What about my fears?

Ramit Sethi

We all have ridiculous things we used to believe (I outlined many of them in Why Do Delusional People Think Their Spending Will Be Different Than Other People’s?)

Stupidly, I genuinely used to think that “fear” was a physical feeling. So when people asked me, “What do you fear?” I would shake my head and say, nothing really.

It took me years to realize that we don’t experience the same fear that our ancestors did — the fear of being chased down by wild animals, or starving to death.

Our fears are far more subtle: the fear of failure. The fear of looking stupid. The fear of being wrong, or regret, or not taking a chance.

So when I started sharing details about the things I fear on my Insider’s List, they were some of the most popular things I’d ever written. I was surprised myself.

So today, I want to share an interview I did with the magazine, “fear.less,” in which talked about some of my fears and philosophoes. Fear.less is focused on “empowering people through unique stories of overcoming fear.”

Here’s two excerpts I think you’ll enjoy:

IG: You studied Behavioural Psychology — what’s the relationship
between decision-making and behaviour?

RS: What I find most interesting is this concept of ‘reactance.’ We
know that if a person feels a particular freedom is being denied,
that person will respond in an over-the-top way to secure that freedom.

If I can eat jelly beans any time I want and you take
away those jelly beans then boy, I am going to fight back because
I want those jelly beans. Well guess what? The same is true of
young people spending money on shoes, jeans, and lattes. If you
tell me “don’t spend money on lattes,” I’ll respond with “screw
you” and anyone who gives me that advice.

IG: If that’s true, how can discipline or saving exist, or indeed any
impulse control?

RS: My book takes a different approach. I say “spend
extravagantly” on the things you love — as long as you cut
mercilessly on anything you don’t care about.


IG: The act of incentivizing yourself in a fun way is way more
powerful than trudging through late fees. Okay, what do you
think about working hard, saving a lot now to pursue your
dreams later, or working at what you want, like launching your
business, but being financially unstable initially?

RS: That’s some bullshit dichotomy — that you can live your life
now and you can live a rich life. Money’s a part of that, not all of
it. I have friends I would call rich that make $25,000 a year and
live in New York City and enjoy their life. I also have friends who
are bankers and make a ton of money but who aren’t rich and
don’t enjoy their lives. The first thing is: what does rich mean
to you? Money’s a part of it, but it’s not everything. The second
thing is when people think about money, they tend to have very
static assumptions that we’ve had for the last five decades. They
assume that the money they have is fixed. They can’t control
their fervent opinions about taxes because they feel that that’s
being taken away from them. Whereas these days, young people
are saying, “Wait a minute. I have a pretty flexible view on this.”
I use a strategy called the CEO strategy. Most people say saving
money is about cutting back on the things that you love.

That’s bull. I think CEO: Cut costs. Earn more. Why doesn’t anyone ever
think about earning more? Then, optimize your spending. To
Indians, optimize means negotiate!

You can read the full interview (scroll to page 32) here.

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  1. Zero Passive Income

    Cool interview! It’s really interesting to see the perspective of someone who knows behavioral psychology and personal finance

  2. Joseph


    Some great points, per usual. I will admit that as sad as this sounds it’s nice to see that a superstar such as yourself has fears just like the rest of us :-p

    I like the term you’ve coined for your brand of personal finance: the CEO strategy. So many personal finance bloggers focus only on spending less (I’ve been guilty of this myself in the past) and don’t bother to write about earning more. To add insult to injury the majority of the bloggers/columnists who do write about earning more usually give useless tips. I am not interested in donating plasma (or any other bodily fluid for that matter) just for a quick buck.

    Thanks for keeping it real! I try hard to do the same for my readers.

  3. Natanya

    I AM the jelly bean example.

    I was just remarking to a friend how funny it is that when I’m low in the dough I want to spend spend spend but when I’ve got loads I tend to save save save. Ugh.

    Your tips though, Ramit, are so helpful in reorienting me back to what I consider important. If I want to eat out because I get to enjoy myself, relax, and spend quality time with friends, then it’s not a splurge its a life enhancing activity. It just means I’m not going to buy new clothes this season instead! 🙂

  4. The Road to Success Step One: Recognize Your Fears | Success Hacking

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  5. Nick Fox

    Ramit, which do you find is more useful:

    -Discovering and examining one’s fears for the sake of minimizing them?

    -Facing one’s fears and fighting/struggling through them?

  6. STRONGside

    I really enjoy reading personal finance blogs but lately they have all seemed to be getting very focused and narrow minded on ruthlessly cutting costs and not on earning more money. There are definitely two distinct camps on how to be financially successful, but the sad part is many people in the “ruthlessly cut costs” camp don’t ever realize that they would not have to cut as many costs or make those sacrifices if they found a way to increase their income.

  7. Russell Davison

    Hello Ramit,

    Following on from your point about when people think about money, they tend to have very static assumptions that we’ve had for the last five decades. Employment is a good example. The vast majority of people (99%) work for someone else. They do this because the salary is higher than what they could get if they were self-employed or because a continuous income stream is guaranteed. That is how it was till about a decade ago.

    Now, there is no company in the U.S. or Europe who could guarantee continued employment beyond 24 months and salaries for employees are falling every year. Consequently, companies in the U.S. and Europe are being forced to change the reason for their very existence. The age of mass consumerism in the U.S. and Europe has come to a close. Import of luxury goods demand is down. Foreign call centres have closed. Cheap clothing imports will also soon finish.

    Labour exploitation in third world countries to enable mass consumerism in the US and Europe through globalisation stopped in 2009.

  8. Kaplan

    I think facing ones fear is the best thing to do though not the easiest.

  9. Tara

    Thanks Ramit, for the posts on fear and testing assumptions. I’ve started testing my own assumptions and realized that, hey, I really could make a go of a freelance life (my dream gig). I designed a 90-day experiment out of the whole thing, quit some things that were standing in the way, and decided to ruthlessly cut out…fear.