Ray Dalio’s ‘Principles for Success’: Insights and Interviews for Achieving Greatness

Invitation to the Journey

Before we begin, let me assure you: I know very little about what exactly I need to know. All my life successes are due to my ability to deal with my ignorance, not to what I know. Teaching and guiding others is quite a presumptuous activity, but I do it because I believe the principles that helped me achieve success can help others reach their goals too. At this point in my life, it is far more important for me to pass on my experience of achieving success than to achieve even more success for myself. How you choose to apply these principles is entirely up to you. It is important to think for yourself, as only you can develop your own principles based on your own values.

Episode 2: Principles of Rational Approach

At first, I discovered that I needed principles—rules for rational approaches to any actions and phenomena that repeat themselves in similar situations. There are principles for everything—from skiing to raising children, cooking, and so on. I am going to share some of my most important and comprehensive life principles that define our approach to everything we have undertaken. But I did not start with them; I developed them throughout my life, mostly based on mistakes and reflections. My life principles are simple but not exhaustive. To this day, I strive to make the best decisions, still make mistakes, and constantly derive new principles from them. This reality requires me to free myself from the surrounding conventions, which meant thinking independently.

Understanding Reality

If you do not want others to control your life, you should make your own decisions about what to do. For this, you will need courage. I did not know this at first and only learned it through the journey itself. Looking back at my life path, I now see that time is like a river, carrying us towards collisions with reality that require us to make decisions. We cannot stop this river’s flow, and these collisions are inevitable. We can only prepare for them as best as we can.

Five Steps to Success

Throughout your life, you will have to make millions of decisions. The quality of your decisions determines the quality of your life. Throughout my life, the most valuable thing I learned came from mistakes that I reflected on to formulate principles that prevent me from repeating the same mistakes. Thanks to these principles, I, an ordinary child from a middle-class family in Long Island, achieved significant success. I learned to love the process, even the failures, as they helped me confront reality and learn to deal with it. This inspired another of my fundamental principles: truth is necessary for achieving good results. By truth, I mean only how the world works. I became a hyper-realist, realizing that a deep understanding of reality and cooperation with it rewards a person abundantly.

Choosing Goals and Achieving Them

The most important decision you make is choosing life goals. I wanted my life to be magnificent, feared boredom and mediocrity more than failure. From childhood, I tried various solutions, fell and got up. I learned to view difficulties as puzzles whose solutions reward me. This inspired me to develop the principle: pain plus reflection equals progress.

The Path to Success and Overcoming Difficulties

Meditation became an invaluable help, helping me cope with difficulties and recover from pain. Each of us is endowed with a unique ability to think logically, reflect on ourselves and our circumstances. This allows us to direct our own development. We will discuss a five-step process that will help with this:

1. Know your goals and strive to achieve them.
2. Identify difficulties and obstacles.
3. Understand the nature of these difficulties.
4. Develop a plan to overcome obstacles.
5. Implement the plan.

Evolution and Continuous Development

A successful life consists of constantly repeating these five steps. Evolution is a process of either adaptation or extinction. It is a law of nature that can be seen in any object or organization. Evolution is about overcoming difficulties and growing despite their complexities.

Overcoming Obstacles and Mistakes

Each of us faces challenging circumstances that can either destroy us or, depending on how we handle them, give us new strength. In 1982, something terrible happened to me when I risked everything I had, anticipating depression. I learned important lessons about risk and reward that will help you deal with similar situations.

Reality and Perception

Life often seems difficult and confusing. I have thought a lot about how everything works, and this helped me see myself and my circumstances in a broader context. I realized that everything around is a mechanism, a structure, evolution. This understanding helped me perceive what happens more adequately and make more effective decisions.

Applying New Knowledge

I discovered that many events occur repeatedly but slightly differently. Understanding this helped me develop adequate principles for solving them. We will discuss how to use these principles to achieve goals and overcome difficulties.

Openness to Others’ Opinions

We should be open to the views and opinions of others to improve the likelihood of making the best decisions. I found that collaborating with smart and insightful people, whose views differ from mine, allowed me to radically improve my decision-making ability.

Conclusion and Moving to a New Stage

I talked about how I learned to face my real difficulties and how I surrounded myself with people who are capable of more. These principles, methods and rules have allowed me to achieve more, and I hope that they will help you too.