Let’s get serious: Wealthy people are not evil

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I read this line over at Trent’s blog, The Simple Dollar, where he was talking about people who can afford nice things.

”To get to this point, you either had to make some tremendous sacrifices along the way – often damaging relationships and missing out on life-affirming experiences and going through painful “salad years” without much at all – or simply have had the ability and opportunity to be in the right place at the right time to take advantage of it – to which I say “good for them” instead of really being jealous of them.”

Anybody see the invisible scripts here?

  • People who have money have terrible lives, including severe sacrifices like “damaging relationships”
  • Or they were simply lucky

As a counterpoint: I have done pretty well in the last few years and, while luck had a lot to do with it, I also worked very hard — and I have not had to go through terrible ordeals or damaging relationships to do so. In fact, I live in New York and San Francisco and go out enough that I can drink most of you under the table on any given Wednesday night.

I’m not picking on Trent specifically, but I want to make a larger point:

Whenever you read pop culture — including this blog — you’ll see implicit biases and invisible scripts appear. They’re often so subtle that you won’t recognize them, and after repeated exposure, you may begin unconsciously agreeing with them.

This is why some people believe:

  • Wealthy people are evil and must have done something bad to attain their wealth
  • Taxes are always bad
  • If someone earns money by selling a product/information, they are out to “get you” and you should try to resist as much as possible…no matter how valuable their product/info is
  • There is no way they can earn more money
  • If only they had [some advantage], they would be able to “really” succeed (this is the Shrug Effect)

Evil money

Here’s a perfect example: a comment from Reddit where the author writes about how evil wealthy people must be.

”The central lie here being getting rich through hard, honest work. I don’t think anyone has ever gotten rich without the determination of screwing other people out of their money.”

How many people do you know that believe this? How successful are they (and I don’t just mean financially)? Or are they simply whiny complainers?

In truth, I can’t just blame them. I understand this script — especially today, seeing crooked politicians and corporations taking as much as they can, leaving ordinary people behind — but that doesn’t mean the “wealthy people=evil” script is correct. Virtually every wealthy person I know has gotten that way through extraordinarily hard work, taking advantage of their social advantage, thinking cleverly to overcome a lack of social advantage, lots of luck…and a clear understanding of what wealth means to them.

These scripts — that wealthy people are bad and must sacrifice their happiness — reinforce people’s implicit beliefs. Those who are struggling in this tough economy read about the evil fat cats making money and it’s understandable that they’re angry. These people have read the frugality sites, done everything they’ve been told — including cutting back on discretionary expenditures and “hunkering down” — but they still can’t seem to get ahead.

Perhaps there’s another way.

Perhaps it’s not just about painting others with a broad brush, but looking at ourselves and automating our finances, not wasting our limited willpower on one-off $5 or $10 purchases.

Perhaps it’s about understanding the psychology of money and then using advanced techniques against ourselves, rather than the illusory satisfaction we receive from judging our neighbor’s $20,000 wedding.

And perhaps it’s about cutting costs to a reasonable extent…and then shifting to the critically important area of earning more.

Here are quotes from my students on how they’ve gotten ahead:

I have secured, as of this morning, better than $10,000 in side income over the next two months from one mega client, with prospects to continue with similar compensation. This is up from roughly $100 per month before. I have not only met my goal for the course, but met my goal for the remainder of the year! I owe this success in no small part to the Earn1k course. I think that once I invested my own money (and more than just $50 for a book), that added enough incentive to get off my ass and make things happen. A 2000% return on investment doesn’t seem too bad to me, either, especially considering the course is only about half over. Thanks, Ramit.
– Ben D.

I just made $100 in a few hours of work thanks to your FREE niche advice. I always see your testimonials of how people went from $8/hr to $50/hr and while I know it’s not b.s., i’ve always been skeptical for some reason but I actually did it myself…I’m ready to move to that next level.
–Brandon

I made my first 1K yesterday. Not only that, I am hired on retainer as well (upselled after the completed project). You were so right about making the fact that I spent time fixing the mistakes that the vendor made a benefit.
–Dean S.

I just wanted to thank you for the earn1k course. I bought the standard course. Without even finishing all the modules yet, I’ve made over $900 bucks in about 6 weeks tutoring accounting students. It paid for itself in less than a month. Good stuff bro, keep up the good work.
–Trevor

You can sit and complain about wealthy people being evil, or…

If you’re interested in seeing how to make money without being evil or “salesy” or sacrificing relationships, I’m opening up my Earn1k course — an online course I hand-crafted to help you earn side income — in a couple weeks. Until then, get free content that you’ll never see publicly on this blog (or anywhere else): Join the FREE preview Earn1k course.

You have nothing to lose and the free material alone has earned some of my readers thousands of dollars. But believe me — I will try to sell you on my course because it’s good. Very good.

Here’s the link.

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84 Comments

 
  1. I just left my FIRST client and I felt guilty about billing her $35/hour for presentation design. Let me be clear: Guilty, as if I was slapping a baby or kicking a puppy. And my training in Earn1K kicked in.

    I’m worth this (I’m actually worth MORE, but my first client and all.) and I shouldn’t shirk away from it. When she handed me the cash for my first billable hour, I felt like HOLY CRAP, I can DO THIS.

    So what am I doing in my office (instead of watching mindless TV)? I’m getting the next two billable hours done.

    Pfft. Wealthy people are evil. That’s sour grapes baby. Deeply sour grapes.

    Pick your expertise, your passion. Figure out how people can benefit from it, what they need.

    And then bill them for it.

    • I know I’m a little off the beaten path as far as carreers go. I work as a Manager at a fortune 100 company but my wife and have a cleaning business on the side. She/we clean residential and commercial properties.

      I said that to say this. When you go in for the bid, don’t short change yourself. People are either too busy or too lazy to do things for themselves and are willing to pay handsomely for someone else to do it.

      She was laid off from her job about 4 years ago, now we make a quiet $50,000 on the side. Ask people for the money, believe in yourself. It works.

