Some Thoughts on Tony Robbins

Over the last few years, several people have asked me questions about the financial advice being given out by the well-known motivational speaker and entrepreneur Tony Robbins. In the past, Robbins was mostly known for his motivational books and seminars and infomercials; I myself have read his earlier books Awaken the Giant Within and Unlimited Power, with some mixed feelings (which I’ll touch on again in a bit).

In the last few years, however, Tony has published two different books on personal finance – Money: Master the Game and Unshakeable: Your Financial Freedom Playbook. Those two books in particular, along with some of the interviews he’s given as well as the recent documentary about Tony (I Am Not Your Guru), have triggered the questions that readers have sent to me.

Honestly, I’ve been putting off those questions because I wanted to give myself the time to actually read some of his books and interviews (and watch the above documentary), and then give myself some time to reflect on all of this and give my conclusions.

I’ll summarize the multitude of questions I’ve been asked about Tony Robbins down to one single question: Does Tony Robbins offer financial or other life advice that’s worthwhile to me?

My short answer? Yes, but the advice he offers can also be found from a lot of other sources.

Let’s separate out a few things here, though.

Tony Robbins became well known due to his earlier books on personal development (the two I mentioned above, Awaken the Giant Within and Unlimited Power, are definitely his most well known) and his series of seminars sharing those ideas.

I won’t get into the specifics of the message that Robbins delivers other than to say it involves a lot of basic self-psychology and reflection. I strongly agree with some of his generalities about self-empowerment, but some of his specific tactics are on shaky ground. For example, neurolinguistic programming (something he apparently doesn’t focus on as much these days) is something that has largely been discredited in the psychology community. If you stick to his broader themes, Robbins is generally on the money.

So, how did he become successful with a general self-empowerment message with a mix of useful and perhaps not-so-useful tactics?

The key to Robbins’ success, and it’s something you can see every time he’s interviewed or when you see clips of him practicing his motivational work, is that he is extremely charismatic, knows how to ask great questions, and manages to emotionally relate to people extremely well. He is one of the most naturally gifted people I’ve ever seen at relating to people. He’s just simply great at appearing likable and making you feel good about yourself. The message itself becomes secondary because of Robbins’ people skills.

To me, this is really the key of his success. I don’t think his ideas are extraordinary at all. For the most part, he preaches standard self-improvement ideas with a few wonky tactics. Where he succeeds is in his charisma, speaking ability, and ability to really relate to others and seem inherently likable. He is really good at that, and that, for some, makes his fairly standard self-improvement ideas much easier to apply when he delivers them.

In the end, though, self-improvement comes down to you, not to Tony Robbins. No matter how good he is as a people person, it still comes down to your own willingness to make changes in your life. If you’re not willing to do that, then no motivational speaker is going to change anything about you. It all comes from you.

Tony Robbins is an incredibly gifted motivational speaker, but there’s nothing magical about his self-improvement ideas. It’s mostly fairly typical motivational stuff. If you succeed by following his tactics, that’s because you chose to do it. He just pushed a little in the right places.

This brings us around to personal finance. Is Tony Robbins bringing anything valuable to the table with his personal finance books?

In all honesty, Tony Robbins’ personal finance message is pretty standard stuff. Let’s walk through some of the core principles he talks about.

He’s a strong proponent of spending less than you earn – ideally, far less than you earn. Over and over again, he keeps coming back to the fact that you cannot build wealth if you’re spending everything you make. You either have to significantly cut spending or you have to find ways to make more money, period. There is no magic solution to this.

He’s a strong proponent of seeking out investments with low fees. Avoiding fees is a key part of his financial advice, actually. He’s very wary of 401(k) plans because of the fees (unless they offer you matching funds, which more than overcomes the fees). He encourages readers to shop around for other investment vehicles (Roth IRAs, 529 plans) based largely on fees.

He’s a strong proponent of indexing and diversification. He argues on behalf of simply buying a few index funds that are very diversified and have minimal fees and just putting your money in there so that your money is diversified amongst a lot of different assets.

He discourages risky investing. Basically, his philosophy seems to be that if there is even a small chance of losing money over your time period, you shouldn’t be investing in it. Stick to things that have a proven history of returning money over the time you intend to be invested. If you have 25 years until you want to retire, then you should stick to things that will almost assuredly build your money over 25 years (like diversified, indexed stocks). If you’re five years away, stick to things that will build your money over five years with little risk of losing the balance (like bonds).

In summary, Tony Robbins offers an investment perspective for individuals that strongly matches that of John Bogle and Warren Buffett. All of them advocate for investing your money in low-cost low-fee index funds and by living frugally in order to get money into those funds.

I found this perspective to actually be rather refreshing. Quite often, motivational speakers who endorse an investment strategy tend to come out in favor of strategies that are very risky or flawed. Robbins is actually advocating for a very sensible strategy, one that’s based on very solid principles.

So, what’s wrong with this?

The problem I had with the material that I read – and it’s the fatal flaw that keeps me from endorsing his books wholeheartedly – is that Robbins constantly plugs for a particular investment firm that I won’t bother to name here. Suffice it to say that Robbins family has a business relationship with this firm (Robbins openly states that he has been in discussions with that firm for business relationships, but doesn’t give specifics) and that the firm’s version of these investments aren’t particularly strong as compared to the market leaders. There are many firms that offer low-cost index funds with low fees – I personally use Vanguard, but you can find low-cost index funds from Fidelity and even firms with traditionally high-fee investments like Schwab offer some very nice low-fee index funds.

In other words, Robbins hits the principles firmly on the head, but the specific firm he endorses doesn’t seem to follow those principles all that well, at least from my vantage point. Rather than bashing a company, I will say that if you choose to follow Robbins’ advice on investing, be sure to actually do the research on specific firms and the fees they charge before investing your money with them.

Aside from that specific issue of investment house choice, the principles Robbins is advocating for are widely shared in the personal finance community.

Of course, that’s true with Robbins in other areas of self improvement: the broad principles he gives out are quite valuable, but sometimes there is some trouble in the details.

I admire greatly Robbins’ ability to communicate with people and motivate them to make stronger choices that empower themselves. I think that he shares helpful broad principles for self-improvement. However, when it comes down to specific tactics, you’re always better off doing your own homework and getting advice from a lot of sources and knowing how to interpret the advice and the data.

Of course, that philosophy is true when it comes to advice from anyone. Never make money moves based on the advice of someone who doesn’t know your specific situation intimately, and even in that situation, don’t hesitate to get second and third opinions. There’s nothing wrong with using the advice of others as a starting point, but be your own advocate and do your own homework.

Let Tony Robbins be your motivator, but even he says that he is not your guru. Do your own homework when it comes to specific decisions as to what to do with your money – and if you’re not sure how to do it, take the time to learn by reading lots of different personal finance and investment books and articles from a variety of writers. Don’t let any one person do all of the work for you.

Good luck!

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