You Could Spend Way More on the Things You Love, According to Ramit Sethi

You don't always need to spend less, just better.

There are a million different opinions on the best ways to organize your personal finances. Spend on this, not that; budget like this, not that. Always do this! Never do that!

For personal finance guru Ramit Sethi, of I Can Teach You To Be Rich fame, it's much simpler. His philosophy boils down to: Spend money on the things you love; don't spend money on the things that don't matter.

As such, Sethi's financial advice is less about definitive rules everyone should follow, and more about your individual path. He has his own 10 Money Rules that he follows in his life -- and suggests you create your own money rules for your life.

Create your own money rules

According to Sethi, the key to defining your own money rules is figuring out what you love, so you can prioritize spending on those things.

"What do I love spending on? Start here," he wrote in an Instagram post. "The most common answers are eating out, travel, and health/wellness, but there are other 'Money Dials' like convenience (which is mine). Don't overthink it -- you instinctively know what you love spending money on."

To fully visualize a life with more money spent on the things you love, Ramit says to dream big. Ask yourself, "What if I quadrupled my spending? What would it look and feel like?"

As Sethi says, this is where you crank up the dial and consider your aspirational goals.

"This is very difficult for people and they tend to give linear answers: 'I love eating out so I would eat out 4x/week!' NO! You could go to every Michelin-starred restaurant in your city...you could fly to Italy to eat at a chef's table...you could take an Indian-cooking class...and you could do all of these things with friends. Dream bigger."

Stop spending on unimportant stuff

Once you've determined the things you want to spend more money on, it's time to figure out what you can spend less money on. This means thinking about all the things you spend money on that don't actually matter.

As Sethi writes, "IWT teaches you to spend extravagantly on the things you love, as long as you cut costs mercilessly on the things you don't. So what DON'T you care about?"

Do you spend a lot of money on streaming services you rarely watch? Cut it and move that money elsewhere. Do you throw out a lot of groceries -- and, thus, money -- because it goes bad before you can use it? Maybe you value convenience more than home cooking. That's fine! Shift that money so you're not wasting it on things you don't love.

Adapt your money rules over time

Finally, Sethi emphasizes that establishing and maintaining your money rules isn't a one-and-done thing. Your life changes constantly, and so do your goals. 

"Your Money Rules should change over time," Sethi writes. "Some may stay the same, but if you're still using the same ones from 15 years ago, you're not thinking deeply enough about your Rich Life."

You may still love to travel as much as you did when you were younger, so perhaps vacation spending is still a key money rule. But maybe a new family means your goals have shifted to spending on family activities, instead. Whatever the case, be sure to evaluate your money rules every year or so to make sure they still align with your life goals.