  2. “If someone earns money by selling a product/information, they are out to “get you” and you should try to resist as much as possible…no matter how valuable their product/info is”

    I always found that one to be very interesting because often times, if its free, people assume its worthless and/or just a way to upsell another product. So what products/information are we supposed to listen to?

    I’d guess one of the usual answers would be “experts” on television, who often also have some sort of product to sell in their utility belt of business, but they are on Opera and therefore are right. Another example would be college/university, where you are in fact paying (usually paying would be more accurate when you consider scholarships and the like) for the information you are learning. Clearly the difference is the seller that everyone thinks is out to get them has a long way to get the reputation that a television appearance (often already requiring a reputation) brings and a university has.

  3. What most people don’t realize is that the real wealthy people got that way by having good habits from the beginning. Not living beyond your means and saving money in your 20′s when compound interest is on your side can be a HUGE advantage. (even if it’s just $100 a month) Many people drink/eat/shop their money away in their 20′s and then wonder why they’re broke in their 30′s. Hmm, maybe cause you weren’t thinking about the future…

    Anyway, I fully intend on signing up for Earn1K when it’s open again. I kind of regret not signing up last time, but I was already with work and two night classes… can’t wait. :D

    • I completely agree with you. I am 24 and I did shop my money away for years. I am more focused now and working towards being as close to debt free as possible by the end of next year. Plus I am spending money on what is much more important to me. Traveling!

      I also found a parttime job for $22/hour. Not much but enough to start slowly getting ahead. I would only work weekends. I will bring in an extra $500-900/month. In the next couple of years I will have a Masters degree and I hope I will be a licensed forensic psychologist.

  4. Hey Ramit,

    I’m curious about your take on San Francisco versus New York in the rich people are evil script. Huge generalizations below, but…

    It seems to me that in SF you’re much more likely to meet people that earned money doing something productive from an economy-wide point of view, for example doing a startup somewhere in the tech space and then selling it to a larger company.

    In NYC you’re much more likely to meet young people who made money as i-bankers and the truly wealthy that either inherited their money and/or moved to NYC from somewhere else. I don’t actually think my friends that went to be i-bankers do that much for the economy (they definitely work hard, though). Because finance plays such an outsized role in NYC’s moneyed-class, and because a lot of finance is about taking a small piece of a big transaction (securitization) or trading equities, it seems sensible to me to admire the wealthy in SF and grumble about the wealthy in NYC.

    Anyway, do you detect differences in attitudes toward wealth on the coasts?
    (As a disclaimer, I appreciate the role of credit in the modern economy, and think folks on Wall Street to important work so I don’t want to diss them too hard, but if I were to estimate their importance economy-wide I would say they deserve like 5% of corporate America’s profits, not the 40% they sucked up at the peak of the bubble).

  5. To me, the funniest thing is that I see so much of our “primate status” instinct in this script. We look to our peers to determine our own place in the social hierarchy. If their lives don’t match our expectations, we come up with rationalizations–they did “evil” things to get ahead, they were just extraordinarily lucky, they had to sacrifice their core integrity/family/health to do that thing. We NEED that rationalization about others’ behavior to make us feel OK about ourselves.

  6. Scripts like these are first a way of justifying our own apparent lack of success compared to Ms. X. I might not be rich like her but that’s because I don’t (insert gross generalization about the rich here). Later, they become internalized and self-fulfilling.

  7. There are a multitude of reasons why some people are wealthy just as there are different reasons people are not. Circumstance is a big factor that we can’t always control, but choices make a huge impact.

    If you’re not where you want to be (financially or otherwise) what choices can you make to improve? If you want to be making six figures and you just started your career, what options do you have?

    Scripts that say the rich are rich because they’re cutthroats are just the easy way out. Focus on what you can control, your choices, and cerate a system to get you there.

  8. What an overly simplistic post. A lot of wealth is effectively evil, and hard work is not a license to enjoy it. The “effectively evil” part comes from the opportunity cost: At what point does someone’s desire for an expensive item trump a kid’s need for basic health care? These tradeoffs exist every single day. (In this case, it’s not the pursuit of lots of money that’s the problem; it’s the sitting on it and thinking that your very marginal enjoyment of the extra $10,000 or $100,000 constitutes a worthy use.)

    Alex F hit the nail on the head about hard work: It’s not clear to me that people who bust their a— working 80 hours per week for in banking, laws, entertainment, etc. are adding as much value to the world as their salaries imply. They clearly might add some, but the actual amount depends in complex ways on the nature of the work and its impact.

    Money can be a highly distorted representation of value, and its pursuit via certain modes can be a questionable use of time. Given the state of the world, it requires an unusual shortage of empathy to argue that wealth in and of itself is morally neutral.

    • So you are saying that a person’s wealth is “effectively evil” if they spend it on anything other than the most needy person or cause? So I can NEVER justify a nice dinner out or massage – no matter HOW HARD I might have worked for my money – so long as there is a hungry child in the world somewhere? Hmm. I’m not saying that shopping for fun is anywhere near as valuable as charitable giving, but it seems a little extreme to use words like “evil” and to assert that hard work isn’t a “license to enjoy” the fruits of your labor. What exactly is your alternative? That everybody take a vow of poverty no matter how much income they make? Ah, but then to whom would we give our money – we’d all be poor! :)

    • I agree with Meg. From what I understand many wealthy people give quite a bit of money away to charities. It may not all be just to give from the heart because there is also the perk of charitable donations that are tax deductible.

    • Meg & Quita – I don’t know where the line is either. (For the record, I do generally like markets and am not socialist. I just think markets need tempering.) Everyone has a right to happiness, but there comes a point where I believe it’s wrong for someone to choose a teensy bit of extra enjoyment when the same resources could go a long way to lifting someone from misery. I feel like this is a tradeoff most of us ignore from day to day. “Evil” isn’t really my favorite word, since it’s a term usually reserved for deliberate malice; that said, I think the vast majority of genuinely avoidable suffering in the world results indirectly from apathy. It would be really easy to correct a lot of harms if we donated more to increase literacy, improve health, and improve access to contraception. This is harm through neglect, i.e., opportunity cost.

