Develop The Good Habit Of Regular Investing Says Ramit Sethi
April 27, 2023
Last week, Netflix aired the first episode of Ramit Sethi’s series on How To Get Rich. Through the series, “I give people the tools to fix how they think about money. From credit card debt and buying a house to saving for retirement-even multi-level marketing-nothing is off limits,” Sethi, 40-years-old, says on his site.
Trying to save $5 by not buying a cup of espresso coffee is not going to change your financial life, Sethi writes in his blog. “But learning how to automatically invest, how to select the right asset allocation, and how to negotiate a $15,000 raise will. I believe in asking $30,000 questions, not $3 questions.”
In his blog, Sethi covers a wide range of financial issues including: 4 gift-giving tips; When To Ask For A Raise In Salary; 77 Best Businesses To Start With $10,000 Or Less; When Is The Best Time To Buy A Car; and Buying a House in Recession.
Sethi’s newsletter has 800,000 subscribers and he has more than 95,000 followers on LinkedIn. He also has a podcast and is the author of two books, including the bestseller I Will Teach You to Be Rich.
Ramit Singh Sethi was born in Sacramento, California. His father Prabhjot S. Sethi was a mechanical engineer for the California Energy Commission.
“When I was a kid, my family didn’t have a lot of money,” writes Sethi. “My mom and dad immigrated from India. My dad was an engineer and my mom (Neelam Sethi) stayed home raising 4 kids. No nanny, no private schools.”
When the family would visit relatives, his dad would pay for a room with two single beds at a motel. He would then ask for two more cots and four more towels for the family of six.
“After receiving my first scholarship in high school, I invested it in the stock market and immediately lost 50%,” writes Sethi on his LinkedIn page. So, he decided to learn about money but realized that most money advice was irrelevant.
In 2002, while studying at Stanford University, he started the site iwillteachyouhowtoberich.com. “Since I came from a middle-class family, the only way I could afford college was to pay my own way. That’s when I built a system to apply to 60+ scholarships. My hard work paid off and I earned enough to attend undergrad and grad school at Stanford.“
In 2004, he earned a BA (Information & Society) in Science, Technology & Society with a minor in Psychology; and in 2005 a Master of Arts in Sociology, both from Stanford.
In 2018, Sethi married Cassandra Alicia Campa, with a Catholic priest officiating; a separate ceremony presided by two Sikh priests was held the same day. The couple live in New York City.
Sethi’s advice for people in their 20s “is to set up an automatic investment” as soon as possible, he told CNBC. This will set them up for a bright financial future since even a small annual return, on a small recurring investment, has decades for the interest to compound and grow into a large saving. For instance, $1,000 invested annually, earning an annual 5%, totals $134,000 after 40 years.
Automatic investing in the 20’s, while your salary may be low, will instill a good habit. As you earn more money in your 30s and 40s you can add more funds to your automatic investments.
Sethi wants those in their 20s to also have fun. “One of my regrets looking back is that I didn’t have more fun,” Sethi told CNBC.
“You don’t need to be perfect to take control of your money,” notes Sethi on his blog. “It’s OK to make mistakes. Get 85% of the way there and move on with your life.”
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