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

key things. Ramit Sati, financial

expert, the money man, New York Times

bestseller. Has more than 20,000

documented success stories. This is your

chance to never worry about money again.

You can live a rich life regardless of

where you came from, regardless of your

income. How many people are clear on

what their rich life looks like? Less

than 1%. When I talk to people who have

a spending problem, 100% of the time

they always say the same thing. I just

need to earn more. If you doubled your

income today, do you think your problems

would disappear? No. Some of the stats I

pulled out from your book, about 25% of

people who make $100,000 a year plus are

still living paycheck to paycheck. Makes

us realize that maybe the things we

think we need are things that we have

been socially taught are important. For

example, owning a house is the best

investment. It means you are successful.

But it can be a very bad financial

decision. There are far better, far

simpler investments. So, I've got £100

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

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.

Do you know the math? I would have

736,000

in my account. Yeah.

Reit 10 money rules. This is where the

real wealth is created. Number one,

this episode changed my perspective on

money. I'm an investor. I've been

investing for the last six, seven years

at different levels. Big companies,

small companies, the S&P 500 funds, you

name it. But Rammit changed my mind. He

changed my mind on money, spending,

investing, and he changed my mind on

something that I think 95%

of you that are listening to this

podcast and that are about to listen to

this need to have your mind changed on

too. that if you have the right

philosophy towards money, the right

perspective and mindset towards money,

then there is a path to living our rich

life, to becoming rich that enough

people are not talking about. He debunks

the myths of money, the limiting beliefs

about money, and he confronts all of the

unhelpful advice about money that stands

in the way of you becoming rich. There's

an app on my phone that I now have

installed because of this conversation.

And there are three big investments that

I've now made in my life because of this

conversation.

And there is one key idea

that I now believe will make me 10 times

more wealthy over the next three decades

because of this conversation.

You're going to love it. Enjoy.

[Music]

Remmit.

Someone's just clicked on this podcast

on YouTube, on Spotify, on Apple, and

they saw the title, they saw the

thumbnail, they thought that sounds

interesting.

Tell me why you think they should stay

and listen to what we're going to talk

about today, what they stand to gain if

they give us their time. Whenever

someone hears someone talking about

money, they get rigid. They instantly

think that 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 new clothes. Save all your

money until you're 90 years old." And

maybe, just maybe, then you can spend

it. And I don't believe in any of that.

I think you should spend extravagantly

on the things you love as long as you

cut costs mercilessly on the things you

don't. I think you should live a rich

life today and an even richer life

tomorrow. And so when you combine money

and psychology, you start to understand

that there is more to a rich life than

just some number in a spreadsheet.

People already know they should be

saving more. They know about compound

interest. They may not know the

intricacies, but they understand if they

invest some now, they're going to have

more later. So, what's stopping them?

That's been the central question that

I'm fascinated with for the last 20

years. That's why when I studied human

behavior and persuasion and psychology,

I was obsessed with this question of

what are the things we know we should

do, but we still don't. You can live a

rich life regardless of where you came

from. You can live a rich life

regardless of your income. Now, of

course, having a higher income

dramatically helps, but just like

fitness, we can all improve 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 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 the road, when to use our

turn signals, most of us do not have

even the equivalent knowledge of money.

For example, the basic language of money

would be what percentage of your income

are you saving and why? What percentage

are you investing and why? When will you

have $100,000 or $500,000 or a million

dollars and what will that money get

you? Because just having a million

dollars in the bank is pointless. What

does it get you specifically?

This is the basic language of money.

You've got to know your key four, six

numbers in your life. Not many, just a

few. But once you understand those

numbers, it's like understanding the

speed limit. 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 happen? Why do

these rules exist? And these rules are

similar in money. You can 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 that I really like to track. I

track these myself and these are the

numbers I encourage. The first is your

fixed costs. Okay, those would be your

rent or your mortgage, your in uh your

uh any debt payments, groceries, the

money that you are spending every single

month that is essentially fixed. And the

number I recommend for that is 50 to 60%

of your take-home pay. So that would be

if you're spending 50 to 60% of what you

make, what you take home on your rent,

your groceries, any debt payments, your

car, you're in good shape. Okay. The

next one is your savings. That would be

roughly 5 to 10%. Savings would be

things like an emergency fund, savings

for a down payment, for a car, things

like that. Third is investments. Uh this

is where the real wealth is created. And

for this, 5 to 10% of take-home is fine.

Of course, the more you put in, the more

you're going to have. And then the

fourth category, the one I love the

most, is called guilt-free spending.

This is going out for cocktails in New

York. It's buying a beautiful shirt.

It's treating your friends, whatever you

love, yoga,

20 to 35% of your take-home pay. So, if

you're watching or you're listening to

this, just take 15 minutes back of the

napkin, jot down your approximate

numbers. You don't even have to get them

perfect. And you will be able to

benchmark how you are spending compared

to those numbers. I'll tell you that

those numbers tell me 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 love spending on. I

can tell what you don't. I can tell what

your priorities are.

And I can also tell where you are out of

alignment. So I'll give you an example.

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, "Oh god, not this answer

again." I hear it every day. I go, "Wow,

that's so interesting. So what do you

want?" They go, "Uh, most people have

never thought beyond a trit answer." So

then the next answer I often get is

freedom. I want freedom. I go, "Great.

That sounds good. What is freedom?" I

want to do what I want when I want. I

look at their numbers and I see

a huge payment that they're making to a

30-year mortgage. I see debt payments. I

see car payments. And I go, "Now, this

is interesting. You want freedom, but

you have essentially anchored yourself

down to not be able to travel or to

pivot or to move. How can those two be?

How can you reconcile those two? And

that dissonance is actually a

fascinating moment. I love when we

experience dissonance. We all do. 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 they

simply have never thought about it. What

what our rich life is these gener these

generic phrases, freedom, flexibility,

it's just words. What I really want

somebody to say, I want them to go a lot

deeper, is to say,"I want to be able to

travel for six weeks a year. I want to

go to London. I want to go to New Delhi.

I want to go to Thailand because I want

to visit my family." 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 where

they're eating. They tell me who they're

bringing with them.

But to simply say I want freedom is so

vague that when I look at your numbers

there's often a huge inongruity with how

you're spending versus what you claim

your rich life is. How many people from

your experience of interviewing people

and doing this research are clear on

what their rich life looks like down to

you know what you described 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 class I'm going

to be on as I travel less than 1% less

than 1% of people know that no most

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

rich life why does it matter to be? What

did that one that less than 1% of people

that have that planned out have as an

advantage or a benefit from that

meticulous thought that the other 99%

don't have because they can craft their

rich life that is uniquely theirs.

Almost like getting a handmade glove.

