Search Avatar image 2:31 / 1:38:21 • Why should someone stay and listen to this episode? The Money Expert: "Do Not Buy A House!" 10 Ways To Make REAL Money: Ramit Sethi The Diary Of A CEO 5.13M subscribers Join Subscribe 114K Share 5,387,723 views Jul 20, 2023 All The Diary Of A CEO Episodes In this new episode Steven sits down with personal finance adviser and host of Netflix’s ‘How To Get Rich’. 0:00 Intro 03:05 Why should someone stay and listen to this episode? 04:53 The language of money 06:03 Numbers we should know 09:47 How many people are clear on their rich life 15:40 Why people should think twice about buying a houses 26:00 The S&P500 & investing 37:00 Compound interest calculator 44:20 What are the characteristics of someone that will end up little money 47:44 How do I increase my income? 51:47 Optimising your skill sets 59:11 Should I invest in cypto 01:04:13 Always have 1 year of emergency funds 01:04:52 How much to invest & what you shouldn't question spending money on 01:06:30 Business class flights 01:07:54 Always buy the best 01:08:38 Always spend on these 2 areas 01:11:16 Work only with people you like 01:12:59 don't get caught up in the numbers 01:14:02 Talking about money with a partner 01:29:09 Character traits of people that will never get rich 01:33:18 The last guest's question Follow Ramit: Instagram: https://bit.ly/3Om30Gw Twitter: https://bit.ly/3NXDNAH My new book! 'The 33 Laws Of Business & Life' pre order link: https://smarturl.it/DOACbook Join this channel to get access to perks: https://bit.ly/3Dpmgx5 Follow me: Instagram: http://bit.ly/3nIkGAZ Twitter: http://bit.ly/3ztHuHm Linkedin: https://bit.ly/41Fl95Q Telegram: http://bit.ly/3nJYxST Sponsors: Huel: https://g2ul0.app.link/G4RjcdKNKsb Whoop: http://bit.ly/3zNvvop Chapters View all Explore the podcast 274 episodes All The Diary Of A CEO Episodes The Diary Of A CEO Podcasts Transcript Follow along using the transcript. Show transcript The Diary Of A CEO 5.13M subscribers Videos About Shop the The Diary Of A CEO store $31.53 The Diary $31.53 The Diary 8,424 Comments cloudreader Add a comment... @DanielaMeza-hv7pe @DanielaMeza-hv7pe 1 day ago Blcktken300 gang in the house! Thanks for the analysis! 275 Reply @JoseFelipe-nf3zy @JoseFelipe-nf3zy 1 day ago Wasn't Alex Becker a private investor for Project Blcktken300 . It's been killing it lately. Do you think it's still got room to move. 277 Reply @AlondraCarranza-kf6pc @AlondraCarranza-kf6pc 1 day ago Nice work. I’ve been on the Blcktken300 train for a while, never sold as they are always building. 240 Reply @user-hq7ty9jt4b @user-hq7ty9jt4b 1 day ago Need more Blcktken300 content. Converted my ETH to BTC but kept my Blcktken300 196 Reply @gazmaniroblesvelazquez @gazmaniroblesvelazquez 1 day ago Blcktken300 is young. Holding almost anything mentioned here is a good hold because the VHS or Beta will only show in time. I want to hold them early. Its sad that most dont think of these things as good future holds instead of being out of the market and bottom hunting. Are we the adopters or are we scavengers? surely one of these layer ones will become the standard and i dont want to sell any of them too early. 244 Reply @JosemiguelDelacruzherrera @JosemiguelDelacruzherrera 1 day ago Im staying in Blcktken300 till after ETFs being approved and will move into alts after that... 311 Reply @roblewisvideos @roblewisvideos 1 month ago I am 43, nobody in my life ever had this conversation with me. This episode was gold. Thank you. 393 Reply 17 replies @LeonelSarabia-dl5cs @LeonelSarabia-dl5cs 1 day ago I feel that the last bull run was bolstered by all the money being printed. Major returns next bull run but I think they will be tamer in my humble opinion. A 10x on Blcktken300 and a 15x on polygon are fair considering how much those two coins are interwov 218 Reply @Tedoslo @Tedoslo 13 days ago Housing prices are unlikely to significantly decrease until there's a substantial increase in housing supply. In the USA , there's a shortage of millions of housing units, and construction isn't keeping pace. The constant demand for housing, coupled with population growth, means that even a slight price drop attracts numerous buyers who quickly absorb the available supply. I'm considering purchasing affordable houses in 2024 and possibly venturing into stock investments. When is the best time to enter the stock market? Some people say it is profitable , but others say it's risky. Any advice? 833 Reply 12 replies @user-cv5nv9zm3l 1 day ago Do it. Blcktken300 already in my bags. I had a Blcktken300 after ( your should I buy ) and I agreed and bought. I'm looking to stack more, too. 240 Reply @josejavi7079 1 day ago My Blcktken300 shorts are doing pretty well and I plan to hold much longer. 234 Reply @Casey-summer 5 months ago Building wealth from nothing involves consistent saving, disciplined spending, and strategic investments. Begin by creating a budget to track expenses and identify areas for savings. Prioritize paying off high-interest debt and establishing an emergency fund. As you build a foundation, start investing in low-cost options like index funds, and focus on continuous learning and improving your skills for better income opportunities. 2K Reply 13 replies @leoniciomata 1 day ago I think Blcktken300 will be the most important project in crypto. But HBAR sounds nice too. Will buy some with my Blcktken300 earnings lmao 219 Reply @masonwilliams1810 3 weeks ago “ how can you judge someone based on a reaction to a situation they’ve never been in?” what an amazing quote. 37 Reply @dannacasas8524 1 day ago Love the Blcktken300 content. I think this project is just as essential as HBAR and they both will be great movers 217 Reply @josejavi7079 1 day ago I'm DCAing in Blcktken300 as well. ETH heavier DCA and ALGO. I'm taking your advice and starting Google tomorrow with a 50 dollar purchase and continuing Microsoft and Apple. VTI and VOO on another app and longterm portfolio. Here we go family! 216 Reply @benitabussell5053 4 months ago The S&P 500, if one sticks with it, outpaces inflation by many percentage points. I just want my money to keep outgrowing the inflation rate. That is why I'm looking for companies now to put in $80k for a start. Just don't know how to proceed 591 Reply 5 replies @jessicamegan5850 2 weeks ago Hello, I am in London and am considering investing in real estate as a way to get some passive income. A few years ago, my brother purchased a home in a county outside of London. Because he was unable to find tenants, the property was eventually repossessed. As a result of this experience, I'm concentrating on purchasing real estate in London, where it's quite challenging to obtain a mortgage because of the high cost of the properties. Would you kindly recommend an easy way, where one may try to sustain these cost on mortgage? 612 Reply 15 replies @ernestagyemang-botchway108 4 weeks ago (edited) I have a bachelor in banking and Finance,and I never learned this all in my 4 yrs of college.Golden resource...thank you 80 Reply 3 replies @TheBlueskyson 3 weeks ago (edited) I sold ALL my properties. What a waste of time accumulating and buying houses was. I completely misunderstood the method to gittin rich. Now i just rent and live stress free. The markets are everything to me now. HNY y'all. ty 4 vid. 38 Reply 3 replies Transcript Intro 0:00 ah this is driving me insane to make a lot of money you don't need to be a genius you just need to remember a few 0:06 key things ramit Sethi Financial expert the money man New York Times bestseller has more 0:11 than 20 000 documented success stories this is your chance to never worry about money again you can live a rich life 0:17 regardless of where you came from regardless of your income how many people are clear on what their rich life 0:24 looks like less than one percent when I talk to people who have a spending problem 100 of the time they always say 0:30 the same thing I just need to earn more if you double your income today do you think your problems would disappear no 0:35 some of the stats I pulled out from your book about 25 of people who made hundred thousand dollars a year plus are still 0:41 living paycheck to paycheck makes us realize that maybe the things we think we need are things that we have been 0:47 socially taught are important for example owning a house is the best investment it means you are successful 0:53 but it can be a very bad financial decision there are far better far simpler Investments so I've got 100 0:59 pounds that I want to invest where do I start I love that we're getting into the nuts and bolts let's do this exercise 1:05 together and everyone can do it with us first off and then got it now there's just one more thing you have to do 1:12 do you know the math I would have 736 000 in my account yeah 1:18 ramits 10 Money Rules this is where the real wealth is created number one 1:32 this episode changed my perspective on money I'm an investor I've been 1:38 investing for the last six seven years at different levels big companies small companies the S P 500 funds you name it 1:45 but ramit changed my mind he changed my mind on money 1:51 spending investing and he changed my mind on something that I think 1:56 95 of you that are listening to this podcast and they're about to listen to this need to have your mind changed on 2:03 too that if you have the right philosophy towards money the right perspective and mindset towards money 2:10 then there is a path to living our rich life to becoming rich that enough people are 2:19 not talking about he debunks the myths of money the limiting beliefs about money 2:25 and he confronts all of the unhelpful advice about money that stands in the way of you becoming 2:32 rich there's an app on my phone that I now have installed because of this conversation 2:38 and there are three big Investments that I've now made in my life because of this conversation 2:44 and there is one key idea that I now believe will make me ten 2:50 times more wealthy over the next three decades because of this conversation 2:57 you're gonna love it enjoy [Music] 3:03 remains [Music] Why should someone stay and listen to this episode? 3:08 someone's just clicked on this podcast on YouTube on Spotify on Apple and they saw the title they saw the thumbnail 3:14 they thought that sounds interesting tell me why you think 3:20 they should stay and listen to what we're going to talk about today what they stand to gain if they give us their 3:25 time whenever someone hears someone talking about money they get rigid they instantly think that 3:33 someone's going to come in and tell them you can't spend money on lattes you can't go on vacation you can't buy any 3:38 new clothes save all your money until you're 90 years old and maybe just maybe 3:45 then you can spend it and I don't believe in any of that I think you should spend extravagantly on the things 3:51 you love as long as you cut costs mercilessly on the things you don't I think you should live a rich life 3:58 today and an even richer life tomorrow and so when you combine money and psychology 4:04 you start to understand that there is more to a rich life than just some number in a spreadsheet people already 4:11 know they should be saving more they know about compound interest they may not know the intricacies but they 4:17 understand if they invest some now they're going to have more later so what's stopping them that's been the 4:22 central question that I'm fascinated with for the last 20 years that's why when I studied human behavior and 4:28 persuasion and psychology I was obsessed with this question of what are the 4:33 things we know we should do but we still don't you can live a rich life 4:38 regardless of where you came from you can live a rich life regardless of your income 4:44 now of course having a higher income dramatically helps but just like Fitness we can all improve 4:50 where we are and that's what we get to talk about today when you talk about the language language of money what do you mean I The language of money 4:57 mean understanding the nuts and bolts of money so just the same way that we all learn how to drive we learn the rules of 5:04 the road when to use our turn signals most of us do not have even the equivalent knowledge of money for 5:10 example the basic language of money would be what percentage of your income are you saving and why 5:17 what percentage are you investing and why when will you have a hundred 5:23 thousand dollars or five hundred thousand or a million dollars and what will that money get you because just 5:30 having a million dollars in the bank is pointless what does it get you specifically 5:35 this is the basic language of money you've got to know your key four six 5:41 numbers in your life not many just a few but once you understand those numbers it's like understanding the speed limit 5:48 understanding the speed limit means you understand a lot there's a rule of the road if you go too fast what's going to 5:54 happen why do these rules exist and these rules are similar in money you can 5:59 break them that's okay but you got to understand the rules first what are those numbers that I need to know there's four numbers Numbers we should know 6:06 that I really like to track I track these myself and these are the numbers I encourage the first is your fixed costs 6:12 those would be your rent or your mortgage your in uh your any debt 6:18 payments groceries the money that you are spending every single