Ramit Sethi's 3 Best Pieces of Advice

by Christy Bieber | Published on Nov. 9, 2021

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Some of his advice may surprise you.

Ramit Sethi is a bestselling author and founder of the blog I Will Teach You To Be Rich. More than a million people turn to him for financial advice each month.

That's not a surprise, given his unique money philosophy. Sethi says that many financial experts encourage people to minimize their goals by focusing on things like paying off debt or simply becoming financially comfortable. His focus is different -- he wants people to maximize their potential and aim to build a rich life.

While Sethi has provided tons of tips on everything from getting started investing to deciding how to spend, some of his best money tips are those designed to change the way you think about -- and manage -- your money.

1. Automate your finances

Automating your finances means taking as many daily money decisions out of your hands as possible. As Sethi says, taking this step "has the potential to be a money game-changer" and is "critical to successfully getting control of your finances."

The finance guru explains that when you automate smart financial decisions, your financial success no longer depends on willpower. You're no longer trying hard to do better with money management -- and potentially setting yourself up for failure.

On his blog, he suggests setting your money to automatically route to the correct places, including bill-paying, saving money, investing, and spending. You can set up transfers of your money into savings and investment accounts, as well as to paying fixed costs each payday. That way, anything that remains in your account can be spent without guilt.

"The beauty of this system is that it works without your involvement, and it’s flexible enough to add or remove accounts any time. You’re accumulating money by default."

2. Engage in conscious spending

One of the big differences between Sethi and many other finance experts is that he doesn't focus on sacrificing to grow rich. Instead, he explains, "Our philosophy is simple: Spend extravagantly on the things you love, and cut costs mercilessly on the things you don’t."

Rather than cutting lattes from your budget if they're important to you, Sethi encourages people to spend consciously. He believes most forms of budgeting are like a bad diet that's difficult to stick to, and instead urges a simpler approach of dividing income into fixed costs, investments, savings, and money you can spend guilt-free.

He also suggests taking the time to figure out where you want your money to go, and then deciding how to spend it after carefully considering what you love to buy. By knowing where your money goes, automating the process, cutting expenses that don't provide value, and using your cash for what matters to you, you can make the most of your hard-earned dollars.

3. Maximize your earning potential

Finally, Sethi emphasizes increasing what you earn, while many other financial experts spend most of their time focusing on the spending side. "There’s No Limit to How Much You Can Earn," is one of the key tenants on his blog, and he provides advice on starting a business, as well as finding ways to earn investment income.

The reality is that spending can only be cut so much -- especially without sacrificing things you love. But by building multiple income streams, you can develop more independence and ensure you have the money you need to live a rich life.

These three pieces of advice work hand-in-hand to provide a road map for using money to enjoy life while growing wealth.

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