Why the Wealthiest People in the Room Are Often the Most Miserable — and What to Do About It

They dig into the three-pot portfolio strategy Matt developed after managing insurance company money that changed how his clients think about market volatility, why crossing wealth thresholds rarely reduces financial anxiety, and what it actually means to be on the right mountain.

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A full transcript is below.

This podcast was recorded on Oct. 4, 2026.

Matt Ludmer: Why do wealthy people get wealthier? It's because they don't have to sell. They can handle volatility. It's not brilliance. It's organic understanding of Well, I don't need to sell my equities I have so much other stuff to pull from. Why don't we do that as individuals, as well, to the extent that we can?

Rachel Warren: That was Matt Ludmer, 40-year Wall Street veteran and author of the Right Mountain on why the secret to building lasting wealth has almost nothing to do with being smarter than everyone else. I'm Motley Fool analyst Rachel Warren. Matt started his career as one of the first wealth managers at Morgan Stanley. After decades sitting across the table from some of the wealthiest people in the world, he came to a startling conclusion. Most of them are miserable. He joined me to talk about what actually separates people who build wealth and relax from those who build wealth and burn out, including the three pop portfolio strategy he developed that changed how his clients think about market volatility forever. We hope you enjoy. Welcome back to Motley Fool Conversations. I'm Motley Fool analyst Rachel Warren. Today, I'm delighted to welcome Matt Ludmer to the show. Matt is a 40-year veteran of Wall Street Wealth Management, the founder of Aligned Wealth Management, and the co-author of the new book, The Right Mountain Practical Wisdom for Achieving True Wealth. Matt started his career as one of the first wealth managers at Morgan Stanley, later becoming a director there, and then, of course, launched his own firm, Aligned Wealth Management in 2013. Matt, welcome to the show.

Matt Ludmer: Oh, thank you, Rachel. Thanks for having me.

Rachel Warren: I'm excited to talk about your book and just dig into your experience and background. I want to start here. We live in the wealthiest society in human history, but anxiety, burnout, dissatisfaction rates have never been higher. I wonder after decades at the top of your craft, what led to your realization that today's definitions of wealth and success are somewhat broken, if you will?

Matt Ludmer: It wasn't me sitting on highway making that observation. It was really my own personal experience. I was at Donaldson Lufkin & Jenrette around the year 2000. I was on one of those corporate outings that were pretty opulent in the four seasons in Scottsdale, Arizona. They were giving out awards for the top producers. I remember it was lie winning an Oscar while everybody was in the ballroom and they called up the fourth largest producer, the third, and I had just joined the firm from Morgan Stanley. I had no idea these things actually went on. Then they announced a top producer at the firm, and I got the award. I was shocked. I was like, what? First of all, I didn't know that was the case. Second of all, it was at first, it felt great. Then it felt actually like the person who won the second greatest producer, largest producer, turned to me and said, I want your position. I'm going to get it next year. I was like, wow. I just realized, I have to do this again. I just felt like the Sisyphean rock up the hill thing, I felt hollow. I felt achievement, but I didn't feel fulfilled. It really was that realization and then also seeing it in my clients the same thing, and then having a father who was content in all ways and didn't really have very much. Seeing the contrast, seeing my own hollowness, put me on a path to understanding, I'm a wealth manager. One of the first wealth managers of Morgan Stanley. If this isn't wealth, if this achievement doesn't bring fulfillment, what does? That's what I spent the past 26 years on a first principle basis studying.

Rachel Warren: What is the three pot portfolio strategy?