month that is essentially fixed 6:24 and the number I recommend for that is 50 to 60 of your take-home pay 6:30 so that would be if you're spending 50 to 60 percent of what you make what you take home on your rent your groceries 6:36 any debt payments your car you're in good shape okay the next one is your savings that would be roughly 6:43 five to ten percent savings would be things like an emergency fund savings for a down payment for a car things like 6:50 that third is Investments uh this is where the real wealth is created and for this 6:56 five to ten percent of take home is fine of course the more you put in the more 7:02 you're gonna have and then the fourth category the one I love the most is called guilt-free spending 7:09 this is going out for cocktails in New York it's buying a beautiful shirt it's 7:14 treating your friends whatever you love yoga 20 to 35 percent of your take-home pay 7:22 so if you're watching or you're listening to this just take 15 minutes 7:27 back of the napkin jot down your approximate numbers you don't even have to get them perfect and you will be able 7:33 to Benchmark how you are spending compared to those numbers I'll tell you that those numbers tell me 7:41 a lot it's almost if you just show me those four numbers of your spending I can tell so much I can tell what you 7:47 love spending on I can tell what you don't I can tell what your priorities are 7:52 and I can also tell where you are out of alignment so I'll give you an example 7:57 when I ask people what is your rich life one of the common answers they say is I want to do what I want when I want I go 8:04 oh God not this answer again I hear it every day I go wow that's so interesting so what do you want 8:11 they go uh uh most people have never thought Beyond a trite answer 8:17 so then the next answer I often get is freedom I want freedom I go great that sounds good 8:22 what is freedom I want to do what I want when I want I look at their numbers and I see 8:28 a huge payment that they're making to a 30-year mortgage I see debt payments I see car payments 8:35 and I go now this is interesting you want freedom but you have essentially anchored yourself down to not be able to 8:44 travel or to Pivot or to move how can those two be how can you 8:49 reconcile those two and that dissonance is actually a fascinating moment I love when we experience dissonance we all do 8:56 I say that I want to work out more but I don't work out more why and what you'll discover is people often 9:03 they simply have never thought about it what what our rich life is these Genera these generic phrases Freedom 9:10 flexibility it's just words what I really want somebody to say I want them to go a lot deeper is to say I 9:17 want to be able to travel for six weeks a year I want to go to London I want to 9:23 go to New Delhi I want to go to Thailand because I want to visit my family 9:28 that's a good start if we get even more specific they tell me what seat on the airline they're sitting on they tell me 9:34 where they're eating they tell me who they're bringing with them but to Simply say I want freedom 9:40 is so vague that when I look at your numbers there's often a huge incongruity with how you're spending versus what you How many people are clear on their rich life 9:47 claim your rich life is how many people from your experience of interviewing people and doing this research 9:53 are clear on what their rich life looks like down to you know what you described 9:59 there I want to travel for a couple of months a year and then even further down to which seat I'm going to be in which 10:05 class I'm going to be on as I travel less than one percent less than one percent of people know that no most 10:10 people literally say I want to do what I want when I want that is their the extent to which they've thought about a 10:17 rich life why does it matter to be what did that one that less than one percent of people that have that planned out 10:24 have as an advantage or a benefit from that meticulous thought that the other 10:29 99 don't have because they can craft their rich life that is uniquely theirs 10:35 almost like getting a handmade glove and in fact the more you craft your rich life the more bewildering it looks to 10:42 the outside world so I'll give you an example from my own life I love to travel 10:48 I spend a lot of money when my wife and I we go we'll travel for months at a time 10:53 I love hotels I love the hospitality I love the details I I love it all 11:01 I don't really care about cars not at this phase of my life it's just not that important to me 11:06 so when I talk about my money dials or the things that I love to spend money on I might spend 11:13 a crazy amount on a hotel per night just because I love it but I drive a car that's almost 20 years 11:20 old it's just not important to me and I want that I want to hear in your 11:25 life what you spend extravagantly on but then you cut costs mercilessly on because I want that Duality which 11:33 indicates you are intentional about your rich life what if we're buying things to impress other people and we don't 11:39 because it's hard to un looking in from the outside especially it's hard to know if someone actually likes Lamborghinis 11:44 yeah or if they're buying Lamborghinis because they were beat up when they were nine years old on the playground and 11:50 they're trying to overcompensate and make the world and does it matter where they're buying it does it matter I don't know first of all how would we even know 11:58 how would they know is there is there a difference do you think just on your in your opinion on the impact that that 12:03 purchase has on us whether we're doing it intrinsically or we're doing it extrinsically because I reflect on some of the things that I spent money on 12:10 and I go that was for someone else whereas there's other things I spend money on which are maybe health related 12:15 or travel related like convenience flying in a nice class on a plane which I know that's actually adding a lot of 12:20 benefits to my life whereas that Mansion I bought out in the countryside when I was 23 or whatever was a terrible decision it took me away 12:28 from my friends because it was an hour and a half outside of the city yeah and none of my friends ever came to it so I was just arriving at midnight after work 12:34 in this mansion with this Tennis Court by myself sleeping for three hours and then driving another hour and a half 12:40 back to the city where all my friends and work were I go that was a stupid decision based on extrinsic external you know motivations it's a 12:48 great question and you know particularly in America we love this 12:53 idea of ownership we are taught you've got to own owning a house is the best 12:58 investment it means you are successful and if you're renting no one really says this but what they 13:05 deep down say is you're a loser yeah okay this individualistic strain really runs 13:11 deep and it has led a lot of people to make poor financial decisions uh first 13:17 of all you might be surprised to hear my view is that owning can be a good financial decision but it also can be a 13:25 very bad financial decision in fact I rent by choice and living in New York 13:30 for example I lived here for a long time I knew that if I were to buy I would be losing 13:39 thousands of dollars every single month because it actually cost more than twice 13:45 as much to own than to rent but can you imagine the type of 13:51 pressures even I got from people who would come over and say oh 13:56 so do you own this place the place that I was renting I said no I rent 14:01 and there was this visible moment of confusion they're shaking my hand they know that I'm the I will teach to be a 14:08 rich guy but I rent how can you be teaching money but you rent isn't renting for losers 14:16 and I have to say because I was Rock Solid confident in my decision 14:21 that pressure did not affect me but I want to also say that a lot of us buy things based on status 14:29 like the idea that we don't buy things based on what people around us think is is nonsense we buy things based on 14:36 status to deny it is absurd but I do think that for the big 14:42 purchases in your life like a house a car the big things you've got to run the numbers 14:49 and if you decide hey you know what I want to buy a house even though it's going to cost me an extra six hundred 14:54 thousand dollars in opportunity costs and Phantom costs but I'm gonna do it because I like it or it makes me feel 14:59 good I say God bless if you simply make decisions based on 15:05 what other people around you do then you will discover like you did I thought I was going to feel a certain 15:11 way and I don't really feel that way and that for me is an opportunity for you to 15:17 interrogate your own beliefs and money is a like a personal zerosome game right like 15:22 so I can't just spend indefinitely so buying that ridiculous house out in the 15:28 countryside takes away from something which might have genuinely brought me closer to happiness 15:33 like I don't know going with my family or whatever it might exactly you talk there about buying property I find that really curious because the the popular Why people should think twice about buying a houses 15:40 narrative is for most people the minute they get any decent amount of money is to buy your first house and that's what 15:45 people do they get they take a 10 deposit or 20 deposit whatever it might be and they buy a house 15:50 um why is that a poor investment why is that a bad thing to do because 15:56 that does kind of sit counter to the popular narrative well we have to remember first of all where the popular narrative came from 16:02 in America if you ask people what is the American dream 16:08 yeah the answer is inextricably tied up with a single family home with a white picket fence that's not an accident that 16:15 is the result of Decades of messaging some might call it propaganda 16:21 first of all most people in the world do not live in single-family homes like we do in America that has caused a lot of 16:27 issues but to leave that part aside this is how most people think about buying a house they think Grandma bought 16:35 a house in Austin Texas in 1970 for a hundred thousand dollars grandma just 16:42 sold it 50 years later for one million dollars grandma made 900 16:48 000 they go it's the most profitable thing you could do buy a house I go okay that sounds really nice did 16:55 granny factor in how much she spent on maintenance for the past 50 years uh no uh did granny 17:03 factor in inflation and how that affected her return uh no what's inflation uh did granny factor in the 17:09 opportunity costs of what that down payment could have been used if invested in the S P 500 uh no and did granny look 17:16 at all these Phantom costs such as interest on the loan uh no 17:22 it's not simply the bigger number minus the smaller number that's wrong that is 17:27 simplistic for the biggest purchase of your life you've got to go deeper again when I was 17:33 living here I kept a very close eye on real estate and the place right right 17:39 next to me same square footage same number of bedrooms same everything it would have cost 2.2 times what I was 17:47 paying in rent so just to give you an example if I was paying three thousand dollars a month it would have cost about 17:52 sixty four hundred dollars a month to own okay I said you know what I like renting 17:58 if I have a problem I just text my landlord I took the thirty four hundred dollars I would have spent owning when 18:04 factoring in Phantom costs maintenance interest taxes all that and I simply invested it and I made more money doing 18:11 that than I would have owning what about if you're buying somewhere to for the 18:17 rental income that can work that can work so owning real estate as an 18:22 investment can be part of a well-diversified portfolio if you run the numbers right now there's a lot of 18:29 hype people go I'm gonna buy a house and if I don't like it or whatever I'm just going to rent it out okay fine but 18:37 you've got to remember that if your mortgage is a thousand dollars 18:42 that's not just the amount you're paying there's a lot more in fact in my estimations I add 50 to that price so 18:50 fifteen hundred dollars a month which would include a roof repair happening 19 years from now we've got to amortize 18:56 that out uh labor costs interest all that if you can rent it out and make a profit 19:03 fantastic it cash flows that's awesome what you discover is that most people 19:09 who buy a primary residence the place they want to live in they buy it because they want it and then they tell 19:16 themselves it's an investment buying a house can be an investment but 19:22 oftentimes it's not and they're far better far simpler Investments here's my 19:27 key message I want to make sure nobody misunderstands me I've been accused of saying buying a house is bad no I never 19:33 said that in fact I will buy a house myself one day and when I do it's going to be a terrible financial decision and 19:39 I'm going to do it anyway my key message is for the biggest purchase of your life you've got to run 19:45 the numbers sometimes buying can be a good financial decision often renting 19:50 can be a good financial decision run the numbers and never feel guilty for 19:55 renting as it relates to buying a house I've always been hesitant because I'm 20:01 scared