And in fact, the more you craft your

rich life, the more bewildering it looks

to the outside world. So, I'll give you

an example from my own life. I love to

travel. I spend a lot of money when my

wife and I, we go, we'll travel for

months at a time.

I love hotels. I love the hospitality. I

love the details. I I love it all. I

don't really care about cars. Not at

this phase of my life. It's just not

that important to me. So, when I talk

about my money dials or the things that

I love to spend money on, I might spend

a crazy amount on a hotel per night just

because I love it. But I drive a car

that's almost 20 years old. It's just

not important to me. And I want that. I

want to hear in your life what you spend

extravagantly on but then you cut costs

mercilessly on because I want that

duality which indicates you are

intentional about your rich life. What

if we're buying things to impress other

people and we don't cuz it's hard to

looking in from the outside especially

it's hard to know if someone actually

likes Lamborghinis. Yeah. or if they're

buying Lamborghinis because they were

beat up when they were 9 years old on

the playground and they're trying to

overcompensate and make the world and

does it matter why they're buying it.

Does it matter? I don't know. H first of

all, how would we even know? How would

they know? Is there a is there a

difference? Do you think just on your in

your opinion on the impact that that

purchase has on us? Whether we're doing

it intrinsically or we're doing it

exttrinsically because I reflect on some

of the things that I spent money on and

I go that was for someone else. Whereas

there's other things I spend money on

which are maybe health related or travel

related like convenience flying in a

nice class on a plane which I go no

that's actually adding a lot of benefit

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 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 in this

mansion with this tennis court by

myself, sleeping for 3 hours and then

driving another hour and a half back to

the city where all my friends in work

were. I go, that was a stupid

decision based on extrinsic external,

you know, motivations. It's a great

question and you know, particularly in

America, we love this idea of ownership.

We are taught you've got to own. Owning

a house is the best investment. It means

you are successful. And if you're

renting, no one really says this, but

what they deep down say is you're a

loser. Yeah. Okay. This individualistic

strain really runs deep. And it has led

a lot of people to make poor financial

decisions. Uh first 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 very bad financial

decision. In fact, I rent by choice. And

living in New York, for example, I lived

here for a long time,

I knew that if I were to buy, I would be

losing thousands of dollars every single

month because it actually cost more than

twice as much to own than to rent.

But can you imagine the type of

pressures even I got from people who

would come over and say, "Oh, so do you

own this place?" the place that I was

renting. I said, "No, I rent." And there

was this visible moment of confusion.

They're shaking my hand. They know that

I'm the I will teach you to be rich guy,

but I rent. How can you be teaching

money, but you rent? Isn't renting for

losers? And I have to say, because I was

rockolid confident in my decision, that

pressure did not affect me. But I want

to also say that a lot of us buy things

based on status. Like the idea that we

don't buy things based on what people

around us think is is nonsense. We buy

things based on status. To deny it is

absurd. But I do think that for the big

purchases in your life like a house, a

car, the big things, you've got to run

the numbers. And if you decide, hey, you

know what? I want to buy a house even

though it's going to cost me an extra

$600,000 in opportunity costs and

phantom costs, but I'm going to do it

because I like it or it makes me feel

good. I say God bless. But if you simply

make decisions based on what other

people around you do, then you will

discover like you did, I thought I was

going to feel a certain way and I don't

really feel that way. And that for me is

an opportunity for you to interrogate

your own beliefs. And money is a like a

personal zero sum game, right? Like so I

can't just spend indefinitely. So buying

that ridiculous house out in the

countryside takes away from something

which might have genuinely brought me

closer to happiness like I don't know

going away with my family or whatever it

might be. Exactly. You you talked there

about buying property. I find that

really curious because the the popular

narrative is for most people the minute

they get any decent amount of money is

to buy your first house. And that's what

people do. they get they take a 10%

deposit or 20% deposit, whatever it

might be, and they buy a house. Um, why

is that a poor investment? Why is that a

bad thing to do? Because that does kind

of sit counter to the popular narrative.

Well, we have to remember first of all

where the popular narrative came from

America. If you ask people, what is the

American dream?

Yeah. The answer is inextricably tied up

with a single family home with a white

picket fence. That's not an accident.

That is the result of decades of

messaging. Some might call it

propaganda.

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 issues. But to leave that part aside,

this is how most people think about

buying a house. They think grandma

bought a house in Austin, Texas in 1970

for $100,000.

Grandma just sold it 50 years later for

$1 million. Grandma made $900,000.

They go, "It's the most profitable thing

you could do. Buy a house." I go, "Okay,

uh, that sounds really nice." Did granny

factor in how much she spent on

maintenance for the past 50 years? Uh,

no. Uh, did Granny factor in inflation

and how that affected her return? Uh,

no. What's inflation? Uh, did Granny

factor in the opportunity costs of what

that down payment could have been used

if invested in the S&P 500? Uh, no. And

did Granny look at all these phantom

costs such as interest on the loan? Uh,

no. It's not simply the bigger number

minus the smaller number. That's wrong.

That is simplistic.

For the biggest purchase of your life,

you've got to go deeper. Again, when I

was living here, I kept a very close eye

on real estate. and the place right

right next to me, same square footage,

same number of bedrooms, same

everything, it would have cost 2.2 times

what I was paying in rent. So, just to

give you an example, if I was paying

$3,000 a month, it would have cost about

$6,400 a month to own. Okay? I said,

"You know what? I like renting. If I

have a problem, I just text my

landlord." I took the $3,400 I would

have spent owning when factoring in

phantom costs, maintenance, interest,

taxes, all that and I simply invested it

and I made more money doing that than I

would have owning. What about if you're

buying somewhere to for the rental

income? That can work. That can work. So

owning real estate as an investment can

be part of a well- diversified portfolio

if you run the numbers. Right now

there's a lot of hype. People go, "I'm

going to buy a house and if I don't like

it or whatever, I'm just going to rent

it out." Okay, fine. But you've got to

remember that if your mortgage is

$1,000,

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, $1,500 a month, which would include

a roof repair happening 19 years from

now. We've got to advertise that out. uh

labor costs, interest, all that. If you

can rent it out and make a profit,

fantastic. It cash flows. That's

awesome. What you discover is that most

people who buy a primary residence, the

place they want to live in, they buy it

because they want it and then they tell

themselves it's an investment.

Buying a house can be an investment, but

oftentimes it's not. And there are far

better, far simpler investments. Here's

my key message. I want to make sure

nobody misunderstands me. I've been

accused of saying buying a house is bad.