Matt Ludmer: I had the real great privilege of managing money for an offshore captive insurance company in the '90s. One of my mentors invited me down to compete for business for a large portfolio. Anyway, I didn't know anything about insurance and how they invest, but they do it differently than individuals. They don't invest like it's one big pitting, you just invest the whole thing. They match assets to liabilities. I think, wow, that's interesting. They do it over time. When you have an insurance portfolio, you have the working capital portfolio to take care of insurance needs. You have the insurance reserve, and then you have surplus. The first is for short term, the second is for intermediate, and the third is for the long-term needs for the people that are insured. Because I was running the money, I was seeing, the first part is for one to five year needs. Of course, that's going to be more fixed income oriented portfolio. Pot 3, the last one, the surplus, of course, is all equity because it's got a long-term nature to it. The second pot was a mix of the two. I thought, wow, that's a great idea. Why don't individuals do that? There's a psychological benefit for that. That's when it hit me. Oh, that third pot is now untouchable because when I need funds, I have a first pot and a second pot to go to before I touched the third pot, the long-term pot. What I realized over time, working with very wealthy people is that, why do wealthy people get wealthier? It's because they don't have to sell. They can handle volatility. It's not brilliance. It's organic understanding of, I don't need to sell my equities I have so much other stuff to pull from. Why don't we do that as individuals, as well, to the extent that we can? When someone comes to me with a portfolio, this is the way I look at it now. I say, the goal of this portfolio is psychological, not just material. Psychologically, I need to hold you back from selling your portfolio when things get scary. How do I do that? Let's create Pot 1. Pot 1 is, how much money do you need? People say, oh, for mortgages for the next few months or whatever. No. What amount of money is going to make you sleep at night in the bank? Let's say AI starts wreaking havoc or there's a whatever, and the market goes down 30, 50%. What's going to make you feel I'm okay? Maybe nothing.

But for many, it's like, if I had this much money, I know that things get solved and things do get solved relatively within a certain amount of time. For each one of us it's different. Some of us are very conservative. We want to have a very large pot one. Some of us have a very small pot one. Look, I don't think I can be fine with it. That's your secure base, and that's invested in treasuries and AAA Munis. You sleep at night. You're good. Secure base comes from Dan Goleman's wife, Tara Goleman, who writes about emotional alchemy, and she calls it the secure base. In life just not even investing. You need your children. Everybody needs a secure base before they go take risk. I'm just psychological first principle. Then the third bucket is really for 10-year plus money or your IRA, your pension plan, what you can put away that you know you're not going to need for the long term. Why? Because we know the basics of investing are like rolling dice. If you roll it once or twice, you can get anything, but if you roll 1,000 times, you're going to get sevens. If I think of the market as 7%, and if you think of the market as somewhat random, which it is, in my opinion, then anything could happen. How do I protect myself from that? I keep a long-term investment horizon. I have a lot of roles. Not 12 in 12 months, but 120. Therefore, I almost guarantee myself by the law of numbers in a normal distribution that if history holdsas it has for over 100 years, and corporate cash flows continue to increase, and everybody wakes up, tries to make a better world for their kids and millions of companies. I could buy an index to capture that. I'm going to do that. On Pot 3, and I can go to different techniques. But essentially, I just want to own the whole market as much as possible and let that hold that for a long period of time and be confident that the world is trying to solve its problems, and it does that.

That's what the entrepreneurs do. That's why they're so great, because whatever problems come, they're going to wake up one morning and go, I got the answer. I'm going to put it in my company. I'm going to make the cash flows and the discounted cash flow future earnings better and better. You have confidence in that, and you have your secure base to protect you. Then, of course, we're not like machines. We want to have fun, and we want to make predictions, and we want to a friend who's a hedge fund manager who's doing great and you believe in him. Even if the statistics are tough in this particular Pot 2, Pot 2 is to express yourself and express your opinions. It's where you have a private investment that you do where there's no history, and you're taking a shot at something. What I found myself personally in Pot 2 is I'm pretty terrible Pot 2 investor. I get so excited by other people's ideas that it's like, oh, I'll do that. Invariably, it's more emotional than real. But it also makes me feel alive. I can't just be a full index only person. If I could, I would but I've been in Wall Street my whole life. I like new technologies and what's going on.

Even though I know most of this is already priced in the prices of things and the chances of me doing well are suspect. It makes me just feel part of life. This Pot 1, which is one of five years, Pot 2, which is 5-10, and Pot 3, which is 10 plus is a way of structuring a portfolio, and I've showed it to a number of people who are directors of a number of the investment firms, and one or two have taken it and made very large businesses out of it. They went mad. How come you didn't just go out and do this? I'm like, because this is great, but what does this actually do? It allows you to invest and relax. Once you have this structure, we'll do this tomorrow. The mark went down 20%. Your structure is guiding you, not the market. You can have confidence in your structure. That really matters. It's like having structure in all these views really allows volatility to happen, and volatility is part of life. But if you're prepared for it and you're structured for it. You can now turn to other things. Your question of what's your relationship to it, if you're trading every day and if you're constantly doing Pot 2 activity, the stress that you could have can be really high. In my mind, going from invest and stress to invest and relax is really what the whole book is about. Because like, once you do that, I'm not looking at my portfolio every day. What do I do? How do I gain fulfillment?

