The Money Advice Politicians Push (That Costs You Thousands)

You know, and I know that politicians have been lying to you about money for decades, and you are probably losing thousands of dollars because you believe these lies. Things like buying a house is the American dream. It's always better than renting. And hey, loser, you need to pull yourself up by your bootstraps. I have spent 20+ years studying how people handle money. You may have seen me on Netflix or my bestselling book that sold over a million copies. Today I'm breaking down the 5 biggest money lies that politicians keep repeating and how they are costing you money. Let's start with one that's been going around for decades. The amount of men making $45,000 a year who bend over backwards to lick the boot of billionaires in my comments is truly unbelievable. Many of them struggle to pay gas, and yet they insist, don't raise taxes. On billionaires, they will leave New York. Are you out of your fucking mind? I live in New York and LA. If you raise my taxes a percentage point on the marginal amount, I'm not leaving the cities that I love. That is exactly how wealthy people think. There's a myth created by the ultra wealthy, and a lot of you believe it, that if you raise taxes a tiny amount on the ultra wealthy, they will simply pack up and leave. Hey, everybody, if that's true, why aren't the most billionaires in Wyoming? Have you ever stopped to think about why they tend to live in New York City, LA, San Francisco? Because the ultra-wealthy and wealthy can choose where they want to live. And in fact, the wealthy like to be around places with a lot of things to do, with a lot of educated people that they can hire for their businesses, and frankly, a lot of restaurants and places that they can enjoy. This myth that if you raise taxes on the wealthy, they will simply pack up and go is also not proven by the data. There's an excellent book called The Myth of Millionaire Tax Flight, and it shows conclusively that wealthy and ultra-wealthy people move way less than middle class and poor people. Do you know why? Because middle class and poor people move for jobs and they tend to be younger. Wealthy and ultra-wealthy people tend to be older. They have community roots. They also probably have a business, and they're not trying to move because they're paying an extra $55,000 in taxes per year. Beneath all of these angry men on TikTok posting how you shouldn't tax the wealthy is a deep belief in trickle-down economics. The idea that if we give the wealthy all these tax benefits, then that wealth will trickle down to me. Well, I'm wealthy, and I'm going to tell you right now, if you give me a tax cut, I am not going to hire a single person in my business. That is not how it works. No CEO hires people because their taxes got cut. CEOs only hire people for one reason: more demand. So you can give me tax cuts. You can cut my taxes by 90%. You know what I'm gonna do with that money? Save it. Invest it, perhaps, but not hire people. That is a myth created by the ultra-wealthy so they get more and more tax cuts. You can look at the data to see this. Go back to our fucking devil in America, Ronald Reagan, who started cutting taxes on the wealthiest people in America. Do you think those jobs trickle down? Do you think the wealth trickle down? No, that's not how it works. In fact, in America's strongest period of growth, the marginal tax rates were over 50, 60, 70 plus percent. It is surprisingly easy to rile up Americans against increasing taxes for the wealthy. Even though those very taxes would likely help the middle class and poor with public transportation, with social services, with all kinds of benefits like feeding poor children at public elementary schools. But you know what? If you can keep the American public angry, then they will simply be distracted at what is really going on. And if we look at the difference in wealth accumulation for the middle class and for the wealthy and ultra-wealthy over the last few decades, you can simply see it is as plain as day. The ultra-wealthy have taken a disproportionate amount of wealth while everybody else has been left just trying to get by. Now, you can keep people angry, you can keep them distracted, because if they actually looked at what was going on and how the wealthy and ultra-wealthy have truly rigged the game in their own favor, there would be a revolution. If you have grown up religious and you heard certain things like God will provide over and over from your family, from your church, from the people at school, then you start to believe it. You actually don't even question it. Imagine the same thing happening, but with money. The idea that the ultra-wealthy are some sort of almost omniscient people in our society, because if they're wealthy, surely they must deserve it. And me, even though I'm not wealthy, in fact, I'm struggling just to pay for my Arco gas. Well, I'm just a temporarily embarrassed millionaire. Free me of the shackles that prevent my success, and I too will join them in nirvana. That's basically how