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Jun 16, 2019 16:31:54

i will teach you to be rich

by @swizecteller | 502 words | 🐣 | 116💌

Swizec Teller

Current day streak: 0🐣
Total posts: 116💌
Total words: 32303 (129 pages 📄)

Today's run, I finished @ramit's I Will Teach You to be Rich. Scammy title, great content 👌

A recap 👇

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Ramit's spiel is that anyone can become rich, even you, if you just focus on the right things, play the long game, and stop fretting over that $5 latte. 

Don't budget, prioritize.

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Ramit's first recommendation is to call your bank. 

Ask them to reduce your credit card interest rate, cancel any fees on your accounts, and let you be. If they complain, switch banks.

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Ramit's second recommendation is to pay down your credit card debt. Very American problem, sure, but generalize to this 👉 Avoid high interest debt like the plague.

Low interest debt is okay. Keep that for the long-term.

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Once you're out of high interest debt, it's time to start investing.

Take advantage of 401k matching. Make sure you contribute as much as the maximum match your employer gives. Leverage that shit.

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If you still have money after your 401k max match, open a Roth IRA, invest in index funds.

If you still have cash, go back to your 401k. Max that shit out.

If there's still cash, open a post-tax investment account. Invest in index funds.

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Why index funds?

Because index funds follow the market and are cheap to use. Average 8% returns, low or none management fees.

Fees on a finance advisor or a mutual fund will eat you alive. Avoid. 

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Set an investment goal. Invest the same amount each month. Best if investment money gets deducted from your salary before you even see it.

Automate that shit.

You will fall prey to your emotions and fuck it up. Automations won't.

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Then you wait 30 years and you're rich. Yay.

That was easy ... but where does all that investment money come from?

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You get money to invest by prioritizing your spending. Design Your Rich Life Ramit calls it.

Spend extravagantly on things you enjoy. Cut cost like a mofo on things you don't. By investing before you spend on accident, you ensure there's always enough.

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And by spending extravagantly on things you enjoy AFTER SAVINGS, which are automatic, you get to enjoy your life and don't even notice that you've budgeted.

👌

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Oh and stop worrying about the little things. If you're making 6 figures and you still worry about a $5 expense, something has gone terribly wrong.

Remember to enjoy your money. That's what it's there for.

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Here's a better way to spend your time: Worry about the big things.

Are you saving up for a wedding? A car? A house? Kids? Something else you know is coming?

Start a savings account for it now. Don't let expected large expenses surprise you.

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Oh and make sure you really really understand shit when making large purchases. A small change in interest rates on a house can cost you $X00,000 over 30 years. 😅

Optimize that, not your morning latte.

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And most of all, don't live life in a spreadsheet. Automate your finances, set a savings/investment rate, THEN ENJOY THE SHIT OUT OF YOUR OTHER MONEY. You've earned it.

Originally published at twitter.com

  • 1

    @swizecteller Good summary. I finally decided to get this book when the 2nd edition was recently released. He has a lot of good, practical advice for people who are struggling with managing money.

    Brandon Wilson avatar Brandon Wilson | Jun 17, 2019 07:54:02
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