#650: Sarah Williamson is the kind of person who shapes the decisions that move trillions of dollars. She earned her MBA with distinction from Harvard Business School and holds both the CFA and CAIA designations, two of the most demanding credentials in finance.
In this episode, she helps us understand how investing really works, who the major players are, how capital flows through the system, and why the incentives driving investors, activists, and asset managers often collide.
Sarah spent more than twenty years at Wellington Management, where she rose to Partner and Director of Alternative Investments, after working at Goldman Sachs, McKinsey & Company, and the U.S. Department of State. Today she leads FCLTGlobal, an organization dedicated to helping companies and investors focus on long-term value creation. She is also the author of The CEO’s Guide to the Investment Galaxy.
She explains why index funds now dominate corporate ownership, how Reddit and retail traders changed the market’s dynamics, and what it means when activists push companies to “bring earnings forward.” She also introduces a framework for understanding the “five solar systems” of investing, a map that connects everyone from day traders to trillion-dollar sovereign wealth funds.
Whether you are a passive investor or simply curious about what drives the market, this episode gives you the clarity to see how capital really moves and why it matters.
Key Takeaways
Reddit and the meme-stock movement permanently changed how individual investors move markets
Index funds now dominate ownership, creating both stability and new corporate challenges
Activists often prioritize short-term profit over long-term innovation
Sovereign wealth funds act like national endowments, investing with century-long horizons
Understanding who owns what (and why) makes you a more informed, confident investor
Resources and Links
The CEO’s Guide to the Investment Galaxy by Sarah Williamson
FCLTGlobal, a nonprofit that helps companies and investors focus on long-term value creation
Chapters
Note: Timestamps will vary on individual listening devices based on dynamic advertising segments. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(00:00) Meet Sarah Williamson: CEO, CFA, Harvard MBA, global finance leader
(5:41) The five “solar systems” that organize the investing world
(7:55) Reddit and the rise of the retail investor
(16:25) Tesla, brand loyalty, and shareholder activism
(22:57) How sovereign wealth funds invest for generations
(28:57) Inside asset managers and their incentives
(41:56) Activist investors and the tension between short and long term
If you want to understand the real power dynamics behind modern investing, from Reddit traders to trillion-dollar endowments, don’t miss this episode.
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1:13:26
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1:13:26
The Third Option Between Working and Retiring
#646: What if you didn’t have to choose between grinding full-time until retirement or quitting work altogether?
By 40, Andy Hill and his wife had built a $500,000 portfolio and paid off their home. Instead of racing toward early retirement, they chose a third way: scaling back to part-time work, becoming equal partners in parenting, and reclaiming their time.
In this episode, recorded live at FinCon, Andy shares his 10-step framework for building a “Coast FIRE” lifestyle — where your investments can coast toward retirement while you focus on living today.
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The Middle Path Beyond FIRE
Most of us think of retirement as a cliff: one day you’re working, the next day you’re not. Andy challenges that binary. He and his wife structured their careers to work 20–25 hours per week each, creating a rhythm that gave them more time with their children, each other, and their health.
He breaks down the mindset shifts and tactical steps — from eliminating debt and protecting your family with insurance to stockpiling FU money and designing a three-day workweek. Along the way, he explains how Coast FIRE frees you from mandatory retirement contributions and opens doors to a flexible, meaningful life.
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Key Takeaways:
Balance beats extremes. Neither full-time grind nor full-time stay-at-home felt right; designing a flexible, part-time work life created the equilibrium their family needed.
Cash buffers change behavior. A 3–6 month emergency fund reduces stress and scarcity thinking, making it easier to parent calmly and make better money decisions.
Choose time over trappings. Fancy upgrades aren’t worth trading away presence; prioritizing family time beats lifestyle escalation.
