When I say the “secret” of grounded confidence, I mean both that there’s a secret to gaining it (which I’ll be sharing below)… but also, that grounded confidence itself is a secret!

What do I mean?

Well, when you hear the phrase “gain confidence,” what comes to mind?

Maybe you think of some kind of pep-talk, from a mentor, coach, “motivational speaker” or “transformational leader.”

(Those in latter two groups sell expensive seminars where you jump in chairs all weekend, scream in groups, and hear inspiring stories about other people who took the upsell seminar and now live on yachts, etc…)

These forms of “confidence” are like jolts of coffee… good for a few hours, or even days (hey, that’s some strong coffee!) But then the crash comes… and you need the next external fix.

In contrast, grounded confidence is based on:

A back-and-forth dialogue between inner confidence, and improvement in external results.

(The last part–external results–is where the “grounded” part comes in.)

Let me tell you a little story about grounded confidence, and how to gain it.

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Most people who haven’t already “made it” are lucky to have a few people who truly have rock-solid, investible faith in them. Maybe their parents (if they’re lucky!) Maybe a few really close friends, or a mentor they’ve been lucky to find.

But in a typical lifespan–before you’ve “made it,” however you define that– the main person who is going to have faith in you is you.

That means, before you’ve reached the level of success you desire in life, investing in yourself is a form of contrarian investing. (Investing that goes against the crowd.) And a form that I think is much more doable, valuable, and safe than contrarian investing in the markets.

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If you’re wondering how you will provide for you and your family’s financial security in the future, you’ve probably considered saving money in your IRA or 401(k), and investing it in broad mutual funds tracking the US markets. Or you may have already done this.

If so, you’ve probably been lulled in by the personal finance industry’s PR that, “in the long run, the US stock market has gone up 7% per year annualized, after inflation.”

Sounds great, right? 7% per year is a doubling of your assets roughly every ten years. Just stick that money in there, don’t touch it again (“buy and hold,” or “passive investing”) and watch your wealth double every 10 years! (That’s a 12-fold increase over 40 years!)

The problem is, there’s a dirty secret to the investment business–one that the people selling you this BS advice don’t want you to know, because it would put them right out of business.

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The key to fool-proof investing is truly internalizing the implications of the following unsettling fact.

Most people are fools when it comes to evaluating their own talent in many of their own skills. (Including, as we’ll see in a moment, investing.)

Unfortunately, chances are, that includes us.

Studies show that 95% of people believe they are “above-average” drivers.

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There’s a strong case to be made that the two sentences I’m about to share with you are the most influential in the entire history of Western philosophy.

They were uttered during the trial of Socrates for “corrupting the youth” in Athens, 399 BC–according to the version recounted by his disciple Plato.

According to Plato, Socrates said–while commenting on a negative run-in with a supposedly wise man of Athens:

“Although I do not suppose that either of us knows anything really beautiful and good, I am better off than he is–for he knows nothing, and thinks that he knows. I neither know nor think that I know.”

A basic reformulation of this, is that a fool can become wise, simply by knowing that he’s a fool. For he is then wiser than the most other people, who are also fools, but don’t realize that they are.

What does all of this have to do with investing?

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