No, I never 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 I'm going to do

it anyway. My key message is for the

biggest purchase of your life, you've

got to run the numbers. Sometimes buying

can be a good financial decision. Often

renting can be a good financial

decision. run the numbers and never feel

guilty for renting. As it relates to

buying a house, I've always been

hesitant because I'm

scared really of the point you mentioned

about being anchored to a location. So,

I the way that I've kind of justified

that away is by saying, "Well, I'll just

Airbnb it when I'm not there or I'll

rent it out when if I decide to move to

New York or whatever." Is there a a cost

in the opportunity of being less

flexible about where you can be 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 at that point. Yes. Buying

a house is one of the most profound

financial decisions that will affect

your lifestyle ever.

You can sell a car even at a minor loss,

but selling a house involves massive

transaction costs and labor that most

people don't anticipate.

One of the reasons that I rent is for

lifestyle reasons. Financial, yes, I

make more money renting and investing

the 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 is one of the key things

that I would encourage people to decide

before they buy. You want to know that

you're going to be there for at least 10

years because then you can spread all

those transaction costs. Spread them out

over 10 years. They become much more

affordable. It's kind of like buying an

expensive jacket. If you buy it and you

wear it once, that's really expensive.

If you buy it and wear it over 10 years,

becomes a lot more affordable. Now, take

that, multiply it by a thousand, and

that's a house.

Particularly for young people,

I don't give a lot of unsolicited

advice. 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 really don't. If somebody

comes to me, they come to my blog, my

social media, great. Otherwise, I'm 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

graduate from college. What advice do

you have for me? And at that moment, the

the best piece of advice that I have is

move where the action is. And typically

that's a big city. So that would be

where there's more jobs, where there's

simply more people if you're looking for

relationships. And there's a lot of

tacit knowledge that happens in big

cities. Like, oh, have you tried this?

Oh, what? Have you seen that musical?

Uh, have you tried this thing? This idea

that's going around. So often

surrounding yourself geographically can

be hugely rewarding 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 best investment. And if

I were to say, "Show me where you

calculated the numbers that it was going

to be an a great investment."

75 plus% of people have never created a

simple spreadsheet. How does buying a

house compare in terms of returns to

something like investing in the S&P 500?

It's quite poor actually. Really? Yeah.

Over about a hundred years, there's

great research showing that it has

essentially matched inflation. It's been

slightly above inflation. People find

this mind-boggling again because they

think somebody bought a house for 100K

and they sold it for a million, so it's

900K. But they don't properly factor in

inflation, opportunity cost, phantom

costs, all that. It's really hard to

factor these numbers in. But it's

critical because it's the biggest

purchase of your life. I'll give you

another example of where people don't

properly factor it in. Uh some people

pay a financial adviser 1%. They go 1%

it's not a big deal. I'll pay 1%.

What they don't realize is that that 1%

over the course of their lifetime will

take 28% of their returns and hand them

over in fees. Think about it. If you

make a million dollar in investing over

the course of your life, $280,000 are

going right out of your pocket into that

advisor's pocket. Now, that's super

counterintuitive. 1% turns into 28%. How

does it work? You can simply go online

and search for uh investment cost

calculator and plug in the numbers, add

a 1% fee, and you will see. The point of

this is that sometimes money is highly

counterintuitive.

Really counterintuitive. It's unlike

anything else. If you and I go to sushi

right now and we get sushi for 20 bucks,

it'll be fine. If we get it for a

hundred bucks, what do you think? It

probably be a little better, right? And

if we get it for $1,000, the fish will

have been flown in from Tokyo this

morning and it will be served in an

absolutely stunning setting. 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

going to have a different type of

fabric. More on a car, it's going to

look cooler, have cooler features.

Money's not like that. If you spend

more, you don't get better returns. You

don't get better anything. In fact, if

anything, you get worse returns. People

find this mind-boggling because it is.

It's counterintuitive. But in investing,

costs matter. In buying a house, you've

got to run the numbers because they are

totally counterintuitive. Quick one

before we get back to this 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 and

tuning into the show week after week. It

means the world to all of us. And this

really is a dream that we absolutely

never had and couldn't have imagined

getting to this place. But secondly,

it's a dream where we feel like we're

only just getting started. And if you

enjoy what we do here, please join the

24% of people who watch this channel

regularly and have hit that subscribe

button means more than I can say. And if

you hit that subscribe button, here's a

promise I'm going to make to you. I'm

going to do everything in my power to

make this show as good as I can now and

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and we're going to continue to keep

doing all of the things you love about

this show. Thank you. Thank you so much.

Back to the episode. So, what is the S&P

500 for 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 want to simplify this for people

that are at the very start of their

investing journey, you know, because I

mean, this is what you spend so much of

your time doing that. I just think about

my my team here, say the diary of a CEO.

There's about 30 people and we started

talking about money one day and it was

mindblowing how nobody in my team's

lives had ever had the conversation with

them about investing. We all think of

investing as something that rich people

after the age of 40 do once you have a

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. Ah this is driving me insane.

It's true though, isn't it? Yes. And

that's that's the central part of my

work is that you can live a rich life

and that rich life can be richer and

more vibrant and more personal than you

ever imagine. If you want to travel, you

can travel for longer than you ever

thought. You can travel for me at nicer

hotels. You can uh spend more time with

your children, with your loved ones.

Whatever your rich life is, you can do

that. But you've got to learn a few key

basic things about investing and money.

So let me tell you what I would tell my

family when they come to me. They go,

"How should I start investing?" The

simplest simplest way that I advise my

family is I say, "Get a target date

fund." So let me explain what that is. A

target date fund is one fund, just one,

and you pick it based on the year that

you're going to retire. So, if you're

going to retire in 2050,

if you're going to be 65 in 2050, you go

and you find that one fund. It's called

a Vanguard 2065 fund or Fidelity 2065 or

Schwab 2065. There's lots of brokers.

These funds, it's one fund. All you do

is put money into it. That's it. The

fund, like a pie chart, is automatically

diversified. So, as you get older, it

gets more conservative because somebody

who's 75 years old should be investing

differently than someone who's 25.

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 uh a

set or a basket of stocks and maybe

bonds. So, we've all heard of, you know,

companies like Microsoft, Google,

whatever. A fund owns lots of these,

right? And that's important because

we've heard diversification, like you

should have diversified your

investments. Okay? Well, how do I do

that? You don't need to go and buy 20

stocks and then figure out how much of

each to do. That's too much work. And

honestly, most people are not good at

that, even professionals. You buy a fund

which automatically owns lots of stocks

like hundreds of them and over time all

you the individual investor like me have

to focus on is putting money into it

automatically. So a fund essentially

I've got £100 that I want to invest. Um

I find a fund. Where do I find these

funds? You can go to Vanguard, Schwab or

Fidelity. All those are great companies.

uh what you're looking for regardless of

what country you're in is you're looking

for a lowcost brokerage firm. So, but

there's also apps and stuff that I can I

can you can use apps. I don't like a lot

of the apps because they gify you to try

to invest. They want you clicking and

trading. I hate traders. Trader, you do

not want to be a trader. Traders lose

money. Investors treat investing like

watching paint dry. That's how sexy it

is. Trust me, I'm not getting my

entertainment from investing. I'm going

out, go watch a movie, go watch Netflix,

but investing is boring and automatic.

