This little trick will give you the lifestyle of your dreams.
Let me guess: you would like to be rich.
But you are not.
You are tired of trying to save, month after month, without any results, while still depriving yourself of enjoying the money you work so hard to make.
You follow all the saving tips you read online and think twice before spending money on anything. You cut on your lattes, your meals, your trips, your clothes, and your subscriptions. You do this because you want to save enough to have a more comfortable life in the future.
But you are tired of it. Now. Because you are not getting any instant gratification from your money. You are postponing everything for when you will be rich.
But what if there was a way to enjoy the rich lifestyle while still saving?
What Does It Look Like To Be Rich?
Imagine yourself being rich. You have done this plenty of times, right? But now imagine it in more detail.
What are you doing in your vision? Where are you? Who are you with? What are you wearing? What kind of car do you drive? How does your apartment look like? What is your job? What do you do for fun?
Author Chris Guillebeau mentions that, as a kid, this was his definition of being rich.
“At some point, I remember thinking: One day I want to have enough money that I can eat at McDonald’s any time I want”.
Being rich does not mean having unlimited money. It means having enough money for the things that matter to you. For some people, what matters is to buy haute-couture clothes, to others, it’s to drive a sports car, travel every month, go out for fine dining every week, or having smart appliances at home. Whatever it is, it’s ok. Nobody gets to decide that for you — you love what you love, and everything is allowed.
You want to be rich. But the first step to getting there is to define what that looks like to you.
Find Your Non-Negotiable
I like Bruce Springsteen. I once spent a ridiculous amount of money on a ticket to his show in Paris. Another time I flew from the UK to Portugal just to see him at a music festival. I didn’t regret it one bit.
Yet, I feel incredible guilt every time I buy a new pair of jeans. Why? Because clothes are irrelevant to me. While Bruce Springsteen is very much relevant.
“To make sure you’re really being conscious about your spending, you need to spend on the things you love — while ignoring everything else.”
— Ramit Sethi
Ramit Sethi wants to teach us all to be rich. For that, he developed an approach called “conscious spending”. One of its core ideas is that you should define your non-negotiable(s) area(s) for spending and allow yourself to indulge there. Only there. While cutting on everything else.
The truth is that most of us don’t care that much about several aspects of our lives. It’s all the same to us whether we own 3 pairs of jeans or 30. Even when we have 30, we always wear the same 3 anyway.
Is it really important for you to drive a fast car? Or you don’t care that much, as long as it takes you to the places you want to go? Maybe you prefer to go to the restaurant, regardless of how you get there. Or maybe you like to stay at home, but enjoy high-quality homemade meals with the best organic ingredients. Or maybe nutrition is important to you, and you want to hire a personal advisor in that area. And maybe you will be happy if you eat healthily, all while driving a cheap, broken-down car.
This means that you have room to cut. But if you cut on all areas of your life, waiting to accumulate enough savings to reach a comfortable lifestyle, years will pass before you consider yourself rich. You will waste a good part of your life for a future that might not even happen.
But, if you save on everything that is unimportant to you while giving yourself the freedom to spend on what you love, guilt-free, you will still accumulate long-term wealth and, at the same time, enjoy your life in the present moment.
Ramit Sethi gives the example of his friend who loves shoes and spends $5,000/year on high-end shoes. What sounds ridiculous or unattainable for most people, is feasible for this lady. How?
As Sethi mentions, “she’s ruthless about cutting out the things she doesn’t care about. That means avoiding new tech gadgets, gym memberships, or eating out. She also lives in a tiny room in a small apartment because she doesn’t care about having a fancy place”.
You don’t have to cut on everything. You need to cut on everything BUT the one thing that makes you happy.
How To Implement This Mindset
Firstly, identify you are non-negotiable. It’s not hard. It’s the one thing that makes you tick. The one thing you can’t shut up about. The one thing that gets you excited every time you do it. You probably know what it is already.
Now, take your net income every month and deduct all your mandatory outgoings. This means your rent, monthly bills, any debt payments, or anything that you can not absolutely cut. What remains after this should cover your non-essential expenses for the month.
According to Ramit Sethi, take around 20–30% of that parcel and direct it to your non-negotiable. Feel free to spend it all — that is the point! That you can do it without any second thoughts or any feelings of guilt.
You can now experience what it feels like to be rich. Every month! You are rich, in your own terms.
“Wealth is the ability to fully experience life.”
— Henry David Thoreau