Daily News Portal

Following This Ramit Sethi Advice Could Change Your Financial Life


A young businessperson does paperwork in coffee shop and checks their phone.

Image source: Getty Images

Consider following this Ramit Sethi advice to rethink how you manage your money.


Key points

  • Many people manage money by focusing on cutting small expenses, but Ramit Sethi doesn’t believe this is the best approach.
  • He urges looking for a few big wins rather than asking $3 questions.
  • It’s more important to worry about debt payoff, salary negotiations, and savings than paying for coffee, dessert, or a rideshare service.

It can be hard to figure out the best way to manage your money. And, unfortunately, some people may end up focusing on the wrong things entirely.

In fact, personal finance expert Ramit Sethi recently warned that many people end up “wasting decades” because they take an approach that doesn’t really work out well in the end.

Sethi warns against making one crucial error and suggests that a shift in mindset could make all the difference in how much money you end up with. Here’s what he advises.

Ramit Sethi warns against getting hung up on small details

On Twitter, Sethi addressed one of the biggest mistakes he’s seen people make when it comes to financial decisions.

“I think people spend way too much time agonizing over small money decisions and not nearly enough time on big decisions,” he said. “Small $3 questions: Coffee, dessert, price of an Uber.”

By contrast, they don’t focus enough on what he calls the “$30,000+ questions,” which he lists as “buying vs. renting, debt payoff, negotiating salary, savings rate, asset allocation.”

As Sethi explains, it is these bigger decisions that will have a more important effect on how much money you end up with. But there ends up being a lot of pressure to focus on the little stuff instead. “Everything in our culture pressures us to narrow our focus,” he warned.

Rather than obsessing about whether to spend a few dollars here and there, Sethi suggests focusing “on 5-6 big wins.”

Is Ramit Sethi right?

Sethi’s advice is exactly what many people need to hear, and it can change your life if you take his words to heart.

The reality is, frugality can only take you so far and you cannot become rich just by reducing your spending alone. Of course you don’t want to live above your means or spend every dollar that you earn. But if you are wasting your time and energy looking for ways to cut a few pennies from your budget, you’re likely to get too bogged down in details that aren’t going to make a lot of difference in the end.

If you manage to cut a few hundred dollars from your budget each year — while stripping all of the fun out of your life — it’ll be hard to sustain those savings. And getting rich will be a long and difficult slog since there simply isn’t enough “wasted” money in many people’s discretionary spending to make a meaningful difference. But if you focus on big issues that could potentially give you tens of thousands of dollars more to save, it’ll be a lot easier to build wealth in a sustainable way.

Sethi’s suggestions for the things you should focus on can give you a good starting place to put this practice into action. Making the right decisions about your housing costs and your job can have a huge impact on your financial life, as can being smart about what you do with the assets in your brokerage account.

By shifting your attention to these big picture issues — and trying to otherwise find ways to focus on the big wins — you will be setting yourself on a path to success.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2024

If you’re using the wrong credit or debit card, it could be costing you serious money. Our expert loves this top pick, which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee. 

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and apply in just 2 minutes. 

Read our free review



Read More:Following This Ramit Sethi Advice Could Change Your Financial Life