The concept of “being rich” is often misunderstood. It focuses solely on accumulating wealth rather than creating a life of purpose and fulfillment.
In this article, I’ll share my personal journey with wealth, help you define what “rich” means, and provide actionable steps to achieve your financial goals.
Why I Wanted to Be Rich
When I first started thinking about wealth, my goals were simple and, admittedly, a bit shallow. I wanted the fancy cars, the expensive watches, and the ability to buy whatever caught my eye without a second thought. But as I grew older and wiser, my perspective on my Rich Life and what it means to be “rich” evolved dramatically.
I realized that true wealth isn’t about having a certain amount in your bank account. It’s about freedom, choice, and the ability to live life on your terms. That epiphany crystallized into one goal: I never wanted to make a bad decision because of money.
Imagine staying at a job you hate because you’re trapped by car payments or a mortgage. Or not being able to help a family member because you’re living paycheck to paycheck. These scenarios became my motivation to not just accumulate wealth but to use it as a tool to create the life I truly wanted.
How I developed my Rich Goals
As I refined my goals, they became clearer and more meaningful:
- Give my parents a retirement where they don’t have to work if they don’t want to
- Enjoy a comfortable, sometimes indulgent lifestyle (I have a weakness for fine pens)
- Make career decisions based on passion and purpose, not financial necessity
- Stay connected with friends by seeing them in person often, no matter where they are in the world
These goals aren’t just about money. They’re about relationships, freedom, and personal fulfillment. And that’s the kind of richness I want to help others achieve.
Defining "Rich" for Yourself
So, let me ask you: Why do you want to be rich? Take a moment to think about it.
Is it about:
- Having more time to spend with your kids as they grow up?
- The freedom to travel the world without worrying about your bank balance?
- Starting that business you’ve always dreamed of?
- Being able to support causes you’re passionate about?
- Or simply having the peace of mind that comes with financial security?
There’s no right or wrong answer here. Your definition of “rich” should be as unique as you are. It’s not about hitting an arbitrary number in your bank account. It’s about creating a life that matches your values and aspirations.
For some, being rich might mean having a modest home fully paid off and the ability to retire comfortably at 55. For others, it could be running a successful business that allows them to work from anywhere in the world. The key is to get specific about what wealth means to you.
Why planning your Rich Life matters
The key is to get specific about what wealth means to you. However, this process can be challenging, especially when you’re part of a couple with different perspectives on money and lifestyle.
Balance is crucial when building your Rich Life, and it’s equally important not to let existing money scripts make you overly cautious. To illustrate this, let’s look at a real-life example from my podcast.
Meet Noor and Jibran. They’re in their early 30s, earning $250,000 in a low-cost-of-living area—a situation many would consider comfortable. Yet, they struggle with defining and living their rich lives. Noor dreams of taking vacations and spending on conveniences to make their busy lives easier. Jibran, influenced by his experiences growing up with less, prefers to save and do everything himself.
[00:04:55] Noor: I would disagree. I think that we have put travel in the back burner since we’ve been together since 2016.
[00:05:03] Ramit: Why is that?
[00:05:04] Noor: Before we had kids, he started an event service company. It was mostly on the weekends when we would travel, and he would see money lost. When he started the company, he was a worker of the company rather than a business owner, which I understand, but he wouldn’t want to turn it off for a weekend or for a week for us to go anywhere because he’s like, oh, then I’ll lose $1,500. I’ll lose $1,000 or whatever.
[00:05:31] Ramit: Did you say exactly those words?
[00:05:33] Jibran: Something akin to that. Yeah. It’s like, if I’m not there working yet– in the beginning, when you start a business, you’re working it. So something similar to that.
[00:05:43] Ramit: Okay, so you went a few years without traveling. If there were no young children, do you think you would have traveled?
[00:05:49] Noor: Well, when we didn’t have young children, he had his event service company. That was his child. So we didn’t travel before that.
[00:05:57] Jibran: Yeah. So it was the business, and then we got married in COVID and had kids. So there was just the stack up of excuses, if you will.
We see the tension between frugality and quality of life. Despite significant savings from childcare, Noor feels restricted in spending on conveniences that could ease their daily stress. Jibran’s long-term focus, while admirable, leaves Noor questioning the purpose of their current sacrifices.
[00:08:46] Noor: We had two kids. I work from home, so we were able to keep them home from childcare for 10 months for each of them. And I calculated. It saved almost $30,000 between the two kids, but yet we still can’t DoorDash or get cleaners. And I’m like, ah. Parenting, working, sometimes I just want life to be easier. I want to sit down and watch Netflix. I want to have somebody else deep clean the house, things like that.
[00:09:12] Ramit: Yeah.
[00:09:12] Noor: Whereas he does not lose stamina and is so laser focused on the long-term goal, which I don’t even know what that is because he doesn’t want to retire early. He loves working. So I’m like, what are we doing this for?
[Narration]
[00:09:26] Ramit: We’ll be right back. Now back to the show.
[Interview]
[00:09:30] Ramit: Jibran, are you a machine?
[00:09:33] Jibran: At times.
[00:09:34] Ramit: You remind me of me.
[00:09:35] Jibran: At times, yeah.
[00:09:36] Ramit: I can just work through it. What’s the problem? I’ll just grind it out.
[00:09:39] Jibran: Do it, yeah.
[00:09:40] Ramit: Okay, all right.
[00:10:23] Noor: And also he didn’t feel it because he was still working from our house. His life wasn’t interrupted or as tiring as mine.
[00:10:31] Ramit: Because of childcare?
[00:10:32] Noor: Yeah. And nursing throughout the night and then signing on at night to work. He was scrolling and I was writing reports.
[00:10:39] Ramit: You said we can’t order DoorDash. Can you?
[00:10:45] Noor: I think so, but I think it’s hard for me to do something without– and maybe that’s a me thing– feeling like he’s like, yeah, let’s do it.
[00:10:54] Ramit: You could open up your phone, click the Thai thing. What would happen if you did that?
[00:11:00] Noor: I think I’d feel guilty if he wasn’t on board, even for something that’s 40 bucks. I don’t know.
Noor and Jibran’s story illustrates the challenges of aligning different financial perspectives within a relationship. It highlights the importance of open communication about financial goals and the need to balance long-term savings with present-day quality of life.
True wealth isn’t just about accumulating savings—it’s about intentionally allocating your resources to create the life you truly want, both now and in the future. This balance between saving for tomorrow and enjoying life today is at the core of what I call a Rich Life. But how do you achieve this balance?
The Conscious Spending Plan
The gap between our current lives and where we want to be often lies in how much we can enjoy guilt-free spending. You might already be closer to your ideal “rich” life than you think, or you may still have some work to do. However, using my Conscious Spending Plan (CSP) is the quickest way to find out.
The CSP isn’t about restricting your spending or following a rigid budget. It’s about positioning your spending alongside your values and goals. Here’s how I would usually break down a CSP:
- Fixed Costs (50-60%): These are your essential expenses like rent/mortgage, utilities, and groceries.
- Investments (10%): This includes retirement savings and other long-term investments.
- Savings (5-10%): Set aside for short to medium-term goals like vacations or a down payment on a house.
- Guilt-free Spending (20-35%): This is money you can spend on anything you want, guilt-free.
The beauty of the CSP is its flexibility. If you value experiences over things, you might allocate more to your guilt-free spending category for travel. If financial security is your priority, you might bump up your investments and savings percentages.
By consciously deciding where your money goes, you’re taking control of your financial life and actively working towards your personal definition of “rich.”
Finding Your Invisible Money Scripts
Even with a solid plan like the CSP, many of us struggle to progress toward our financial goals. Often, this is because of invisible money scripts – deeply ingrained beliefs about money that we may not even be aware of.
These scripts often originate in childhood and can significantly impact our financial behaviors as adults. For example:
- “Money is the root of all evil” might lead to subconscious self-sabotage when you start to become successful.
- “You have to work hard for money” could prevent you from seeking out smarter, more efficient ways to increase your income.
- “I don’t deserve to be wealthy” might cause you to undervalue your skills or avoid asking for raises.
Identifying and challenging these scripts is crucial for financial growth. Sometimes, these scripts can be so deeply ingrained that they affect not just our behaviors but our relationships as well. Let’s look at a real-life example from my podcast illustrating how money scripts can impact a couple’s financial dynamic.
Meet Cristina and Ron, a married couple with different financial backgrounds and perspectives. Their story showcases how our money scripts can create tension and misunderstanding in relationships, especially when they go unexamined.
[00:02:06] Ron: There was a couple of vacations planned for this year, some together and then some separately. My thing is, she’s going on, in my opinion, too many little mini vacations, and I just see the dollar signs adding up in my head. She said, hey, me and the girls are going to plan a girl’s trip to New Orleans.
[00:02:29] Ron: My initial reaction is, no, we can’t afford it. It’s too much. You just got back from England. I just say, is this something we can afford? Because she’s more in tune with our finances than I am. She pays more attention. She does the day-to-day stuff. Whatever bills come in, she’s already working all the different accounts. So I full-heartedly just go with what she says.
[00:02:54] Ramit: Okay. All right. And then how did it get resolved?
[00:02:58] Ron: She’s going to New Orleans.
[00:03:01] Ramit: Okay. And Ron, can you afford it?
[00:03:06] Ron: In my head, no. On paper, yes.
[00:03:11] Ramit: Oh, what’s the difference between your head and paper?
[00:03:14] Ron: I’m cheap. I’m more frugal than she is. She’s just–
[00:03:19] Ramit: Which one? Cheap or frugal? Those are two different words.
[00:03:24] Ron: Frugal, I’m going to say. Yeah.
[00:03:26] Ramit: Okay. Why is that?
[00:03:29] Ron: I’m not cheap because I don’t mind spending money when we have it. I’m frugal because I just see dollar signs, dollar signs, dollar signs, and then I just imagine these numbers in my head like, we’re going to be spending this huge amount when in reality, she’s already got it budgeted because she’s good at doing that where it’s only going to be a small amount. So I’m already imagining the worst.
[00:03:50] Ramit: What’s the frugal part of that?
[00:03:55] Ron: Okay. Maybe cheap.
Ron’s admission of being afraid of money and his inability to enjoy spending on himself highlight how limiting money scripts can be. Even with clear financial goals, Ron anticipates that achieving them won’t change his anxiety around money. This demonstrates how deeply rooted these beliefs can be, often defying logic and financial reality.
[00:12:15] Ramit: Is there a time when you spend money where you don’t think about the cost?
[00:12:20] Ron: Me? No.
[00:12:22] Ramit: You like spending money on anything?
[00:12:27] Ron: No, because I don’t really have any hobbies or anything that I’m interested that I want to actually spend it on.
[00:12:36] Ramit: Okay. What would you say your feeling is toward money, if you had to describe it in a word or two?
[00:12:40] Ron: One word? Afraid.
[00:12:43] Ramit: Do you like money?
[00:12:49] Ron: I like it. I wish I had more of it.
[00:12:51] Ramit: How much?
[00:12:55] Ron: You mean to earn a year or in savings and stuff?
[00:12:58] Ramit: Let’s go with both. Let’s start with earning per year.
[00:13:02] Ron: I’d at least like to make 150 a year.
[00:13:08] Ramit: Do you make the higher income out of the two of you?
[00:13:11] Cristina: Right now, yeah.
[00:13:11] Ron: Right now, yeah.
[00:13:12] Ramit: So that’s basically like, you’d like to make about 30k more than you make. Right?
[00:13:16] