IWillTeachYouToBeRich - Ramit's Money Rules

Hi Reader,

Over the next few days, I want to share a whole series all about the RULES I've developed to live my own Rich Life.

You can't analyze all the facts for every decision, over and over all day long. It's too much. That's why I believe having a set of guiding principles in different parts of life — like love, money, work, and health — lets you live a Rich Life. If you pick the right RULES, then all the decisions in your life become simple, quick, and productive.

Today, I want to share my 10 money rules.

These are MY money rules. Yours will be very different from mine. In fact, the more you define your Rich Life, the more your rules will become truly individual, until they fit you like a glove.

As you read these, notice:⠀

• What surprises you? ⠀
• How do these rules reflect my values?⠀
• What are your money rules?⠀

I used to say 6 months. After COVID-19, I've upped this to 12 months, because in times of crisis, I want you to live to fight another day — and that starts with being financially secure. You can use my CEO Strategy of cutting costs, earning more, and optimizing your spending, including the word-for-word scripts from my book to save ~$1,000 with a few phone calls. 

This is my personal minimum goal. If I’m doing this, I know that I’m hitting my long-term goals, and I don’t have to worry about spending an extra $10 on appetizers. This is really important — set up a simple rule where if you hit it, you win. Then don’t agonize over the $3 expenses.

One of my mentors once told me, “We have a no-debt policy in our household.” Back then, in my early 20s, I thought: “Must be nice.”

Now, I completely agree. Again, this is my personal rule, but before I make any large purchase, I want to know that I have the ability to pay cash. That doesn’t mean I will — I almost always charge large expenses on a credit card for points/protection — but I don’t want to buy something that I can’t outright afford in cash.

There’s also a deeper reason. Here's why: For important purchases, I don't want cost to be the primary factor. I’d rather save up for longer, then buy a dream car or house or trip.

To go deeper, check out this excerpt from my appearance on the Tim Ferriss Show. Tim and I talk about our Money Dials and what it means to 10x yours.

When my wife and I ran a fundraiser, I realized how hard it is to ask friends for money. I decided then and there that if a friend ever raises money for a cause, I’ll donate more than they ask. I’ll never forget the people who donated to ours.

Same for books, health, and appetizers. Books and health are two areas I love. Appetizers might stand out to you — why that? — but it goes back to when I was a kid. We would never order appetizers because we didn’t have the extra money. Now, knowing I can go to a restaurant and order any appetizer feels amazingly extravagant … even though it’s only $10!

Used this for my 8-year-old MacBook Air, the apartment I lived in for 11 years, and my clothes.

These are the personal things that are important to me. I have no limit on spending here.

It is truly amazing to know that I can choose who I work with. And I choose to work with people I respect and like. No assholes. 

And two more...

Who you marry is one of the most important decisions you ever make — including financially. Where you live, what you spend money on … these are things you’ll talk about every day for the rest of your life.

Finally, a Rich Life is lived outside the spreadsheet. Running another Monte Carlo analysis won’t change things. At a certain point, you won the game — now get out of your chair and turn the page to the next chapter.

What about you?

What are YOUR money rules? Or if you've never thought about it, what's one money rule you might want to test living by?

Remember, those are MY rules. I’m sure yours are different. Reply to this email and let me know.

P.S. Tomorrow I'll share another rule that looks beyond wealth. Talk to you soon.