      Peter Singer sums up the issue nicely by asking whether we’d spoil our nice shoes to rescue a kid drowning in a small pond if no one else (or not enough other able people) were around. Most of us agree it would be wrong not to save the kid, even if we have to sacrifice our shoes. If the kid happens to be on another continent and the shoes are really pretty and on sale, however, the thought usually doesn’t cross our minds.

      George Bernard Shaw said, “The worst sin towards our fellow creatures is not to hate them, but to be indifferent to them; that’s the essence of inhumanity.” That’s the “evil” I’m getting at.

    • I really enjoyed reading this. Good points!

  9. I just don’t understand this point of view, but I have definitely seen it. My best friend (I love him to death, but this drives me nuts) firmly believes that anyone who accumulates serious wealth must be evil in some way or a “corporate tool”. I’m not sure where the cutoff is in his crazy theory, but he includes me in this bracket since I made a chunk more than him (however I’m not even in the six figure bracket) and I aggressively save. I told him I work 35-40 hours a week and am very happy with my job (recently got a promotion too), but he insists that I am selling out and am miserable. I rarely do side work because I love my free time, and my wife works so much I like to be available to help or take care of things for her. His theory (especially concerning me) is especially ridiculous because I work for a university and not the corporate world (where I would make more)!

    To elaborate on this, people in my group at work generally make a lot more than me, some in the six figure range. They are not evil. They have spouses with successful careers too. They did nothing horrible to get ahead; none of them went to graduate school even. They simply started working high paying jobs in their late 20s and have since… now they are very comfortable. These people are role models to me, not evil! Many of them consult on the side and are very successful there too- they even charge a very reasonable rate.

    So long story short, I recently wrote something pretty similar to my friend (over IM), and surprisingly enough he actually consented that it was all very reasonable and maybe he was a bit harsh and jealous. Sometimes people who feel this way just need to have some rational discussion.

  10. I would agree that wealthy people are not evil, and I think in todays time, they are not doing truly evil things (as compared with history) to attain that status.

    However, I think in our current society the journey to becoming wealthy (or staying there) is rife with opportunities for moral ambiguity.

    As described in the post, becoming wealthy can be contributed a lot to luck and opportunity, but from an outside observer that doesnt have these things, their conclusion is that person must be morally corrupt.

  11. I grew up poor. I hated it then, I hate it now. I hated sacrificing so that my younger sister could get everything that they wanted, and I hated not being able to go to university because it was too expensive and my student loans wouldn’t cover the expense. I hated working my ass off for a sub par education. I’m not rich, but I make every effort to earn a little extra and fuel my own ambitions while avoiding being walked all over by the type of employers who just expect you to go above an beyond for their own personal gain. GET A LIFE!

    These day I feel that there are two classes of rich. You have the people who feel entitled and actively screw people over for the previledge of earning more. Unfortunately these are the ones that we hear about the most and tend to be the harvengers of ‘earning more money means cutting corners and steping on all the little people’.

    Then you have the ones who will legitimately put their hearts and souls into their work and reap the rewards accordingly. It’s no more luck than it is lucky for a farmer to harvest his crops from the seeds that he’s sown. The difference here, is that the ones who care, take care of the people who help them on the way up.

  12. IMO I think you slightly missed the point of the simple dollar post (and modified it to fit your own script!)

    Trent was making a broader point about tradeoffs. If you’re making a moderate salary and still live like a college student you’ll slowly become wealthy. If you make an ibanker salary, work constantly and “damage relationships”, you can become wealthy and still live a baller lifestyle. Or, you can maximize time flexibility and accept a lower salary with less working hours and material positions.

    I actually fall into the first category above. I still live in my far flung neighborhood of NY with roommates and go to divey bars on a very decent (but not ibanker) early career salary. I manage to spend about 15% of my income on rent and have a very well funded 401K. These are the sort of “salad years” I believe he’s referring to. The only problem I had with his article is his connotation of these “tough times”. Everyone has their own combination of preferences, has their own amount of luck, and lives by it. It’s not like I’m miserable living this way!

    Btw, you’re getting a bit metaphysical with your “theory of scripts”. It’s an awesome way of describing the ruts people get in!

  13. I got a firsthand look at one of these scripts just recently.

    This weekend I was at a party, and this guy in his early 20s was saying he’s been sitting in his apartment playing video games for the past week because he doesn’t have any money to go out. He said he was waiting for payday, and that as soon as he got paid he was going to go out partying and “vomit money” as he put it.

    The interesting thing is, without anyone saying anything he launched into a whole speech about, “I know I should save some money, but think about it… have you ever met a rich person who has FUN?” He proceeded to define fun as buying rounds of drinks for all your friends (among other things).

    I just kept my mouth shut and listened.

    • Your friend seems to have a mistaken idea of richness, but is it necessarily bad that he defines fun as buying a round of drinks for your friends? I read a lot of frugality sites like The Simple Dollar and it really bothers me how they, in general, seem to define happiness/fun/success a certain way (own a house, have like five kids, spend a lot of time with kids stuff and gardening) and assume everyone else secretly has the same definition but is weak and easily distracted by activities like partying or buying gadgets and clothes. Personally, I think the frugal dream of a house full of kids sounds like my worst nightmare, and I would rather spend my money on dinner out with friends and clothes. Your friend would probably fare better if he saved a little bit of his money week to week instead of just vomiting money but I don’t see anything else wrong with spending money that way.

    • So fascinating

      And Aimee, your point about people not adhering to that lifestyle being weak-willed is extremely insightful

  14. I think this particular concept is particularly interesting when viewed from generation to generation. Growing up we were more or less on the edge of poor. I didn’t know it at the time but it’s pretty obvious to me now. Being as such, my dad would always make comments about the rich being a-holes and other similar comments.