American culture works, when in reality the game has been rigged to take the wealth that is created in America and disproportionately advantage the wealthy. I actually don't mind if you become wealthy or ultra wealthy. I want that to happen. I have become wealthy in part through hard work, through a lot of sacrifice, but also through a lot of luck. I grew up in a country with two educated parents where it was safe, where I could go and know that if I pay my taxes, nobody's going to come and steal our house. Those things, we got to admit them. What I do want is a more fair playing board. I want you to know that if you lose a job for two months, you are not going to lose your house. You're not going to be destitute. That maybe, just maybe, in the wealthiest country in the world, we have a social safety net that makes life just a little easier. What actually creates jobs is a strong middle class, a strong middle class that can afford to spend their money. And this is critical because when the middle class makes money, they tend to spend it. They need to use that money to live. That creates jobs because there's more demand for sheets and towels and vacations and all kinds of things that a strong American middle class creates. We've had a strong middle class in America, and in fact, believe it or not, our middle class has actually become wealthier. So that's the reason that there are so many long lines at Disneyland and all these lounges. These Amex lounges have lines out the door. That's because what used to be elite is now accessible to a lot more people because they make a lot more money. But even though that is true, the ultra-wealthy have taken even bigger amounts of the wealth created in this country. And you know who that leaves behind? The poor. We're talking about people who are single parents. We're talking about people who may be taking care of an ailing parent. We're talking about children who grew up orphans or grew up without a stable household. And for them, what I'm asking is simply to raise the floor just a little bit. I'm not trying to hand out $1 billion to everybody. I'm simply saying if you are a poor child who cannot afford to eat. Perhaps our public schools in the wealthiest country in the world could provide food for you. If it costs the wealthiest people in America a marginal amount, good, good. They should enjoy the privilege of being able to provide for a strong middle class, which actually makes their lives even better. You can take action right now with your own money. The first thing you can do is look at where your money is going. You have to remember, 50% of people don't even know their own household income. They certainly do not know their 4 key numbers: fixed costs, savings, investments, and guilt-free spending. They pretty much spend whatever's in front of them. You can be the exception. Know your numbers. Set aside an amount. I recommend 5 to 10% of take-home pay for investments and the same amount for savings. Now, if you're immediately going, hey, Ramit Sethi, that's impossible, I could barely afford gas, then make it 2%. If you can't afford that, make it 1%. But you've got to set the money up automatically because one way or another you're going get older, you might as well have accumulated a lot more money. Next, on a longer scale, you can start to actually look critically at who you vote for. I vote for progressive candidates who specifically are willing to tax the rich and provide social services. I look specifically for candidates who are YIMBYs, meaning they want to build more housing—yes, in my backyard—and they openly state they're willing to tax the rich. Remember, I'm going to be the one who gets taxed more. Guys like me can afford it. I want the middle class and poor people in America to be able to have food, healthcare, transportation that works for them, making their life just a little bit easier. The first lie tells you to wait for money to trickle down. Hey, where's my money, rich people? I've been waiting since Ronald Reagan. Anybody? Anybody? The next one tells you to lock up your own money for 30 years and call it the best investment of your life. The American dream that has been sold to you is that you must buy a single-family home, ideally in the suburbs. And if you don't, you're a fucking loser. Well, I'd like to invite you to take a look at a different type of American dream. For some people like me, homeownership is not the dream that I have right now. I could go and buy a house in cash today. I choose not to. I rent because I enjoy the flexibility I enjoy being able to text a landlord and say, hey, the AC screen stopped working. Can you send somebody? Sure, send somebody tonight. And finally, I actually have made more money renting than I would have owning for the last 20 years. And that includes renting in cities like San Francisco, LA, and New York. In America, we treat the biggest financial decision of our lives, buying a house, like a kid treats chicken fingers. Mmm, delicious. There's literally no downside or ramifications to this. Mmm. That's not how the biggest