tax involves acquiring knowledge and learning what one doesn't know.
  • The process of learning is continuous and often involves identifying knowledge gaps.

e and you pay down your ignorance tax by.

Learning what you don't know.

These quotes outline the concept of "ignorance tax" and the importance of learning as a means to reduce it. The first quote introduces the idea of an ignorance tax, while the second quote specifies the method of reducing this tax by learning.

Professional Development and Skill Acquisition

  • Continuous professional growth often includes acquiring new skills or enhancing existing ones.
  • At higher levels of expertise, the focus may shift from acquiring skills to transferring and teaching skills.
  • Teaching a skill is a distinct skill in itself, separate from the skill being taught.

And so, like, right now, the big breakthrough that I've had in our business, and this happened very recently, was I was like, I grovel trying to figure out what's the next skill that I need to learn, right?

This quote emphasizes the speaker's realization that professional development may not always be about learning new skills but could also be about effectively transferring existing skills.

Marketing Skills and Knowledge Transfer

  • Recognizing deficits in one's skill set is crucial for growth, such as the speaker's lack of experience in running a marketing department.
  • The speaker acknowledges the need to teach the process of marketing, not just provide instructions.
  • There is an intention to share comprehensive knowledge to enable innovation and independent execution.

But I have never ran a marketing department. I've never done that. And so I've realized now that the big deficit that I have is that I have not taught how to market.

This quote reveals the speaker's self-assessment and the identified gap in their skill set regarding marketing and teaching marketing.

Empowering Teams Through Knowledge Sharing

  • The speaker plans to share in-depth knowledge with gym owners to foster innovation and autonomy.
  • Understanding the thought process behind marketing decisions is critical for strategic execution.
  • Details such as image selection, funnel structure, and technical optimizations are part of the knowledge to be shared.

I'm going to be basically sharing with you everything that I know, an absolute theoretical level so that you can execute this stuff on your own, so you guys can innovate this stuff.

The quote signifies the speaker's commitment to sharing comprehensive knowledge with their team to enable them to operate independently and innovatively.

Resilience and Skillsets

  • The ability to recover from loss is tied to one's skillset.
  • Having a wide range of skills can facilitate a faster and greater level of recovery.
  • The speaker uses Elon Musk as an example of someone who quickly regained wealth due to his skills.

So imagine if you lost everything and you could get to a level 100 times or ten times as high as you're at right now, pretty fast. What's the difference? You just have more skills, right?

This quote discusses the hypothetical scenario of losing everything and the role of skills in recovery, emphasizing the value of a diverse skill set.

Investment in Knowledge

  • The speaker advocates for investing in acquiring information as a means of personal and professional growth.
  • There is a belief that investing in knowledge leads to cash flow that exceeds the capacity to consume information.
  • The speaker prioritizes spending on information over other expenses.

I spend every dollar I possibly can on acquiring information. Every dollar I can.

This quote reflects the speaker's personal strategy for growth, highlighting a strong belief in the power of investing in knowledge acquisition.

Financial Growth through Learning Investments

  • Investing in knowledge to reduce the "ignorance tax" and achieve financial success.
  • Importance of acquiring skills that eliminate limiting factors on the path to becoming a billionaire.
  • Prioritizing learning and joining groups over saving money in the early stages of career growth.
  • High return on investment (ROI) from networking in mastermind groups and purchasing skill-specific courses.
  • Emphasis on learning relevant skills to one's business rather than non-essential knowledge.

You invest to pay down your ignorance tax. You invest to become a billionaire. And the way to become a billionaire is to learn all the things that you need to know to be a billionaire, which is removing all the limiting skills that you don't have to get there.

This quote underscores the concept of investing in oneself to gain the necessary knowledge and skills to achieve significant financial success, likening ignorance to a tax that can be reduced through education.

I think the two most valuable things that I've done in terms of spending money on information, I don't think I got a lot from events personally. I got a lot from networking specifically, which I think is just as valuable at, like, mastermind type. I think those types of groups where you have people who are similar to you, similar level and above is where I got the highest ROI.

Myron Golden highlights the value of investing in networking and mastermind groups as opposed to events, suggesting that the former provides a higher return on investment due to the level of engagement and quality of connections.

The other really high ROI is when I bought courses. So courses on how to acquire a certain skill.

Golden identifies purchasing courses that teach specific skills as another area where he has received a high return on investment, emphasizing the importance of targeted learning.

Strategic Skill Acquisition

  • Understanding the incremental nature of skill development and its impact on income.
  • The concept of "talent stacking" and the importance of acquiring the right skills in sequence.
  • Recognizing that not all skills will directly increase income unless they are the "missing link" in one's skillset.
  • The importance of focusing on skills that are directly relevant to one's business before exploring broader knowledge.

It just might be one more link that gets you closer to connecting the thing that's going to be able to allow you to pull money forward.

Myron Golden explains that each new skill learned is a step closer to the ultimate goal of increasing income, but not all skills will have an immediate impact unless they fill a critical gap.

But unless that's the missing link, it's just going to be one more chain thing, one more skill that you stack adjacent until eventually you'll get the last one or two, and then everything takes off.

This quote emphasizes the idea that while some skills may not provide immediate financial benefits, they are part of a larger process of building a comprehensive skillset that will ultimately lead to success.

Maximizing Return on Investment (ROI) in Learning

  • The decision to invest in learning over traditional saving or investing in the marketplace.
  • The tangible financial benefits realized from investing in knowledge and skills.
  • The strategic approach of applying relevant information to one's business before seeking general knowledge.

If you want to pay down your ignorance, tax the millions and billions of dollars that all of us are paying life right now for not knowing how to make millions and billions of dollars, that is where I would put my money.

Myron Golden advocates for investing in learning as a means to overcome the financial disadvantages of not having certain knowledge, framing it as an "ignorance tax" that everyone pays.

I think I've spent upwards of $700,000 I was adding it up with them on just extra stuff. All right. Anyways, so the $700,000 that I spent, that's a ton of money. Some people might say, you know what, man? If you had invested that in the marketplace, they're like, maybe. But now we have way more than that because we took that money and got a huge ROI on it based on what we were able to now make from it.

Golden shares his personal experience of spending a significant amount on learning and networking, which he believes has provided him with a higher return than if he had invested that money in the marketplace.

Practical Application and Focus

  • The recommendation to prioritize actionable information and skills over entertaining but non-essential knowledge.
  • The strategy of executing business-relevant actions before branching out into other areas of learning.
  • Encouragement to focus on acquiring skills that will pay off the ignorance tax and contribute to business success.

Don't try and reinvent the wheel. If you have information that's in front of you that's relevant to your business, do that first.

Myron Golden advises focusing on using information and skills that are directly applicable to one's business, rather than seeking out new or unrelated knowledge.

Just focus on food and knowledge, and you'll be much better off for it.

Golden emphasizes the importance of concentrating on practical knowledge that feeds one's business and personal growth, likening it to nourishment that is essential for well-being.

Reflective Conclusion

  • Acknowledgment that the presented information may not be as comprehensive as intended due to technical issues.
  • A farewell message expressing hope that the key points have been effectively communicated.

This was not as good as my 1st 18 minutes rant, but hopefully I brought the points home in this one with my mute not on.

Myron Golden reflects on the delivery of his message, hoping that despite any shortcomings in the presentation, the key ideas were successfully conveyed to the audience.

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