    Now that I’m an adult, my husband and I earn approximately $350k a year combined. My only sister and her husband have similar incomes. My dad still makes comments about rich people all the time and I wonder if it’s ever dawned on him that my sister and I (not to mention pretty much all of our friends, who my dad also loves) are now representative of and included in that category of people he’s calling a-holes. I’ve never pointed it out to him and if I did I’m sure he’d say we’re different somehow but he probably wouldn’t be able to really to say why. I just think it’s exactly what Ramit’s saying in his article, all his life he grew up poor and I’m sure he learned that rich = evil (or in his case, a-hole) and now it’s so ingrained into his personal scripts that he doesn’t even recognize that he’s indirectly calling his own daughters a-holes.

    Luckily none of this really bothers me or my sister because we know he wouldn’t really mean to call us a-holes and most likely doesn’t even recognize the fact that we would be considered rich by most people, including him if he didn’t know us. It’s just something I’ve noticed and immediately thought of when reading this post today.

  15. This is a great post. Admittedly, the fear that Ramit was just out to get rich and screw me is what held me back from joining Earn1K. However, I employed a number of his free tips and got my freelancing gig off the ground. I finally got my head on straight and realized if I did that with just free times, I should be able to kick things into high gear by signing up for the course.

    After that, I joined B1K and it’s been awesome, if only for the weekly ass kickings – I think I’ve found a niche market related to the web development I’ve been doing just by talking with someone in the ass kicking chat room.

    At some point, if you want to get make a change in your own situation, you have to take the time to analyze the potential ROI for a product and be evaluate your goals against it’s value. If I spent all your money on a get rich quick scheme, I’d have to kick my own ass for looking for an easy way out rather than a quality product.

    Lastly, Ramit, if you’re ever in Toronto, I’d like the opportunity to take you up on drinking me under the table. First one to pass out at the bar pays.

    pete

  16. Funny how I don’t flinch at paying someone well to perform a service, even if they charge more, because it will come out the way I want it. Sort of “You get what you pay for”–and I want the best. And I see the people charging this doing very well for themselves. I don’t resent them at all. I want to BE one of them.

    Odd that I inwardly cringe at asking for equally generous pay for my services. Is it really some horrible psychological flaw with my self-esteem? I know I am better than average at what I do. I AM high quality. Why the disconnect?

  17. How about this one: all rich people got rich off the backs of the poor. You can even use that to define most everyone in the US as rich (because we have such luxuries relative to most of the world) and then say that we’re all rich because we buy cheap imported products that were made by poor people in poor countries. Thus, most of the US is evil and got rich off the dirt cheap labor of the poor.

    That’s my favorite. The entire country is doing it wrong.

    When I first started consulting, I felt guilty for charging $50 an hour. I now charge $63 an hour to that same client and am considering dropping them because it’s not worth my time anymore. I could be earning $90-$100 an hour if I replaced them.

    I also want to scale back my full-time job to do my own thing (make games). I’m not sure of the exact scripts keeping me from doing either of those, but I think they’re things like: fear of dropping a dream job and client, both of which are very low stress, and not being able to get them back if my own venture goes sour. A strong (silly?) sense of loyalty. Emotional attachment.

    Ramit: your recent subscriber/earn1k emails have been great and thought-provoking. Much appreciated!

  18. I read Trent’s blog quite often and I think he simply has a different view point on life than you do. It goes back to your post from a few weeks ago on not judging others for their money decisions. He has his way and you have your way. I prefer your way since it’s more fun but there’s nothing wrong with his way either.

    I know people who lived happy lives by being frugal, devoting most of their time to their families and living the simple dollar way. I also know some who live the I will teach you to be rich way and have a grand time doing it. Different strokes for different folks and all that :)

    That said, the mantra of “rich people are evil” is pretty stupid.

  19. I haven’t finished the Earn1k course, but my attitude about money hasn’t changed. I can’t speak for others, but I don’t think I would’ve joined the course if I thought that making money would mean I was evil. I’ve always known that many people made their money in honest ways, which is exactly what the dream of being an Entrepreneur is all about!

  20. Anyone who lives in a city with Old Money can readily attest to the fact that rich most often does NOT equal evil. The concept of noblesse oblige may not be as widely known as it once was but one has only to look at the many institutions, organizations and trusts for the public good that are funded heavily or even exclusively by private monies. (The endowment funds of many of these institutions were significantly reduced by the stock market downturn – have mercy when they call you with special pleas.)

    Personally, I’m starting from nothing right now – no savings, no retirement funds, no health insurance, a very meager income and a year and a half away from my 40th birthday – and it’s time to take some lessons, and fast. The book is on the way, I set up accounts with Schwab and ING yesterday and now it’s time to get very good at earning, saving and selectively investing.

    You say you’re rich? Be my Yoda.

  21. Great post Ramit. It’s funny cause the thought process not only occurs in the private sector but especially our government. I just wrote a post that discusses about what do our representatives think: is the economic pie fixed in size, or can we create a bigger pie?

    http://investorjunkie.com/4334/important-voting/

    Invalid scripts can affect your entire life.

  22. I believe we are successful based on intelligence and intuition (knowing when to put ourselves in the right situation at the right time … even unconsciously) as opposed to just pure luck.

  23. I think the “rich people are evil” mantra is a product of scarcity mentality. If someone is making more money than you, they must somehow be indirectly screwing you, since most people seem to perceive the amount of available money as being very tiny and fixed. I had an ex-boyfriend that would stay up at night bemoaning the fact that we could statistically never be richer than our parents.. or something. (My current boyfriend is a little more level-headed and already makes more than his dad, so..)

  24. As long as we live, they will be people like this. Negative thoughts don’t make you better. They will always be poor people and rich people.

    Start by changing your thinking. Change your mentality. Instead of criticizing the rich, ask them how they got started. That’s what I did.

    Invest in yourself and share it with others, that how one grows.

    Ramit is doing a good job. He is blogging about how to become a success. There is no excuse, get started!

  25. To play devil’s advocate: Many Americans are wealthy by world standards and luck played a big part–they happened to have been born in the US instead of, say, Somalia.