purchase of your life works. The vast majority of people in America have never run a buy versus rent calculation. They don't even know what I'm talking about. They have never understood that you're ideally supposed to keep your total housing cost below 28% of your gross income. What the fuck is this guy talking about? These are just numbers. They literally go into this huge purchase going, buy a house, wait, become rich. They don't understand any of the math behind it, and I would like to share some of it with you. When you buy a house, let's just assume you put down 20%, which is a lot of money. If you took a $60,000 down payment and instead of buying the house you just kept renting and you invested that $60,000 down payment, just let it sit over 40 years, that would turn into nearly $900,000. $500,000. As another example, if you buy a $500,000 house, it's going to cost you over a million dollars once you factor in interest. And most of you are not factoring in any of those other phantom costs, including taxes, which go up. You're not factoring in maintenance. You're not factoring in opportunity costs of investing that down payment. And finally, you're not factoring in transaction costs, like how much it costs to buy and sell. Now, when I talk about these things, especially when I tell you that I have made way more money, millions more renting than I would have buying, people get very angry because in America our number one religion is homeownership. So they will always say the same things to me. Yeah, Ramit Sethi, but rent keeps going up. But when you own a house, you lock in your payment. Oh, really? Okay. You lock in your mortgage, but your payment is not locked in. TCO, total cost of ownership, goes up. Once you think about maintenance, once you think about property taxes and all kinds of other phantom costs that you are not factoring in. The next thing they say is renting is throwing money away, but at least I'm building equity. Okay, let's talk about it. What is equity? Where do I get it? I've put money into my house. How do I get it out? Oh, I have to sell it, which means I have to incur massive transaction costs. Oh, and then in order to get the equity, I have to go somewhere. So because housing has also gotten more expensive in my area, I have to move out of the city that I love where I have roots, and I have to somehow go and buy another house. Where's the money? And here's the most startling example of all. Let's say you buy a house today, and as you know, when you pay your mortgage, some of it goes to interest and some of it goes to principal where you build equity. How many years do you think it's going to take for you to pay more towards principal than it is to pay towards interest? The answer is not 1 or 2 years. Here's the shocking truth: for the next 20 years, you are going to be paying more towards interest than principal. What does that mean? It means that all those people who say, "I'd rather not throw money away on rent," you might as well more realistically say, "I'd rather not throw money away on interest." You build very little equity for the first 15 to 20 years of your house. Most people don't even stay in their house that long. So what are you talking about? Now, I am not saying that buying a house is the wrong decision. In fact, at some point, I'm sure my wife and I will buy a house. What I am saying is that if you do not run the numbers on the biggest purchase of your life, then you're a fool. Because simply letting mom and dad and society nudge you into making this decision without even thinking about what you you want is crazy. How many people do I know who tell me, my number one goal with money is financial freedom, and then they spend 140% of their net worth on a 30-year mortgage, geographically locking them down in one place so they cannot move to get a better career, change their school district, or anything like that? That's not financial freedom. It might actually be the opposite. Again, I want you to think carefully. What is my rich life? Do I want to buy a house? Great. Why? Mm. That's what everybody does. Why? Well, I'd like to become wealthy. Okay. Is that the only way to become wealthy? What are the other options? What if I took that money and invested in low-cost index funds? What if I started a business? What if I bought a house? We need to factor all of these things in. Do not become myopic. About what your life has to be. You get to choose what your rich life is. Society does not get to tell you. Homeownership is not just something that your parents tell you about. It is actually officially encouraged by the government. Homeownership in America is highly subsidized. We have things like 30-year fixed mortgages, which are not the case in other countries. So there is a structural incentive for you to buy a house. Now, back in the day, there was this kind of idea of, hey, we'd like to create strong community roots. Shoots. But over time, that is not what happens. Now, the fact is that today the real estate industry is one of the biggest industries in America. In fact, look at