Old Money Rules Are Keeping You Broke. Here's What Works Now

Let me ask you something. Have you ever felt like you're just bad with money? You're smart, you work hard, and yet you still feel broke and stressed and maybe even ashamed. A lot of people think it's their fault. You must be doing something wrong, right? Well, a lot of times you've been following broken rules. You may not be broken, but the system is. And in this video, I'm going to show you how the old rules have failed you, plus what's actually going on behind the scenes. And finally, how to take control without guilt, without complicated solutions, or even budgeting apps. Stick around because I'll share the one system that will finally give you confidence with money. Plus, I'll show you why the advice you've been given was designed to keep you playing small. Now, I know you've heard advice that goes like this: cut back on Starbucks, rent is throwing your money away, and never set foot in a restaurant. Okay, those rules were all written in a world where houses cost about 3 times your income, healthcare didn't bankrupt you, and jobs gave you pensions and raises just for showing up. But now housing is historically expensive. It has nothing to do with freaking avocado toast. Pay often does not keep up with inflation. College degrees cost tens of thousands of dollars and still don't guarantee jobs. The advice hasn't changed while the world has. No wonder you feel like you're drowning. You might be playing by rules that just don't apply anymore. We didn't just inherit bad advice; we absorbed it from as early as our childhood. Think back—have you heard any of these phrases growing up? "It's not polite to talk about money." "Money doesn't grow on trees." "Those rich people are greedy." Or my favorite one of all: "We can't afford it." These messages, or what I call invisible scripts, shape how we feel about money, even when we don't realize it. It's why someone with $100,000 in their savings account can still feel not ready to invest. It's why a raise or a bonus doesn't always change the way you feel about money. A lot of times it just still feels like you're keeping up, barely. But it doesn't stop there. Because once we grow up, the internet is waiting for us, ready to prey on every insecurity we have about money. Oh, you took a vacation to the Grand Canyon? I went to the Maldives. Oh, you have $10 in your account? I have $10 million. And when you actually try to improve your life, you start searching for random phrases. How to save money. What do you find? Buy this one stock and get rich overnight. You need to build passive income by buying 78 properties. Real estate is the only way to build generational wealth, you fucking loser. Guys, this stuff works because it feeds on your fear and confusion. And let's take an example. Your cute little pet Ollie. Ooh, Ollie, such a cute dog. And I know you don't just have one dog because Americans love to cross species. You buy a dog, a gerbil, a turtle, a snake, a freaking alligator, whatever. It never stops at one dog. Anyway, imagine that you decided to learn about dogs and you go online, you type dogs. Dogs die, leaving you guilt-ridden and crying along with your little kids who are also crying for the rest of their life. It sounds kind of depressing, doesn't it? And yet that is your relationship with money. The only stuff you read about it makes you feel horrible. These invisible scripts that we grew up with around money leave us unprepared, leave us feeling bad, and now these scammers and grifters are ready to sell us the solution, which usually involves whole life insurance. Fucking bullshit. They invent complexity around money so they can sell you some answer, and it always involves the word tax-free. Fucking tax-free. You should be happy to pay your taxes. Why would I pay 50% more to get a 10% tax deduction? You ever think about that? No, you didn't. You don't even know what a tax deduction is. And it works because you've been trained to believe that money is hard and someone else must have the secret. I mean, look, you're actually watching a video of somebody talking about money right now. God bless. At least you found the right place. Going around on YouTube is like an obstacle course of life. You make one wrong click, you end up radicalized on the right-wing manosphere. You make another wrong click, you end up a communist. Luckily you're here. We're going to talk about actual sensible ways to make money, but I want you to be aware of how many people want to prey on you. There's so many grifts out there. Once you see it for what it is, you can actually stop chasing the hacks, stop feeling guilty for not knowing better, and you can start building a real plan that works for you. So pause and ask yourself this: what is one money belief I learned as a kid that might still be influencing me? Comment it below. Yes, it actually is hard out there. And no, it's not just in your head. Our entire country is set up to take money and resources from the young and give it to the old. This is a classic gerontocracy. For example, the boomer generation climbed the ladder and then pulled it up right behind them. I'm going to show you some specific examples. Let's start with housing. Back in the '60s, people could buy a house for about 2 times their household income. By 1985, it was 3.6 times their