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Rachel Warren: You've talked about how you spent decades managing money for incredibly wealthy individuals. I wonder, did crossing certain wealth thresholds reduce financial anxiety or did it tend to just shift the anxiety onto different variables?

Matt Ludmer: It's great. I write about this in the book about it's called The Wheel of Life and the Different Ways We Suffer.

Rachel Warren: I love that.

Matt Ludmer: Because when you don't have enough, you suffer some poverty mentality. How many people do you know who if they only had a net worth of X can then go to Florida to have a life they want, and then they're like, 65, 70, and they're first starting to live? No, that's not a good formula. Or someone's made it early and they're living this great life, but there's a constant dread of like it's going to go away. There's this tightness in them that's not able to relax because there's a constant radars checking everything. I'm checking this. I'm checking that. Why are you checking? What in your structures making you check? You don't need to do that. In fact, if you are checking, you are not relaxing. Your structure should be able to handle it. The confidence of your understanding the view that you have is what you have confidence in. Once you have confidence in your view, you can relax. If you're going to have fun in life, relaxing cannot be a phony relaxation. It has to be structural. You know what I mean? My goal when I meet with a client is I want finances to go background for you. You should get to the point where you understand this so well, you don't need me.

Rachel Warren: What's interesting about this, as well. You talk a lot about mind body practices in your book, which I think is really fascinating, going back to the mindset aspect of accumulating and preserving wealth. How can those be applied by, let's say, investors who are concerned about market volatility? They're watching the state of the markets. There's obviously a lot of exciting investment opportunities, but there's also a lot of hype around a very small number of businesses. If you're an investor and you're anxious about some of the developments that you're seeing, what are some of those mind body practices? I know you go over a lot of ancient traditions that you brought into the development of some of these in your book, but maybe you can walk through a couple of those.

Matt Ludmer: I'll give you one that my friend Jeff Carrera uses, because if you're constantly in a mindset of problems, like you know people like this. Everything's a problem. We're going on a trip. Oh, we're not going to make it on time. We get there. The hotel's not good enough. I just got a call from my mom, and there's always a problem. There's no space for this contentment and relaxation to occur. It just doesn't happen. I have a friend who teaches the practice of no problem. Before people get nervous, it doesn't mean you don't have a problem. It just means you allow yourself some time to not have one. It's this very simple practice. The practice starts like this. You just said a timer. Let's say, you said it now. Then you just say, whatever comes to my mind, it's not a problem. You just say to yourself, it's not a problem and then go back to just relaxing. You set the timer, and then it's the practice of no problem. As you sit there and try to relax, notice what problem comes and just say, not a problem and let it go. You do that. Even if you do that right now, if I just say, for the next 10 seconds, don't have a problem with anything and don't have a problem that you don't know not have a problem. Don't have a problem with that. Let's start now. Hopefully, you've had some experience of not having a problem with what's going on. As you widen that practice to five minutes to 10 minutes, and you're able to just sit without a problem, your body, you start to witness things more than actually be in them, and you get a little bit of a relief. The practice is no problem, which Jeff Cara teaches, and I highlight him. It's really worthwhile. Also, there's another just obvious one that I could just quickly show you. If you put your hands over your eyes and I ask you what you're seeing, you're just seeing the back of your hand. But if you take your hand out, you still see your hand, but you see the full room. When someone says why would you meditate? When somebody's fretting a lot, it's essentially and they're worried about their portfolio or stock. Their hands over their eyes, that's all they can see.

