The Trap Of "I Already Know That": Why Arrogance Is The Enemy Of Wealth

Yesterday, I had an interesting conversation with an oil and gas engineer who’d left his details on one of my ads. The exchange went something like this:

“What do you invest in?”

I listed the usual: stocks, bonds, mutual funds, cash-flowing structured products...

Some he recognized; others, he clearly didn’t.

“I already have a portfolio that produces 30% in INR,” he exclaimed.

“Great,” I said, “but INR isn’t USD. You can invest in Zimbabwe and get 100% returns, but currency volatility will eat most of it for lunch.”

“I signed up just to see if this was something new. I already invest on my own, so no need,” he said—and then hung up. And it got me thinking…

The "I Already Know That" Trap

The moment you tell yourself, “I already know that,” your brain shuts off. It’s a survival instinct—our brains are wired to conserve energy. Though the brain is only about 2% of your body weight, it uses up to 20% of your daily energy. So naturally, we default to autopilot, especially when faced with new or challenging information.

In Daniel Kahneman’s research on decision-making, most people rely on System 1 thinking—quick, automatic, and effortless. This mode of thinking is useful for routine tasks but dangerous when it comes to complex decisions, like managing your wealth. It blocks deep thinking and leaves you stuck in a loop of overconfidence.

It’s a classic case of the Dunning-Kruger effect: people with limited knowledge overestimate their expertise. Meanwhile, those who genuinely understand how little they know remain curious—and that’s where the magic happens.

Why Arrogance Blocks Wealth

Wealth isn’t about what you know—it’s about how quickly you can adapt to new information and let it change your actions.

In my personal experience, I am shocked that some of the wealthiest people I work with— some of whom are actually professional traders, CFAs, investment bankers... whose knowledge is far deeper than mine—are the least likely to tell me they know it all. I usually witness them say with stunning humility...

• “I got lucky. ”
• “What do you think about this?”
• “I’m still learning. I'm not a professional!” (even when they are professionals...)

They are curious and humble, gaining my admiration. They welcome new information without shutting it down as something they already know, not because they lack knowledge, but because they understand this simple truth: wealth is built on adaptation, not arrogance.

The Mindset Shift

The difference between “I already know that” and “Wow! I'm always learning more about this” is night and day. The former keeps you poor, waiting for the perfect opportunity or clinging to what you think you know. The latter keeps you evolving, adapting and makes you wealthier.

Successful investors don’t fear new information; they embrace it. So, how do you handle new information? Do you assume you already know... even when it's possible that you don't? Can you let go of “I already know that” and stay open to learning?