income. That means housing was getting more expensive. Today, it's 5.3 times the median household income. Since 1960, home prices have jumped 121% after adjusting for inflation. And household income? It's only grown 29%. That gap is getting wider every year. Oh, and do you know why housing is so expensive? It's not what you think. Not BlackRock going around, some hedge fund buying up. That's The very people who got in early and bought houses have now decided to prevent more houses from being built. These are your neighbors. These are even your parents. They fight tooth and nail against any new housing development, saying it will ruin the character of their neighborhood. That's called NIMBYism. Those are NIMBYs, not in my backyard. And it's keeping you out because they have constricted the supply of housing. Oh, you want more examples of gerontocracy? I'll show you right now. Let's talk about college. College can be a fantastic use of money, but no one warned you about the price tag. In 1969, a 4-year college degree cost about $11,000 adjusted for today's dollars. Today, that same degree is $39,000. No wonder the average student borrows over $31,000 just to get a bachelor's degree. And then a degree doesn't guarantee you a job. The promise of get a degree, get a good job is not a given anymore. But let's say you do get a job. Do you think your paycheck is going to keep up? Well, since 1978, CEO pay has skyrocketed 1,085%. But your pay barely moved, only 24% up. In 1965, CEOs made 21 times what a typical worker earned. I don't mind it. CEOs should be paid well for what they do. But today, they make 290 times more. That's not a typo. It's not even close. They're not even in the same universe. These are the same people who said we're all in this together, making 290 times what you make. Translation, the people at the top are getting richer a lot faster than you ever will by working harder. I don't mind people becoming wealthy or even incredibly wealthy. I have had the fortune of doing that through good luck, hard work, and creating something that the world wants. But I don't think guys like me should get a freaking tax advantage. Why? I don't need it. I don't need tax cuts. I want social services and more resources for the poor and middle class. Oh, and it's not just pay that's rigged. They're coming after your retirement too. In 1975, if you had a job with a retirement plan, chances are it was a pension. 88% of private sector workers were covered by a pension plan. Your parents probably had one. That meant employers would take care of you in retirement. You worked, they paid. Pretty simple agreement. Today, pensions are essentially extinct. Companies ditched pensions and handed you a 401k, basically saying, this is now your responsibility. Now, I also do not mind companies Giving employees some amount of responsibility for their retirement, that's okay. But let's look at the broader picture. Social Security, not safe either. In the hands of the Republican administration, they have repeatedly floated that Social Security is now at risk. We already know with recent passing of bills, Medicaid has been cut. There are dramatic cuts here and coming for the poor, the middle class, and even the elderly. If you are younger, by the way, you're going to be paying into a system that likely gives you even less. So while older generations cash their full checks, younger people are often left holding the bag, paying into a system that's giving them less and less, and has structurally been set up to make it nearly impossible for you to ever buy a house. And just when you think it can't get worse, there's taxes. With Trump's One Big Beautiful Bill Act, the richest Americans are getting a massive payday. I'm looking at myself right now. I do not need a tax cut. I don't need it. I would rather have that money go to helping poor kids eat and helping people be able to afford healthcare. Let me show you some numbers. The top 1% saves over $75,000 a year. The top 0.1%, the people who don't even notice a $100,000 charge on their Amex, they save more than $286,000 per year. They save a lot more than that. And you, if you earn under $34,600 a year, your cut is about $150. That's not even a tax cut, it's an insult. It's actually infuriating. The worst part is you've been told it's your fault, and a lot of you actually believe it. You've been told you're not working hard enough, that you should stop buying lattes, or that kids these days just want everything handed to them. Enough! The game has been rigged against young people, against people who are poor and middle class, against people of color. I want you to understand, yes, we can simultaneously call for systemic reform as well as take personal responsibility. Once you can see how the game is rigged, and I've just scratched the surface today, then you can stop only blaming yourself. You can stop following broken advice that's designed to keep you small, and you can start playing a different game, one where you take control and build your rich life on your terms. When you realize the whole system is stacked against you, one of the worst things you can do is sit frozen, buried in spreadsheets, and tell yourself you'll figure it out later. That is playing defense. Instead, you need tools that give you leverage and help you play offense. That's where today's sponsor Gamma comes