Ramit Sethi's 10 Money Rules

The Frug Life


I got an email from ra meet sethi with ten money rules and i thought it was interesting enough that i wanted to share it with you my audience. If you don't know where meat sethi is the author of. I will teach you to be rich and i'm pretty sure. I shared a review of his book on this podcast f. So they'll be lincoln the show notes to that episode so let's dive right into it. Rule one always have one year of emergency fund. Cash or meet goes onto explain. He used to say six months but after covid nineteen. He's up to twelve months. And you know. I agree with this idea now. You personally don't necessarily need to have twelve months but if you do want to have twelve months i support you in that one of the purposes of having money at least in my mind is peace of mind and of having twelve months of expenses. Saved up in cash gives you that gives you peace of mind. I say it's money while used some people might say it's too much money that you should have less of an emergency fund an icee in the way that benefits you the most his next role role to is save ten percent invest twenty percent of gross annual income. I think this also is a pretty good roll. My heart isn't set on the percentages in particular f. You know me. I save and invest everything i can. I don't even know the number offhand. I should try to calculate it. I suppose but in a chapter of my life where. I am living pretty much as frugally as i can where i am investing as much as i can and saving as much as i can. I think for most people this ten percent saving and twenty percent investing is a good number. So i say you can go higher. But you probably shouldn't go. Lower now also uses this point to say that he can spend money on small things and not worry about it like spending money. On appetizers next is rule three be able to pay in full for large expenses before spending for important purchases. Save enough. that cost is not the primary factor in my decision and that is also one hundred percent. True you don't want to finance your wedding on debt. I guess the only exception for that is a house. He says a house. But if you live in california like me buying a house in cash is simply not possible unless you are so well to do. But in general. I agree with this principle as well. I say never get into consumer debt. Always pay off your credit card. Don't borrow for things that aren't a house is role for never questioned spending money on books appetizers health or donating to a friend's charity fundraiser. Into this i say question spending money on whatever you want. As far as books are concerned go to the library and check out a book for free. If fact that's how. I read remains book. I went to the library. Checked it out and read it for free and so books are invaluable sources of knowledge. But you actually don't necessarily need to buy them you can borrow them and you get all the knowledge. So if you are spending tons of money at barnes noble buying paper books maybe you should question that. And as far as appetizers go just eating an entree without an appetizer might be effective dieting for you so again you could with good reason questioned spending money on an appetizer. Now as a treat. Definitely treat yourself so. That's okay when you spend money on your health. You have to be aware of what you're spending your money on. There is a whole industry of health supplements that do little to nothing for you and so also you should question what you spend on health. Because some things don't do anything and they cost a lot of buddy and as for the last point he was making your friends charity fundraiser. While maybe my new nickname is going to have to be mister scrooge. Instead of mr frugh. But you're under no obligation to donate to your friends. Charity fundraiser f. You don't want to if you do go for it but if you don't you have no obligation. His next rule rule five is business class on flights over four hours and to this rule. I say that's nonsense. You can fly coach like everybody else. Actually i ve very rarely been on a four hour flight. So maybe i'm not the best one to a pine on this but personally i'm definitely not an a place to fly business class everywhere. Roll number six by the best. Keep it as long as possible and this rule is potentially pretty good if you buy good and they last longtime you're probably going to be better off than you bought very cheap stuff and let it wear out real quick especially with tools and equipment. I think a good pair of boots will last you a long time. A cheap pair of boots will not last you a long time and you'll be miserable every step of the way rule. Seven no limit on spending for health or education and also to this. I say oh yes. There should be a limit true. Investing in your health can be a good idea. He specifically mentions a personal trainer. And if that is helpful to you you may have health benefits that the financial costs. But that's not a free ticket for anything you want. Likewise when he says education he specifically mentioned courses events etc. but also. I think that is a bad idea. There are no blank checks for example if you wanted to go to an expensive private school and would put you like a million dollars in debt. I say no no way. Don't go a million dollars in debt for anything now. Maybe a million dollars is kind of an exaggeration but at the same time he said no limit. So what's stopping me. Rule eight earn enough to work. Only with people i respect and like i think this is a great goal. I'm not sure about how good it is. As a rule in fact it may be kind of difficult to live by that rule number nine mary. The right person which also is a great rule. Shout out to mrs frugh okay. Roll number ten prioritize time outside the spreadsheet a rich life is lived outside the spreadsheet running in another monte. Carlo analysis won't change things at a certain point. You won the game. Now get out of your chair and turn the page to the next chapter. And i guess i should specify these are ra meets rules for himself and he says your rules may be different. In fact i'd go on to say your rules should be different. You can set your own financial rules for

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