The 5 Chimps Theory states that you are an average of the five people you spend the most time with.
Like it or not – you are greatly influenced by the 5 people closest to you. Most of your conversations are with these people. They affect your mood and drive your behavior. They influence your decisions. In short, they influence your life!
According to Dr. McClelland of Harvard, these people determine as much as 95% of your success or failure in life.
Over time we end up becoming like the people we are closest to. Hence, the old saying – Show me your friends, and I will show you your future.
Close connections are important. So it is important to choose them wisely. You cannot hang out with negative people and expect a positive life.
5 chimps theory and Finances
I have a couple of friends who are focused on saving and have similar views about money. This helps me with my finances, and I do not get caught up in lifestyle inflation.
I have found that truly successful people are happy to share their perspectives and help others. If you cannot find the right people, there are a lot of books / blogs / podcasts on personal finance. It is better to read a good book on personal finance than to hang out with friends who live beyond their means. (if you like, there are a few recommendations at the end of the article)
The 5 chimps theory is not limited to personal finance. It applies to anything that you want to do in life. You may admire someone for their professional success. Or for their sense of humor. Maybe they are a great parent. Or they are an optimist.
The important thing is to spend time with the people you admire and wish to emulate. Because over time, you will end up becoming like them.
You spend a lot of time with your family. So that leaves maybe 3 of the 5 slots remaining. Look around – who do you spend most of your time with? Make sure they are people you admire.
Be around the people you want to be like; because you will be like the people you are around.
Finer Recommendations:
Below are some resources that were useful when I started my Financial Independence journey:
Books
- Your Money or Your Life (Vicki Robin & Joe Dominguez)
- The Millionaire Next Door (Thomas J. Stanley & William D. Danko)
- The Richest Man in Babylon (George S. Clason)
Blogs / Podcasts / Videos
- Mad Fientist (He also has a podcast, if you prefer that)
- Mr Money Mustache (a great video from MMM if you want a quick recap)