Book Review “I Will Teach you to Be Rich” by Ramit Sethi: Frontload the Work and Relax

This book is great for young professionals that want power over their finances. Ramit is a smart bachelor whose mission is to maximize his utility and manage his limited willpower. I’ve put his systems into action and I’ve saved thousands. We also agree on how to eat chicken wings.

I read this in college after hearing Ramit on the Art of Charm (back when it was pickup podcast, RIP). After 2 years in the oilfield, I know this book laid a solid foundation. Last month I put his negotiation tactics to work while shopping for car insurance and got a 30% reduction by switching to Allstate. His tactics paid for the book 20 times over. Besides that he makes financial literacy interesting and has a biting dry wit.

ramit-cut-the-shit

Ramit sets 6 weeks to put in his systems. By the end all of your finances will be automated. Your credit card, online savings and investment accounts will be connected. They will all be low-fee, high-interest, and minimal maintenance. The last section is about saving for weddings, negotiating for cars, and creating a rich life for yourself.

automation-overview

These are the habits I gained and recommend doing:

  • Mint: Probably the best thing I have learned from reading this back in college was getting a Mint account. I have had it for 4 years now and have an awesome data set. I spent the other day running through what I’ve spent over the past 4 years on alcohol, bars, groceries, amazon shopping, and even income.
  • Get rid of all subscriptions: Magazines, cable, Netflix, and linkedin. They are soul sucking. If you want them, buy a la carte.
  • Craigslist: I find its great to buy/sell used items.  I have sold bikes, shoes, furniture and TV’s.
  • Investing: Automation, putting money away for an index fund. It’s like tinder dating for your money. Keep working hard and learning at your job so you deserve the raises that will come your way, and you can invest those. Nothing feels quite like making money while you sleep.

Ramit has a large collection of articles and courses. I almost pulled the trigger on Dream Job but I decided to implement his free stuff first before I moved on to the premium services. This is an entertaining book and I plan on giving it to my nephews and cousins when they are in college.

For 2 great interviews of Ramit:

http://theartofcharm.com/podcast-episodes/ramit-sethi-will-teach-you-to-be-rich/

http://theartofcharm.com/podcast-episodes/episode-172-ramit-sethi-iwillteachyoutoberich-com-dream-job/

For another good book review of IWTTBR. Look to Mr Money Mustache’s Book Review.  He calls the title into question, “At best, it should be called I Will Teach You to Stay Out Of Trouble”. MMM is more of a stoic frugalist. Ramit is more of a measured hedonist.

Ramit’s main message is to set up the financial system so you CAN live a rich life. Whatever that means to you.

Buy the book here

 

Advertisements

How I paid for my vacation to San Miguel de Tucuman, Argentina

Studying abroad in Tucuman, Argentina was a turning point in my life. Now at 23 I want to return to see friends I made when I was 16. When I got my job in the Oil Field I made sure that my first vacation would be back to Red Clay Courts of Tucuman.

I come from a middle class family who believed in hard work and the promise of education. Through college I worked odd jobs and saved money.

In sophomore year I listened to a podcast from Ramit Sethi, and promptly bought his book, I Will Teach You to Be Rich. A crazy title I know, but that ostentatiously titled book laid out the basics of money management.

All together the 18 day trip cost me $2400. When I got back my bank account wasn’t empty and there was no money hangover in the form of payments to credit card companies. This journey taught me how to save and be frugal; habits that will stick with me for the rest of my life.

Argentine Asado.
Argentine Asado.

1) The biggest strategy was Automatic bank withdrawal into a high yield online savings account with Capital One 360. $50 to $150 withdrawn without me having to move a muscle. Slowly building up money for 24 months, this was how I bought my ticket straight up.

Open an account now
2) Bring stuff to sell there. This was something I researched before going down. In Argentina Iphones are highly prized due to import restrictions and high tariffs. Labtops, ipads, and anything Mac related will sell for high prices. I took down skateboards to sell to my friends for a steep discount and in exchange for staying at his place.

The Country where an Iphone cost $3,500
3) Learn how to cook. I began with Mexican food. Its a lot of cleanup so I wouldn’t recommend it for beginners. I would recommend grilling a whole chicken.

 

4) Got on Mint and started tracking all my spending. I used to spend irrationally at the grocery store. I used to have a full refrigerator. Now I buy for 1 week, and use up everything. I have cans of soup for when food gets low, but I enjoy being creative with meals.
5) Buy a bike. I use it all the time being close to the grocery store, and gym. I save money on gas and repairs for my car.
6) Follow Personal Finance Bloggers. Ramit Sethi helped me negotiate my rent down 15% using his scripts in my emails. I ended up saving $800 from 1 email.
7) Take care of the stuff I own, I like to keep the stuff I have equal. If I buy something like a new shirt I have to either give a dress shirt away or throw it out. I clean the shoes I own and now they last 50% longer than before. Learn how to wash certain things. Jeans don’t need to be washed that much, and when you do, make sure to flip them out. When my phone screen cracked, I learned how to repair it online and bought a kit to do it. Now I have repaired it twice.

iphone-5s-repair-kit-complete-screen-lcd-glass-touch-panel-tools-black
8) Bring cash. The official rate is 9 pesos. Dollar Blue is 13 pesos. Bring $100 bills only. Go to where the banks are and people outside will trade with you. Listen to the word, “Cambio”. It means change in Spanish.

IMG_2920
9) Get a Skymiles credit card. Got into the lounge area for $30. I had food, drinks, Wifi, and a shower. Yeah it was worth $30 to pass 5 hours in the Atlanta airport. If I could do it over again I would have opened up the card 2 years ago. You can ask for a limit increase every 6 months. Right now my limit is only $1000. And tickets to Argentina are between 1,300-2,000 roundtrip. This is to save up miles for my next trip to Tucuman.