Michael O’Leary, the CEO of Ryanair has provided several practical business lessons. But he has provided more than just that. There are also several finance lessons from Michael O’Leary too!
I personally don’t like Michael O’Leary too much. But that isn’t to say that I don’t respect him. Michael O’Leary also provides several practical business lessons and personal finance lessons!
Most of these lessons come from Alan Ruddock’s “Michael O’Leary: A Life in Full Flight“. However, others do come from interviews he’s done over the years.
7. It doesn’t matter how you get money
When many people are trying to make money, they often worry about the source of the money. Not just if it’s legitimate or not, but how it will look if others find that they’ve made this money.
Obviously, I’m not advocating that you sign up for every scam imaginable. But I am advocating that if you need (or really want) that money, you should be willing to do whatever it takes to get that money!
And Michael O’Leary agrees with me! He talks about how some of his best business deals have come more out of desperation rather than planning!
And this is something I can also relate to!
A few years ago, a friend of my wife needed a lot (and I mean a lot) of money. She had no family, no husband or boyfriend to rely on. But she did have a rich (an I mean very rich) friend.
This friend of her’s had a wife, but was infertile. He offered to pay her enough money to bear their children, so that she never had to work a day in her life afterwards!
She initially turned him down because she worried about what people may think if they found out.
One day, she brought it up to my wife, who told her to talk to me. She told me the story and I asked her how badly she needed the money. Very badly. So I told her that if it was as serious as she said, she should probably take it.
So she did. And she’s never looked back! (PS: You’re welcome to not like me because of my involvement in the story. I understand there is often politics regarding a situation like this!)
6. The importance of timing
One of the best lessons from Michael O’Leary (in my opinion anyway!) is knowing the importance of timing. With your finances, just as with business, timing is everything!
It’s not just about knowing what to invest in that is key, but when. It’s not just about knowing how to budget, but when to implement it to have the best effect!
Whilst investing too early may cause you to waste valuable money. If you invest too late, you may not get the results you were hoping for! If you budget too early you might actually save less. If you budget too late, you might actually save less too!
Michael O’Leary teaches that timing needs to be (almost) perfect. Timing needs to be thought of in advance, not done on the fly. But, timing doesn’t need to be waited on for several years.*
*Unless you’re waiting to invest in a bear market, when it is a bull market!
5. Know when to quit (or not to!)
One of the greatest lessons from Michael O’Leary is to know when to quit, and more importantly when not to! In the beginning, Ryanair had two options:
- Try to find routes that ere under served and serve then, before building up to take on Aer Lingus
- Take Aer Lingus on directly and try to beat them
Michael O’Leary hasn’t really changed much since. As a result, he chose option two. This option almost broke him and Ryanair. But instead of quitting because it got hard, he pushed on.
And the same can be applied to our finances (as well as your business!)
When you’re investing, it will get tough. Spending hundreds of hours trying to find the best deal you can. With all of those hours going to waste if you don’t find a great company.
You will want to quit.
But know that if you do, and you want to invest your way to retirement, it will never happen!
The same can be said for budgeting, filing taxes and saving!
But sometimes you will have to quit. Sometimes you will find a bad investment that you need to cut your loses on. That’s when knowing when to quit can help you!
4. Know your income, expenditure and net worth
When Michael O’Leary was starting out, he worked under the tutelage of Tony Ryan. The founder of Ryanair. O’Leary soon got the full attention of Ryan after he handed the reigns of Ryanair to Eugene O’Neill.
Throughout O’Neill’s tenure, Ryanair suffered with not having enough funds. And it wasn’t just that. The Ryanair books were almost like a black hole!
Ryanair had no idea how much they were making, nor how much they were spending. As such, Michael O’Leary couldn’t find out where he needed to save on costs, nor where he could boost the bottom line!
As such, Michael O’Leary always tries to stress the importance of knowing everything about your finances! This can be done through the old fashioned, notepad and pen technique, or via a budget!
Another great lesson from Michael O’Leary would also include knowing your net worth. Why? Because it let’s you know what you are worth with a simple number!
If it’s low, you know you have a long time before you’re done. If it’s high, you know you haven’t got a lot of time left. It’s up to you!
3. The limitation of books
Books are the key to knowledge. The richest people continue to read and learn long after others have stopped. This doesn’t just have to be personal finance books, but also anything else!
However, one of the best lessons from Michael O’Leary is also about how books can only teach you so much! People can only write about what they know to be true, and sometimes, this can be very limited.
Both O’Niell and O’Leary saw this, when they were trying to make sense of Ryanair’s books and recognized that they didn’t understand what they were looking at!
Whilst they could’ve both hit the books, and tried to learn everything they need. They chose another path. Instead, they chose to get their boots on the ground and see it up close and personal.
As a result, when they returned to the books, they knew exactly what they were looking at! As such, they conquered that part of the issue and got back to the larger issue at hand.
What can we learn? On the ground experience tells you far more about something than books can! Whether it’s your finances, your investments or whatever!
2. Know when you’re not the expert
Probably one of the best lessons from Michael O’Leary is knowing when you aren’t the expert. When you are investing, whether in stocks, real estate, bonds or something else, you need to be the expert on it!
However, there may be a time when you aren’t the expert. This may be because you haven’t researched enough, and happen a few days or weeks after your investment.
Or this may happen decades after you made your investment. Perhaps due to new technology or a new player in the game.
But the most important part is, to know when you are not the expert. This is when you can then choose to learn more. Get reading about the new state of your industry, or get some hands on experience.
Or, you can divest yourself of that investment. It’s your choice.
1. It pays to be cheap
Probably one of the best lessons from Michael O’Leary is that it certainly pays to be cheap!
It’s not just because he runs a notoriously low cost airline. But also because of how he markets them. When advertising, he always takes the cheaper alternative!
Have you ever seen an ad online for Ryanair (assuming you live/travel to Europe)? Certainly not! O’Leary just doesn’t buy them! But on the TV, now that’s a different story…
Many people are also familiar with travel points (sometimes called reward points/miles or frequent flyer miles!) There are sites who often talk about how to get them, spend them or make them go further! (pun intended!)
But Michael O’Leary never pays for those sites referring them!
And whilst for those site owners, it is undoubtedly frustrating, it is one of the best lessons from Michael O’Leary in the flesh!
Which are the best lessons from Michael O’Leary? Tell me in the comments!