the amount that the real estate industry spends on lobbying. It is huge. Do you know where all this money is being made? It's from you. I need you to stop thinking that paying rent is somehow you losing, because if you actually understood that if you buy a house you have to commit massive amounts of cash up front plus huge amounts of money that goes to interest for 20 years, you might start thinking twice. But until you learn this stuff, you're just going to be repeating the same old phrase: "I'm throwing money away on rent." Look at me. I have paid over $1 million in rent and I am thrilled about it. When I paid, it meant that I did not have to worry about anything in my apartment, it meant that I could take the extra money because it would have cost way more to own than to rent. And I invested it, making me more money. Do you even know if it's cheaper for you to rent or buy in your own neighborhood? The vast majority of people do not know. Let me tell you why. Most people simply believe that buying is better and renting is bad. It's as simple as that. That is the childlike approach that they take to the biggest financial purchase of their lives. So when people say like, hey, if it's $1,000 to rent and $1,000 to buy, I'd rather buy and build equity. I want you to think about two different answers to that. First, it is more expensive to own than to rent in 100% of the top 50 US metro cities right now. Your rent is the maximum you will pay. Your mortgage is the minimum you will pay. So important for you to start thinking about these numbers in a deeper way. One of the reasons that I am so open about renting is that I want to destigmatize it. Because after all, if a guy like me who's written all these books on money and can afford it chooses to rent, maybe renting is not just for losers who made mistakes in their life. I don't think renting is for people who are losers. I think that we should all carefully choose what is part of our rich life. And for some people, they want to own. Maybe they have children and they want a certain type of stability or location. Maybe they just love to decorate, or maybe they just want to do it. Amazing. All I ask is that they think deeply and run the numbers. But for other people, for a lot of people, if you probe them, they don't even really want to own. They've simply been told this over and over, and they feel like a part of them is missing, that they are a loser. Never feel like a loser. Because you rent, even if you can't afford it. Prices are historically high right now. It's not your fault that a bunch of old nimbies have prevented housing from being built. Instead, go on offense. Rent eyes wide open, knowing that it would cost you more to own. And so instead of paying that, you're going to take some of the money that you are saving and invest it aggressively. Give yourself the gift of being wide-eyed and conscious of what is going on in the housing market and invest aggressively so that at some point you have more options for your rich life. There are ways to use money to actually be more secure. And real security is about protecting your time, your energy, and your personal information online, which is why I personally use Delete.me, today's sponsor. Delete.me is a hands-free subscription service that goes out and removes your personal information from hundreds of data broker and people search sites. These are the sites that profit off of your data, and DeleteMe keeps monitoring them over time. I actually bought DeleteMe for my parents as well, because I know parents tend to be even more vulnerable to their information being sold online. And DeleteMe is the best in the business. They've been the leading expert in personally identifiable information removal for over 15 years, and they were recently named by Wirecutter as the number one data removal service. When I log into my DeleteMe dashboard, I can literally see the reports, like which sites had my info, what they found, phone, address, relatives, and confirmation that it's been removed. That is time and energy I don't have to spend playing whack-a-mole with these shady websites. So if you want to take control of your digital footprint without turning it into a major project, Go to joindelete.me.com/ramit and use code Ramit at checkout for 20% off a plan for you or your entire family. You can also click the link in the description below. Buying a house can trap your money inside your walls. But the next lie is even worse because it scares people away from one of the easiest ways to build wealth. Buying stocks is for the rich. One of the ideas in money that drives me insane is this idea that investing is only for rich people. People think investing is like going to the Kentucky Derby. Oh, I got to buy a $5,000 outfit, one of these big hats that doesn't even look good. No, it's much more like going to Safeway and buying lettuce. Everybody can invest in the stock market. The barrier to entry is almost zero. It is basically free. To invest in the stock market and you can build huge amounts of wealth. Has anyone ever talked to you like