really of the point you mentioned about being anchored to a location so I the way that I've kind of Justified that 20:07 away is by saying well I'll just Airbnb it when I'm not there or I'll rent it out when I if I decide to move to New York or whatever is there a a cost in 20:15 the opportunity of being less flexible about where you can be 20:20 um that people don't think about especially when they're younger yes and they're probably a little bit unencumbered by you know life yes at 20:28 that point yes buying a house is one of the most profound financial decisions that will affect your lifestyle ever 20:37 you can sell a car even at a minor loss but selling a house involves massive 20:42 transaction costs and labor that most people don't anticipate one of the reasons that I rent is for 20:49 lifestyle reasons Financial yes I make more money renting and investing the 20:54 difference than I would owning but also lifestyle I don't know that I'm going to be in the same place for 10 years which 21:00 is one of the key things that I would encourage people to decide before they buy you want to know that you're going 21:07 to be there for at least 10 years because then you can spread all those transaction costs 21:12 spread them out over 10 years they become much more affordable it's kind of like buying an expensive jacket if you 21:18 buy it and you wear it once that's really expensive if you buy it and wear it over 10 years it becomes a lot more 21:24 affordable now take that multiply it by a thousand and that's a house 21:29 particularly for young people I don't give a lot of unsolicited advice 21:34 I used to do it when I was young when I just learned about money and I realized nobody really wants to hear it they 21:41 really don't if somebody comes to me they come to my blog my social media great otherwise I'm 21:46 not going around telling people you should do this once in a while though I get a young person asking me I'm just about to 21:53 graduate from college what advice do you have for me and at that moment the the best piece of 22:00 advice that I have is move where the action is and typically that's a big city so that 22:06 would be where there's more jobs where there's simply more people if you're 22:13 looking for relationships and there's a lot of tacit knowledge that happens in big cities 22:18 like oh have you tried this oh what have you seen that musical uh have you tried 22:24 this thing this idea that's going around so often surrounding yourself geographically can be hugely rewarding 22:31 to you as you grow you can't do that if you bought a house because everybody told you that it was going to be the 22:36 best investment and if I were to say show me where you calculated the numbers that it was going to be in a great 22:42 investment 75 plus percent of people have never created a simple spreadsheet how does 22:48 buying a house compare in terms of returns to something like investing in the S P 500 it's quite poor actually 22:56 really yeah over about a hundred years there's great research showing that it has essentially matched inflation it's 23:03 been slightly above inflation people find this mind-boggling again because they think somebody bought a house for 23:09 100k and they sold it for a million so it's 900k but they don't properly factor 23:14 in inflation opportunity costs Phantom costs all that it's really hard to factor these numbers in but it's 23:20 critical because it's the biggest purchase of your life I'll give you another example of where people don't 23:26 properly Factor it in uh some people pay a financial advisor one percent they go one percent it's not 23:33 a big deal I'll pay one percent what they don't realize is that that one percent over the course of their 23:39 lifetime will take 28 of their returns and hand them over in fees 23:46 think about it if you make a million dollars in investing over the course of your life 280 23:51 000 are going right out of your pocket into that advisor's pocket now that's 23:56 super counterintuitive one percent turns into Twenty Eight percent how does it work you can simply go online and search 24:03 for uh investment cost calculator and plug in the numbers at a one percent fee 24:08 and you will see point of this is that sometimes money is highly counterintuitive really 24:15 counterintuitive it's unlike anything else if you and I go to sushi right now 24:20 and we get sushi for 20 bucks it'll be fine if we get it for a hundred bucks 24:27 what do you think probably be a little better right and if we get it for a thousand dollars the fish will have been 24:32 flown in from Tokyo this morning and it will be served in an absolutely stunning setting 24:38 so in other words you pay more you get better results we're used to that if I spend more on a sweater it's probably 24:44 gonna have a different type of fabric more on a car it's going to look cooler have cooler features 24:49 money's not like that if you spend more you don't get better returns you don't 24:56 get better anything in fact if anything you get worse returns 25:01 people find this mind-boggling because it is it's counterintuitive but in investing costs matter in buying a house 25:09 you've got to run the numbers because they are totally counterintuitive quick one before we get back to this 25:14 episode just give me 30 seconds of your time two things I wanted to say the first thing is a huge thank you for listening 25:20 and tuning into the show week after week means the world to all of us and this really is a dream that we absolutely never had and couldn't have imagined 25:27 getting to this place but secondly it's a dream where we feel like we're only just getting started and if you enjoy 25:33 what we do here please join the 24 of people who watch this channel regularly and have hit that subscribe button means 25:40 more than I can say and if you hit that subscribe button here's a promise I'm gonna make to you I'm gonna do 25:45 everything in my power to make this show as good as I can now and into the future we're going to deliver the guests that 25:51 you want me to speak to and we're going to continue to keep doing all of the things you love about the show 25:57 thank you thank you so much back to episode so what is the S P 500 for The S&P500 & investing 26:03 anybody that doesn't know yeah and what are the returns that I'm likely to get from investing in the S P 500 I really 26:09 want to simplify this for people that are at the very start of their investing Journey you know because I mean this is 26:15 what you spend so much of your time doing that I just think about my my team here instead of the Diary of a CEO there's about 30 people and we started 26:22 talking about money one day and it was mind-blowing how nobody in my team's lives had ever had the conversation with 26:29 them about investing we all think of investing as something that rich people after the age of 40 do once you have a 26:35 million dollars um or if you don't have a million dollars then the only other way to invest we're taught is to buy a house 26:44 driving me insane it's true though isn't it yes and and central part of my work is that you 26:51 can live a rich life and that rich life can be richer and more vibrant and more 26:56 personal than you ever imagined if you want to travel you can travel for longer than you ever thought you can travel for 27:03 me at nicer hotels you can spend more time with your children with your loved 27:09 ones whatever your rich life is you can do that but you've got to learn a few key basic things about investing and 27:17 money so let me tell you what I would tell my family when they come to me and they go how should I start investing 27:23 the simplest simplest way that I advise my family is I say get a Target date fund so let 27:29 me explain what that is a Target date fund is One Fund just one 27:35 and you pick it based on the year that you're going to retire so if you're going to retire in 2050 27:42 if you're going to be 65 in 2050 you go and you find that one fund it's called a 27:48 Vanguard 2065 fund or Fidelity 2065 or Schwab 2006. there's lots of brokers 27:55 These funds it's One Fund all you do is put money into it that's it the fun like 28:01 a pie chart is automatically Diversified so as you get older it gets more 28:06 conservative because somebody who's 75 years old should be investing differently than someone who's 25. 28:13 One Fund all you have to do is set your money up to go into it every single month what is a fund a fund is a a set 28:23 or a basket of stocks and maybe bonds so we've all heard of you know companies 28:29 like Microsoft Google whatever a fund owns lots of these right and 28:35 that's important because we've heard diversification like you should have Diversified your Investments okay well 28:41 how do I do that you don't need to go and buy 20 stocks and then figure out 28:46 how much of each to do that's too much work and honestly most people are not good at that even professionals 28:52 you buy a fund which automatically owns lots of stocks like hundreds of them 28:58 and over time all you the individual investor like me have to focus on is 29:04 putting money into it automatically so a fund essentially I've got 100 pounds that I want to invest 29:10 um I find a fund where do I find these funds you can go to Vanguard Schwab or Fidelity all those are great companies 29:16 uh what you're looking for regardless of what country you're in is you're looking for a low-cost brokerage firm so but 29:24 there's also apps and stuff that I can you can use apps I don't like a lot of the apps because they gamify you to try 29:30 to invest right they want you clicking and trading I hate Traders trade you do 29:36 not want to be a Trader Traders lose money investors treat investing like 29:42 watching paint dry that's how sexy it is trust me I'm not getting my entertainment from investing I'm going 29:48 out go watch a movie go watch Netflix but investing is boring and automatic 29:54 that's how it should be I used a a company called hargreave lands down in 29:59 the UK who have an app when I first started investing um when I first started investing in funds they they had a very ugly app so I 30:06 wasn't very compelled to use I think it's better now but I would use just do it on desktop which I do get your point because you don't want to you don't want 30:13 to be gay you don't want to scream yeah all of that note I like uglies it should be ugly and you don't want it to be too 30:18 accessible correct I don't want to be able to check it every day no look on my phone you will see no investing apps yes 30:24 there should not be why do you need to log in and check it every day what's the point yeah in fact I log you know what 30:31 most people should check it every three to six months and here's how you check it you log in on your desktop 30:38 wow it's up wow it's down okay bye you're not tweaking anything it's like 30:44 making Thanksgiving dinner once you've put the turkey in the oven just let it sit do not fiddle with it 30:52 because you're only going to mess it up and in this case you're letting the turkey cook for decades and that fun so 30:57 I've got 100 pounds I go on a website Vanguard Fidelity Schwab whatever they are I have no Alliance to any of them 31:04 neither do I um there's various ones in the UK I actually do recommend Hargrave Lansdowne just because it's quite simple and I think investing in funds there's 31:10 no fees there's no fee associated with the investment itself obviously they take you know they might take a percentage depending on which fund 31:16 you're investing in I take my 100 pounds and investing in Hargreaves lands down you don't need there's no 31:22 um minimum great from what I understand and there's no if you invest in a stock they charge 12 pounds per investment but 31:28 if you invest in a fund it's free um I put my hundred pounds into a fund the fund is essentially taking one 31:33 pounds one of those pounds and investing one pound into Facebook it's investing one pound into Google one pound into 31:39 Shopify one pound into Spotify one pound into Nvidia or whatever it's doing that for me it's managing it for me it's 31:45 making the decisions for me I just put the money in every month whatever I can and I leave 31:51 it yeah and let's go even deeper I love that we're getting into the nuts and bolts here because you know honestly 31:57 most people they do not know how to invest literally what website do I go to and then what do I do 32:05 the fund owns these different stocks and some will go up and some will go down 32:10 and it's inconsequential to you all you need to know is you own this fund 32:16 now that you've opened up an account and you've sent a hundred bucks or a thousand bucks great you've made one of 32:22 the most important decisions of your life now there's just one more thing you have to do set up an automatic transfer 32:28 so that every single month you have a certain amount of money going in now if you don't know how much money use 32:35 my conscious spending plan guideline what did I say five to ten percent of take-home is a good guideline all right 32:42 you should be able to do five percent trust me anyone who comes to me they go Remy there's no way must be nice I can't 32:49 afford I go show me where you're spending your money I guarantee you I can find five percent to send in every month now you're not trying to send it 32:57 in I don't try to brush my teeth in the morning