38 Comments
-
-
Tage
The Negotiate Your Rent link goes to the "I'll pay your rent" page, but no articles about it. Is there an article about it?
-
Josh
If the majority of people spent their time embracing Ramit's advice rather than systematically attempting to pick the opinions apart based on non sensical untested theories most would be better off. Whether its fitness, health, love, career or life goals actions speak louder than words. If you want something go get it. I don't care for fancy clothes but have no problem spending hundreds a month on fitness memberships or nutritional products. Make choices and stick to them!
-
Nassrin
Ramit, I really enjoyed this post. It was indeed comprehensive, as Johnny Mean had mentioned. I am eager to continue working on implementing the remaining steps on this list. Cheers.
-
Sharkman
Ramit, fantastic the way you blend human behavioral psychology and personal finance. Because other than just plain not knowing (lack of knowledge or experience), isn't one the primary driver of the other? Your automation system does wonders to negate the things that hold most people back from making a lot of wrong choices - fear and uncertainty. Multiple scientific studies show that the human mind is hard wired, when it comes to risk, fear and uncertainty around our personal finances to make poor decisions. Automation allows us to make the right choices by bypassing that wiring. That's a HUGE win.
-
Varaneka Laxmi
Thanks, Ramit. I am passionate about mastering your teachings for myself so that I can help others do the same in their lives, especially regarding healing themselves. I've been meditating on increasing my focus. This Big Wins article came just in time as a pleasant reminder. Information addiction is a time waster, right? I reminisced about my life coach Shanel Cooper-Sykes' words, "Ignorance on fire!" haha Thanks again!
-
Carlos
Ramit, Great manifesto. I chucked several times while reading it. I still feel many of your anti-frugality arguments are straw-men, but overall your philosophy is clearly to focus on big wins. Nobody is going to argue earning 10k more per year versus cutting back on a latte every day. But then again cutting back on the daily latte isn't the best frugality has to offer. How about big wins like: Living closer to your work to cut back on commuting time and cost. Getting a small car versus a luxury SUV. Living in a modest home versus a mansion. I would say many of these differences can be just as large if not larger than earning 10k more a year. I think people would be wise to both earn more and spend less. And really deep down I think we are on the same page, as your say yourself in this article "as long as you cut costs mercilessly on the things you don’t [love]".
-
Jon
The big wins that Ramit suggests are long term solutions that can apply to anyone looking to increase their income. Your "big wins" list is more specific to certain geographical areas. Living closer to work is viable, if you can find a suitable spot near work. If you work downtown, you might be hard pressed to find an affordable and suitable solution 'close to work'. This may rely more on luck than skill. The luxury SUV may have more than one purpose (if you have kids, soccer mom, or transport large objects.). In regards of the size home, i assume you are renting your home vs owning the home. Yes, a smaller home should be cheaper. But again, location/landlord has a larger effect on price than . If you are truly frugal, why not stay in an efficiency/motel? You can get utilities and a roof over your head for what $400-800/mo all included. The frugality approach and the earning more approach still have the basic component of 'opportunity costs' to consider for each
-
-
Julie
I love your emails Ramit, I am going to get rich with your advice, thanks for being so honest and real
-
Kelly
One time I calculated how much I was spending on lattes per month. It came out to around $200. At first I thought "Damn Kelly, that's a lot of money every month for something you could make at home." Then i asked myself, "What would I do with $200 per month if I was making all my lattes at home?" The answer was (you probably guessed it) buy lattes at my favorite cafe! Yes, I can and do make lattes at home, but something about the cafe experience is like a ritual and puts me in the mindset to be productive. I get some of my best, most focused work done with a large in hand, prepared for me by a friendly barista who knows my order when I walk in the door. I've cut back on other things, but it's like you say: I spend extravagantly on the things i care about, and almost nothing on anything else.