this? I bet not. In fact, the most common advice parents give their kids is we can't afford it. They almost never teach their children about investing. How could they? They don't even understand it themselves. But you can. You are watching this video. You have an obligation to learn how investing works. And I'm going to break it down for you right now. Investing is not gambling. A lot of people, typically uneducated about investing, will say, well, it just feels like gambling to me. In their head, they think that investing is somehow magically picking these individual stocks and then you become rich and they don't have the skills to do that. So they go, I can't do that. That's gambling. Sophisticated investors do not pick individual stocks. Do you know how I pick investments? I have a bunch of index funds. They are set up to automatically buy every single month. I barely ever log in. If I was hit by a car, my investments would keep going. If I took a 3-month vacation, my investments would keep going. And that's it. It's boring. It's not entertaining. I don't watch TV talking about stocks. It's fucking boring and dumb. In fact, when you read Chapter 6 of my book, I Will Teach You to Be Rich, you will learn that even highly compensated investing professionals fail to beat the market about 80% of the time. Guess what? You can go and buy the market. It's basically free. You can get a Vanguard, Fidelity, or Schwab index fund and you can beat all these New York fancy portfolio managers. Another thing that people have a misconception about is, oh, I don't know if it's the right time to buy. It seems expensive right now. My— the guy who drove me in an Uber told me that stocks are crazy right now. What the fuck is wrong with you? Why are you listening to an Uber driver tell you about Nvidia? You need to focus on not timing the market, but rather time in the market. That means you just buy every single month automatically. Oh, and if you're going, I don't have $5,000 a month, then make it $500. If you don't have $500, make it $100 or even $50. These are amounts of money you will not miss, but they turn into serious wealth over time. Finally, it can even be simpler than you think. One of my favorite types of investments is something called a target date fund. You literally pick the year that you are going to retire. What year are you going to be 65? Let's just say it's 2050. Great. There's a Vanguard 2050 fund. You go and get it. All you got to do is set it up to draw from your bank account every single month. It automatically handles diversification. It handles becoming more conservative over time. It handles all this stuff. It's so simple. It's basically like deciding, hey, every Friday I'm going to order the same chicken bowl from Chipotle., and I'm actually going to have it automatically set up to do it over and over. Except in this case, it's going to make you over $1 million. Real investing, guys, is not entertaining. It's fucking boring. Look at my face. Get in tight on this. That's me investing. Do I look like I have a single ounce of joy in my life looking at my Vanguard? Look, look again. That's my revulsion at you. You who's going on these stupid WallStreetBets, dumb Twitter account guys who only post when they win and then the minute they lose, they close their account. I'm revolted at you, actually. I never thought that I would get to the point where on my own YouTube videos I would be looking at you. I see you right now. I could see through this camera and just going, I'm disgusted. Disgusted because of how you think about investing. But fortunately, I actually want to help you. So let's look at some freaking math. If you invest $500 a month just from age 25 to 65, you're going to have about $1.2 million. And yes, I already factored inflation in. Do not leave a comment that says, "How much is it going to be worth then?" That's the amount, okay, in today's purchasing power. If you invested the same amount, but instead of starting at 25, you started at 35, you would only have $585,000. In other words, waiting 10 years cost you about $650,000. Now, I know that a lot of people go, hey, I don't want to wait until I'm 65 to have $1 million, $2 million, $5 million. I want some money now. Good. Me too. I want you to live a rich life today and a richer life tomorrow. But when I ask those people, okay, what's your alternative? They go, oh, I don't know. Maybe I'll just buy some shitcoins. No, that's not how it works. What you can do if you want to have more money now and even more later is you can increase your income. I talk about that in many of my videos. You can start a business. You can cut your expenses and redirect some of that to investments. What you can't do is simply go, "Hey, I don't want to be 70 and have $3 million." Okay, then what's your alternative? You need a plan now. In other words, do not fall prey to these misconceptions about investing. It's really easy to invest. It's not hard. But if you don't know how, here's the simple truth. You have probably never bought even a single book about personal finance. Not