Ramit Sethi’s I Will Teach You to Be Rich is essentially a personal finance book written specifically for his generation: young adults in their 20’s and early 30’s. The author claims that it’s “not just another boring, personal finance book.” Instead, it focuses on a 6-week plan to get your finances in order and set up for financial success.
Rich, of course, is to some degree a relative term, and what Sethi is referring to here is the result of long-term, predictable financial management, not necessarily the “sexy” (his term to differentiate types of wealth throughout the book) idea of wealth of temporary financial grandiosity. He stresses the importance of taking these steps while still in early adulthood.
This book is especially helpful for adults who did not take personal finance courses and/or whose parents did not discuss personal finances with their children. He uses simple and understandable terms and breaks down scary sounding finance-speak. The focus of the book is on the “big picture” of personal finance and helps readers look toward establishing long-term investments and savings, as opposed to using small savings, such as coupons, reusable household items, etc…. He shows how important it is to be making big savings, too, because mistakes or neglect there can obliterate whatever savings seemed to be made by the little savings areas like coupon-clipping.
Sethi shares a slew of resources for his readers, most of which can now be done online and also managed personally instead of by a financial manager. Some of his advice differs from other well-known personal finance gurus, but makes sense as an alternative option. (For example, his advice on credit cards would differ from someone like Dave Ramsey; Sethi proposes their frequent use to establish good credit or set up scheduled payments and explains why this is important.) Though unmarried himself, he even offers some great marriage advice as it relates to finances.
This book can be read in a brief sitting, but is written to be followed as a six-week plan for setting up personal finances. My husband and I read it in a quick-read, but plan to go back and work through the areas we see we need to focus on. As self-employed, we were thankful for his inclusion of options for self-employed wage-earners. At the same time, this was a little weak in some areas in giving advice that applied only to those employed with financial benefits. (For one, I would have benefited from further explanation on how a 401K could be beneficial to contract workers and the self-employed.)
The six-week focus is as follows, in this order: credit cards, bank accounts, investing accounts, conscious spending, automatic money flows, and investing choices.
Sethi includes a good deal of this content on his site and blog at iwillteachyoutoberich.com. However, this is helpful to have in concise and ordered form, via the book. For someone planning to go through and do each of the steps of this book, it’s probably a book that’s better to buy and add to the bookshelf instead of just borrowing and working through it as a quick read.
Table of Contents:
- Introduction: Would You Rather Be Rich or Sexy?
- Chapter One: Optimize Your Credit Cards: How to Save Hundreds Per Month (And Still Buy What You Love)
- Chapter Two: Beat the Banks: Open High-Interest, Low-Hassle Accounts and Negotiate Like and Indian
- Chapter Three: Get Ready to Invest: Open Your 401(k) and Roth IRA–even with just $50
- Chapter Four: Conscious Spending: How to Save Hundreds Per Month (And Still Buy What You Love)
- Chapter Five: Saving While Sleeping: Making Your Accounts Work Together–Automatically
- Chapter Six: The Myth of Financial Expertise: Why Professional Wine Tasters and Stock Pickers are Clueless–and how you can beat them
- Chapter Seven: Investing Isn’t Only for Rich People: Spend the Afternoon Picking a Simple Portfolio that Will Make You Rich
- Chapter Eight: Easy Maintenance: You’ve Done the Hard Work: Here’s How to Maintain (and Optimize) Your Financial Infrastructure
- Chapter Nine: A Rich Life: The Finances of Relationships, Weddings, Buying a Car, and Your First House