There is no relief from that. You don't want to forget about it 'cause it's on your mind. I don't you can stop thinking about it. But if you give it a little bit of a space, if you pull it out metaphorically and just see it and then see what else is going on in your life, as well, it just gives it some perspective. When we meditate, that's essentially what we do when we look at our thoughts. Initially, we are our thoughts. But then when you just look at them and relax, they start to move and give a little bit of distance. I think we need to relax and have some distance from the maniacal pursuit of achievement, even if it's just a relief for a few minutes. Look, Dan Goleman, if you ask him what's the best method of emotional intelligence or meditation, let's say, he'd say, it's the one that you'll do. There's so many apps now. There's so many ways to learn to meditate and gain space and gain relaxation. If I just gave you two little ones, and maybe they work for you, maybe they didn't but I'm just trying to motivate you to look for those methods and then do the one you'll do. It could be just taking a walk during lunchtime. It could be just getting on the phone with a friend who talks about other things besides finance. Get yourself some relief, and then start walking a deeper path. Ultimately, for me, it went way far. I've been doing this since I'm 18-years-old. It happened upon a great Tibetan teacher named Chögyam Trungpa Rinpoche, one of the first Buddhist teachers in the United States at a Boulder, Colorado. I met one of his students, and I said, oh, that was the Harry Met Sally moment. It's like, oh, I want what they have because there's a contentment that comes with a meditation practice. I like learning from lineages because it's like a first principle thing. It's been checked out and tried and true. I don't know. Is this where?

Rachel Warren: It's fascinating. Absolutely. Also, our listeners and viewers don't always get to have a live meditation on air, so that's also very fun. I think it's an important point you make. This was something that also fascinated me in your book was, as you were learning some of these Tibetan traditions and then taking it into your relationship with money and wealth management. Maybe you could talk a little bit more about that to our listeners.

Matt Ludmer: I thought I was a freak because there were just so many aspects of wealth that I was seeing that were not being used by people. My 50th birthday party, I invited my friends from the different parts of my life. This is crazy. But I'm sitting around a round table in the meat packing district and we're celebrating my 50th birthday party with my best friends, and nobody knew each other. Because my life was so segmented. My Buddhist friends who are meditators, were sitting next to my business friends, who were sitting next to my Jewish friends, we're sitting against my friends at home and my basketball buddies. They all didn't know each other. I realized, oh, part of the integration. What I'm trying to do really is provide an integral view of wealth. I hate to say it, but we don't need another psychologist, meditative instruction, investment advisor, social activist, or a professor, we need someone who can say, in a modern life, how do we put all this together? How do we align it? That's why I called my firm Aligned Wealth. How do we align it? It was from learning the principles of integral theory that I was like, oh, this is how you integrate. Integral theory was the basis of Paul Foods. It was at John Mackey. Tony Robbins had found great benefit from Ken Wilbur's work. Bill Clinton learned Integral theory. It's funny because it has a power to it. Once you learn it, I can give you a quick two minutes. How do you make something integral? You simply ask three questions. Is what I'm doing true, is what I'm doing good, is what I'm doing beautiful? It's called truth beauty and goodness. I tend to Wall Street to do the true things things is I can count and weigh. But I want to do good. I want to help other people. The beautiful aspect is just knowing myself. If I'm doing something and I know I can make it beautiful and I can do it for the benefit of others, and it's true and effective, that's what holistic means. This whole holistic movement. If you ask somebody, what does holistic mean? There's very few people give you a definition. To me, that's the definition. If I want to do something holistically, is it true? Is it beautiful? Is it good?

Rachel Warren: There's something you also talk about in your book is this idea that so many people spend significant parts of their lives climbing the wrong mountain, so to speak, that can be a very jarring experience. What are some of the most common reasons people come to that realization, and what is the way to change that to pivot?

