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Yahoo
5 days ago
- Business
- Yahoo
Stop Doing These 13 Things If You Want To Get Rich, According to Ramit Sethi
People often think that getting rich is as simple as doing the 'right' things: getting a good job, working hard and building your savings. While there's nothing wrong with any of those things, you can do them all and still not end up rich. At least, that's what financial influencer Ramit Sethi argued in a recent YouTube video. Find Out: Read Next: Sethi outlined 13 common pitfalls that may be holding you back from achieving your financial goals. See if any apply to you. Not Questioning Your Financial Mindset Your perspective on money is shaped by your culture, your parents, your friends, social media and many other sources. Often, Sethi argued, we don't question the money messages we receive: 'We quietly believe it.' But just because an idea is pervasive doesn't mean it's correct or valuable to you. You can shift your perspective on money to one that better aligns with your goals and priorities. Sethi did exactly that. Check Out: Avoiding Budgeting There's a misconception that 'budgeting means restriction.' The way Sethi sees it, budgeting is about 'spending guilt-free on the things you love while automatically saving and investing for your future.' That kind of reframing can make budgeting much more positive and impactful in your life. Surrounding Yourself With the Wrong People People say 'you're the average of the five people you spend the most time with,' and there's some truth to that. Sethi pointed out that the financial attitudes and practices of those around you will begin to seem normal and influence your own behavior. Try to surround yourself with people who make smart financial decisions you want to emulate. Not Having Enough Curiosity When Sethi used to pass restaurants he couldn't afford to eat in, he reframed his thinking to be curious about what those restaurant patrons were doing to afford to eat there. He asked himself, 'What can I learn from that?' Being curious and always willing to learn more will set you up for success in your financial journey. Being Overly Cautious Sethi argued that 'a lot of people use caution to seem smarter than they are.' While thinking your actions through is a good thing, you can't let fear stop you from making the right moves. Listening to the Wrong Advice There's tons of financial advice out there. Everyone has some idea of what you should do to get rich, but those ideas don't all have merit. Sethi's recommendation is to take financial advice from someone only if you would trade places with that person, financially speaking. If you don't want their life, don't listen to their advice. Not Talking About Money With Your Romantic Partner People often avoid talking about money because it's awkward, even in a committed romantic relationship. However, that mistake can hinder your financial goals, according to Sethi. You have to be proactive and on the same page. Sethi suggested setting up a monthly money date with your partner. Feeling Like You Have No Control Sethi said he hears a common complaint all the time: 'How can anyone get ahead? The system is rigged.' Sethi acknowledged that systemic problems, such as housing, do hold people back, but he also encouraged his viewers to take personal responsibility for the decisions they can make to improve their financial lives. Focusing on Frugality Over Bringing More Money In While cutting your spending will leave you with more money to save or invest, so will increasing your income. Sethi argued that there's an overemphasis on being frugal when strengthening your skills and increasing your salary would often be more impactful. Relying on Credit Card Debt The average credit card carries an interest rate of 23%. Such high interest rates make credit card debt extremely expensive, yet nearly half of U.S. households carry this debt. 'Every time you put something on a credit card you cannot afford today, you are actually stealing from your future self,' Sethi said. His recommendation is to avoid purchasing anything with a credit card that you could not pay for in full today. Cutting Every Single Expense On the other hand, cutting all of your expenses at once can boost your savings, but it may ultimately leave you feeling unsatisfied. Sethi clarified that he doesn't 'have anything against cutting unnecessary expenses.' Just make sure your budgeting and expense-cutting actually support your happiness and long-term goals. Spending Too Much on Your Vehicle In 2025, the average new car costs $49,740 in the United States. If you take out a loan, that's hundreds of dollars on your car payment every month. Sethi recommended looking at the total cost of ownership for a vehicle and not buying more car than you can afford. Not Understanding the Cost of Home Ownership 'Sometimes buying [a home] can be a great financial decision — other times, not so good,' according to Sethi. Make sure you run the numbers and understand how much house you can afford before making a purchase. Don't shy away from renting if it makes more sense in your situation. More From GOBankingRates 5 Old Navy Items Retirees Need To Buy Ahead of Fall Clever Ways To Save Money That Actually Work in 2025 This article originally appeared on Stop Doing These 13 Things If You Want To Get Rich, According to Ramit Sethi
Yahoo
15-06-2025
- Automotive
- Yahoo
Financial Influencer Vincent Chan Says No One Is Talking About These 5 Wealth Killers
Vincent Chan is a popular financial influencer with 746,000 subscribers and counting on YouTube. Recently, he published a video called 'The 5.5 Wealth Killers No One Talks About.' Discover More: Find Out: In his video, he shared several purchases and decisions that could be preventing people from building wealth. He also offered strategies and tips for making big purchases, like houses and cars. Viewers who watch his video or read the advice below should leave with a solid understanding of how to make big life decisions and purchases that can impact them for a lifetime. Cars have become incredibly expensive to own. In fact, the average new car payment is now $745 per month, according to Q3 2024 data from Transunion. As Chan pointed out, cars also significantly depreciate in value. He explains that in just the first year, new cars lose 20% of their value. There are some tactics consumers can use to purchase a car the smart way. Chan advised following what he calls the 20/4/10 rule, which is to make a 20% down payment for four years. Additionally, he said car expenses should not exceed 10% of a person's monthly income. Consumers should also consider buying used to avoid the initial depreciation new cars experience, and to avoid rolling negative equity into a new loan. Read Next: While no one wants to think about