it's a habit investing is even easier than brushing your teeth because 33:04 you set it up automatically the investment fund will automatically draw 33:09 from your checking account and it will pull in a hundred bucks 500 bucks a thousand bucks whatever your 33:15 number is and so you're not going to log in for three four five months you're going to log in a few months later you're gonna 33:21 be like oh my God I didn't even realize that all this money is in here 33:28 when you add that plus compounding over many years that is how real wealth is 33:33 created so I don't want anyone to think that you have to be rich in order to 33:39 start investing one of the ways you get rich is by investing I've got a friend 33:45 that's currently actually in this building at the moment and I had this conversation with them about a year ago 33:51 gave the advice that you've just given there and about two months later this 33:56 individual who I shot name came to me and I said How's your you know your your Investments going in in that fund and 34:03 they said oh yeah I had bills I had a credit card bill so I took it out oh yeah she treated like a checking account 34:09 Investments for me are places to accumulate wealth I don't draw 34:15 from it that's what a checking account is for so if what that is is there's two 34:20 parts to what your friend is saying one is um mentally she's thinking that this 34:26 investment account is just money I can draw from if I need it so I would sort of gently change the way she thinks 34:32 about it the second is I guarantee her account structure is a little 34:38 um subpar so here's how I would set it up this is in chapter five uh it's all 34:43 automation because trust me I don't want to spend time transferring money back and forth that's I don't spend any time 34:49 on that you get paid your money goes into your checking account from your checking account it is automatically transferred 34:57 to a savings account in fact I have sub savings accounts for vacation car down 35:05 payment all that stuff so you have money set up for specific goals money is transferred to your investment 35:10 account it's transferred there I'm not going to touch that money I'm going to let it cook and then I have my guilt-free 35:17 spending which is going out with friends whatever I love and my credit card bill 35:22 is automatically paid off every single month that's how you want to set it up it takes a couple of weeks to set 35:29 everything up and then you never have to think about it again how can you prove to me that this is the 35:35 way to make wealth what case studies have you got that investing in funds over a long period of time is the path 35:42 to financial wealth because you know it's you said earlier about the paint drying thing the narrative that we see 35:48 about how why people and how people get rich is you know they sell a company or they have a lottery win or maybe they 35:54 buy some cryptocurrency and it goes up yeah that's what we hear that's what we're trying to emulate totally we prove 36:01 to me that that's that this fun strategy is better well there's there's a couple things first off the research over more 36:07 than 100 about a hundred years shows the returns of the stock market and the 36:13 returns tend to be at least in America they tend to be around 11 percent 36:19 10 to 11 and if you take out inflation you get about seven to eight percent per 36:26 year now for anyone listening they go okay well what does that mean that number means nothing to me seven percent 36:31 whatever if you go right now and you Google investment calculator and you just plug 36:39 in your age you plug in let's say 200 300 bucks a month and you plug in seven 36:46 percent return and you just watch how that money grows you will be shocked Jack give me my 36:53 phone I'm gonna do it now okay so let's search for compound interest calculator and there's a really 36:59 simple one this it's called money chimp okay okay I've got it all right Compound interest calculator 37:06 all right so there's four numbers we need to fill out here let's take a look the first is current principle that means how much you've got in the bank 37:12 I'm gonna say five thousand dollars and I'm gonna start when I was 16 because if I'd saved 37:19 my money when I was 16 and not spent recklessly I think I could have had that 37:25 five thousand dollars when I was 16. um annual Edition what does that mean how much can you invest per year so for most 37:32 people they think about on a monthly basis they might say 200 bucks a month which would be twenty four hundred 37:38 dollars annual Edition okay so what do you want to say I'm gonna say can I say five thousand 37:43 dollars yeah that's you know about 400 bucks a month I think that's reasonable I often find that with people making uh 37:51 median or slightly above median salary that they're hundreds of dollars a month of money that is unaccounted for that if 37:58 properly made intentional could be invested so great five thousand a year all right obviously I could have once I 38:05 got past a certain age I could have increased that though so we're going to talk about that okay hold on to that idea okay how many years this was you at 38:11 20 this was me at 16. oh okay and how old are you today 30. okay so 14 years 38:17 let's just do it until today and we'll see what happens okay all right 14 years and then it says interest rate so what 38:24 should we assume for that is that eight percent yeah seven to eight I you I do seven just to be super conservative 38:30 because I never want to be surprised on the downside right if anything I'm going to make more so seven percent all right 38:37 let's calculate it okay what do you see Tom what do you see 38:44 133 000 537. yeah that's what you would have had right now now let's add some 38:50 context so this is really important you see a number that says 133 000 at age 38:56 30. yeah okay is that a lot is that not hmm I don't 39:02 know let's break it down at that point you started with five thousand dollars and 39:07 you invested five thousand dollars per year we assumed no raises even though you 39:13 obviously made more than you made at age 16. we assumed you stopped investing at 39:18 age 30 which is obviously ridiculous and you end up with six figures let's 39:25 play it out let's take it until 40. 39:31 so instead of 14 years you invested for 24 years what do you 39:36 see I would have 336 000 it's getting better 39:42 from just five thousand dollars a year it's not much it's fantastic again 400 bucks or so a month is very modest 39:50 remember people's income goes up typically in their 30s and 40s and if 39:55 you already are investing a little bit automatically all you have to do is just tweak a number and it will take an extra couple hundred three four five hundred 40:01 bucks let's do one more let's go to 34 years just because I want to see what happens and then we're going to play with the other numbers 40:07 okay so investing from the age of 16 until I'm 50 mm-hmm 40:13 I would have 736 000 in my account yeah now I want to 40:19 do the full the full thing I want to do a more realistic number here so instead 40:25 of 50 we're gonna go 49 years 40:30 that takes you to age 65. yeah okay and instead of five thousand dollars per 40:35 year your income obviously went up from being 16 years old so I'm gonna pick a 40:41 number out of thin air and and I'm gonna tell you how I picked it I'm going to say instead of five thousand dollars a 40:47 year it's actually going to be thirty thousand dollars per year let me tell you why I picked that 40:55 in your early years you don't have as much money but you were still investing a little bit which shows that you're dedicated as your income goes up 41:02 you're going to start proportionally continuing to invest so at a certain point your income will be really high 41:08 and that will bring that average up that's why I switched it to 30 000 per year I actually think this is quite 41:14 modest but I'm gonna go ahead and do it so here we have someone starting 41:20 investing at five thousand dollars they invest thirty thousand dollars per year 41:26 okay they grow it for 49 years at seven percent do you know the math 41:33 no tell me 12 million three hundred and three thousand dollars 41:39 so that's me starting with 5K gradually ratcheting it up until I'm investing 41:44 well investing 30k on year a year per average across those 49 years yes which 41:49 is a flaw in this because it's so simple that money invested you are not actually going to invest that much early on 41:55 you'll invest more later yeah so you won't actually you'll maybe have a marginal amount less but we're talking 42:01 10 versus 12 million that's a lot of money and then if I got eight percent instead 42:08 of the seven percent I'd have 17.4 million yeah but don't mess with that because this is what people do they go 42:14 well if I got 13 I'm gonna invest in this PE fund I go don't do that you're gonna lose all your money just stop yeah 42:19 seven percent is safe it's conservative that's why I am here that's why I want 42:24 to encourage people you don't need to juice your returns I hope you do get eight percent but I don't want you to 42:30 count on that I want you to count on safe stable returns and what matters for 42:36 you is the time you started early and the amount you have a considerable 42:41 amount to invest what about the richest people in the world you know we think of the Warren 42:47 buffetts of the world or the Charlie mongers of the world who ended up becoming the richest investors on planet Earth yeah what was their strategy I'll 42:54 tell you let's talk about Warren Buffett uh there's a friend of mine Morgan housel he wrote this amazing artist I 42:59 love that book yeah the psychology money he wrote this amazing article about Warren Buffett if you look at Warren 43:06 Buffett's returns he started investing at a very young age and the money compounded again it's like 43:13 putting the turkey in the oven and letting it sit there not just for an hour but many hours in his case 60 plus 43:20 years he has made over 90 I think over 99 43:25 percent of his wealth happened over the age of 60. okay think about that it's all because 43:33 he started investing so far ago and what is mind-boggling is that you don't need 43:39 a fancy strategy you don't need to be picking individual stocks you don't even need to be a genius 43:44 to make a lot of money you do not have to be the smartest person in the room you just need to remember a few key 43:50 things start as early as possible okay and if you're not 16 years old if 43:57 you're 30 40 even 45 okay start now second invest aggressively every single 44:03 month that's critical third keep your costs low one percent in fees is going 44:09 to take 28 of your returns two percent is going to take over 55 of your returns 44:14 keep your costs low if you do those things you will have more money than you ever imagined what What are the characteristics of someone that will end up little money 44:22 are the attributes of someone that's probably going to be poor in 30 years in terms of that relationship and their 44:27 behavior with their money they're easy they don't invest they feel overwhelmed and anxious about money and they talk 44:33 about it all the time but they've never read a single book about money 44:39 and there's these deeper attributes they have only rich people invest they think 44:45 that yeah and that's why I'm here I want Everyday People to know just like me I 44:52 started off my parents immigrated from India I had no special uh investment knowledge but I had two 45:00 parents who were educated and encouraged me and said learn this stuff here we'll do it together and that was a gift 45:07 everyday people can build tremendous wealth which in and of itself is 45:13 impressive but it's even more impressive when that wealth is used to live a rich life a rich life of adventure and 45:19 spontaneity and generosity some of the stats I pulled out from your book about 25 percent of people who make a hundred 45:25 thousand dollars a year plus a still living paycheck to paycheck according to a recent survey of 45:32 millionaires done by the U.S trust 83 percent of the wealthy wealthy say their 45:37 largest investment gains have come from small wins over time rather than taking 45:42 big risks yes this is counter to everything we see on TV because on TV it's really boring what are you going to 45:49 look at my Vanguard account oh wow compounding seven percent per year it went down eight percent last year and it 45:54 went up nine percent this year so boring so we see these cool stories of business 46:00 owners and we're both business owners it is cool but a tremendous amount of my 46:06 own wealth will come from low cost long-term methodical investing that's 46:12 like a rule of life isn't it that the the real returns you know in reality the great Returns come from patience and 46:20 consistency and things that really aren't sexy like they're not instagramable if I post on my Instagram 46:25 today hey I've got some advice for you guys to become wealthy and I go I need to invest in this fun then just leave it 46:31 there but if I go listen I've got this new NF this new nft collection or cryptocurrency coin that's gonna make 46:36 you a million percent this year people are going to go all in that's just like something within the human condition where we want we want 46:43 big returns with little effort and today we want to get rich quick same with a 46:49 six-pack we want the six-pack abs in 10 minutes we don't want six pack abs with diet restrictions and nine months of 46:56 work that's not and that is why I have a lot of compassion for helping people unlearn some of the messages about money 47:03 because we all have them uh we all have the equivalent of I want six-pack abs 47:08 but we also have something in life that we've spent time to get really good at and we know that the secret is basically 47:15 consistency if I go ask someone who's an amazing cook hey I want to cook like you how do I do 47:21 it what are they going to give me some use cinnamon no they're gonna say get in the kitchen and cook every single day 47:26 for five years and you're gonna learn about when to use salt and when to cook it for longer Fitness you want to ask 47:32 someone who looks really good or or feels really good about their body they're going to give you some secret workout no they're gonna say I show up 47:40 when I feel good I show up when I don't I show up when you let's think about the How do I increase my income? 