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4 Steps absolutely *anyone* can take to become Rich (in 2020)

Most people don't become rich because they don't have a proven plan. I'll show you excatly what steps to take to become rich.

Ramit Sethi

how to become rich cover photo

There are no secrets to getting rich overnight, but there are some repeatable, proven, systems to help you become rich.

It’s crazy how many people still fall into get-rich-quick traps even though there’s mountains of evidence that shows that they’re total scams.

Take multi-level marketing (MLM) businesses for example.

I hate MLMs. So. Freaking. MUCH.

The fact is if there were truly one great way of getting-rich-quick, we’d all be doing it.

There are no “secrets” to getting wealthy overnight. But there are proven systems to get rich — and they take time. Let’s get into the steps you can start taking today to increase your income.

Here are the 4 steps to getting rich:

Bonus: Want to know how to make as much money as you want and live life on your terms? Download my FREE Ultimate Guide to Making Money

Step 1: Invest your money (the smart way)

The single most crucial thing you can do to ensure your financial future is investing — and the sooner you start, the easier it is to get wealthy.

This isn’t BS. There are more than 100 years of evidence in the stock market that suggests this.

Still don’t believe me? Let’s look at a real-world example of how to become rich by investing.

Say you’re 25 years old and you decide to invest $500/month in a low-cost, diversified index fund. If you do that until you’re 60, how much money do you think you’d have?

Take a look:


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$1,116,612.89

That’s right. You’d be a millionaire after only investing a few thousand dollars per year.

Notice, I’m not talking about the Hollywood type of investing where hot-shot stockbrokers make huge multi-million dollar trades while yelling “SELL” into a phone for some reason.


Pictured: Some dude trading stocks and losing money. Not pictured: You investing in low-cost index funds and getting on with your life.

I said you should invest in low-cost, diversified index funds over time. That’s because smart investments are about consistency more than anything else — not chasing hot stocks. Or other weird investments:

The two essential ways to invest your money are straightforward:

  • 401k: Be sure to take advantage of your employer’s 401k plan by putting at least enough money to collect the employer match into it. This basically means that for every dollar you contribute, your company will match that (pre-tax!). This ensures you’re taking full advantage of what is essentially free money from your employer. That match is POWERFUL and can double your money over the course of your working life:

  • Roth IRA: Like your 401k, you’re going to want to max it out as much as possible. The amount you are allowed to contribute goes up occasionally. Currently you can contribute up to $6000 each year.

Note: If $500/month sounds like a lot, read all the ways you can free up that money with just a few phone calls.

Bonus: Ready to ditch debt, save money, and build real wealth? Download my FREE Ultimate Guide to Personal Finance.

Step 2: Spend your money like a wealthy person (using conscious spending)

Anyone who knows me knows that I detest ultra-frugality — otherwise known as the lifestyle of clipping coupons and sacrificing things like lattes for the sake of saving money.

Unlike a lot of people you see in the personal finance world, I’m not ashamed of how I spend lots of money on things I enjoy like eating out, traveling, or nice clothes.

And that’s all because I practice conscious spending. It’s the same system my friend uses in order to spend more than $21,000 on going out. I’d never tell you to skip on spending on the things that make you happiest. Just do so purposefully, and by avoiding the mindless spending that can come from disorganized finances.

Setting up the system might seem hard — but in the end, it’s all about:

  1. Automating your finances.
  2. Knowing where your money goes so you’re in complete control of the situation.

Automating your finances allows your system to work for you and passively do the right thing instead of you constantly wondering if you have enough money to spend. Or, getting your credit card bill each month, shrugging, and saying to yourself, “Yeah, I guess I spent that much.”

And it’s simple: at the beginning of the month, when you receive your paycheck, the money is immediately sent to where it needs to go through automatic systems that you have set up already.

Some spending recommendations for your system:

  • 50%-60% Fixed Costs: This includes things like utilities, rent, internet, and debt.
  • 10% Investments: This includes your Roth IRA and 401k plan.
  • 5%-10% Savings: This is money that goes towards things like vacations, weddings, home down payments, and unexpected expenses.
  • 20-35% Guilt-free Spending: Fun money! Spend this on anything you want from nice dinners to movies.

Why automatic?