    Also, the gap between rich and poor in the US has widened, and according to what I’ve read, the increase is due largely to tax breaks given to the wealthy by rich politicians. So there’s some justification for both “luck” and “the evil rich.”

    At the same time, most of the sour grapes I hear in my circle come from Americans with decent educations and middle-class backgrounds. I’m not wealthy by US standards, but I do have a business that lets me travel while I work. The luck part was my American middle-class birth to educated parents. The rest was me keeping a goal firmly in mind and being willing to take risks.

  26. Interesting post. I’ve found that the best way to challenge my own internal scripts is to flip them.
    Therefore, if all rich people got that rich by making morally bankrupt choices, then all the bums you see on the street are at that place because they gave to charity, helped the little guy and made morally upright choices.
    By that logic, we have an outright duty to be evil, so that our families are provided for.

  27. This is an interesting article because it actually runs against a very widespread invisible American script: that wealthy people DESERVE their wealth: a script that can be equally troubling and defeating. It’s the script that leads many poor voters to vote against their own interests. It’s the script of the American dream. Many Americans think that success is just a matter of hard work and making the right choices. If you don’t succeed in life, it’s because you’ve made poor choices. And obviously this script isn’t just used by the rich to justify their success. Thinking this way can also be extremely detrimental: it means blaming the poor for being poor. Your blog is aimed at an educated audience. I think all of us DO have the potential to stop complaining and earn more. But that’s not true for everyone. There are people out there who haven’t had the same opportunities and it bothers me to think that they believe that failure is entirely their own fault and that rich people are unequivocally deserving of their wealth.

    • “I get what I deserve” can be twisted into either the thinking of a habitual self victimizer or a megalomaniac. What we “deserve” is actually a lot less important than what we want and what we are willing to do in order to obtain it.

  28. You kind of included a script about how people who are wealthy are drunks.

  29. In regards to the “luck” factor I often hear about wealthy people, I am always reminded of a great quote. “the harder I worked, the luckier I got”. I’ve lived by this and promise you that when you start working hard instead of looking for a quick buck luck will start chasing YOU around!

  30. Here’s a different script:

    If I make money passively and accumulate substantial savings, chances are my money is passing through the hands of transnationals that are destroying the environment, blocking the development of civil rights in Third World countries, perpetuating war, undermining the democratic process, and manufacturing products that they know either don’t work or are harmful to consume in the long-run (without publicizing the fact). The more money I make, the more leverage I’m giving to these corporations that don’t care about anything but profit maximization.

  31. Excellent post, Ramit! I couldn’t agree more.

    I read a lot of finance blogs, including The Simple Dollar. Actually, I read that blog mostly for the comments because I find the author has a very limited view on the world and it can stir up some interesting debates. I cut spending ruthlessly in a lot of areas (although I don’t think I’ll ever resort to making my own laundry detergent), but I also spend pretty wildly in the areas that are important to me. I try to balance frugality with my love for a fancy, whipped treat from Starbucks.

    It’s interesting to see your take on Trent Hamm’s personal scripts regarding money. He has a very strong anti-rich script and, judging from the personal details he shares on the blog, that probably stems from his own experiences in a job while struggling with debt. I have to admit, it bothers me. Many of his posts come off as justifications for the decisions he made and he does that by making negative assumptions about others who have the things he claims he doesn’t need.

    This idea of carrying around predetermined scripts applies to things well beyond the realm of personal finance:
    - fat people are lazy
    - doctors are arrogant
    - women are bad drivers

    Taking the time to examine biases we carry can have a positive impact on all areas of our lives. A little honest reflection is good for the spirit, I think.

  32. 100% on the money Andrew – we create our own “luck”

  33. Through damaging relationship…
    That sentence make me shudder.. does it have to be that way ?

    yeah.. I’ve been through some damaging relationship event before I get where I am Now. more likely because we have develop different prespective in life.

    my question is.. does this event will continue to happen like “Donald trump vs Ivana trump”

    or can we avoid this thing to happen like “Warren Bufftet and Susan” ?

  34. Success to me is simply doing work that is important to you, making a contribution to humanity, and making enough to enjoy your live and live it the way you want.

    Those invisible scripts you mentioned do describe me. I did struggle for almost a year. I did have to sacrifice, I did lose out on relationships. For most guys I believe, when the ideal you is not the real you, nothing else matters other than creating the life for yourself you want. So I can somewhat relate to simple dollar.

    It’s ironic because you have had a different path than someone like me, so you have your own scripts that influence your opinion. Really these scripts are more based on experience. The difficult part for most, and what I think you’re really getting at is viewing wealth unattached from experience.

  35. Many of our “invisible scripts” come from the small number of people we associate with on a daily basis. If people I know are rich (be they friends, famility, coworkers etc.) and I see them work hard everyday, I’ll believe that rich people work hard for their wealth. Likewise, if I know a rich person who got rich by treating others badly, I’ll probably think rich people are jerks. Same thing with whether being poor is bad luck or bad habits. Our minds don’t adjust for the inevitably small sample size generated by our social networks.

    Furthermore, if I don’t know anyone I think falls into a certain category, it’s a lot easier to demonize that group of people. We all like thinking we’re smarter, harder-working, better people than “someone else”. We tend to look for any script/paradigm that tells us we’re right. It’s a lot tougher to admit that we don’t have all the answers.

  36. My superior Irish drinking genes say that you wouldn’t last two hours trying to go drink to drink with me. Put your money where your mouth is, Mr. “I live in New York and San Francisco and go out enough that I can drink most of you under the table on any given Wednesday night.”

    I’m challenging you, right now, to a drinking contest–next Wednesday night, if you’re in NYC, in fact. We’ll have one reader of your blog as an unbiased witness/participant/judge. You can even pick the venue–just as long as it’s accessible by NYC Subway.