in. You might have seen Gamma before, but they just took things to another level with their new Gamma Agent and Gamma API. Gamma Agent is like having a designer, writer, and researcher working for you on demand. You give it a simple idea, and in minutes, you've got a polished document that makes you look like a pro. And here's where this matters for you. Most people obsess over these defensive, tiny moves like saving money on coffee while ignoring the big offensive wins. Gamma is a tool that helps you go after the big wins. You want to ask for a raise? Stop staring at a blank page. Use Gamma Agent to create a professional presentation that shows your results and why you deserve more. Or are you starting a side hustle like my dream business idea, Ramit's 60 Days to Habanero, which unfortunately nobody will ever pay for? In 60 seconds, you've got a pitch deck to test your idea instead of wasting months fiddling around with logos. And if you're leading a team at work, use Gamma API to automatically generate reports and updates so you spend your time on strategy, not formatting slides. Over 50 million people use Gamma today, making it the most popular AI presentation app in the world. So if you want to start operating like a pro, go to gamma.app or click the link in the description to try Gamma today. All right, let's get back to money, specifically the emotional side of money next. Why do you feel anxious about money? I'm going to make a suggestion here because money is not just math. Money is deeply emotional. For example, I've coached couples worth millions who who still fight over target expenses. I've seen people making six figures who still feel guilty every time they eat out at lunch. I'm talking Chipotle level. I've met people who track every penny in multiple apps and they still feel broke. That's not a math problem. An extra $100,000 is not going to change the way they feel. That is an emotional struggle. It's the stories you tell yourself when you look at your bank account. It's the fact that you even look at your bank account on your phone. Why do you even have the app on your phone? It's the guilt you feel after a night out. It's the silence at the dinner table because you and your partner don't talk about money, or if you do, you fight. And here's the truth. No app or spreadsheet is going to fix your relationship with money. Hey, tech nerds, I'm talking to you. You go, yeah, we have this problem in my relationship. I know what I'll do. I'll create an even more Byzantine spreadsheet. This one's going to have 37 tabs. Hey babe, make sure you click on this tab and then do a cross-reference over here, and then we'll combine the two, and then we'll use our CRM to make sure we've cross-validated all the data. That's not the right solution. Just to ask you bluntly, has it worked? No, it never works. So why don't you do it my way? You can track every coffee, you can track every Amazon order. But if deep down you believe you are bad with money, it doesn't matter how much you have. If you don't fix that relationship with money, if you don't improve it, if you don't see money as a source of aspiration, adventure, possibility, even generosity, you're going to stay stuck. So the question is, what happens next? You can either shrink your life to fit some arbitrary budget, or you can build a system that expands your life to a rich life vision. I don't know about you. I never wanted to play defense. I never wanted to have to make decisions solely because of money. So let's flip this game and start playing offense. Why are you guys stuck playing defense with your money? People playing defense always think, okay, I need to track every dollar. I need to be more disciplined. I need to get in control. I got to tell you, you don't build a rich life by obsessing over $3 questions. Yes, defense is important. You need insurance, you need to diversify your portfolio, but offense is where the real money is made. Let me explain. Playing defense is how we are mostly taught about money. Track every penny, monitor every category, and feel guilty when you spend on anything because spending is bad and saving is good. That's basically what we're taught in America. But what happens if you live this way? You stay small. You start to believe that the only way ahead to cut, cut, cut. You focus on saving $5 on coffee. You feel guilty once in a while if you splurge for dessert, but you ignore the opportunity to make $15,000 at work. It's hard to see big opportunities when you're playing defense. But what if you played offense instead? Playing offense means focusing on the big wins that can actually dramatically move the needle. Negotiating a $15,000 or $20,000 raise. Starting a side business that brings in $1,000 a month. Investing consistently. Understanding asset allocation, and letting compound interest do the heavy lifting over time. Let me tell you a story. Sophie is a classic example of someone stuck on defense. She skipped vacations for years and years, almost a decade. She meticulously saved every penny, and she proudly told herself, I'm being responsible. And after a decade of sacrifice, she saved $12,000, which is impressive. But here's what she never did. She never asked for a raise. In those 10 years, she could have negotiated her salary and earned tens of thousands. Over the course of 30 years, hundreds