That's how it should be. I used a a a

company called Hogre Lands down in 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 wasn't very compelled to

use it. 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 to be game. You don't

want to screen all of that notification.

I like ugly. It should be ugly. And you

don't want it to be too accessible as in

I don't want to be able to check it

every day. No, look on my phone. You

will see no investing apps. There should

not be. Why do you need to log in and

check it every day? What's the point? In

fact, I log, you know, most people

should check it every 3 to 6 months. And

here's how you check it. You log in on

your desktop. Wow, it's up. Wow, it's

down. Okay, bye. You're not tweaking

anything. It's like making Thanksgiving

dinner. Once you've put the turkey in

the oven, just let it sit. Do not fiddle

with it because you're only going to

mess it up. And in this case, you're

letting the turkey cook for decades. And

that fund. So, I've got a £100. I go on

a website. Yep. Vanguard, Fidelity

Schwab, whatever they are. I have no

alliance to any of them. Neither do I.

Um, there's various ones in the UK. I

actually do recommend Hogrey Lands down

just because it's quite simple and I

think investing in funds, there's no

fees. There's no fee associated with the

investment itself. Obviously, they take

a, you know, they might take a

percentage depending on which fund

you're investing in. I take my 100

pounds and investing in Hargrave

landsdown, you don't need, there's no um

minimum. Great. From what I understand,

and there's no if you invest in a stock,

they charge 12 pounds per investment,

but if you invest in a fund, it's free.

Um, I put my£100 into a fund. The fund

is essentially taking one pound, one of

those pounds and investing one pound

into Facebook. It's investing one pound

into Google, one pound into 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 making

the decisions for me. I just put the

money in every month. Whatever I can and

I leave it. Yeah. And let's go even

deeper. I love that we're getting into

the nuts and bolts here because, you

know, honestly, most people, they do not

know how to invest. Literally, what

website do I go to and then what do I

do?

The fund owns these different stocks and

some will go up and some will go down

and it's inconsequential to you. All you

need to know is you own this fund.

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 the most important decisions of your

life. Now, there's just one more thing

you have to do. Set up an automatic

transfer so that every single month you

have a certain amount of money going in.

Now, if you don't know how much money,

use my conscious spending plan

guideline. What did I say? 5 to 10% of

take-home is a good guideline. All

right? You should be able to do 5%.

Trust me, anyone who comes to me, they

go, "Reie, there's no way. Must be nice.

I can't afford." I go, "Show me where

you're spending your money. I guarantee

you I can find 5% to send in every

month." Now, you're not trying to send

it 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 you set it up automatically. The

investment fund will automatically draw

from your checking account. And it will

pull in a hundred bucks, 500 bucks,

a,000 bucks, whatever your 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

going to be like, "Oh my god, I didn't

even realize that all this money is in

here." When you add that plus

compounding over many years, that is how

real wealth is created. So I don't want

anyone to think that you have to be rich

in order to start investing. One of the

ways you get rich is by investing. I've

got a friend that's currently actually

in this building at the moment and I had

this conversation with them about a year

ago. Gave the advice that you've just

given there. And about 2 months later,

this individual who I shan name came to

me and I said, "How's your uh you know,

your your your investments going in that

in that fund?" And they said, "Oh, yeah.

I had bills. I had a credit card bill,

so I I took took it out." Oh, yeah. She

she treated it like a checking account.

Investments for me are

places to accumulate wealth. I don't

draw from it. That's what a checking

account is for. So, if what that is is

there's two parts to what your friend is

saying. one is um mentally she's

thinking that this investment account is

just money I can draw from if I need it.

So I would sort of gently change the way

she thinks about it. The second is I

guarantee her account structure is a

little

um subpar. So here's how I would set it

up. This is in chapter five. Uh it's all

automation because trust me, I don't

want to spend time transferring money

back and forth. That's I don't spend any

time on that. You get paid, your money

goes into your checking account. From

your checking account, it is

automatically transferred to a savings

account. In fact, I have subsavings

accounts for vacation, car, down

payment, all that stuff. So, you have

money set up for specific goals. Money

is transferred to your investment

account. It's transferred there. I'm not

gonna touch that money. I'm gonna let it

cook. And then I have my guilt-free

spending, which is going out with

friends, whatever I love, and my credit

card bill is automatically paid off

every single month. That's how you want

to set it up. It takes a couple of weeks

to set everything up and then you never

have to think about it again. C how can

you prove to me that this is the way to

make wealth? What case studies have you

got that investing in funds over a long

period of time is the path to financial

wealth? Because you know it's you said

earlier about the paint drying thing.

The narrative that we see 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 buy some

cryptocurrency and it goes up. Yeah.

That's what we hear. So that's what we

try and emulate. Totally. We prove to me

that that's that this fund strategy is

better. Well, there's there's a couple

things. First off, the research over

more than a hundred about a hundred

years shows the returns of the stock

market and the returns tend to be at

least in America they tend to be around

11%

10 to 11% and if you take out inflation

you get about 7 to 8%. Per year. Now for

anyone listening they go okay well what

does that mean? That number means

nothing to me. 7% whatever.

If you go right now and you Google

investment calculator and you just plug

in your age, you plug in let's say 200

300 bucks a month and you plug in 7%

return and you just watch how that money

grows. You will be shocked. Jack, get me

my phone. I'm going to do it now. Okay.

So, let's search for compound interest

calculator. And there's a really simple

one. This it's called Money Chimp. Okay.

Okay, I've got it. All right. 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. I'm going

to say

$5,000 and I'm going to start when I was

16. Cuz if id saved my money when I was

16 and not spent it irres recklessly, I

think I could have had that $5,000 when

I was 16. Um, annual addition. What does

that mean? How much can you invest per

year? So, for most people, they think

about on a monthly basis. They might say

200 bucks a month, which would be $2,400

annual addition. Okay. So, what do you

want to say? I'm going to say, can I say

$5,000? Yeah, that's, you know, about

400 bucks a month. I think that's

reasonable. I often find that with

people making uh median or slightly

above median salary that there are

hundreds of dollars a month of money

that is unaccounted for that if properly

made intentional could be invested. So

great 5,000 a year. All right. Obviously

I could have once I got past a certain

age I could have increased that though.

So we're going to talk about that. Hold

on to that idea. Okay. How many years?

This was you at 20. This was me at 16.