    And here’s what I propose to put on the line:

    YOU DRINK ME UNDER THE TABLE:
    I’ll sign up for your next Earn 1k course and blog about it on my personal blog without giving away the secrets/course material–just a review of how it is increasing my photography business (personal journal URL: http://www.melizabethwilliams.com/journal (Alexa Rank: 121,005 in the US…not too shabby, though by no means as awesome as what you have here and at earn1k.com))AND give you free advertising from both that site and on my business site, http://www.girlpluscamera.com. I’ll also offer one hour each free photography & free retouching on said photos, whether they’re stock photos you want for your blog, an updated headshot for you and those you employ, or whatever else you want. Hell, I’ll even take a photo that says “Ramit Sethi drank my ass under the table” and use it as my social media image on Facebook, Twitter, etc. for a month afterwards with a link to your site.
    In summary, that means you’ll get:
    To make a blogger humiliate herself/eat humble pie;
    A businesswoman’s honest review of your product with links to this site, your Scrooge Strategy, Earn1K program, and your book on Amazon on my blogs and social media sites.
    Free services from Girl + Camera LLC: 1 hour free photography of your choice (still life/model-related stock images, business portraits, whatever you want) with 1 hour free retouching and no additional costs for the shoot (I eat the cost of travel expenses, proof creation, final image delivery, etc.). That’s a $296.45 value
    Oh, and I’ll pick up your bar tab from that night.

    IF I DRINK YOUR ASS UNDER THE TABLE I will get the cash value of what I’ve proposed above, which I estimate to be $2151.87*, made as a donation to my Faced With Injustice project (http://facedwithinjustice.melizabethwilliams.com), you place a link to the Faced With Injustice project in your next newsletter/on your website , AND you pick up my bar tab.

    If I win, you’ll still receive all the benefits of being a Partner-level supporter:
    A 125px x 125px logo with link to your site every page of the Faced With Injustice website.
    A copy of the book Faced With Injustice, shipped (before the preorders ship) on July 1, 2011
    An 8×10 floating gallery print of the image from the book of your choice, shipped to you before the book launch.
    Your name listed in the Supporters section of the Faced With Injustice website along with a link to your website.
    Invitation to the project’s gallery opening on July 4, 2011 (location TBD)

    So, really, it’s win-win.

    This is a THROW DOWN. I expect you to defend your statement in your blog post, put your money where your mouth is, and just TRY to Drink Me Under the Table! That is, of course, unless you were just bullshitting when you said you could.

    *How I calculated the Cash Value:
    Price of the standard Earn1K program ($995) + price I’d charge for that package I put on the table ($296.45) + the price of my dignity and free advertising/advertorial on my websites ($100 for advertorials about using Earn1K, $25/day advertising on all sites for a month and loss of dignity, with 30.4167 being the no. days in an average month)

  37. This invisible script is what bedevils most liberal politicians when it comes to economic policy.

  38. I see what you’re doing! You’re saying that these hidden scripts are what stop us from getting in the way of our own financial issues. We say, “rich people are evil,” and then that becomes a barrier for us to deal with out own financial issues, “Yeah, well, I’m not evil.” (which is funny, because that is evil).
    I guess the word is, “projection.” My failures to get what I want become pain that I will not own. Instead, I will project my pain onto these rich people and say that they are evil. It’s not a sense of justice, but jealousy. However, because it hurts, I feel righteous as I say I’m the victim and they owe me.

  39. Hmm.. I’m not getting the confirmation email from the earn1k website. I’ve tried 4 or 5 times, and checked my spam folder..

  40. Interesting post. Reminds me of the theory that when people do something right, they contribute their hard work and smarts as the main reason. When they fail, they blame their environment. Oddly enough, when we see other people succeed, we say its their environment that determined their status, but when they fail we often blame the individual.

  41. Re: Elizabeth Williams’ challenge – really, Ramit, are you going to let a GIRL drink you under the table? Hmmmm???

    • @Matt: Can you believe it? I think Ramit is scared to put his money where his mouth is and take on this tiny girl’s challenge to drink him under the table. Maybe it’s because he knows he’s gonna lose and have to cough up $2K.

      And, honestly, speaking of scripts–there’s an internal script at work here that says a woman should be an easy challenge because a woman can’t hold her liquor. Maybe Ramit’s turned off that script and knows his ass will go down against my superior drinking ability.

  42. Wow, I find it very amusing to read, “In truth, I can’t just blame them. I understand this script — especially today, seeing crooked politicians and corporations…” because this sentenance *includes* a script multiple people latched onto in the above comments. This time the script isn’t about money, but corporations and politicians.

    At what size does a corporation become sleazy, crooked, corrupt, or evil? If I start my own company–working hard and playing it safe–at what point do I cross the threshold? Am I okay with a staff of less than 5, or revenue of less than $2 million, or only serve customers who are Green? What if my staff grows to 50, or 2,000? Is it okay if I make a profit of $2 million? Do I need to employee people in my own country to avoid being hated while ignoring the chance to give good jobs to people who are not working somewhere else? And while I hate the demagoguery found in politics, most of them are not crooked either. I refuse to believe it.

    I thought about replying to the earlier post about my own invisible scripts, but refrained at the last minute. This conversation pointed out another of my own scripts.

    Jeffrey’s script: Most people want to do good. This includes the vast majority of people who are looking out primarily for themselves and their own concerns, but do not intend harm to come from working towards meeting their own desires. To the extent people are self-serving, they are willing to consider and change when they find their actions cause a direct, negative impact on others. (Indirect harm is a different story, IMO.)

    I think of Ramit in this light. He appears to want a nice, comfortable, and relatively rich lifestyle. His mechanism for achieving his personal goals are centered around helping others. And I believe, after reading his posts for a number of years, his overall intention is good or noble and he does not want to hurt others in pursuit of his lifestyle goals or the mechanism he’s using (give folks good tools). Do you think Ramit will, by default, be a corrupt person if he decides to run for dog catcher, city council, or Congress? Will he bring harm if his tools become so used he becomes a millionaire?

    Let me end with a modified quote from this post. “Perhaps it’s about understanding psychology [snip] and then using advanced techniques against ourselves.”