Resources mentioned:
Andy Hill's book on Amazon: Own Your Time
Marriage, Kids, and Money Podcast
(4:01) Why the shift
(5:35) What their life looks like now
(9:08) Why extremes didn’t work for Andy and Nicole
(14:45) Step 1 Dream and define your ideal life
(18:21) Step 2 Commit to living without high-interest debt
(20:38) Step 3 Protect your family (insurance, estate plan, emergency fund)
(27:04) Step 4 Invest to reach Coast FIRE
(30:29) Step 5 Pay off your home (or optimize if renting
(36:21) Step 6 Stockpile FU money
(47:53) Step 7 Design a three-day workweek
(57:02) Step 8 Plan your intentional four-day weekend
(1:02:39) Step 9 Simplify to avoid lifestyle creep
(1:08:56) Step 10 Teach your kids the path to time freedom
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1:12:29
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1:12:29
Q&A: My Friend Won’t Invest - How Can I Help?
#645:
Mike (02:50): After 15 years of intentional living, Mike is 80 percent of the way to financial independence. Now he’s trying to help friends take control of their own financial future. But what happens when one spouse is eager to learn and invest, while the other isn’t interested?
Michael (27:07): For two years, Michael has tracked his net worth monthly. So far, growth has been driven almost entirely by how much he saved. But when will investment returns begin to take over and shift that steady line into an exponential curve?
Alvaro (34:00): After 15 years of investing in U.S. and European real estate, Alvaro has a big decision to make. Should he leverage a commercial loan to build an ADU for short-term rental income, or take on more personal debt to expand their family home?
Jonathan (58:50): After hearing Paula and Joe discuss the efficient frontier — and then listening to Big ERN, Paul Merriman, and JL Collins — Jonathan can’t help but wonder: has Joe’s perspective evolved? Is the simple path still enough, or is there merit in a more complex approach?
Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.
Enjoy!
P.S. Got a question? Leave it here.
Resources Mentioned:
JL Collins Part 1 and Part 2
Karsten Jeske (Big Ern) Episode 643
Paul Merriman Episode 550
Note: Timestamps will vary on individual listening devices based on dynamic advertising segments. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
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1:16:47
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1:16:47
The Hidden Psychology Behind Every Financial Decision You Make with Dr. Daniel Crosby
#644: Why do we both crave money and resent it? Why do some people sabotage their financial futures in the name of short-term comfort? And why is your brain — not the stock market — the biggest threat to your wealth?
In this conversation, we explore the surprising ways that psychology and money intertwine. Our guest, Dr. Daniel Crosby, is a behavioral finance expert, psychologist, and bestselling author of The Soul of Wealth, The Behavioral Investor, and The Laws of Wealth. His research dives into how our emotions, childhood scripts, and personalities shape the financial decisions we make every day.
Dr. Crosby shares why investing is an act of optimism, why income matters more than coupon clipping, and how our spending reveals truths about who we really are — even when we don’t realize it..
Key Takeaways
Money is a mirror. The way you earn and spend reflects your real values, not just your stated ones. Tracking your money reveals gaps between who you say you are and how you actually live.
Income drives wealth. Frugality matters, but once the basics are handled, your long-term financial future is determined more by growing your income than by cutting costs.
Short-term comfort is costly. The biggest threat to your wealth isn’t the market — it’s the temptation to prioritize momentary relief (panic-selling, stress spending) over your long-term goals.
Resources & Links
Dr. Daniel Crosby on LinkedIn
Standard Deviations Podcast
Books by Dr. Crosby:
The Soul of Wealth
The Laws of Wealth
The Behavioral Investor
Personal Benchmark
Closing
This episode reminds us that building wealth isn’t just about math — it’s about mindset. The markets may fluctuate, but the greatest risks and rewards often lie within our own psychology.
If you enjoyed this conversation, share it with a friend, subscribe to our newsletter at affordanything.com/newsletter, and connect with our community at affordanything.com/community.
You can afford anything, but not everything. Choose wisely.
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic advertising segments. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(03:24) Does money really buy happiness? Rethinking the $75k income myth.
(08:48) Our conflicted relationship with money: Love, resentment, and the paradox of wealth.
(10:32) Childhood money scripts: How early beliefs still drive adult financial behavior.
(16:10) Personality traits & money outcomes: Why agreeableness and neuroticism matter.
(24:15) Investing as an act of optimism: Human progress, markets, and long-term growth.
(30:39) AI, work, and the future of wealth: Why EQ may outpace IQ in tomorrow’s economy.