Oh okay. And how old are you today? 30.

Okay. So 14 years. 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 should we

assume for that? Is that 8%. Yeah. 7 to

eight. I you I do seven just to be super

conservative because I never want to be

surprised on the downside, right? If

anything, I'm going to make more. So 7%.

All right. Let's calculate it. Okay.

What do you see? Damn. What do you see?

$133,000.

537. Yeah, that's what you would have

had right now. Now, let's add some

context. So, this is really important.

You see a number that says $133,000

at age 30. Yeah. Okay. Is that a lot? Is

that not? Hm. I don't know. Let's break

it down. At that point, you started with

$5,000 and you invested $5,000 per year.

We assumed no raises, even though you

obviously made more than you made at age

16. We assumed you stopped investing at

age 30, which is obviously ridiculous.

And you end up with six figures. Let's

play it out. Let's take it until

40.

So instead of 14 years, you invested for

24 years. What do you see?

I would have $336,000.

It's getting better from just $5,000 a

year. Not much. It's fantastic. Again,

400 bucks or so a month is very modest.

Remember, people's income goes up

typically in their 30s and 40s. And if

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, 500

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. Okay. So,

investing from the age of 16 until I'm

50,

I would have $736,000

in my account. Yeah. Now, I want to do

the full the full thing. I want to do a

more realistic number here. So, instead

of 50, we're going to go

49 years.

That takes you to age 65. Yeah. Okay.

and instead of $5,000 per year, your

income obviously went up from being 16

years old. So, I'm going to pick a

number out of thin air and and I'm going

to tell you how I picked it. I'm going

to say instead of $5,000 a year, it's

actually going to be

$30,000 per year. Let me tell you why I

picked that.

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,

you're going to start proportionally

continuing to invest. So, at a certain

point, your income will be really high,

and that will bring that average up.

That's why I switch this to 30,000 per

year. I actually think this is quite

modest, but I'm going to go ahead and do

it.

So, here we have someone starting

investing at $5,000. They invest $30,000

per year.

Okay? They grow it for 49 years at 7%.

Do you know the math?

No. Tell me. 12,33,000.

So that's me starting with 5K gradually

ratcheting it up until I'm investing

well investing 30k on year a year per

average across those 49 years. Yes.

Which is a flaw in this because it's so

simple that money invested. You're not

actually going to invest that much early

on. you'll invest more later. Yeah, so

you won't actually you'll maybe have a

marginal amount less, but we're talking

10 versus 12 million. That's a lot of

money. And then if I got 8% instead of

the 7%, I'd have 17.4 million. Yeah, but

don't mess with that. Cuz this is what

this is what people do. They go, "Well,

if I got 13%, I'm going to invest in

this PE fund." I go, "Don't do that.

You're going to lose all your money.

Just stop." Yeah. 7% is safe. It's

conservative. That's why I am here.

That's why I want to encourage people,

you don't need to juice your returns. I

hope you do get 8%. But I don't want you

to count on that. I want you to count on

safe, stable returns. And what matters

for you is the time you started early

and the amount you have a considerable

amount to invest. What about the richest

people in the world? You know, we think

of the Warren 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 tell you. Let's talk

about Warren Buffett. Uh there's a

friend of mine, Morgan Hel, he wrote

this amazing article. I love that book.

Yeah. The psychology of money. He wrote

this amazing article about Warren

Buffett. If you look at Warren Buffett's

returns,

he started investing at a very young age

and the money compounded. Again, it's

like putting the turkey in the oven and

letting it sit there not just for an

hour, but many hours. In his case, 60

plus years.

He has made over 90 I think over 99% of

his wealth happened over the age of 60.

Okay, think about that. It's all because

he started investing so far ago. And

what is mindboggling is that you don't

need a fancy strategy. You don't need to

be picking individual stocks. You don't

even need to be a genius 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 things. Start

as early as possible, okay? And if

you're not 16 years old, if you're 30,

40, even 45, okay, start now. Second,

invest aggressively every single month.

That's critical. Third, keep your costs

low. 1% in fees is going to take 28% of

your returns. 2% is going to take over

55% of your returns. Keep your cost low.

If you do those things, you will have

more money than you ever imagined. What

are the attributes of someone that's

probably going to be poor in 30 years in

terms of their relationship and their

behavior with their money? Easy. They

don't invest. They feel overwhelmed and

anxious about money and they talk about

it all the time, but they've never read

a single book about money.

And there's these deeper attributes they

have. Uh, only rich people invest. They

think that. Yeah. And that's why I'm

here. I want everyday people to know

just like me. I started off, my parents

immigrated from India. I had no special

uh investment knowledge, but I had two

parents who were educated and encouraged

me and said, "Learn this stuff here.

We'll do it together." And that was a

gift. Um, everyday people can build

tremendous wealth, which in and of

itself is impressive, but it's even more

impressive when that wealth is used to

live a rich life, a rich life of

adventure and spontaneity and

generosity. Some of the stats I pulled

out from your book, about 25% of people

who make $100,000 a year plus are still

living paycheck to paycheck. According

to a recent survey of millionaires done

by the US trust, 83% of the wealthy

wealthy say their largest investment

gains have come from small wins over

time rather than taking big risks. Yes,

this is counter to everything we see on

TV because on TV it's really boring.

What are you going to look at my

Vanguard account? Oh wow, compounding 7%

per year. It went down 8% last year and

it went up 9% this year. So boring. So,

we see these cool stories of business

owners, and we're both business owners.

It is cool, but a tremendous amount of

my own wealth will come from lowcost,

long-term methodical investing. That's

like a rule of life, isn't it? That the

the real returns, you know, in reality,

the great returns come from patience.

Yeah. And consistency and things that

really aren't sexy. Like, they're not

Instagrammable. If I post on my

Instagram today, hey, I've got some

advice for you guys to become wealthy.

And I go, need to invest in this fund

and just leave it there. But if I go,

listen, I've got this new NF this new

NFT collection or cryptocurrency coin

that's going to make you a million% this

year. People are going to go all in.

That's just like a something within the

human condition where we want we want

big returns with little effort. And

today, we want to get rich quick. Same

with a six-pack. We want the six-pack

abs in 10 minutes. You don't want six

pack abs with diet restrictions and 9

months of work. That's not and that is

why I have a lot of compassion for

helping people unlearn some of the

messages about money because we all have

them. Uh we all h have the equivalent of

I want six-pack abs. 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 consistency. If

I go ask someone who's an amazing cook,

hey, I want to cook like you. How do I

do it? What are they going to give me

some use cinnamon? No. They're going to

say, "Get in the kitchen and cook every

single day for 5 years, and you're going

to learn about when to use salt and when

to cook it for longer." Fitness, you

want to ask 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 going to

say, "I show up when I feel good. I show

up when I don't. I show up." when you're

let's think about the 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 don't know a

cleaner. They're a teacher. They are a

personal trainer.