Because as humans we have incredibly limited willpower. It’s so limited in fact that it can render things like paying bills and putting money away in your savings each month a very difficult task.

Automating your finances subverts this by allowing you to save money without ever having to do it yourself.

If you want to find out more on how to automate your finances, check out my 11-minute video explaining it here:

Step 3: Tap into “hidden income” (Combine with Step 1 for big results)

I’m not talking about piles of cash buried somewhere in your backyard — this is the money that you can be saving right now by negotiating your bills.

That’s right. With just a few one-time, 5-minute phone calls, you can save HUNDREDS a month on bills for your:

  • Car insurance
  • Cell phone plan
  • Gym membership (less likely but still possible)
  • Cable
  • Credit card

It’s simple too — there are only 3 things you need to do to negotiate with these companies on fees and rates:

  1. Call them up.
  2. Tell them, “I’m a great customer, and I’d hate to have to leave because of a simple money issue.”
  3. Ask, “What can you do for me to lower my rates?

Of course, you’re going to want to adjust this formula for whatever company you’re calling. Check out my video on negotiating your bills for more on this topic.

Along with your bills, you can also be EARNING more money through salary negotiation.

This is actually one of the easiest and fastest way to earn more money.

In fact, a one-time salary increase of $5,000 — properly invested — adds up to over $1,300,000 by the time you retire.


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1-time salary increase of $5000 invested and compounded after 40 years: 1,398,905.20!

And in many cases, getting a raise only takes a single, 15-minute conversation with your boss.

Remember the chart from above showing the effect of $500/month?


You can meet this goal with ONE salary negotiation.

If you’re interested in learning how to boost your income for life, check out my Ultimate Guide to Salary Negotiation (it’s free). It includes HD videos, word-for-word negotiation scripts, and walks you through each step in the process of getting a raise.

My favorite part: You’re already getting paid. Why not get the most out of every paycheck?

It’s a quick win, and you should absolutely capitalize on it. But if you’re looking for something that takes a bit more time — with a lot more upside — you should consider starting a business of your own.

Bonus: Want to turn your dream of working from home into a reality? Download my Ultimate Guide to Working from Home to learn how to make working from home work for YOU.

NOTE: If having a work from home job is part of your Rich Life, I’ll show you how you can convince your boss to let you work from home in my article Working From Home: The Essential Beginner’s Guide.

Step 4: Build another stream of income

This is my all-time favorite answer to the question “how to become rich?” I’ve always believed that there’s a limit to how much money you can save — but no limit to how much you can earn.

This is especially true if you start your own online business.

From my years of experience not only running my own business but teaching scores of people to start their own as well, I’ve found that there are two great ways to start a business:

  1. Turn the skills you already have into a side hustle.
  2. Start an online business and reach millions of people all over the world.

Side Hustle

This is one of the fastest ways to get started in business. By utilizing the skills and talents at your disposal, you can start freelancing and generating a steady source of income on the side.

And the best part: you don’t even have to quit the job you already have.

Online Business

With an online business, you can reach millions of people on the internet every day while scaling your product to help you earn millions online.

Don’t believe me? Check out just a few different ways you can make $1 million online.

  • 250,000 people spending $4
  • 100,000 spending $10
  • 50,000 people spending $20
  • 10,000 people spending $100
  • 1,000 people spending $1,000

Could you find 1000 people to buy from you over the next few years? I think so.

To start an online business, you need to choose from 6 different models:

  1. Software (including apps)
  2. Physical products
  3. Advertising
  4. Affiliate marketing
  5. Coaching
  6. Online courses

Obviously, there’s a lot that goes into creating a business based on these models — getting traffic, building an audience, launching a product etc. — but it’s all completely doable.

Plus you can automate your online business so once you frontload the work, the business keeps paying you again and again, even while you sleep.

Over the years, I’ve shown thousands of students how to build businesses just like that. Click here to see some examples of the businesses they’ve built.

Bonus: Want to finally start getting paid what you’re worth? I show you exactly how in my Ultimate Guide to Getting a Raise and Boosting Your Salary

Every great business begins with a profitable idea. After creating 18+ successful products of our own, we’ve developed a system that guarantees your business idea will pay.

If you’d like to see the system we’ve built — or if you just want to put your existing idea to the test — enter your name and email below.

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