47:46 people that might be listening now so there's going to be someone that is a they're a they're a bus driver or they are a social media manager they are a I 47:54 know cleaner they're a teacher they are a personal trainer if you were if your job was to make that 48:02 person a millionaire in 20 years from now whatever your age they are right now 48:08 what is and you were there financial advisor in fact you were controlling all 48:13 of their personal professional decisions talk me through what you would do with that individual at a very detailed level 48:20 I would do a few things number one that the most important things I would do would be set up automatic investing and 48:27 be aggressive about it two they have to increase their income okay I'm gonna be that person I'm gonna embody that person 48:32 like I just described so increase my income I'm a personal trainer perfect okay so so what should I do all right 48:38 you're a personal trainer so first off I would say how much are you charging how are you finding your clients we talk 48:43 about that and let's say you're charging 100 bucks an hour and you have clients who say how long do they stay on average 48:49 uh that's exactly what I'm changing perfect great they stay longer than two months I'm 48:55 very good how long do they stay three months three months wow okay you're very good all 49:00 right so your average client is worth 400 uh a few thousand bucks yeah great so 49:06 you're making let's say 60 70 000 a year all right 49:12 uh the first thing after I understand all this information I would say all right we're going to double your income 49:18 how are we going to do that the first answer everyone gives is I've got to find more clients okay you should 49:24 you should ask your clients hey I've got a few slots available who would you recommend so you should get more clients 49:30 second you're going to listen to your clients and you're going to say what else are you looking for I know you've 49:35 got your fitness journey you're going on they're going to tell you I've got a 10-year reunion I want to plan for that 49:41 uh another person is going to say gosh I I know I should be eating healthier but 49:46 it's really hard for me so you're thinking about it here's what you do you create you package up meal planning 49:54 Services you can either do their macros for them and charge them a little bit 49:59 extra let's say an extra 200 bucks a week or 200 bucks a month you can also 50:05 partner with a food delivery service and you coordinate with that company to feed over their macros and it gets delivered 50:12 to them and you take a small cut right there you've added thousands and thousands of dollars per year 50:18 per client as long as they stick with you in addition to that you can do group 50:23 sessions so you go hey I'm going to do a weekend session I'd like for you to invite your friends invite them for free 50:31 and of course of the people who come let's say you get 15 20 people to come you do a free little session on Saturday you go I'm a trainer I work in SoHo I 50:39 have three open slots that's how you're finding new clients now so you're doing two things you're finding new clients 50:45 you're increasing your average lifetime value per client okay that's the that's 50:51 two things now let's do one last thing let's increase the duration that they stick with you they're sticking with you 50:57 for three months give them a special offer to stay with you for six months so when they sign up they work out with 51:02 you for a month you say look it's a hundred bucks right now if you stick with me for a six month plan I will give 51:07 you my sessions at ninety five dollars per plan you'll save x five percent 51:13 one two three you've increased and if we did the math you may have doubled your Revenue you 51:18 certainly boosted your profit in a huge way all of a lot of that's about making sure you're getting a better return per 51:24 hour you spend at work but also making sure all of those hours are full then doubling down and making sure each hour 51:30 because that's your your currency when you're a personal trainer you're trading in your time I need to make the most from every hour I spend 51:37 um I've thought about something recently as I've been writing my new book The Diary of a CEO um which I've written 51:42 these 33 laws for building and becoming great essentially it goes across marketing and business whatever and one of the chapters that I investigate is Optimising your skill sets 51:49 this idea of making sure your skills are on the right market so my company went 51:55 public and one of the things that I I came to learn from sitting with investment bankers for many many years was that if you put a company the exact 52:03 same company let's just say it's you know the company that make these silver mugs in front of me if I take this company 52:10 public on the London Stock Exchange I might get for example four times Revenue if I take the exact same company and I 52:17 list it on the New York Stock Exchange it will be valued at eight times Revenue yeah it's the exact same company exact 52:24 same people exact same business just moving it to a different market and what upon leaving the social media marketing 52:30 world when I was 27 years old one of the first calls I got was from a biotech 52:36 company ran by a billionaire friend of mine that was going public and they brought me in and on the first 52:41 week when we were discussing what they might pay me I'm thinking they can't really pay me in cash because I've got 52:46 enough cash I don't really need that they can maybe give me some stock they're offer to me for my skill set 52:52 was eight million dollars roughly eight million dollars in options that I would 52:57 earn in nine months from taking the company from where it was building out the marketing team handling their storytelling and taking the company 53:03 public which we did at about 3.2 billion valuation their offer was eight million dollars in 53:09 options I reflect on that and go I'd spent the previous 10 years using the same skill set to sell consumer goods 53:16 like dresses and iPhones for apple and Logitech and big fashion brands yeah I took the same skill set and applied it 53:23 to a marketing industry where it was rare biotech people know nothing about Reddit and Twitter and Facebook and 53:29 social media so my skill set was rare scarce in that market so it was incredibly valuable and I think about 53:35 this a lot with with especially as this AI thing rolls in I think people should be looking at their skill sets and going where is my 53:42 skill set as a writer gonna yield the greatest returns I could be a social media manager I could be a uh a Blog 53:49 writer or I could add a little boat string to my bow and become a a scientific writer or 53:57 like work a writer in biotech and you'll get paid if you can add that little bit of knowledge to your to your writing 54:02 skills you'll get paid I'm gonna say five times potentially five times more yeah and people don't think about the 54:10 fact that they're they they need to use Place their skill sets in the most lucrative Market where it's scarce yeah 54:16 and I it's so yeah just throwing that out there because it's really front of mind for me at the moment like retaining 54:22 you know like personal should be at a gym and you'll lose 75 of your income to the gym or you can do it virtually you 54:29 can specialize on um just preparing people in in the 54:35 beginning of the year it's like your best year and every January that is your focus it can be celebrity clients it can 54:41 be uh Uptown um mid-career Executives that's a very 54:47 lucrative you choose but you choose carefully I agree that's a bit of an advanced concept I think most people 54:53 they start off they go just how do I make more money I'm a trainer I have three hours but once you kind of Master 55:00 that and you go like for example there's a trainer I know here who charges 175 bucks an hour that's very good 55:06 after you get that and you fill up your entire calendar you go okay I'm making 305 55:11 000 a year I want to make more how do I do it now you need to get creative you move to different markets you add in 55:18 package things that scale when you sleep you have video courses Etc there's so many different ways but I think everyone 55:24 would do well to listen to what you're saying which is think about how to move up Market or potentially to a totally 55:29 different Market well your skill set is really scarce yeah and that's the problem a lot of people have there's you 55:35 know their skill set might be too abundant in the industry like social media managers even social media 55:41 managers is one thing but that's a slightly different skill set because there's there's a wealth of knowledge there that is unique to that knowing the 55:46 algorithms knowing the platforms there's a real creative element to it but I think about my friend Anthony he was he 55:53 was a graphic designer the greatest graphic designer I ever knew in Manchester but he was designing 55:58 nightclub flyers and he's talked about this publicly before for not every nightclub fly he designed he got fifty 56:04 dollars the equivalent 50 to 100 right I had a conversation with him a couple of years ago about this and I said you're 56:11 you you're really specifically good at like luxury design he's got that really like beautiful Chic simple but you know 56:19 elegant design style I always go to him whenever I only design work like that so I said to him 56:25 move to Dubai and and go in there and help design 56:32 um luxury Brands yeah and this guy did it so he went from Manchester where he was doing nightclub flies 56:38 to moving to Dubai and without revealing his financial position what I can say is 56:43 the same hour per piece of work is now yielding him tens 56:49 and tens more in returns you know instead of getting 500 he's getting fifty thousand dollars for for a project 56:56 and it's just moving his skill set the same thing designing on the same software to a different industry which 57:02 will appreciate and pay more for the same skill the lesson I take away from that Beyond 57:07 his willingness to actually make a change which is amazing is that most of us do not think 57:15 in terms of discontinuous jumps we think okay I'm making I have a hundred bucks a 57:20 month what if I had 120 bucks a month well 20 57:25 is like quite good that's amazing but what if I had 500 bucks a month or five 57:31 thousand that's a discontinuous jump and to get those kind of numbers something big has to change in business 57:38 moving markets developing a new skill partnering all those things but it's different in investing 57:45 it's primarily time and that's where we're not attuned to it we go well you know I only have like a 57:51 couple hundred bucks a month to invest that's nothing it's only going to turn into a few thousand you know you're not thinking about time because the human 57:58 mind is not made for compounding so plug it into a calculator and you will be blown away same thing buying a house 58:05 you're only thinking of how expensive your rent is which granted rents are 58:10 very expensive but you're not actually factoring in how much time and money it 58:16 costs to pay taxes and maintenance and interest on your loan you've got to get 58:21 smart about running the numbers and when you start to sit back when you learn the basic language of money and you 58:28 understand how you feel about money whether it be I like status or I like 58:33 luxury or I don't really care about XYZ when you understand your own feelings 58:40 suddenly you can almost look at the chess board dispassionately you sit back you go okay I see what's going on here I even see 58:48 how I am a player on The Game of Life when it comes to money and then you start to say the most 58:54 powerful question of all what if what if I earned more what if I spent 59:00 less what if I decided I actually love traveling two months a year or buying a 59:06 house because I can decorate it the way I want what if what if what if and then you can start to make moves that line up Should I invest in cypto 59:12 with your rich life someone comes to you and they say what about crypto I get that question a lot oh God what about 59:18 crypto