If you were if your job was to make that

person a millionaire in 20 years from

now, whatever age they are right now,

what is and you were their financial

adviser and in fact, you were

controlling all of their personal

professional decisions. Uhhuh.

Talk me through what you would do with

that individual at a very detailed

level. I would do a few things. Number

one, that the most important things I

would do would be set up automatic

investing and be aggressive about it.

Two, they have to increase their income.

Okay. I'm going to be that person. I'm

going to embody that person I've just

described. So increase my income. I'm a

personal trainer. Perfect. Okay. So, so

what should I do? All right. You're a

personal trainer. So, first off, I would

say, how much are you charging? How are

you finding your clients? We talk about

that. And let's say you're charging a

hundred bucks an hour and you have

clients, they say, "How long do they

stay on average?" Uh, that's exactly

what I'm charging. Perfect. Great. They

stay longer than two months. I'm very

good. How long do they stay? Three

months. Three months. Wow. Okay. You're

very good. All right. So, your average

client is worth four uh few thousand

bucks. Yeah. Great. So, you're making

let's say 60,000

a year. All right. Uh the first thing

after I understand all this information,

I would say, all right, we're going to

double your income. How are we going to

do that? The first answer everyone gives

is I got to find more clients. Okay, you

should you should ask your clients, hey,

I've got a few slots available. Who

would you recommend? So, you should get

more clients. Second, you're going to

listen to your clients and you're going

to say, um, what else are you looking

for? I know you've 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. Uh, another

person is going to say, "Gosh, I I know

I should be eating healthier, but it's

really hard for me." So, you're thinking

about it. Here's what you do. You create

uh you package up uh meal planning

services. You can either um do their

macros for them and charge them a little

bit extra. Let's say an extra 200 bucks

a week or 200 bucks a month. You can

also partner with a food delivery

service and you coordinate with that

company to feed over their macros and it

gets delivered to them and you take a

small cut right there. You've added

thousands and thousands of dollars per

year per client as long as they stick

with you. In addition to that, um you

can do group sessions. So you go, "Hey,

um I'm going to do a weekend session.

I'd like for you to invite your friends.

Invite them for free." 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 have three

open slots. That's how you're finding

new clients. Now, so you're doing two

things. You're finding new clients.

You're increasing your average lifetime

value per client. Okay, that's the

that's two things. Now, let's do one

last thing. Let's increase the duration

that they stick with you. They're

sticking with you for three months. Give

them a special offer to stay with you

for six months. So, when they sign up,

they work out with 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 you my

sessions at $95 per plan. You'll save x

5%."

One, two, three. You've increased. And

if we did the math, you may have doubled

your revenue. You 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 hour you spend at

work, but also making sure all of those

hours are full, but then doubling down

and making sure each hour 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. Um I thought about

something recently as I've been writing

my new book, The Diary of a CEO. Um

which I've written these 33 laws for

building and becoming great.

Essentially, it goes across marketing

and business and whatever. And one of

the chapters that I investigate is this

idea of making sure your skills are on

the right market. So my company went

public. And what 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

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 public on the London Stock

Exchange, I might get for example four

times revenue. If I take the exact same

company and I list it on the New York

Stock Exchange, it will be valued at

eight times revenue. It's the exact same

company, exact same people, exact same

business, just moving it to a different

market. And what upon leaving the social

media marketing world when I was 27

years old, one of the first calls I got

was from a biotech company ran by a

billionaire friend of mine that was

going public and they brought me in. And

on the first week when we were

discussing what they might pay me, I'm

thinking there's no they can't really

pay me in cash because I've got enough

cash. I don't really need that. They can

maybe give me some stock. Their offer to

me for my skill set was $8 million,

roughly $8 million in options that I

would earn in 9 months from taking the

company from where it was, building out

the marketing team, handling the

storytelling, and taking the company

public, which we did at about 3.2

billion valuation.

Their offer was $8 million in options. I

reflect on that and go I'd spent the

previous 10 years using the same skill

set to sell consumer goods like dresses

and iPhones for Apple and Logitech and

big fashion brands. I took the same

skill set and applied it to a market and

industry where it was rare. Biotech

people know nothing about Reddit and

Twitter and Facebook and social media.

So my skill set was rare, scarce in that

market. So it was incredibly valuable.

And I think about 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 skill

set as a writer going to yield the

greatest returns. I could be a social

media manager. I could be a uh um a blog

writer or I could add a little bow

string to my bow and become a a

scientific writer and or 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 skills. you'll

get paid I'm going to say five times

potentially five times more. Yeah. And

people don't think about the fact that

they're they they need to use place

their skill sets in the most lucrative

market where it's scarce. Yeah. And I So

yeah, just throwing that out there

because it's really front of mind for me

at the moment. Like personal training,

you know, like you could be at a gym and

you lose 75% of your income to the gym

or you can do it virtually. you can

specialize on um just preparing people

in in the beginning of the year. It's

like your best year and every January

that is your focus. It can be celebrity

clients. It can be uh uptown um

mid-career executives. That's a very

lucrative. You choose but you choose

carefully. I I agree that's a bit of an

advanced concept. I think most people

they start off they go just how do I

make more money? I'm a trainer. I have

free hours. But once you kind of master

that and you go, like, for example,

there's a trainer I know here who

charges 175 bucks an hour. That's very

good.

After you get that and you fill up your

entire calendar, you go, "Okay, I'm

making $35,000

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

package things that scale when you

sleep. You have video courses, etc.

There's so many different ways, but I

think everyone would do well to listen

to what you're saying, which is think

about how to move up market or

potentially to a totally different

market where your skill set is really

scarce. Yeah. And that's the problem a

lot of people have. There's, you know,

their skill set might be too abundant in

the industry that social media managers,

social media managers is one thing, but

that's a slightly different skill set

because there's there's there's a wealth

of knowledge there that is unique to

that. Knowing the algorithms, knowing

the platforms, there's a real creative

element to it. But I think about my

friend Anthony. He was He was a graphic

designer. Uhhuh. The greatest graphic

designer I ever knew in Manchester. But

he was designing nightclub flyers. And

he's talked about this publicly before

every nightclub flyer he designed, he

got $50, the equivalent $50 to $100,

right? I had a conversation with him a

couple of years ago about this. And I

said, "You're you you're really

specifically good at like luxury design.