-
Tristan
Great article. I'm someone who tends to focus too much on the minutuaie sometimeis - the idea of a few big wins (as in your book) is great for simplification. And yes, we are tired of the same old advice from 'experts' to cut out lattes ;-)
-
Tiffany Martin
Ramit, I want to marry you, lol. I want to tell you, I think this is your best article ever, and here's why: It outlines your "narrative" so that anyone can follow it. It links some of your best articles in one place. It saves us all time! It's very shareable! As for me, I plan to never spend more than 3k on a car (unless I must drive a reliable car for income), I taught myself how to color my own hair (according to Tresemme the average woman spends $1130/year on hair) and I'm currently getting pretty good at nails (btw women last year spent 7.3 billion on nail services). These are my merciless cuts, because I don't get pleasure from driving a car, going to a salon, or getting my nails done by someone else. With the money I save I invest in healthy food, and classes or experiences that make me more awesome. And did I mention, I'm handicapped as fuck and I live on a fixed income? Even in this situation I don't see much point in cutting every corner, instead I prefer to lay groundwork for getting ahead later and never worrying about stupid crap again. Maybe then I'll re-strategize and get my nails done at a salon if it saves me time, lol. Probably not what you read everyday, but how's that for big wins?
-
John Garvens
Ramit, Please, tell me that you wore that toga in public. Also, your principles helped me reverse my financial situation. I recommend your book to all of my friends. (My zealousness annoys them.) John
-
Alok Deshpande
Ramit, Interesting read. I think there is one important behavioral factor that you haven't accounted for, inspiration. You've inspired many people to change their behavior -- they are following you (and should). The particular strategy is less important. People need to cut expenses, try to increase income, live within their means, save for their future, stay out of debt...the list goes on. You can pick any of these. They all work. It's math. But, to sustainably change behavior, we must be inspired. Systems help direct and support the inspiration but nothing happens unless you're driven to make a change. You inspire. You make people want to be better and give them the information (and strategy) to get there. I've taught personal finance and served as a financial coach for a number of years. IMHO, the main difference between people who succeed and fail at changing behavior is the source of inspiration. Don't underestimate the power of you. Thanks for everything you've done. Alok
-
LuWee
Thanks Ramit. Worked like a charm! After joining Ramit's Earn1K and Find Your Dream Job courses, I managed to: 1) Get a job right out of college (yes, in this horrible, horrible economy) 2) Secured 3 clients from my freelance writing business (earned more than 1k, so the course paid for itself). Planning to get a few more to secure the 6 month emergency fund (before considering going full time) Ramit mentions in the Earn1K course. 3) Raised the rates at which my family homes and shops were rented out by 30%-40% each The result of all this: I don't have to cut back on going out with my friends (and sometimes paying for them) or family! I'm gonna be out of debt in 2 or 3 years (instead of the omnious prediction of 20-30 which I previously imagined)! It feels great! It's a snowball effect! Guys, you should really join any of Ramit's courses! I personally endorse them! You are gonna be raking in millions over your lifetime.
-
-
-
MP
Recently did steps #1, #3 and #5 :) As for #7: I used to stress over every food item (and latte) I bought, then at the end of each month would be amazed that I ended up spending the same amount of money for food every time. I also used to work at a restaurant where the owner tried to cut cost in every little thing (napkins, cleaning solution, hired incompetent employees for lower pay), yet the biggest problem seemed to be the location and the size of the restaurant (not many customers but very spacey dining room). She ended up closing after 2 years. Since then, I realized the importance of the fixed costs and looked for lower rent. Automatically, there was more savings and it gave me the impression of having more to spend for my food budget. Interesting enough, at the end of each month I still spent the same amount for food. This just proved to me that trying to cut on small expenses only put you in a cycle of misery.