one. Get my book or get it from the library. I don't care. But you've got to get educated on this just the same way you got educated about how to speak English. Money is another language, and I want you to learn it. Politicians are pretty smart in what they share with the general public. They don't really go out to the general public and talk about stocks because, you know, for the good old boys, that's not really going to resonate. Personally, I'm not really of the mindset that I want to pander to people at their lowest base desires. I would actually rather Set the bar and bring everybody up with me. So when it comes to investing, what they will typically talk about is affordability and middle-class Americans, which is great. I support the middle class. That's my entire political philosophy. But we need to acknowledge that a lot of Americans invest. In fact, most Americans do because they have investments through something like a 401. So actually investing is a very powerful tool that everybody has access to. But when politicians talk about investing, it can seem unrelatable. I'm less concerned about that. I'm more concerned about you. I want you to know that you have control over your financial life. And by opening up a free account at some of these discount brokerages, you can actually start putting money aside, which turns into a huge amount over the long term. If somebody said to me, "I don't trust Wall Street," I would give them a high five. I would say, "Yeah, me either." But what does that have to do with you as an individual investor? If you are specifically choosing low-cost, long-term investments, you're actually giving a big middle finger to Wall Street because Wall Street doesn't want you to buy index funds. They want you to buy these larded up bullshit investments like whole life insurance and these expensive mutual funds. They want you to pay 1.25% AUM to a financial advisor. The thing they want least is for you to have a really simple, automatic portfolio of low-cost index funds that just grows because you're basically paying them nothing. It can be extremely dark when I talk to couples on my podcast who have never calculated how much money they are going to have at retirement. Many of these people have worked their whole lives. They have worried and agonized about money. But they never actually learned how money works. And they realize very grimly that the income they're going to get is something like $35,000 or $45,000 a year. And there's a moment where you can see it on their face. They're terrified. And they realize that there is no easy way out. And that is a moment of realization that I want you to see, because I don't want you to be 56 years old and wondering how much you're going to have and realizing, oh my God, all those vacations, all those trucks I bought, the house that I bought without ever running any numbers. Maybe I should have. By the time you get close to retirement, it is very difficult to change your financial situation. That's why a lot of people use these morbid phrases like, I'm just going to work till I die. I don't like that. You might say it as a half joke, but it's not funny. There are a lot of people as they get older, they cannot do that. There are a lot of people who end up having to take care of other sick family members who cannot just work. So I want you to take this seriously. In fact, I want you to respect money the same way that you respect the loved ones in your life, the same way maybe you respect your body by going to the gym. I want you to treat money with respect, which means you need to learn how it works and you need to start investing now and aggressively. So far you've heard lies about taxes and housing and the stock market, but the next two are much more personal. These are lies that you've heard many times that have almost certainly made you feel guilty, like something is wrong with you. And I actually think these might be the ones costing you the most. But first, you might be starting to realize something uncomfortable as you watch this. Nobody ever taught you how money actually works. You were told buy a house. You were told investing is risky. You were told just work harder and you've got to cut back on everything. Money is not meant to be spent. Cut back on lattes. And then somehow you were expected to, what, magically build wealth? Or maybe not even that. Maybe just you're not meant to be wealthy. You're just like one of us. This is exactly why I created Money Coaching. Inside Money Coaching, my team and I are going to help you stop guessing, stop relying on these outdated scripts that somebody fed you, and instead build a money system for you. You'll get coaching, you'll get step-by-step playbooks. That you can implement right now today, and you'll get accountability. We'll show you how to pay off your debt, how to invest, how to build your rich life. Imagine logging in and knowing exactly what your next money move is. You don't have to swipe through a bunch of TikToks. You don't have to have a million spreadsheets, and you don't have to wait to