should I be investing in that my friends told me about this new coin and I'm thinking of putting a couple of 59:24 thousand Pounds into it I get this all the time should I invest in that coin that my friend told me about 59:30 so I get this question a lot I I got it a lot a few years ago yeah let me tell you what happened you know people read 59:36 the book they know that I'm a fan of low-cost long-term investing and then all these crypto nuts grow up and well 59:42 they grow up to be you know 19 years old and they go oh ramit seiti such an old 59:48 guy such a Luddite he doesn't understand investing this is the new future Fiat is 59:53 dead I go um I have a couple of questions for you number one what is the rest of your 59:59 portfolio look like crypto I go oh God okay 1:00:06 second do you think that it's normal to get uh four thousand percent return per year 1:00:13 when over about a hundred years the stock market has returned approximately seven percent per year they go yeah 1:00:19 that's because Fiat is dead you idiot it's gonna be we're going to the Moon I go you're going bankrupt and many of 1:00:26 them did lose a tremendous amount of money my view on crypto is if you have a 1:00:32 well-diversified portfolio well Diversified and you want to have a little bit of fun with one two even five 1:00:41 percent of your portfolio go ahead and that could be crypto it could be an 1:00:46 individual stock it could be investing in your friend's bar in Brooklyn could be whatever you want but you got to limit your risk and what 1:00:53 you find is that the type of people who tended to be attracted to crypto tended 1:00:58 to be extremely risk seeking and in fact they saw diversification and risk 1:01:05 management as boring for old people 1:01:10 this game is a marathon you want to live a rich life you want to be living it for 60 70 years I'm not trying to get 1:01:19 ten thousand percent returns and then blow out and that's what happened to many of them I mean part of the problem here is that 1:01:26 when we do get our 10 000 returns ten thousand percent return moment yeah we think it's going to be 10 million 1:01:31 percent if we just but we also go tell everybody oh of course you never hear anyone saying let me tell you something 1:01:36 thank you for saying that I went on Twitter because uh you know I mess around with these crypto guys a lot on 1:01:42 Twitter I have a great time doing it I go hey where'd all the crypto Bros go everyone seems to have disappeared in 1:01:48 2023 where'd you guys go and there's just like crickets we're in 2020 they were really coming out you know guns 1:01:54 blazing I said if you have lost a lot of money from crypto send me an email I 1:02:02 want to share your story I'll keep you anonymous I have a lot of people who follow me on social media I got less than three responses 1:02:11 we love to share our successes we love it we do it with crypto we do it with 1:02:17 buying a house and selling it for a profit we do it with business we do with all that stuff but you almost never hear anyone saying 1:02:25 oh my gosh I bought this uh I sold it for um one-fifth the price oh and by the 1:02:31 way because of the transaction fees Associated I actually lost like 80 of my money you know or 85 of my money you 1:02:37 never hear that it's deeply shameful for people to admit that they lost money it's the opposite 1:02:43 of status isn't it yeah and we're not wired to seek the opposite of status exactly why to voluntarily bring 1:02:49 ourselves down in the tribe exactly we are safety seeking we are status seeking 1:02:55 and so this is what happens with money that's why I talk about prenups and why I talk about investing and mistakes and 1:03:02 all of the above is that I want to shine a light and show people if you are only seeing the top of the iceberg all the 1:03:09 successes of course you feel like you're behind of course you feel like everyone knows something you don't but it's 1:03:14 complex some people make good decisions some make poor decisions we got to look at them all and then we will understand 1:03:21 what's right for us so on my my position on crypto is um I believe in the underlying technology of 1:03:27 the blockchain and I I'm I've been a big ethereum holder for a very very long time but it does represent less than 1:03:34 five percent of my portfolio although I am a very big holder um in ethereum and I've held it for so 1:03:41 long that although I'm at a I'm at a point of profit right now I'm well aware 1:03:46 that I could go um into a huge you know into the red yeah irrespective of that it a has is 1:03:55 inconsequential to any decisions almost like like my financial Financial portfolio at large and B because of that 1:04:01 I have such a long-term time Horizon that I could hold it for 30 40 years and I've never flinched I don't check the 1:04:08 price sometimes I just check my password works but I but but I'm not in I've never traded I have no interest in that Always have 1 year of emergency funds 1:04:14 ramits 10 Money Rules I just want to go through these 10 money 1:04:19 rules because you mentioned prenups there and I was quite curious that number 10 in these rules is marrying the 1:04:25 right person but let's start at number one always have one year of emergency funds 1:04:31 yeah so for me one year of emergency fund is conservative it's more 1:04:36 conservative than most lets me sleep at night and I just keep the cash in a savings account 1:04:41 it's not under my pillow cash does not mean it's sitting under my bed please don't try to rob me it's cash in a 1:04:48 savings account totally liquid and that's what it's for emergencies rule number two save ten percent invest How much to invest & what you shouldn't question spending money on 1:04:55 twenty percent of gross annual income yeah this is all about the numbers that I shared and being more aggressive with 1:05:01 them I know that paying myself first now turns into way more later so I invest aggressively rule three pay cash for 1:05:08 large expenses like engagement rings or big holidays or weddings yeah this one 1:05:13 is controversial because for the things that are important to me I don't want 1:05:19 price to be the number one concern so I'd rather save up for it when I was in 1:05:24 my 20s before I ever met my wife I knew one day I would get married and because I'm Indian I knew we would have a big 1:05:31 wedding and I wanted it to be amazing so I started putting money aside every single month automatically I do the same 1:05:37 thing for trips house Etc rule four never question spending money on books appetizers health or 1:05:44 donating to a friend's charity fundraiser yeah so the books and the appetizers are a little weird I have 1:05:49 something called ramit's book buying rule which means if you ever see a book book that you're even remotely interested in just buy it don't ask a 1:05:57 question don't equivocate just get it because if you can learn one thing from that book it can transform your life 1:06:03 appetizers when I was a kid we couldn't afford to eat appetizers so we would eat out every six to eight weeks if we had a 1:06:09 coupon we'd usually go to a pizza place getting appetizers was inconceivable so 1:06:15 now when I eat out to be able to see one or even two appetizers that look good I go yeah I'll take them both it feels 1:06:22 incredibly rich and this is just an example of how our childhood sticks with us it feels awesome to be able to do Business class flights 1:06:30 that rule number five business class flights on flights over four hours long Yes again my money rules not for anyone 1:06:36 else when I used to when I was in my early 20s I would get on a flight and I would 1:06:42 actually in my head scoff as I was walking from the front of the plane to the back I feel like why would anyone 1:06:48 spend four times the money paying for a first class ticket makes no sense we're all getting to the same place ha ha ha 1:06:55 I wish instead of disparaging that I would have gotten curious and I wish I would have said 1:07:01 wow if somebody can afford to get those seats why would they I wonder what 1:07:06 they're spending money on aren't we all getting to the same place and if I had gone from disparagement to curiosity 1:07:12 from D to C I would have understood that some people have their office paying for it some 1:07:18 people do it for health because they want to get there they want their back to feel good they maybe need to go to a 1:07:24 meeting and some people just have enough money that they can do what they want and when I started to become more 1:07:30 curious about money that opened up my eyes to be able to spend on certain things and spend extravagantly but also 1:07:37 to realize wow maybe I try this certain type of food once cool I don't need to do it again so for me my money rule so 1:07:44 that I don't have to decide every time I take a flight boom this is my guideline it's done it's written never have to 1:07:52 think about it again rule six buy the best and keep it as long as possible yes I love this I think Always buy the best 1:07:57 we all intuitively have this idea of quality over quantity but if you look in somebody's closet or you look at the 1:08:04 things in their house there may be some incongruity so um for example my car is 1:08:10 17 years old it's a good car so I mean for me it was a fine car I don't care it 1:08:16 rides fine it's a four-door Honda Accord I told you very sensible long-term great 1:08:23 uh buy the best keep it for a long time it's the same with clothes 1:08:29 um those things matter to me I like that and so I'll buy something that might seem very expensive but I'll keep it for 1:08:35 a long time good for the environment as well yeah rule seven no limit on spending on Always spend on these 2 areas 1:08:40 health or education yeah this this one is important um I learned when I was in my 20s and I 1:08:46 started training and learning from personal trainers and nutritionists that I really loved it and I also realized 1:08:52 that I needed help I needed great teachers and So eventually I just realized I'm gonna give myself unlimited 1:09:00 spending on this same for education so I'm a teacher I teach different programs of course I'm a student as well I want 1:09:07 to learn from great teachers from taking accounting classes here at Columbia to buying every conceivable book and 1:09:15 digital program there is I've given myself the freedom to do that and all that came from I had a 1:09:22 scholarship I had many scholarships that paid my way through college and one of the scholarships set up an account for 1:09:27 me at the Stanford bookstore so when I walked in there I could get literally any book I wanted it was like 1:09:34 uh Willy Wonka and the Chocolate Factory for a guy like me to have unlimited books 1:09:39 it was like unbelievable and when I graduated from college I realized that 1:09:45 would be going away and then I remember having this conversation with myself and saying 1:09:51 how much would it really cost to recapture that feeling that feeling of 1:09:57 being able to get anything I wanted see a book on the bookshelf I'll get it and 1:10:02 the answer is really not that much so over time that then expanded to health and Education Health I find really 1:10:09 compelling because it's clearly clearly the most important 1:10:14 foundation of all of this it's clearly the most lucrative investment any of us could make 1:10:19 um because everything we've described the rich life doesn't exist without that Foundation yeah so it's all good 1:10:24 investing in your Vanguard but it doesn't matter at all if you're gonna die yeah if you ask people what's important to you they'll often give you 1:10:31 the same answers they'll say relationships Health maybe travel career maybe yeah I go okay let's take a look 1:10:37 at your spending show me where you spend on those things it gets really quiet really fast now 1:10:44 it's one thing to spend time on relationships and we should but we can also spend money to enrich those things 1:10:50 it might be surprising your niece at a showing of Michael Jackson or it might 1:10:57 be surprising your family by going home and visiting them there are lots of ways you can use money to enrich those 1:11:03 experiences same for health it could be what you buy at the grocery store it could be training or a gym 1:11:09 membership it could be whatever it is that's meaningful for you but if we claim something's important to us 1:11:14 it sure better show up in our time and our spending rule number eight earn Work only with people you like 1:11:19 enough to work only with people you respect and like I love this one I decided long ago that I only want to 1:11:26 work with people that I like and respect and so I earn enough money so that I can 1:11:33 do that and to me who you surround yourself with matters profoundly ideas 1:11:38 seep into your Consciousness values seep in if I'm around people who when I look 1:11:44 at the calendar when I have a meeting with them I dread it I already know it's the beginning of the end most of us have 1:11:50 to work with they're right like we yeah I say have to I shouldn't use that word I don't like saying have to but most of us spend most of our lives 1:11:56 especially the early part of our Lives working with um we work with people that we may not 1:12:02 particularly choose ourselves I think that's probably [Laughter] 1:12:08 so yes I built a life where I could make