M he's got that really like beautiful

chic simple but you know elegant design

style. I always go to him when whenever

I need design work like that. So I said

to him move to Dubai

and and go there and help design um

luxury brands. Yeah. And this guy did

it. So he went from Manchester where he

was doing nightclub flies to moving to

Dubai. And without revealing his

financial position, what I can say is

the same hour per

piece of work is now yielding him tens

and tens more in returns. You know,

instead of getting $500, he's getting

$50,000 for for a project. And it's just

moving his skill set, the same thing,

designing on the same software to a

different industry which will appreciate

and pay him more for the same skill. The

lesson I take away from that beyond his

willingness

to actually make a change, which is

amazing, is that most of us do not think

in terms of discontinuous jumps. We

think, okay, I'm making I have a 100

bucks a a month.

What if I had 120 bucks a month? Well,

20% is like quite good. That's amazing.

But what if I had 500 bucks a month or

5,000? That's a discontinuous jump. And

to get those kind of numbers, something

big has to change. In business, moving

markets, developing a new skill,

partnering, all those things. But it's

different. In investing, it's primarily

time. And that's where we're not attuned

to it. We go, well, you know, I only

have like a couple hundred bucks a month

to invest. That's nothing. It's only

going to turn into a few thousand. You

go, no, you're not thinking about time.

Because the human mind is not made for

compounding. So, plug it into a

calculator and you will be blown away.

Same thing buying a house. You're only

thinking of how expensive your rent is,

which granted rents are very expensive,

but you're not actually factoring in how

much time and money it costs to pay

taxes and maintenance and interest on

your loan. You've got to get smart about

running the numbers. And when you start

to sit back, when you learn the basic

language of money and you understand how

you feel about money, whether it be I

like status or I like luxury or I don't

really care about XYZ. When you

understand your own feelings,

suddenly you can almost look at the

chessboard dispassionately. You sit

back, you go, okay, I see what's going

on here. I even see how I am a player on

the game of life when it comes to money.

And then you start to say the most

powerful question of all. What if? What

if I earned more? What if I spent less?

What if I decided I actually love

traveling two months a year or buying a

house cuz 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 with your rich life. Someone

comes to you and they say, "What about

crypto?" I get that question a lot. Oh

god. What about crypto? Should I be

investing in that? My friends told me

about this new coin and um I'm thinking

of putting a couple of thousand pounds

into it. I get this all the time. God,

should I invest in that coin that my

friend told me about? 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 the

book, they know that I'm a fan of

lowcost long-term investing and then all

these crypto nuts grow up and well, they

grow up to be, you know, 19 years old

and they go, "Oh, Ramit Sati, such an

old guy, such a ly. He doesn't

understand investing. This is the new

future. Fiat is dead. I go, "Um, I have

a couple of questions for you. Number

one, what is the rest of your portfolio

look like?" They go, "Portol, I put it

all in on crypto." I go, "Oh, God."

Okay. Um, second, do you think that it's

normal to get uh 4,000% return per year

when over about a hundred years the

stock market has returned approximately

7% per year? They go, "Yeah, that's cuz

fiat is dead, you idiot. It's going to

be we're going to the moon." I go,

"You're going bankrupt." And many of

them did lose a tremendous amount of

money. My view on crypto is if you have

a well- diversified portfolio, well

diversified, and you want to have a

little bit of fun with one, two, even 5%

of your portfolio, go ahead. And that

could be crypto, it could be an

individual stock, it could be investing

in your friend's bar in Brooklyn, it

could be whatever you want. But you got

to limit your risk. And what you find is

that the type of people who tended to be

attracted to crypto tended to be

extremely risk-seeking.

And in fact, they saw diversification

and risk management as boring for old

people.

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 10,000% returns and then blow out.

And that's what happened to many of

them. I mean, part of the problem here

is that when we do get our 10,000

returns, 10,000% return moment. Yeah. We

think it's going to be 10 million% if we

just But we also go tell everybody. Oh,

of course. You never hear anyone saying,

let me tell you something. Thank you for

saying that. I went on Twitter cuz uh

you know, I mess around with these

crypto guys a lot on Twitter. I have a

great time doing it. I go, "Hey, where'd

all the crypto bros go?" Everyone seems

to have disappeared in 2023. Where'd you

guys go? And there's just like crickets

where in 2020 they were really coming

out, you know, guns blazing. I said, if

you have lost a lot of money from

crypto, send me an email. I 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.

We love to share our successes. We love

it. We do it with crypto. We do it with

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, "Oh my gosh, I

bought this uh I sold it for um one the

price. Oh, and by the way, because of

the transaction fees associated, I

actually lost like 80% of my money, you

know, or 85% of my money." You never

hear that. It's deeply shameful for

people to admit that they lost money.

It's the opposite of status, isn't it?

Yeah. Yeah. And we're not wired to seek

the opposite of status. Exactly. We're

not wired to voluntarily bring ourselves

down in the tribe. Exactly. We are

safety seeking. We are status seeking.

And so this is what happens with money.

That's why I talk about prenups and why

I talk about investing and mistakes and

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

successes, of course you feel like

you're behind. Of course you feel like

everyone knows something you don't. But

it's complex. Some people make good

decisions, some make poor decisions. We

got to look at them all and then we will

understand what's right for us. So on my

my position on crypto is um I believe in

the underlying technology of 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 5%

of my portfolio although I am a very big

holder um in Ethereum and I've held it

for so long that although I'm at a I'm

at a point of profit right now I'm well

aware that I could go um into a huge you

know into the red. Yeah. Irrespective of

that, it a has is inconsequential to any

decisions or my like my financial

financial portfolio at large and b

because of that 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 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. Reit's 10 money rules.

I just want to go through these 10 money

rules because you mentioned prenups

there and I was quite curious that

number 10 in these rules is marrying the

right person. But let's start at number

one.

Always have one year of emergency funds.

Yeah. So for me, one year of emergency

fund is conservative. It's more

conservative than most. Lets me sleep at

night and I just keep the cash in a

savings account. 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 savings account,

totally liquid, and that's what it's

for, emergencies. Rule number two, save

10%, invest 20% of gross annual income.

Yeah, this is all about the numbers that

I shared and being more aggressive with

them. I know that paying myself first

now turns into way more later, so I

invest aggressively. Rule three, pay

cash for large expenses like engagement

rings or big holidays or weddings. Yeah,

this one is controversial because for

the things that are important to me, I

don't want price to be the number one

concern. So, I'd rather save up for it.

When I was in 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 wedding and I wanted

it to be amazing. So, I started putting

money aside every single month

automatically. I do the same thing for

trips, house, etc. Rule four, never

question spending money on books,

appetizers, health, or donating to a

friend's charity fundraiser. Yeah. So,

the books and the appetizers are a

little weird. I have something called

REIT's book buying rule, which means if

you ever see a book that you're even

remotely interested in, just buy it.

Don't ask a question. Don't equivocate.