-
Frans
While I agree that earning more absolutely is a good thing, being frugal isn't a bad thing. Bashing it the way you do makes it sound like you're just lacking the discipline for it. Earning $60000 or $200000 can still make you end up with unpaid debts and no money in the end of the month. Hell, if you had that problem at $60000 I'd say it's even likely the same problem would be there at $200000. And the example of John, earning $62000 a year and having a $8200 credit card debt is an excellent example of why we actually NEED to be more frugal. He paid it down to $6400 in TWO years. Not the whole debt in ~6 months, $1800 over two years. He might be the lamest guy ever. Absolutely, being frugal can be tough. But after a few months you just laugh at the people wasting money. :)
-
Jon
I am in total agreement with the people who say that this post is one of the most comprehensive posts on ramit's blog. It actually inspired me to write to my mailing list (who have been patiently waiting for almost a year for me to launch my website, and I haven't emailed in over 6 months). There are some important aspects that are vital when dealing in financial markets. These two quotes are just classic: "....People will continue to do something — even if it doesn’t work — instead of potentially trying something that might actually work but is novel (and therefore scary) to them....." "Are they really not “trying hard enough”? Or is there perhaps a systemic problem urging people to waste their limited cognition on near-meaningless tasks with little reward…and should we instead focus them on high-leverage areas that will result in massive payoffs?" This is 100% correct, especially trading financial products. Well phrased. MP: I found out too when trying to hire the cheapest freelancer to help program some custom indicators the importance of picking competent people and not just looking at price. Then once you determine a good price for a competent person, then you look for a means to afford it. That is one of the things that make rich people richer: they see VALUE in good quality things/services that will enhance their business process and/or quality of life, and then place their attention on how to afford that value. And to address the people on frugality. Ramit can only do so much to give out specific advice. People must tailor it to their own specific needs. But I think Ramit is more concerned about people who put the majority of their thinking into frugality, which usually backfires. When he makes a comment like this "....how to live a rich life by spending EXTRAVAGANTLY on the things you love, as long as you cut costs mercilessly on the things you don’t..." appears to focus the reader's attention on spending money on things you love (which you would value) and simultaneously be 'frugal' towards things that you don't love. I don't think he advocates spending money on shoes that you don't have; but rather pay yourself first. When you buy those shoes, it may encourage you to want to continue to afford things like that, and you are more motivated (internally with desire) to want to earn more. If you focus only on frugality, you tend to attract being poor and not having, because all you can think about is dollar cost. You usually nickel and dime yourself to death.
-
Dave, Financial Conflict Coach
Ramit, I'm always impressed by your behavioral and cultural competence with finances and money. The couple of opportunities I had working with your followers was a pleasure. You're one of the few who know how to describe what's below the line and help people see their true interests/needs and what's really important to them, rather than focus on all the trivial things.
-
Timothy Moser
This article is a big win. I'm barely out of college and only just landed my first full-time job, but thanks to Ramit's materials (summarized by this post), I feel like I'm in a better financial position than 95% of anyone out there because I know what to do with my money and how to keep earning more. Keep the awesomeness coming, Ramit!
-
Rob
Ramit, I just started following your blog and newsletter since December of 2011. Since then, I have negotiated a new job, lowered the mortgage with a refi, started two side jobs, and just naviagted a $10,000 raise after only 3 months of being hired. All in all, I recommend your book to everyone!!! Love the toga too.
-
Kathleen
I just wanted to report that I tried the "negotiating bank fees" script and it worked! I was charged two "returned check fees" of $29 because there wasn't enough money in my checking account to cover 2 withdrawals to my ING direct savings account. I called the bank and told them I normally never have issues like that and they told me, "Well, as a courtesy, we'll refund those fees, but just this time." Awesome!! I'm so glad I saw this post. In the past, I would have assumed that negotiating things like that wasn't possible. Thanks, Ramit!!!
-
financefitz
Great post. Regarding this line, "People will continue to do something — even if it doesn’t work — instead of potentially trying something that might actually work but is novel (and therefore scary) to them," I think it boils down to a few simple things - an individual's appetite for risk and return, his ability to recognize opportunity, and his execution skills. I like your aggressive stance on focusing on the "Big Wins," as it really implies focusing on the biggest returns (for the level of risk of course). For someone like me, I have a high risk tolerance and I am used to asking for the order (raise, business, etc.). For more risk averse people, it makes sense to ask for a raise, get a dream job, etc., but it takes foresight, skills, confidence and execution. Individuals have to not only recognize the abundance of opportunities presented daily, but they have to capitalize on these opportunities. Recognizing and capitalizing on opportunities is a fluid and dynamic process, it can be one of your principles. I appreciate your thoughts on the human psychology, "I want to have a rich life. I want to buy nice things." As you mention, "Nobody wants to keep a budget." But, similar to the other principles you lay out, if you cannot execute a budget or other simple tasks, it may be about sharpening your execution skills too, as there are many factors!