that decision for myself I'm the CEO of 1:12:14 my business but I think what is important there is the intentionality behind it it's like even 1:12:21 if I worked at a company I would be deciding on which Division I want to 1:12:26 work in which boss I want to transfer under based on do I like and do I 1:12:31 respect him that's it the intention is there you again these are my rules not anybody 1:12:37 else's but if this one strikes you then the way that I would interpret this is 1:12:42 wow who in my life do I not like who do I not respect do I need to be around 1:12:48 them maybe it's not work maybe it's the friend that I hang out with socially on Saturdays again we have a choice not on 1:12:55 everything but in the things we do have a choice what a shame if we don't use it rule number nine prioritize time outside don't get caught up in the numbers 1:13:02 the spreadsheets yeah too many Nerds love a spreadsheet and they they go I 1:13:08 gotta optimize cell b43 b43 never talk back to me I go uh all right look yes 1:13:14 you need to know your numbers yes you should be automatically saving and investing all that yes do the conscious spending plan but at a certain point you 1:13:21 won the turkey is cooking you won you know your numbers Turn the Page get out of 1:13:29 the spreadsheet a rich life is lived outside of the spreadsheet so on a personal level that means I spend less 1:13:35 than one hour per month on my finances it all runs it's a machine it's a system I speak to my wife we talk once every 1:13:43 couple of weeks about money besides that do not spend time tweaking 1:13:49 because the rich life is lived having conversations like this seeing friends seeing my family 1:13:55 that's where I want to live not tweaking things endlessly for no marginal gain Talking about money with a partner 1:14:02 number 10. you mentioned your wife there marry the right person yeah maybe the most 1:14:07 important one of all marriage is the most consequential 1:14:13 financial and relational decision we ever make and people they're a little 1:14:19 weirded out by this rule they go what does this have to do with money I go what do you mean the partner you choose 1:14:25 will affect where you live what you spend on a day-to-day basis what type of 1:14:31 house you buy if you do how often you travel the values if you have children that you pass down to kids 1:14:38 of course it's important and so these are conversations that if you are starting to date it's great time 1:14:46 there's natural moments in the dating process or even the relationship process where you can bring up money so it's 1:14:52 like the first time you take a vacation together take a trip you go hey um just wanna you know this is on my 1:14:58 mind I'd love to just like put it out on the table love that you invited me on this trip I'm so excited to go I'm just 1:15:04 curious how were you thinking about paying for the trip who who in your mind pays for it how would you see us 1:15:11 splitting this that's a great way to bring it up and you learn a lot about your partner there 1:15:17 are questions you can naturally ask you know how were you raised with money what do you remember your parents telling you here's what I remember about my parents 1:15:24 genuine curiosity it also tells you a lot about your partner and then there's a few other natural 1:15:29 moments in a relationship where it just makes perfect sense to talk about money uh when you get engaged when you get 1:15:35 married you uh if and when you move in together pre or post-marriage uh if and 1:15:40 when you have children there are these natural moments where you get the gift of being able to talk about money do 1:15:46 people talk about money couples they talk about it uh when something goes wrong 1:15:52 outside of that what sort of percentage of people couples do you think talk about money rarely it's very low I know 1:15:58 I speak to them all the time I ask them when do you talk about money they go when we're fighting or when they talk about it it's like 1:16:04 it's these grooves that have been created for 40 years oh every time she goes to Target she spends too much ha ha 1:16:12 and I'm like that's not that funny like the running joke between you is that she 1:16:17 spends too much at Target sounds like resentment yeah why not it be 1:16:23 something different so that when you talk about money once a month proactively you always start off 1:16:30 complimenting your partner you go you know what I really appreciate that when we travel 1:16:35 you always pick the best flights I I have total trust because you always 1:16:41 get us there on time and you pick the flies that are so comfortable and I just love you for that 1:16:46 that's a great way to reframe how we talk about money but instead we often 1:16:51 simply do not talk about it proactively we only talk about it when something is a problem do you think how Partners 1:16:57 should know how much money we have when you're married probably a little before that as well 1:17:03 like I'll tell you what happened with my wife and me so in my book in chapter nine I talk 1:17:08 about how to talk about money and when to talk about money and first of all there's a lot of personal finance experts they're like 1:17:15 you should talk about money on date one I'm like have you guys ever been on a first date can you imagine who's talking about their asset allocation on the 1:17:21 first date I'm like get a life so she had um asked me like years into our 1:17:27 relationship some 401K question and I was like read this book learn it it's in 1:17:32 there so I knew all about her money we had talked about her finances and then as we started getting more serious one 1:17:38 day she came to me and she said I don't feel comfortable because you know everything about my finances and I 1:17:44 don't know anything about yours and that was it a sobering moment because I realized I 1:17:50 had violated my own rules in chapter 9 of talking about money early and 1:17:56 proactively why didn't you feel comfortable she didn't feel comfortable because she felt like I knew everything and she 1:18:02 didn't know anything about me being in the dark about your partner and their finances is very uncomfortable 1:18:09 we were planning to get married so what does that mean does he have debt does he not does he have this much money or not 1:18:16 does he expect me to pay the exact same amount for this apartment because I don't know if I can afford that there 1:18:23 are what does it mean for children what does it mean for our elderly parents all that stuff 1:18:28 this is what money means money is not just a amount in a spreadsheet it's where do we live security security who 1:18:36 do we get to be and you know security is a really good that word haunts me because uh we we I 1:18:44 realized to my horror that I had not shared about my finances so we had a 1:18:49 series of conversations and as we got engaged 1:18:55 um we had more we started talking about money a lot and I mentioned to my now 1:19:01 wife I said it's really important for me that by virtue of me running a business for so long I've accumulated this 1:19:08 business these assets and I love you but it's important for me that we talk about a prenup and I was very very scared I had talked 1:19:17 to a lot of friends and I'm sharing this because prenups are another thing that always happen in the dark 1:19:24 and I don't want that I want people to shine a light and to understand how these conversations happen because 1:19:29 nobody talks about this I'm going to talk about it so I was nervous and all the advice 1:19:35 online is awful it's like um have the conversation I'm like what conversation what do I say or some people they tell 1:19:42 you to blame your lawyer my lawyer insisted I have a prenup I'm like if I can't be honest to my soon-to-be wife 1:19:48 what kind of relationship do we have so that's what I said to her and she responded like awesome she was like wow 1:19:57 I didn't expect that I don't know much about prenups but I'd be willing to learn more I said fantastic so we start 1:20:04 talking more about it we both get lawyers as you're both required to it was going pretty well 1:20:11 until it didn't and we started really disagreeing about money 1:20:17 and we were we're just like fighting and 1:20:22 she finally said we should go see somebody because this conversation is 1:20:28 not going the right direction and and I totally agreed with her so we literally went on Yelp and we searched 1:20:35 like therapists near us and we found one right there we went and we sit down and this therapist was 1:20:41 great she asked us what does money mean to you and she asked me first 1:20:48 it's so obvious money means growth like I could literally see the compound interest charts in front of my eyes I 1:20:54 know about the rule of 72 and expense ratios growth of course 1:21:01 she has the same question to my wife my wife says safety 1:21:08 like what that's like somebody's saying metal money means metal to me I go huh 1:21:16 and it was that that we realized we saw money completely differently 1:21:21 completely it explained to me why my wife wanted more money in just sitting 1:21:27 in a checking account when I go but that checking account is losing potential interest why would we 1:21:33 lower our yield blah blah blah we were looking at it through two totally different lenses 1:21:39 so that single question was very helpful in us reframing our conversations it 1:21:44 didn't change everything overnight we still had a lot of conversations we had to have and even once we got married we 1:21:50 still have conversations now they're different they're about spending and investing and prioritizing but it was a 1:21:59 new way for us to look at the way we related to money where did her lens come from childhood like most of ours same for me 1:22:06 in fact every time I talk to couples who are now in the seat that I was in 1:22:13 I asked them what do you remember about growing up with money and they always tell me similar things uh my parents 1:22:19 never talked about money that's very common or they said certain phrases like we can't afford it money doesn't grow on 1:22:26 trees we don't talk about money in this family Etc imagine you hear we can't afford it a 1:22:33 hundred times a thousand ten thousand times growing up and you turn 25 35 you start to make 1:22:40 decent money but every time you go to buy something you feel guilty and you feel anxious and 1:22:47 you feel like I should be saving this money and you can't figure out why because on paper you make more money 1:22:54 if you came to me on my podcast we would trace it back and you might realize it is something as simple and Vivid as 1:23:00 sitting around the dinner table and hearing mom or dad saying we can't afford it our childhood sticks with us 1:23:08 and we could change but it's so important for us to acknowledge that it sticks with us if I approach my partner and I say I 1:23:15 want to get a prenup and they say what you don't trust me yeah and they say no 1:23:22 uh what do you do is that the question well I would say first of all I wouldn't start off like that I think there's 1:23:29 that is one of the most important conversations you're ever going to have in your life and the subsequent conversations so take it seriously you 1:23:37 show up and you explain it I explain it perfectly and they'll turn around and say that and they say no 1:23:43 they say you don't trust me uh no okay that's a contingency you might have to plan for so you might say okay can you 1:23:50 tell me why tell me what's going through your head I want to understand your perspective 1:23:56 this is a conversation it's not a dictate trust you don't trust me yeah 1:24:02 would you marry that person I would have a lot more conversations I can't say yes or no because you can't 1:24:09 judge someone based on their reaction in a situation they've never been in how am I going to react if I got in a car 1:24:16 accident and I start crying can you judge me my entire life based on that no but let's say that we extend it and and 1:24:23 you and I are in a relationship and I ask you I it's important for me by virtue of this and that 1:24:29 and you go I don't you don't trust me if you are unwilling 1:24:35 to even discuss it if you're unwilling to talk to friends to talk to lawyers to talk to people you 1:24:43 can find on your own or I can introduce you to then I think we have a bigger disagreement about values and you know 1:24:49 the way that most of us think about a prenup is it's usually some rich telling someone who has way less money 1:24:55 like sign this paper or it's over and again that's Hollywood prenup which I learned 1:25:01 is all about if the marriage ends what you had before or any agreed upon 1:25:10 assets stay with that person so if you have a business and your partner and you 1:25:17 get married there's no prenup and for whatever reason God forbid you separate suddenly that business might be 1:25:25 at risk the portfolio that you accumulated before you ever met your partner 1:25:30 might go to them and that when you explain it that way most people go oh that doesn't really seem fair but the 1:25:36 money that you accumulate together as Mary Partners yeah there definitely should be an agreed upon that money 1:25:43 needs to be split Etc and no person especially the partner who earns less should be left out in the cold ever do 1:25:51 you notice any differences when you