Just get it. Because if you can learn

one thing from that book, it can

transform your life. 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 coupon.

We'd usually go to a pizza place.

Getting appetizers was inconceivable.

So, 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 incredibly rich. And this is

just an example of how our childhood

sticks with us. It feels awesome to be

able to do that. Rule number five,

business class flights on flights over

four hours long. Yes. Again, my money

rules, not for anyone else.

When I used to when I was in my early

20s, I would get on a flight and I would

actually in my head scoff as I was

walking from the front of the plane to

the back. Be like, why would anyone

spend four times the money paying for a

first class ticket? Makes no sense.

We're all getting to the same place.

Haha. I wish instead of disparaging that

I would have gotten curious and I wish I

would have said, "Wow, if somebody can

afford to get those seats, why would

they? I wonder what they're spending

money on. Aren't we all getting to the

same place?" And if I had gone from

disparagement to curiosity, from D to C,

I would have understood that some people

have their office paying for it. Some

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

meeting and some people just have enough

money that they can do what they want.

And when I started to become more

curious about money, that opened up my

eyes to be able to spend on certain

things and spend extravagantly, but also

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 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 think about it

again. Rule six, buy the best and keep

it as long as possible. Yes, I love

this. I think we all intuitively have

this idea of quality over quantity, but

if you look in somebody's closet or you

look at the things in their house, there

may be some inongruity. So, um, for

example, my car is 17 years old. It's a

good car. I mean, for me, it was a fine

car. I don't care. It rides fine. It's a

four-door Honda Accord. I told you very

sensible, long-term. Great. Uh,

buy the best, keep it for a long time.

It's the same with clothes. 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 a long

time. Good for the environment as well.

Yeah. Rule seven, no limit on spending

on health or education. Yeah, this this

one is important. Um, I learned when I

was in my 20s and I started training and

learning from personal trainers and

nutritionists that I really loved it.

And I also realized that I needed help.

I needed great teachers. And so

eventually I just realized I'm gonna

give myself unlimited 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 to learn from

great teachers. From taking accounting

classes here at Colombia to buying every

conceivable book and digital program

there is, I've given myself the freedom

to do that. And all that came from uh I

had a scholarship I had many

scholarships that paid my way through

college and one of the scholarships set

up an account for me at the Stanford

bookstore. So when I walked in there I

could get literally any book I wanted.

It was like uh Willy Wonka in the

Chocolate Factory. For a guy like me to

have unlimited books, it was like

unbelievable. And when I graduated from

college, I realized that would be going

away.

And then I remember having this

conversation with myself and saying,

"How much would it really cost to

recapture that feeling, that feeling of

being able to get anything I wanted? See

a book on the bookshelf, I'll get it."

The answer is really not that much. So

over time, that then expanded to health

and education. Health I find really

compelling because

it's clearly clearly the most important

foundation of all of this. It's clearly

the most lucrative investment any of us

could make. Um because everything we've

described, the rich life doesn't exist

without that foundation. Yeah. So, it's

all good investing in your vanguard, but

it doesn't matter at all if you're going

to die. Yeah. If you ask people what's

important to you, they'll often give you

the same answers. They'll say

relationships, health, maybe travel,

career, maybe. Yeah. I go, "Okay, let's

take a look at your spending. Show me

where you spend on those things."

It gets really quiet really fast. Now,

it's one thing to spend time on

relationships, and we should, but we can

also spend money to enrich those things.

It might be surprising your niece at a

showing of uh Michael Jackson, or it

might be surprising your family by going

home and visiting them. There are lots

of ways you can use money to enrich

those experiences. Same for health. It

could be what you buy at the grocery

store. It could be training or a gym

membership. It could be whatever it is

that's meaningful for you. But if we

claim something's important to us, it

sure better show up in our time and our

spending. Rule number eight, earn enough

to work only with people you respect and

like. I love this one. I decided long

ago that I only want to work with people

that I like and respect. And so I earn

enough money so that I can do that. And

to me, who you surround yourself with

matters profoundly. Ideas seep into your

consciousness. values seep in. If I'm

around people who when I look 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 to work with though,

right? Like we 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, especially the early

part of our lives working with

Um, we work with people that we may not

particularly choose ourselves. I think

that's probably

so yes, I built a life where I could

make that decision for myself. I'm the

CEO of my business, but I think what is

important there is the intentionality

behind it. It's like even if I worked at

a company, I would be deciding on which

division I want to work in, which boss I

want to transfer under based on do I

like and do I respect him. That's it.

the intention is there. You again, these

are my rules, not anybody else's. But if

this one strikes you, then the way that

I would interpret this is, wow, who in

my life do I not like? Who do I not

respect? Do I need to be around 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 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 the spreadsheets. Yeah, too

many nerds love a spreadsheet and they

they go, I got to optimize, sell B43.

B43 never talk back to me. I go, all

right, look, yes, 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 won.

The turkey is cooking. You won. You know

your numbers. Turn the page. Get out of

the spreadsheet. A rich life is lived

outside of the spreadsheet. So on a

personal level, that means I spend less

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 couple of weeks about money.

Besides that, do not spend time tweaking

because the rich life is lived having

conversations like this, seeing friends,

seeing my family. That's where I want to

live. not tweaking things endlessly for

no marginal gain. Number 10,

you mentioned your wife there. Marry the

right person. Yeah, maybe the most

important one of all. Um, marriage is

the most consequential

financial and relational decision we

ever make. And people, they're a little

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 will affect where you live, what

you spend on a dayto-day basis, what

type of house you buy if you do, how

often you travel, the values if you have

children that you pass down to kids. Of

course, it's important. And so these are

conversations that if you are starting

to date, it's great time. There's

natural moments in the dating process or

even the relationship process where you

can bring up money. So, it's like the

first time you take a vacation together.

Take a trip. You go, "Hey, um, just want

to, you know, this is on my 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

curious. How are you thinking about

paying for the trip? Who who in your

mind pays for it? How would you see us

splitting this?" That's a great way to

bring it up. And you learn a lot about

your partner. Um, there there 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. Genuine curiosity. It

also tells you a lot about your partner.

And then there's a few other natural

moments in a relationship where it just

makes perfect sense to talk about money.

Uh when you get engaged, when you get

married, uh if and when you move in

together pre or post marriage, uh if and

when you have children, there are these

natural moments where you get the gift

of being able to talk about money. Do

people talk about money? couples, they

talk about it uh when something goes

wrong. Outside of that, what sort of

percentage of people, couples, do you do

you think talk about money? Rarely. It's

very low. I know. 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 it's these grooves that have

been created for 40 years. Oh, every

time she goes to Target, she spends too

much. Haha."

And I'm like, "That's not that funny."

Like the running joke between you is