figure this out later. Go to iwt.com/moneycoaching. Click the link in the description, or you can scan the QR code, and you can join Money Coaching Now let's talk about one of the most damaging money lies ever created. In America, we have a very deep belief, which is if you work hard, you will be successful. Do you think that is a good belief or a bad belief? I think in general it's a pretty good belief. I like working hard. My parents, immigrants from India, taught us to work hard. My mom took us to the public library every Saturday for hours. We learned how to read. We learned how to do math for hours. I believe in hard work. It has really paid off for me. But even though we grew up middle class, when I went to college, I learned there is a whole different way of thinking that other successful people embody. And it was never taught to me as somebody who grew up middle class. Because if you grow up poor or middle class in America, the idea is as simple as just work hard. That's it. Oh, struggling to pay the bills? Work more. Struggling to pay the bills even more? Work on weekends, work on nights, get a second job. Just keep working. And I hear this from a lot of men in particular who were raised poor. They will basically say, look, I don't care about me. I don't care about what it does to my body. I'm here to provide for my family. I'm just going to work, put my head down and grind. And that works for a while until it stops working. And a lot of people are now discovering there is a limit to how much they can work. Hard work is good. But hard work alone does not necessarily mean you get paid more. All of us have experienced the idea that you worked hard and somebody who you work with who doesn't even work as hard got a promotion. Why? Because there's a whole game being played around us that many of us do not even realize. And that is the game of strategy. Not just how hard should I work, but what things should I be going after to give me a successful life? I'll give you an example. You could work an extra 2 hours a day. It would probably be very tiring over time. It might ruin your body, but you could do it. Or you could learn the skill of negotiating your salary. Not applicable to everybody, but applicable to millions and millions of people who have not done it. And just take a look at these numbers. A $5,000 raise in your 20s, fully invested each year, is worth over $1 million in 40 years. Or you could switch jobs. That can be worth a 10 to 20% increase. Keep in mind that 1 or 2% increase doesn't even keep up with inflation. You could build skills by going to your boss and saying, hey, I know that the next level for me is Project Manager 2. Can you tell me exactly what skills I need to build in order to get that promotion? Because I want it. Or you could build a side income. You could start taking something that you are already good at and start charging people $20 an hour, $30, $50 an hour. I've helped tens of thousands of people do this and make a ton of money. My point is just working hard may not be enough, and there is a whole different way of looking at success that might require you to change the way you think. You know who benefits from this type of thinking? The people who are wealthy and ultra-wealthy and employing you. Because if you think about class consciousness, a lot of people who who have entry-level jobs or are working in the middle-class level, they don't realize the power that they actually have. I'll give you an example. I spoke to a guy who lived in a rural area, and as part of his job, he had to pick up residents from some type of housing thing and drive them around. And I noticed that his personal gas expenditure was really high. I'm like, man, you spend a lot of money on gas. Where are you driving? He said, oh, for work, I have to pick these people up and drop them off. And when I suggested to him that he should ask them to not only cover his gas, probably get the vehicle and give it to him as a work vehicle. It just didn't really compute for him. If you have been raised in a geographical area or in a culture where the people at the top are the ones who dictate everything and they have the power and you're just lucky to have a job, then a lot of this video is like I'm speaking Martian to you. But if you were exposed to different types of jobs, to different types of ideas, then you might realize that you actually have a lot of power as well. And that is what I am doing in all of my work. I am trying to share some of these lessons that we might not all have been lucky enough to grow up with. Even I was not lucky enough to grow up with all these things. I encountered them along the way and I want to share them with you so that you don't look at some of these wealthy and ultra-wealthy people and put them on this omniscient pedestal. No, you have power and you should seize that power as well. If you're worried that you're not good at negotiating, let me put your fears at ease. You are horrible at negotiating, okay? You suck at it. You were never taught it. In fact, in America, there's a culture