speak to these couples or on your podcast um in 1:25:57 gender differences as it relates to the people's relationship with money because I read a lot of stuff about men being 1:26:02 more prone to gambling addiction and gambling generally yeah yeah I think there are a lot of differences I think 1:26:08 gender is one of the axes that people differentiate on um I see typically more aggressive 1:26:14 investing from men I typically if I see a gender difference in investing differences it would be much more 1:26:21 conservative with women I might see words like Safety and Security used more 1:26:27 commonly by women um but I think there are also other axes uh socioeconomic class is a huge one 1:26:34 that we talk about and that's something that's very uh under the covers particularly in America but we talk 1:26:41 about it Point Blank if somebody tells me I've been poor before and I can be poor again 1:26:46 doesn't bother me I can tell you how they were raised I can tell you probably to some geographic area in fact 1:26:53 um if they tell me um my parents said be seen and not heard 1:26:58 that tells me a lot about someone in their financial behavior so there are different axes that you see different 1:27:03 behaviors on this is the best product that he'll have 1:27:09 released in recent times many of you will think of alternatives to this but I I've tried those Alternatives and none 1:27:15 of them are as tasty as fuel's Daily Greens it was out of stock because of the demand it's now back in stock for 1:27:21 everybody in the USA right now it's not available in the UK but when you get a chance just try it that's all I'm gonna 1:27:28 say just try it and I think once you try it you'll understand why this is such an 1:27:34 essential part of my life right now and will probably become an essential part of yours I'm someone that understands 1:27:40 probably from doing this podcast the importance of having Greens in my diet but do I achieve that every week in the 1:27:46 chaos of my life do I achieve that sometimes the answer is no with heels Daily Greens the probability of me 1:27:51 achieving that is now almost 100 because of its convenience and because of the ease of preparing this one scoop 1:27:59 10 second Shake and you're ready to go over the last few years I've realized that my first 1:28:04 Foundation is my health something you've heard me talk about a lot nothing matters more than that first foundation so that is why I'm so excited to be 1:28:11 involved with a company like whoop who are leading the charge when it comes to bettering your health all my friends 1:28:17 have received free whoops from me because once you've tried whoop I think it's like lights turning on to your 1:28:24 health that's the only way I can describe it my sleep my performance my recovery my stress it's like someone turned the lights on I'm sure you guys 1:28:30 know but for those that don't know what whoop is it's a wearable health and fitness coach that provides you with the feedback and actionable insights into 1:28:36 your sleep recovery training stress and overall health and I've become entirely utterly obsessed with it if you know me 1:28:42 well enough you know how obsessed I am with the smallest details I think the Small Things compounded together produce the biggest gains in our life and that 1:28:49 is exactly what woop does in my health and fitness every single day being able to see my one percent gains on woop has 1:28:54 had a profound impact on my health journey I highly recommend you try it all you have to do is search join.woop.com CEO to get a free months 1:29:03 whoop membership on me and if you do send me a DM and let me know how you get on I'd love I'd love I'd love to know Character traits of people that will never get rich 1:29:09 when you look at really successful rich people that are living their rich life that might be billionaires millionaires or just living their rich life what are 1:29:15 the unobvious things the the character traits the the philosophies towards life 1:29:21 that you see whether it's I don't know confidence or whatever that means whether it's patience what are those 1:29:27 like character traits they're really good at multiple things like really good 1:29:32 when I was at Stanford my first year there was a Nobel Laureate professor and 1:29:41 the professor next to him was making a joke but it wasn't really a joke and he 1:29:46 said you know you'll hear stories about a person being an amazing chemistry 1:29:52 professor but they're just a disaster at home Etc but not him 1:29:57 he's a Nobel Laureate I think it was in chemistry he's at the top of his field in chemistry and by the way he's 1:30:03 published papers in music and he's an accomplished father that was the first time that I had been 1:30:10 exposed to the idea that you can be absolutely amazing in multiple domains 1:30:16 because it's a comforting story we tell us that oh this person's really good at this but they're probably a disaster in 1:30:22 everything else and what I find is that the people who are really good at something they're actually good at a lot of things 1:30:28 they take those skills and they transfer them they show up on time they prepare even though they didn't 1:30:34 need to look at all the preparation you've done that's cool you didn't need to but you did it and they're probably 1:30:41 good socially skilled there's a lot of things they're really good at so for me that is inspirational because it means 1:30:49 that I have a lot I can work on flip that coin then on the other side people that you would bet on give me three 1:30:55 character traits of people that you would bet on never living their rich life in terms of character traits 1:31:01 uh number one they they're surrounded by people who uh keep them down versus 1:31:08 build them up so that would be phrases like um why do you need to do that um that's weird don't get too big for 1:31:14 your britches okay number two um 1:31:19 impulsive they make decisions based on what's in front of them versus 1:31:25 stepping back and looking at the entire chessboard and having a long-term perspective and if I were to ask them 1:31:32 tell me two things in your life that you do with a long-term perspective they 1:31:37 would probably struggle to answer it whereas a long-term thinker would be like oh my God I could talk about this 1:31:42 for four hours investing parenting travel uh what I wear on my feet and on 1:31:47 and on health perfect um and three 1:31:53 no personal vision of a rich life so if I ask them what is your rich life they go I want to do what I want when I want 1:31:59 I go yeah yeah what uh I want you know I want the house and I want the car and I 1:32:04 go okay what type of car like a Ferrari okay like how come a Ferrari oh it's just cool like a red Ferrari like no 1:32:11 personal connection to it if they were to say I want a Ferrari because uh you know my uncle once had a Ferrari and I 1:32:18 saw the race in Italy and blah blah blah I go wow but if it's just things objects 1:32:24 driving without us not enough super interesting I wish I'd had this 1:32:30 conversation when I was 18. I'd certainly be in a much different position now I think about if I if I've 1:32:36 been even more Savvy with my money and I had it compounding sooner in my life my life would be 1:32:42 would be a lot different I actually I Ponder and that's why there was such a pause there whether it be happier because like I don't even I don't even 1:32:48 know well your story brought you here yeah what you did and look I wish I had started squatting when I was 14 years 1:32:53 old I didn't know what a squat was yeah and so we all deal we play the cards we're 1:32:59 dealt with and then we make the best with what we've got and I never want anyone to feel like it's too late there's always something you can do 1:33:05 honestly your life has turned out obviously very fantastic but I love that you grapple with these questions just 1:33:12 like anybody we all wonder is it too late what if I'd started five years ago and of course we can't do anything about 1:33:17 that we have a closing tradition on this podcast where the last guest leaves a question for the next guest and the The last guest's question 1:33:22 question that's been left for you without knowing who they're leaving it for is oh okay what is other people's biggest 1:33:31 misconception of you I think the 1:33:36 biggest misconception is that I have a very specific way of telling you what 1:33:44 your rich life is but that's not true that comes across because people often interpret what I 1:33:51 say about buying a house that I'm telling you don't buy a house not true I'm gonna buy a house one day myself 1:33:57 what I what I crave is encouraging someone 1:34:03 to build their rich life with intentionality don't do it like me my rich life is mine your rich life is 1:34:10 never going to look like mine nor should it the misconceptions that I'm telling you follow this exact 1:34:16 formula and you will be rich no follow this formula and you will have a lot of money but building a rich life takes 1:34:22 your unique creativity and only you can do that 1:34:28 do you see that as a piece of work that we all need to do like the kind of the exercise that you ran me through there do you think that everybody needs to 1:34:35 um do that initial piece of work yeah of course otherwise what are we working for 1:34:40 you're saving money blindly that's what the whole Journal is about you've got to know down to the intimate detail what is 1:34:46 my perfect Saturday what do I not want to do I guarantee you when I ask people what their perfect week looks like zero 1:34:52 percent say I want to spend three hours doing laundry I go great can we use money to solve that problem easy Luggage 1:34:58 in the airport can we use money to solve that problem done we never have to think about it again so we've got to design our rich life it 1:35:06 doesn't just happen to us nobody trips and falls and lives a rich life it is intentional and it is ongoing work and 1:35:13 in my opinion is one of the most important pieces of work that we can ever do and that's you're right exactly what this journal does I will teach you 1:35:19 to be rich Journal and throughout this journal you kind of hold people's hand through those 1:35:25 exercises but for a solo or you do it with a partner and you get to dream about money most of us feel so nervous 1:35:32 and rigid and scarce about money we feel ashamed this has almost no numbers it's all about what does your rich life look 1:35:39 like and if anything you finish this and you're dreaming bigger not smaller when I look at this journal as I go through 1:35:45 it there's there's a real emphasis here on just heightening people's turning the lights on in terms of what money is but really heightening their their 1:35:51 self-awareness about their relationship with money as well um which seems to be the foundation of getting good at money and your other 1:35:57 book I will teach you to be rich which is the second edition of this book the first one came out I believe in 2009 1:36:03 just after the financial crash which is perfect timing um this one came out in 2019 so this is 1:36:08 an updated version of the book I mean millions and millions of people have bought this book they're nuts and bolts of money if you don't know how to 1:36:16 get started investing if you have debt and you're not sure what to do if you even have questions about uh should I 1:36:23 buy whole life insurance the answer is no uh should I um buy or lease a car 1:36:28 it's all in there no Gill no excuses no BS just a six-week program that works 1:36:36 you're referred to as the new Finance Guru and I think you know we do need new Finance gurus because there's not enough 1:36:42 financial literacy from the very start of Our Lives as you saw from my story where I just just my relationship with money was catastrophic and I could be in 1:36:49 a much I'm very aware that I could be in a much different position because of those early mistakes 1:36:54 I made and mishaps and my early relationship with money so people do need to start getting educated with their money because as I said at the 1:37:00 start of this conversation it is about living your rich life and that is a subjective thing for me it was having the freedom of choice broadly across 1:37:07 every facet of my life about where I spend my time and who I spend it with um but it is the foundation of that 1:37:13 freedom of choice and that's what your book and your work does so brilliantly and articulately it gives us the the 1:37:18 path to freedom of choice and we get to choose what our rich life looks like so thank you so much for your time thank 1:37:25 you for being an inspiration and being a loud voice in the conversation around money I know so many of the people listening to this podcast are completely 1:37:31 in the dark about money and so having these kind of conversations and having the Practical roadmap to how we can improve our relationship so we can 1:37:37 unlock the future we want is um incredibly important now and I'm sure it will remain incredibly important in the 1:37:42 future because there's going to be a lot of influences like Instagram and Tick Tock that are trying to 1:37:49 tell us a story about money and aspirations and what we should be aiming at that are unhelpful and counter-protuitive to our happiness so 1:37:55 thank you ramit thanks for having me [Music] 1:38:17 thank you