(39:46) Habits vs. willpower: Why automation and environment beat discipline.
(44:28) Frictionless spending: How Apple Pay and subscriptions fuel overspending.
(47:32) Offense vs. defense in wealth: Why income matters more than extreme frugality.
(1:03:16) Chronic vs. episodic mistakes: Small leaks, lost compounding, and long-term damage.
(1:06:24) The pre-mortem exercise: A Stoic-inspired tool to prevent financial failure.
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1:09:41
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1:09:41
LIVESTREAM: A Former Fed Economist Reveals What's Really Happening, with Karsten Jeske (“Big ERN”)
#643: Picture this: you're at the Federal Reserve years ago. The chairman literally hangs up a conference call, waits 30 minutes, then calls back — suddenly everyone agrees on the rate decision.
That's the kind of insider story Karsten Jeske (“Big ERN”) shares when he joins us to break down what's happening with the economy right now.
Karsten worked at the Federal Reserve Bank of Atlanta for eight years, then spent a decade on Wall Street at Bank of New York Mellon.
Today he runs the popular Early Retirement Now website, where he applies his economist background to help people understand money and markets.
You'll hear Karsten explain why the Fed is about to start cutting interest rates. The futures markets are pricing in a 90 percent chance of a quarter-point cut, with more cuts likely through the end of the year.
But why? After all, inflation just ticked up in the latest CPI report, yet the Fed is still planning to lower rates.
We dive into how this affects real people. If you're thinking about buying or selling a house, Karsten suggests acting sooner rather than later.
He explains the "buy the rumor, sell the news" principle – the bond market may have already priced in the good news about rate cuts, so waiting might not help you.
The conversation covers some surprising economics too. Did you know that high interest rates can actually cause housing inflation?
When mortgage rates are expensive, fewer people build new homes, which drives up prices. It's the opposite of what most people think happens.
Karsten walks through the recent jobs report revisions that caught everyone off guard. The government had to subtract nearly a million jobs from their previous estimates. He explains how this happens – it's not that officials are making up numbers, but tracking new businesses is genuinely hard to do in real time.
You'll also learn about two Fed tools most people haven't heard of: the dot plot and R-star. The dot plot shows where Fed officials think interest rates should go over time. R-star represents the theoretical perfect interest rate when the economy has no problems — currently around 3 percent.
The interview wraps up with Carsten's take on Fed culture. The consensus-building era under Greenspan is giving way to more dissenting votes, which actually makes the central bank more like it was decades ago under Paul Volcker.
Enjoy!
Timestamps:
Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.
(1:04) Carsten’s career path from Fed to Wall Street
(1:57) Current economic growth limbo state
(4:04) GDP formula and tariff impacts
(5:10) Trade efficiency and comparative advantage
(6:04) Supply chain threats from protectionism
(8:20) Fed meeting and rate cut expectations
(9:35) Market pricing in multiple rate cuts
(12:19) Real estate timing and mortgage rates
(13:55) How Fed rates affect treasury yields
(18:50) Buy the rumor, sell the news strategy
(22:13) Fed transparency and decision telegraphing
(25:56) Fed consensus culture versus dissent
(30:48) CPI data shows inflation ticking up
(34:32) Transitory versus persistent inflation confusion
(38:56) Fed behind the curve on rate cuts
(40:00) Major jobs report revisions explained
(44:24) Methodological issues with new business tracking
(46:00) Dot plot and R-star concepts explained
(52:29) Bond allocation strategies by age
(57:25) Current bond yields look attractive
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You can afford anything, but not everything. We make daily decisions about how to spend money, time, energy, focus and attention – and ultimately, our life.
How do we make smarter decisions? How do we think from first principles?
On the surface, Afford Anything seems like a podcast about money and investing.
But under the hood, this is a show about how to think critically, recognize our behavioral blind spots, and make smarter choices. We’re into the psychology of money, and we love metacognition: thinking about how to think.
In some episodes, we interview world-class experts: professors, researchers, scientists, authors. In other episodes, we answer your questions, talking through decision-making frameworks and mental models.
Want to learn more? Download our free book, Escape, at http://affordanything.com/escape. Hosted by Paula Pant.
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