against negotiating. It makes us so uncomfortable. Guess what? I'm not uncomfortable with negotiating because it's a skill and you can learn it. And it is critical that you learn how to negotiate because for a few key areas in life, it can be worth hundreds of thousands of dollars to you. You know, I remember once seeing my sister and she was feeding her son, my nephew, and I think he was like 4 years old. He goes, "Mommy, it's spicy." She had given him some peppers. And you know what she said? She goes, "Yeah, drink your water. It's spicy. Water will help." And I was like, "Oh my God." That's how kids learn to eat spicy food. How do you think I freaking pop habaneros for fun? It's not that I'm genetically blessed. It's that we learned culturally spicy food is part of our palate. We're going to eat it. And if it's spicy, drink your water. Oh, you're not good at negotiating? Oh, it's okay. You don't need to do it again. Be comfortable. No, negotiating is important. You are going to practice. You are going to learn that skill because it can be worth hundreds of thousands of dollars to you. The final myth tells you you should never, ever buy coffee. And this drives me nuts. Before we get to this last one, you got to hit subscribe because every week I break down the money advice that actually works. Not the guilt, not the slogans that have been repeated to you for 50 years, but actual new ways of looking at your money and getting ahead. Subscribe right now so you don't miss the next one. And now the lie that you have probably heard more than any other: you just need to cut back. You poor bastard. Why on earth did you think you could afford those pickles? Never buy pickles. In fact, pickles are for rich people and you're not rich. So next time you're outside, you take a cucumber off a tree, you put it in the freezer, and that turns into a pickle and you never have to buy pickles again. I mean, how many people basically grew up with that kind of advice? Only hearing, "We can't afford it," and, "Oh, you're only behind because you have so much avocado toast." Cancel Netflix and above all, stop it with those fancy lattes. I mean, is anyone sick of this shit? I heard this stuff in 2004 when I started my blog. A bunch of old people, usually old men, looking down and lecturing people like me, telling me all the things I couldn't do with my money. I'm like, who the fuck are you telling me what I can't do with my money? I want to go out. I want Taco Tuesday. I want to take trips with my friends. Let me. Just show me how to live that kind of life. But most of them only preach deprivation and restriction. That's not the kind of life I want. In fact, I want to live a rich life. So let's first just look at the math. If you skipped a $5 coffee every day over the course of an entire year, you're saving about $1,800 a year. Meanwhile, housing costs are historically high. Health care is more expensive. Wages, particularly for middle class and poor, have not kept up. But the advice has stayed the same. You are stupid and you need to stop spending money on frivolous things. The very same people who give this advice don't even keep it themselves. I know a lot of the people in the personal finance world. Most of them do not keep a budget. Most of them do not cut back on coffee because that is not how they actually built wealth. I also think that nobody wants to be lectured to. One of the reasons that I love my job is that I ask people, what is your rich life? And I really listen. If they tell me, "Well, you know, I kind of like clothes," I go, "Cool. What brands? What do you love? If you could buy anything, what would it be?" And I let them dream. And then we get to the numbers and I show them, "Hey, if you really want this beautiful cashmere coat, let me show you how you can get it." In America, we have this idea that, "Oh, I shouldn't spend it. I'm so bad. Oh, so bad. Ramit, you're so bad." And then we do it anyway. We got to stop that. You're not a child and stop asking to be treated like one. If you want to spend money on something you love, even a lot of money, fantastic. If you want to spend money on Japanese scissors for no reason other than you admire their beauty and they are incredibly sharp, great. But you've got to be the one who decides, this is part of my rich life, and now I'm going to figure out how to use my money to live it. That is what I teach in my work, specifically my book I Will Teach You to Be Rich. We are trained to focus on $3 questions when we really should be focusing on $30,000 questions like, what am I paying for my investment fees? When am I going to be debt-free? How much am I going to have at retirement? What if I could add an extra $100 or $200 a month to my investments? How much would that be worth 25 years from now? We don't think like that. If you get the 3 to 5 big wins in life right, you never have to worry about, can I afford this? Slice of pizza. These money lies keep you focused on playing small while the big money moves get ignored. So if you want to know how to actually build real wealth, watch this next.