divorce, it's a good idea for people to understand early on that their choice in a partner affects their long-term wealth-building goals. People should consider signing a prenuptial agreement before getting married to protect any assets they have before getting married. Divorces cost, on average, just under $20,000 per couple, according to data cited by Self. That, combined with a loss of assets, can be a big wealth killer. According to Federal Reserve data, the average credit card interest rate as of Q4 2024 was over 21.47%. This high interest rate can make it incredibly difficult for consumers to get out of debt and have enough cash flow to invest. One tactic to eliminate high interest debt is to consolidate it. Consumers can apply for a balance transfer card that has a 0% introductory APR for a set term. This can help them to pay down the principle much faster. Alternatively, consumers can apply for a personal loan with a lower interest rate, and use funds from the personal loan to pay off their credit card debt. Houses are supposed to be the American dream, but many people don't realize just how expensive homeownership can be. A 2024 Harvard University report claimed the number of households that were 'cost-burdened' — meaning their housing costs made up more than 30% of their income — grew by 3 million between 2019 and 2022 to a whopping 19.7 million. That means that for millions of people, their home is unaffordable and prevents them from building wealth. Although many financial experts agree that owning a home is a worthwhile investment, it's not worthwhile if owning it negatively affects someone's quality of life. In order to avoid this wealth killer, Chan said to run the numbers before buying a home. Potential homebuyers should wait until they can fulfill what Chan calls the 28/36/20 rule, which means people shouldn't put more than 28% of their monthly income towards housing. Then, they should make sure all their debt payments combined are less than 36% of their income. Finally, Chan recommended people save 20% for a down payment. At the end of the video, Chan reminded his viewers that procrastination is also a wealth killer. Every time people delay saving or investing, they lose out on potential growth in the future. The earlier someone starts investing, the better, thanks to the wonders of compound interest. Chan reminded his viewers that they can start small and automate their investments to make progress easier. More From GOBankingRates 8 Common Mistakes Retirees Make With Their Social Security Checks This article originally appeared on Financial Influencer Vincent Chan Says No One Is Talking About These 5 Wealth Killers Sign in to access your portfolio
Yahoo
17-05-2025
- Business
- Yahoo
Grant Cardone Made 2 Mistakes That Curbed His Wealth Building — Find Out How To Avoid Them
Grant Cardone is a successful businessman and financial influencer known for his bold real estate investing strategies. His stated approach often involves taking risks and pushing the boundaries of conventional business wisdom. Be Aware: Up Next: When writing about his real estate business in the '90s, Cardone pinpointed two specific strategies he now considers to have been missteps. Here's what they were and how you can apply the knowledge to your own business. The first mistake Cardone says he made was being too cautious in his expansion. He believes that he held back, and that pushing his business to expand at an accelerated rate would have led him to greater growth. There are advantages to quick, large-scale business growth. Expanding allows companies to capture significant market share while outpacing competitors, potentially securing a dominant position in the industry. Companies with larger growth can better capitalize on emerging markets and leverage their size to achieve better negotiation terms with suppliers and partners. Consider This: Aggressive growth through debt can lead to big returns in the real estate market, but it also comes with the risk of losing everything during a market crash. This approach can be risky, as seen in the collapse of Lehman Brothers, which was heavily leveraged and ultimately unable to sustain its debt load during the financial crisis. In real estate, leveraging means buying homes on credit by using borrowed funds to cover a portion of the property's purchase price, typically through mortgages or other loans. Overleveraging happens when the level of debt taken on is disproportionate to the investor's ability to pay it back through the income generated by the property or other financial means. For example, if an investor is using income from one property to pay mortgages on another, he can lose both if he is no longer able to rent out units and does not have enough income to cover loan payments. If the property's rental income is insufficient to cover the mortgage payments, taxes, maintenance and other operational costs, the investor faces a cash flow shortfall. This situation can become unsustainable, especially if multiple properties are involved. If the loans are tied to variable interest rates, there's a risk that rising rates will increase the debt service costs unexpectedly. This can make monthly payments suddenly unaffordable. Cardone says that his goals were often too realistic, which he believes capped his potential for achieving greater success. He argues that investors and businesses should set goals that are 10 times higher than what they think they can achieve. This is the premise of his popular '10X Rule.' Setting high targets can indeed be a catalyst for innovation and lead to significant business breakthroughs. According to the MIT Sloan Management Review, ambitious goals can push businesses to rethink their strategies and operations, leading to inventive solutions and substantial advancements in their field. Leaders who set high aspirations may be able to inspire their teams to greater efforts and achievement, fostering an environment where creativity and performance thrive. Cardone's real estate strategy encourages aspiring entrepreneurs and investors to venture beyond their comfort zones, suggesting that significant rewards often require taking risks. If you're looking to emulate Cardone's success, it's important to develop a good understanding of market dynamics and how to avoid risks and pitfalls. Make sure to keep a keen eye on your financials and have plans in place for potential downturns. More From GOBankingRates Surprising Items People Are Stocking Up On Before Tariff Pains Hit: Is It Smart? 8 Common Mistakes Retirees Make With Their Social Security Checks 5 Little-Known Ways to Make Summer Travel More Affordable These Cars May Seem Expensive, but They Rarely Need Repairs This article originally appeared on Grant Cardone Made 2 Mistakes That Curbed His Wealth Building — Find Out How To Avoid Them
