On living YOUR rich life
Too many people tell you how to save your money. Not enough people tell you how to spend it.
Have you ever asked yourself: What does my rich life look like?
What if I told you that you could start living it today by absorbing one simple statement?
I will...if you decide to stick around.
92% of the financial advice shouted at us by the main-stream financial media is complete crap. In fact, you would be better off doing the exact opposite of what they recommend a majority of the time.
Have any of the following ever been shoved down your throat: A penny saved is a penny earned, cut coupons to save 50 cents on laundry detergent, stop buying that $5 cup of coffee, drive 2 hours away to the outlet mall to save $7 on an outfit, "live" a frugal lifestyle for 64 years, and then when you are 65 you can reward yourself with a cruise.
How excited does that financial "wisdom" make you feel? I can't speak on your behalf, but it makes me want to dive head first into the Atlantic Ocean off that cruise ship. And way sooner than the age of 65.
Ramit Sethi is the anti-financial guru who wrote a book that I think everyone new to financial literacy should read before entering the real world called "I will teach you to be rich".
It was the first book that ever compelled me to buy extra copies of and share with a few friends.
Now let me make a quick confession to you my dear reader - I have been called cheap by more people than I care to admit. And I realized that if more than one person in your circle calls you cheap, guess what? You are cheap.
But this book has (at least partially) helped me to break out of the chains of my programming of save, save, save, then die. And it will do the same for you. Trust me.
Personal finance can be an intimidating topic for many people. So they often choose to blindly follow the advice force fed by the clueless media and their well-meaning parents. Or perhaps most frequently, by using a technique called the ostrich syndrome - instead of dealing with an uncomfortable area of life they bury their heads in the sand (like ostriches).
And I don't blame them. It is hard to know where to even begin. And I certainly don't claim to have all the answers.
But here's the simple statement I promised you - Spend extravagantly on what you love, and cut costs ruthlessly on the things you don't.
Ok now that's something I can get behind. What about you?
Now your whole relationship with money changes. You new job is to start noticing what areas you get real enjoyment out of as well as what you couldn't care less about.
This, of course, will be different for you than it is for me but here are a few of mine to help get your juices flowing:
I want to travel to one new country each year.
I want to be able to fly my Mom across the country 2 times per year to visit me.
I want to buy every book that sounds even remotely interesting to me.
These are a few meaningful ways that I want to spend my money.
And a few areas that I don't care about:
Shoes
Plane tickets (shoutout Spirit Airlines)
Concerts
So I attempt to cut costs here however possible.
Take a minute right now and write down 3 things you want to spend MORE on and 3 things you want to spend LESS on.
Kind of fun right?
This has helped me have a healthier relationship with my money. And it has given me clarity.
Do you think it could benefit you?
Ramit encourages us to stop stressing over $5 questions (should I buy this coffee?) and start dedicating more energy towards the $50,000 questions (should I start a side hustle to earn some more money?). This shift in focus can be life changing.
Ramit and I both give you permission to buy all the coffees you want.
There are many other useful parts of the book that cover topics like: how to waive credit card fees, which investment account to use, scripts for getting a raise, etc. so check out the book if you want to dig deeper into those.
But there is one more section of the book that I would like to discuss here - Negotiation.
Ramit shares a hilarious story about how his dad buys a car. He would drag out car negotiations over multiple days at the car dealership. The whole family would be involved. They would even eat breakfast at the dealership each morning. And he even walked out of buying a car that he had been negotiating for 4 days. Why? Because the dealership would not throw in free car mats!
Not all heroes wear capes.
Negotiating is a common practice all around the world but we as Americans seem to be terrified of that dirty word.
Why is this?
I think a lot of people believe they will be looked down upon if they try to get a good deal.
And that is complete nonsense.
I may be a bit biased because I am half persian and I have witnessed my full persian grandpa ask for and often receive 10% off of just about everything he purchases.
It definitely made me feel a bit awkward when I was a kid but now I love it! My fiancé, not so much.
Imagine if you spend some time negotiating something simple like your car insurance and get it reduced by $20 a month.
That's chump change right? Not when you consider that single negotiation will save you $240 in the first year alone. And over $10,000 if you drive for another 50 years.
Still chump change?
If that still sounds too intimidating, try this fun little experiment the next time you go out to a coffee shop.
When the cashier tells you your total ask "Will you please give me 10% off?"
Then - BE SILENT.
Don't feel the need to give an explanation of why you are asking. Just ask.
You will be surprised how often they will comply.
And if they don't, what is the worst that could possibly happen?
They say "no" and then you still pay the normal price. Who cares?! You will probably never see them again. And if you do maybe they will give you 10% off next time :)
Now obviously, negotiating 10% off your coffees isn't going to make any meaningful impact on your wallet but it will start building those neglected negotiation muscles.
Then you can start to work your way up the negotiation ladder. You will feel more confident and believe that you can negotiate meaningful deals on the big purchases like: homes, cars, and that private jet you want.
Ok, I've rambled a bit so let me finish.
Again let me ask, what does your rich life look like?
It may be completely different than mine but that's ok.
Start spending MORE money on the things you love and spend LESS on the things you don't.
Start asking yourself $50,000 questions instead of $5 questions.
And learn to negotiate like a Persian!
Here is a link to buy the book if you want to learn how to be rich (not an affiliate link).