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I Will Teach You To Be Rich Summary

Do you think money can buy happiness? Did you know that most people will say that money can’t make you happy? Yep, Money won’t make you happy, but everyone wants to find out for themselves. And all I ask from god is the chance to prove that money can’t make me happy. So I decided to read more books about money. And one of the books that I found very helpful is, “ I Will Teach You To Be Rich” by Ramit Sethi. He wants to teach me to be rich. How cool is that? According to Ramit, being rich is actually easy. It's like losing weight, which only requires two things: eating less and exercising more. Unless you're a professional athlete, that's all you really need to do. But instead of taking action, people love to argue about minor details like trans fats, diet pills, and Atkins vs. South Beach. They do this to avoid actually doing anything. When it comes to getting rich, the most important thing is to just get started. You don't need to be an expert, you just need to take action. And the earlier you start in life, the better. My mentor Jim Rohn used to say, "If you start early, the fortune belongs to you." Now if you are watching this video, I guess you already are thinking about getting started. So what should you do to get started? In this summary, I’ll share with you three key lessons on how we can get started.

Key Lesson #1: Use your credit cards smartly

You know there are a lot of financial gurus out there that will tell you to get rid of all your credit cards and burn them all. Like Dave Ramsy is one of them. I heard him once say, “Credit cards are worthless because no millionaires built their wealth from them.” How stupid of advice this is. Credit cards may not make you a millionaire, but there are a lot of benefits in using credit cards that you can take advantage of. But this is only true if you use them smartly. Like, credit cards can be pretty handy when you're buying something and need to pay later. Just make sure you don't carry a balance for more than a month, or else you'll end up paying a high-interest rate. But, here's the good part, if you use your credit card smartly, you can take advantage of rewards and build your credit score. And let's face it, a good credit score is pretty important when you want to buy big-ticket items like a house. For instance, let's say you're planning to buy a $500,000 house with a 30-year fixed-rate mortgage in 2023. If your credit score is less than 650, you'll end up paying a whopping $800,000 in total interest. But, if your credit score is above 750, you'll only pay $600,000 in total interest. So, by having a better credit score, you'll save a whopping $200,000 in interest alone! So, don't ignore the power of credit cards. Just remember to use them wisely and pay off your balances on time.

Key Lesson #2: Open an investment account and start investing

It’s always good to have a savings account and set some money aside. But let's be real, saving accounts don't really offer much in terms of interest rates. And if you keep all your money in there, you're missing out on some serious growth potential. To really make your money work for you, you should invest. And for that, you need to open an investment account. There are so many types of investment accounts but the most famous one is a 401(k) retirement account which is a good place to start. To set this up, you simply need to authorize a portion of your paycheck to be automatically sent from your employer to your 401(k). Then you can sit back and let your money grow. The money you put into your 401(k) is tax-deductible and grows tax-free. And if you're lucky, your employer might even throw in some matching contributions. The only downside is that you usually can't pick and choose where your money goes. That is why you should also consider opening a Roth IRA. While the money you put into it isn't tax-deductible, it still grows tax-free AND you can take it out tax-free in retirement. And the best part? You get to choose where you invest your money - which means you can put it into stocks that you actually like.

Key Lesson #3: Adopt a Conscious Spending Plan

Do you remember the last time you felt guilty about buying something but ended up buying it anyway? Well, the good news is that you can avoid that guilt in the future by learning how to spend consciously. Conscious spending means reducing the amount of money you spend on things that aren’t that important to you and instead, spending more on the things that really matter. It's super easy! All you need to do is set aside a certain amount of money each month for saving and investing, and the rest can be spent guilt-free on whatever you want. It's important to think about what's important to you and adjust your spending accordingly. For instance, I don’t really care whether I live in a big house or not. So I moved to a smaller place and now I have some money that I can use for the things that I care more about, like buying the books that I love to read. So make sure you create a plan and start spending more of your money on the things you care the most about.

So, in summary, saving and investing money doesn’t need to be complicated. You can take advantage of credit cards on your journey to wealth. Open an investment account and let your money work for you. And start a conscious spending plan and direct your spending where you want it to go.

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