  43. Ramit is a blogging genius.. another great controversial post. ;-)

    “… for there is nothing either good or bad, but thinking makes it so.” -Shakespeare, Hamlet

  44. “to which I say “good for them” instead of really being jealous of them”

    I believe he’s putting forward a false dichotomy. It is entirely possible to do both! At the same time! I am super happy for my friend who, while completely remodeling her home paid cash for her 3 children’s college education and eats at wonderful place – and I am also jealous! Although I like to say “envious” – it sounds classier.

    My point being – yeah, I’m jealous. I’m up front about it. And if those feelings of jealousy spur me to, I dunno, do Ramit’s skills/strengths/interests exercise and come up with 3 plausible sidelining ideas, then – more power to me and my jealousy!

  45. People who became wealthy by being “evil” are the ones who are most noticeable in society. They buy ridiculously expensive cars, houses, boats as show off and then you see them snubbing people all the time. Its in their mindset. That’s how they got there.

    People who became wealthy the “right way” are usually not into showing off their wealth by buying expensive things. They behave just like “normal” people and hence are hardly noticed in public.

    This is why there is perception of rich people being “evil” because its the evil rich ones who are most noticeable due to their show off snubbishness.

    • Total assumption. I know plenty of extremely wealthy people who are millionaires many times over and have nice toys. They are great people.

    • I agree with you Ramit. I have met serveral as well.

      But you probably missed my point. I am talking “in general” this is how assumption is made about rich people.

      “In general” as in 100 out of 100 “evil” rich are spottable to be rich – hell they want to be spotted – and of course its not difficult to tell they are just “evil”.

      But 10 out of 100 “nice” rich people can be spottable as to be rich.

    • Jay – Actually, it’s important for the economy and job creation for these people to spend lavishly and it’s even better to be one supplying goods and services at ridiculously high prices. :)

  46. There is another implicit script here and in the original post, which I think is worth examining: the idea that if one is experiencing financial difficulties, one “deserves” it, because of financial mismanagement, short-sightedness, etc. I don’t think we can be so quick to judge, for the richer or the poorer, how they got there. I know people with liens on their homes because of their spendthrift ways, and I also know people who are having financial trouble because of health costs. I know people who are extraordinarily rich who worked to get there (and I don’t say worked “hard” because a lot of people work “hard” and never get there), and I also know people who are extraordinarily rich who had the good fortune to be born into a rich family.

  47. There’s the old tale about a retired engineer who gets called back to his old job to fix a problem. There’s a piece of production equipment that’s stressing with resonance, and if they keep going it’s going to bust apart costing the company millions both in down time and equipment replacement. They’ve run the finite element analysis models, they’ve tried a number of things to reduce the stress, but still can’t figure it out. The old engineer comes in, watches the machine work for a bit, scans some of the data, takes a piece of chalk, and makes an X on one of the structural panels.

    “Put a rivet there,” he says.

    They do, problem goes away. They get his bill. $50,000. They freak out, demanding a detailed, itemized accounting of how it could possibly cost $50,000 for what he did. He sends them the following:

    Piece of chalk: $0.01
    Knowing where to put the chalk mark: $49,999.99

    They pay the bill. Know your worth.

  48. Hate to nag, but I still haven’t received the confirmation email. Is anyone else having difficulty, or is it just me? :(

  49. I seem to recall the Biblical text is that the LOVE of money is the root of all evil.

    I hope nobody here is just accumulating money to accumulate money. We’re earning it and saving it so we can do the things we love, and so we can acquire the freedom and flexibility that are impossible when you’re deeply in debt. Debt closes down your options.

    I’m an older person, and “wealthy.” My husband and I have simply worked at two professional jobs, saved, raised a family, and we never did the really stupid stuff, like the guy who suffers until payday and then vomits money. We were happy together, had friends and fun, and didn’t have to get roaring drunk or buy a bunch of expensive stuff to have fun. We do some things that are incredibly important to us, like help our kids get through school without debt, to travel, and be able to give to charitable causes.

    I am currently packing up to go teach a seminar, for which I will be very well compensated. My husband is coming, too; it’s hobby-related and we’ll be with people we enjoy. It’s a sideline, on top of my regular career.

    Priorities, kids, such as God, love, family, friendship, personal growth. And never be a slave to money – either as a debtor or as a workaholic.

  50. The follow-the-herd mentality is at the root of many societal problems, though it’s often disguised as advantageous. For the same reason that so many objectify the wealthy and then reduce them to all to fit one general mold of greedy, manipulative & unfeeling…we see others do the same with artists, for example, grouping them all into one category of “starving” and hopelessly romantic…impractical…foolish. Neither of these is always the case for either category, as is everything in life.

  51. My invisible script wasn’t necessarily that rich people were evil, but the rich people trying to sell you things were. Marketing was always evil… any commercial on tv or advertisement was trying to sell me something I didn’t need. I just had to have the willpower to reject it. To some end, I still feel this way. Ads still make me want things I dont need, but now that I am a small business owner, I am trying to get people to spend money on things they dont “need” but want.

    Photography doesn’t feed you or keep you warm, so in some respect it is a luxury. I battled with this when I choose to follow my passion. How can I get someone to pay me hundreds or thousands of dollars for an optional purchase? I’ve had to change my whole mindset about it. I’m providing a fun experience for families, memorable images that will last generations and be treasured for years. What I do is important, and I have a talent for capturing moments that can’t be repeated. I should be paid for this.

    I’m not a doctor or a lawyer, and I am not paid like one, but I could in a few years if all goes well. Is my profession worth the pay in the vane of contributing to society as some of the commenters mentioned above?

    Trying to charge for the value of what I am worth, especially when my mom gasps EVERY time she sees my prices (and I am middle of the road for our area!) is tough. But Eark1k has helped me realize one big thing: I am not trying to sell people something they dont need. I’m selling something they want, they want done well, and something they are willing to pay for because they recognize my abilities. I am selling me and my work.

  52. The perception that wealth=evil boils down to the most basic concept in psychology–cognitive dissonance. People who accept (/embrace) the idea that they will never have this or that NEED to think that they are just as “good” or better than those who do have it. If they didn’t, they would always be jealous.

