Probably one of the best comments this site has ever gotten

Ramit Sethi · March 7th, 2006

Don’t forget to read the comments on this site. This one (from this post) was so good that I had to post it here:

Grayden writes:

One thing that might be worth talking about as part of the Financial Makeover is being realistic about housing, transportation, and lifestyle. A lot of people get a bit crazy with spending when they get their first job that pays more than peanuts. For the last several years I’ve been paying far more than I’ve needed to because I felt that I needed to live in a NICE apartment. After living in a nice place for a while and even upgrading to a better place, I realized that I was throwing away half of my income on living expenses and not even earning any equity. It seemed obvious enough that is was time to buy a house and start building some real value. After all, my friends were all buying houses and they seem to be managing just fine. After a period of house hunting and analysis of both my finances and my realistic needs, I realized that owning a house would completely ruin me at this point in my life. After spending so much on rent in a full service apartment for several years, I didn’t have much money for a decent down payment so the banks would have eaten my lunch. On top of that, I’m still in grad school part time in addition to having a full time job, so I wouldn’t have time to properly maintain a house and keep other time commitments in my life as well.

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Having given my housing situation plenty of reflection and trying to find a way to make it work, I’ve realized something about myself – I really just don’t need to live alone or in a fancy place. Sure it’s nice, but I don’t need it to be happy. Everyone has different needs to satisfy their esteem. Some people need to drive a nice car but don’t care where they live. Some people need a nice home but would be perfectly happy driving a rusty old beater. Some people need to have high end home electronics or designer suits and watches. Some people just don’t know what they want and drive themselves into debt trying to have it all without the means to support it. Doing some honest self-reflection and being realistic about things you don’t really need can help you find a few big ways to get your finances in order. Cutting back on things you don’t honestly need can free up a lot of capital for the things that really do matter to you. For my situation, I’ve realized that while I do want to own a home some day, it’s not time yet. I’d rather get my debts settled and save up a nestegg in case I end up moving to another city when I’m done with grad school. This summer I’m moving out of my expensive apartment and into a room in a friend’s house and as a result I’ll be cutting my living expenses by more than 60%. That extra saved money can go into investments and savings until a time when my life is sorted out enough to do something with it.

I’ll be writing more about this in an upcoming article that I’ve been thinking about for a few months. (Hint: It’s about jeans.)

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  1. Is it about destroying your jeans? And what a waste of money it is? Wasting money on jeans

    Okay, end shameless plug of blog. I’m guessing its either about paying $75 for some destroyed jeans, or just paying a lot of money for designer jeans in general?

  2. Ramit Sethi

    Good self-promotion–I love it.

    The article is something like that, but hopefully not that simplistic. Otherwise, if it took me a few months to think of that, I’m pretty slow : )

  3. candice

    Nice clothes are worth the money, though. I’m not talking about 200 dollar designer destroyed denim, per se, but a 60 dollar pair of nice fitting blue jeans looks better and lasts longer than its 20 dollar old navy or walmart counterpart.

    Same goes for “business” type clothes – sure, buy them on sale, but buy nice ones and bring them to a tailor (less expensive than you think – it’s about $10-15 to get one to shorten sleeves, five dollars to hem pants, etc.) and you don’t end up looking like a programmer at an interview.

  4. I was aware of the “rent trap” at the age of 16, so since then I saved like crazy to buy a place.

    At the age of 26, I moved directly from my parent’s home to an apartment I bought.

    I’ve seen the place quadruple in value since then (7.5 yrs) and I’ve paid down a lot of principle, too.

  5. And of course, if you had gotten that great 2 bedroom with the hardwood floors and the fireplace up by Coventry that I really liked, you’d probably have a house by now. 😉

  6. Are you joking me? Course you need a nice place to be satisfied. Everyone who thinks that you dont have to be rich to be happy is… guess what? Not rich.

  7. Are you serious? THAT’s the best comment on this blog? Seriously, I think my comment on a certain gaseous release of mine was much more profound than this garbage. Oh, and I’m not even going to mention the fact that ‘nestegg’ isn’t even a word!


  8. Buying things to make you feel better is great, but don’t go over board.

    The worst thing that a person can do is be cheap to themselves, that’s terrible.

  9. Can you please explain me why is this comment the best ever?

    I don’t understand the great deal about it.

  10. BillinDetroit

    It is an excellent comment because it reflects a coming to financial maturity. Having that great apartment was actually keeping the poster from having a great home. He took a look around, realized that his priorities either weren’t being met or that they had changed and had the maturity to alter his actions.

    Good for him. And good for all those others who realized that they could do the same thing in their own lives.

    The appearance of success was actually preventing the reality.

  11. While I think that it’s great to read Ramit’s articles and see how he has matured financially, this article also shows that he is human like the rest of us. Offering to teach people to be rich when you are not rich yourself is like a 350 lb. personal trainer teaching you how to lose weight. He might know the theory, but the proof of concept is not there yet. He has some great advice for financial newbies, but his claim to teach you to be rich may not work out for everyone, or more importantly those in his target audience. Wealth has a great deal to do with how you spend your money. That is very true. It also has a great deal to do with how much you earn and what circumstances you face in life that are unique to you. I think this site should be renamed to Of course, that’s not as flashy or as sexy of a title, but it’s more accurate. Fiscal responsibility goes a long way, but it never guarantees that you’ll be rich. Of course, if you think you need to be rich to be happy, then you have bigger problems to worry about.