of thousands of dollars more. Nope, didn't do it. She was so focused on playing small, she didn't realize she was losing big. And this is what happens when you focus on clipping coupons and turning off light bulbs. You feel like you are winning tiny battles, but you're actually losing the entire war. To put it bluntly, I didn't become wealthy by saving money on coffee. I became wealthy by thinking about the key big wins in life and going after them aggressively. That's offense. Offense is where real wealth is built. That's where you stop feeling guilty about spending and you start directing your money towards a life you actually want. So if defense means obsessing over pennies and not really getting anywhere, what does playing offense actually look like? It starts with having a system. We are not looking at individual transactions every single week, day, even month. We're not doing that. We have an overall system. We know about where our money is going to go, and we set it up to happen automatically. A system lets you enjoy your guilt-free spending because you already know that your essentials are already handled. Now, I call this a conscious spending plan. It's not a budget. Budgets are restrictive. Budgets are backwards-looking. Budgets make you feel bad because of the complexity and the lack of information they actually give you. But a conscious spending plan is the opposite. The conscious spending plan is forward-looking. It's a simple system that ensures your money goes to the things you love while ruthlessly cutting out the things you don't. Here's how it works. When your paycheck comes in, it's automatically divided into 4 categories. Fixed costs like rent, bills, groceries, investments like a 401k, Roth IRA, savings like an emergency fund or big goals for a huge vacation. And finally, guilt-free spending, which is the fun stuff. That's right, you heard it here. A money guy actually talking about you being able to spend on the things you love. Yes, you can go and buy a burger and you're not gonna roast in hell for all of eternity. Yes, you can take a trip. Yes, you can even buy new pants. Guilt-free spending is structurally 1 out of 4 categories on my conscious spending plan, which you can download for free below. This is money you get to spend however you want. Eating out, shopping, travel. Nails, self-care, whatever, no guilt. Because when the rest of your financial system is set up and running in the background, you'll actually find that you can spend more on the things you love. That's offense. That is part of living a rich life. Once you set this up, it takes less than 1 hour per month to manage. You're not checking in every day. You're not agonizing over a $20 Amazon order. Your system is working in the background while you focus on living your rich life. No budgeting apps, no spreadsheets with 80 categories and 10 tabs. I know I just lost 30% of my viewers 'cause the FIRE community said, no, Ramit, don't take away my spreadsheet. I need 65,000 cells to make sure I'm on top of all my— no, you don't. This is just a plan that works. And if you want to get started with your own conscious spending plan, you could download it for free. I put it together. Click the link below. Once you experience what it's like to have a system that actually feels good for you to live your rich life, you're never going to go back to obsessing over pennies again. So what is all of this for? Why are we building systems to automate and invest? Why are we talking about thinking bigger? I got to tell you, it's not to sit at home looking at spreadsheets. Shut your freaking computer off and go outside and live your rich life. Now, I want to tell you, a lot of people, when they think about a rich life, they picture yachts and private jets. If that's what you want, amazing. If you can afford it and you love it, I'll show you how to do it. But that's not really what I'm talking about for most people. A rich life for most people might mean taking a random Tuesday off to take your kids to school or take them to lunch or take your dog for 3 walks. It might mean flying business class once a year to visit your family. It might mean deciding in your head, I'm always going to tip 30% minimum. These are small, vivid moments that could be part of your rich life. You decide what your rich life is. Nobody else does. And here's the part nobody tells you. You don't accidentally stumble into a rich life. You build it intentionally. So here's what I want you to do today. Pick one thing you've been telling yourself is too indulgent. Maybe it's upgrading your coffee order from small to large. And whatever it is, I want you to try it. I want you to practice doing it guilt-free. And tell me in the comments what you chose. I love seeing examples of what your rich life moment looks like. Once you get a taste of this, might be as modest as $5, $10, you will realize you don't need permission to live your rich life. You just need a plan. And that's what this whole video has been about. Building a system that lets you turn up the dial on the things you love while everything else fades into the background. So what does your rich life look like? And when are you going to start living it? If you're ready to stop feeling stuck and actually start winning with your money, watch this next. I'll show you exactly what to do based on your income.