    “If wealthy people are either lucky or immoral, then I never wanted to be wealthy anyway!”

  53. I think, in Trent’s line of thought, you and your students fall under the category of “ability and opportunity to be in the right place at the right time to take advantage of it.” It’s likely that if you have internet access at all, you have opportunity, and what you offer to teach, Ramit, is ability, no?

  54. Ramit, my 2c: We grow up with the invisible scripts that begin at home and grow with our peers at school, neighborhood and work. This is mostly unconscious assimilation. To break this mold and get the scripts out of our heads needs deliberate re-programming of our value systems. How we shield ourselves from these negative scripts is the crux of the matter. The system does not allow you independence, you have to create it yourself. Once this done, you will achieve even impossible things.
    Reading the other comments to this post, the breakthroughs become evident when people managed to break the value system and created fresh ones.

  55. Yep I agree being wealthy isn’t evil, and not all wealthy people are working 70 hour weeks. I’m not sure why this stereotype remains but I hate it. I’m not even wealthy!
    I’ve known some wealthy people in my life and they weren’t miserable, they weren’t in debt. Yes there are some wealthy people whom are jerks, but there are also poor people who steal and are jerks too. Anyway, thanks for this article I appreciate it ;)

  56. Ramit, most of the people climbing corporate ladder should be willing to work hard, available 24×7 and treat their job as the most important thing in their life. Usually all these management types have spouse who tends to all the kid’s needs, takes them to all the extracurricular classes, takes off to be home with sick kid and keeps the home life running. I am yet to see one who is available for both family and work and go up in the career where the big bucks are. I think missing out on time with family is what Trent mentions about when he talks of missing out on life or damaging relationships.

  57. I believe that money is morally neutral. If you put money into a generally flawed person, they are going to do jaded things with it and for it. But my experience is that most wealthy people I’ve met are generally very good people with good intentions. It makes sense too, because dishonest people tend to throw off bad vibes that repel people and money. Extremely successful people usually want to help people and offer products and services that they believe are enhanced peoples lives.

    Nothing will get you wealthy fast then offering a great product or service and solving people’s needs and problems.

    I find the seeds of scrooge like greed in people who constantly do everything to save money. Greed is an obsession with money whether it is making money or saving money. For example, riding your bike to work everyday to save money seems like work. I ride my bike to work alot but for enjoyment and exercise. Or washing and reusing Ziplock baggies to save money instead of doing it to save the environment.

    I think the best strategy is to make enough money that you don’t need to think about money anymore. This means both sides of the coin, living modestly and earning more which frees you to do frugal things for altruistic purposes not just to Scrooge-like saving of money.

  58. I’ve been mulling over your post the last few days and certainly see that you have a good point, and a larger good point about the “scripts”. Another script that hasn’t been considered too deeply here is the inherent pride in someone automatically thinking that someone else had to do something wrong to get that much money – in short, that because that person cannot think of a way to generate that much value/money ethically then it must not be possible.

    Good post.

  59. After a while, you’ll get tired of chasing money and find it’s not worth the effort.

  60. >>Or washing and reusing Ziplock baggies to save money instead of doing it to save the environment.

    Tim, although I think you make several good points, this may or may not be true in all cases, ie, you can’t judge a book by its cover. In my case, I save money on magazine subscriptions by collecting Coke bottle tops. I work in a place where lots of people drink Coke, and you can enter in the codes on the bottle tops for various rewards. Kind of like Green Stamps were back in the olden days. Now sure, I can *easily* afford subscriptions to Sunset and Oprah on my own, but I cannot tell you how much I *love* the thrill of the hunt when I see a bottle with its top still attached in the recycling bin. So. Much. Fun.

    >>After a while, you’ll get tired of chasing money and find it’s not worth the effort.

    guest, I’m sorry you feel this way. Are you sure it’s really not worth the effort, or are you afraid you might fail if you try some different avenues?

  61. I definitely fall prey to this script. thank you parents and society (well probably mostly growing up in a tiny crappy town is a big part of that “society” thing.)

  62. Great post. I read a lot of PF blogs but am seriously turned off by the overly fugal notion that money is not to be enjoyed and rich people are bad.

    I’ve done OK over the years and often cringe (and smile politely) when family and friends remark about how lucky I have been. Agreed, luck plays into it. I also found a way to pay my way through undergraduate and graduate school, worked very hard, never said no to any challenging project and found ways to add value at work. And I didn’t need to put the screws to anyone to do it.

    One of the places I worked sold software to large companies. Many of the software engineers would often complain about how the sales guys were getting rich when they did all the hard work. The sales VP would always say “Any day you want to come over to this side of the house and make the “easy” money, you’re more than welcome to try.” Don’t recall anyone ever taking him up on it.

  63. I agree with your post, but most people don’t have the luck to be successful. Like you said, luck is a necessary ingredient, but blesses only a select few. And that’s something that’s out of people’s control. So, it’s no wonder why a lot of people don’t have favorable attitudes towards the affluent.

  64. “Chance [luck] favours the prepared mind.”
    ~~~Louis Pasteur

  65. Great post, Ramit. I know a lot of people who feel this way about people with money or about business people in general. In truth a business is simply an exchange of value that should benefit both parties. Combine that with the ability to recognize opportunity (I love Daniel Pink’s chapter on Symphony in his book “A Whole New Mind” that discusses recognizing opportunities) and you have the ability to make plenty of money while actually helping people and progressing society. Cheers,
    Joe

  66. Rich people are snobs and do have a need to show off their money. They are not good for the economy with their lavish spending. They will spend for one car what they can pay three or four HARD WORKING poor persons to work for them in a year. Yes they are evil. When thousands are unemployed, some one wrote an article in our local newspaper to remind us that the state of the economy was their fault because THEY were not boosting it by SPENDING! With what money are the unemployed suppose to spend having to cut down giving up pets, dream houses and dreams for food? Get it?

    Indeed, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of heaven. Luke 18:25