Matt Ludmer: We start climbing a mountain that it's not ours. We're super conditioned. I know we don't think we are, but we are super conditioned. I only know that because I am, and it takes a lot to get unconditioned. Your parents tell you you want to be a good boy, a good girl. You want to get the high marks. You want to do the right thing. I had two friends growing up, both who wanted to be lawyers, and one who always went and his only decision one, I'm going to do the best. That was his decision. I'm going to do the best. The other was I'm going to do who I am. One went to Columbia, and the other went to Fordham. But what happens when you just do what the best is, it's not your best. It's other people's best. Then you find, as you get older, oh, I'm on the wrong mountain because it's not making me feel good. Whereas the person who did what was good in their mind, in their gut as the right path, not always the best, but something that was best for them. They buck the conditioning that's out there. Because if we all did the condition thing, we'd be a pretty scary society. We all have our quirks and ways, and they need to be respected. This other friend of mine who became one of my best friends, he was an amazing guy. He passed, but his name was Dave Goldberg, and he was just like truly who he was. To me, that's true wealth. Succeeding on what other people think is best, I question that. The book starts with the question, are you on the right mountain? Because like I said, initially, it's healthy to follow the path of others. But at a certain point, you got to make your move. You'll be surprised. I remember when I left Morgan Stanley to do this, one of the people at Fidelity, he was a great counsel for me. He said, today every person who's moved said to me, why didn't I do this sooner? Or why didn't I create my own thing first? When I went to DLJ, from Morgan Stanley, I loved the firm, and in a way, things had changed a bit. It was because I knew it was a good place for me to go, and it was just a gut instinct. I didn't do it for money. I did it because I thought it was a good thing. These are risky moves when you move businesses for either no money or for a different view. Don't get me wrong. I love Morgan Stanley. I'm still great friends, and I'm still working with Morgan Stanley in certain ways, because there's still that I still have friends who are part of the initial culture, and I don't know what things are like now, but it's really fantastic. I don't have a negative view pretty much much except when things get unhealthy.

Rachel Warren: I wish we had more time to talk today, but one final question I wanted to ask you before we wrap up today's conversation for investors who might be listening and wanting to develop a healthier relationship with growing wealth, with their relationship to money, what are a few of the mindset traits that we can cultivate?

Matt Ludmer: I'm sorry. What's the profile of that person?

Rachel Warren: Let's say a retail investor who's listening to our conversation today, they're building out their portfolio. We have a broad investor audience. But I think those mindset traits that you've discussed are so applicable across the board, to a wide range of investor profiles. What's a good starting point to cultivate a better mindset trait when it comes to money?

Matt Ludmer: I think the first thing is to just understand the mountain range, what mountain you want to be on. You got to understand the range before you start journeying. It's good to have the full map and to start seating, look, you start from the basics. You start from the things you need to focus on, the positive mindset, building a career that you're excited about, being lit up about waking up in the morning and going to work and having your revenues greater than your expenses. That's really Step 1, because that's the healthy ground on which you build. Then once you've got that, you can then start looking at the full map, which if I spent 26 years writing out and just saying like, what part of this map do I need so that when I'm done with my path, I could look back and go, oh, I'm on the right mountain? I have a great financial abundance in work. I'm lit up about work. I'm psychologically okay and I have a spiritual path. I'm connected with other people, and I'm helping other people. I understand how the world works. These are the four dimensions of true wealth. We don't have time to go into these, but I write about them. When you look at these four dimensions of wealth and you have a full functionality in them, not like, you don't have to be perfect. In fact, trying to be perfect in all these things will harm you. You want to be functional in all this. I find people who make a certain amount of money and want to have the ultimate amount or who are super mindful and want to just be the best meditator, which is a strange thing, or somebody who's connected to people and they're just going to create nothing but a huge community and perfection in all these makes you too serious, and it's no fun. Being functional in all these four areas, what I call true wealth, can lead to fulfillment. Isn't that what we all ought? The last thing I will just put a little bit of a seed in that the seventh essential is where you go from fulfillment to essentially even further, which ultimately is a sense of feeling free. It's a full path I laid out where you go from unhealthy version of wealth to the sense of functional wealth, and then essentially to more profound way of enjoying it. It's a full path thing. I think knowing the full view and then concentrating and where you want to do things. But without the full view, you can get lost.

Rachel Warren: To those who are listening to today's episode or watching check out Matt's new book, The Right Mountain Practical Wisdom for Achieving True Wealth. Matt, it's been wonderful to speak with you today. Thank you so much for joining me.

Matt Ludmer: Thanks, Rachel. I really enjoyed it. Thank you for the opportunity.

Rachel Warren: To see the full interview, go to our Motley Fool Conversations YouTube page. As always, people on the program may have interests in the stocks they talk about, and the Motley Fool may have formal recommendations for or against. Don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. For The Motley Fool Hidden Gems Investing Team, I'm Rachel Warren. Thanks for listening, and we'll see you next time.

Rachel Warren has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.