-
-
Steve
Ramit -- Your coursework, book and general philosophy have helped my family greatly. Thank you! My wife and I discuss conscious spending ALL of the time. We are fortysomethings, and we work smarter than we used to, thanks, in part, to you. Automated finances produce out-sized gains for us -- higher credit scores, lower mortgage payments, larger emergency funds, larger college funds, among other things. I say out-sized because the amount of energy we spend on account maintenance is tiny compared to the rewards. Personally, I used your earn 1k course to improve my current job in sales. I treat my accounts like my own side business, and the results speak for themselves -- double digit gains in sales dollars and sales volume each of the last three years! I am a trusted adviser to these business, and we all make money because we work together. In summary, your writings make a lot of sense to me, because you emphasize that you have to work for your gains -- I am willing to work SMART and HARD to get my life to where I want to go. Thanks again!
-
Matt
I negotiated my pay raise when I got a new position at work, even though I don't want to remain there much longer, might as well make more money while I'm there, neh?
-
SP
This is great advice. But... I still believe in budgeting (for myself at least). I can easily spend several hundreds a month on various things that don't make me happy if I don't pay attention. It isn't so much that I can't afford to do that, but if something isn't giving me a good value or contributing to a "rich life", then I think I'd like to not buy it! Still, there is already a lot of advice on frugality and spending within your priorities. I think some of it is good advice, but without the big wins, it's useless. There are very few people focusing on big wins - thanks for this!
-
Yvette Owo
I recently bought a car and spent 2 hours negotiating the price and finding a lower interest rate online, resulting in $3,800 of savings. The final price was the lowest any dealer in Houston, TX would take. I saved $1,900 per hour! To put it in other terms, if I earned $60,000 per hour before taxes, at a 27% tax rate it would take 178 hours or 3.5 weeks of work to earn that much money. Those 2 hours were well spent!
-
Cody Wheeler
I have to say, the "focus on big wins" concept is probably the biggest thing I took away from your book and your teachings Ramit. That, coupled with a solid spending plan has let me ease up a little bit on my tendency to be too frugal. I still get pissed when I have to pay $7.50 for a beer at a football game, but damn, who doesn't :) Looking forward to more great posts like this in the last half of 2012. Hope you didn't end up in a gutter for your birthday bash!
-
Tim Burkholder
Hey Ramit, using your free material online i was able to make over 3,000 € in 2 months and i'm only 20 years old! (Tutoring) It's amazing! I went from 10 Euros /hr to 25/hr and i just finished selling my first 6 week rapid learning language course for over 200 bucks each. I really niched down my market and i only teach students who are already fairly advanced so its always fun for me and i keep learning!! I still study at university but i think i might drop out and just continue teaching! Thank you so much! I'm able to buy fancy meals at great restaurants for my fam! They are extremly proud of me! Greets from Germany
-
Chris
Thanks Ramit. I love this. I often say that everything can be solved by prioritization, so your words ring true to me on focusing on the "big wins" and things you love over smaller minutiae. I'm going to be showing this to my kids as I teach them about money and personal finance. Will be following your blog for more of your words of wisdom.
-
erik
Hey
-
Rambabu
Ramit, impressed the way you combined Human Psychology with personal finance.
Comments are closed.
Johnny Mean
Ramit, This has been your most comprehensive post to date. It's all there in plain site. I am heading off to Asia for several months in September thanks to your IWTYTBR Blog and courses. Thanks Ramit and IWTYTBR staff. +John Mean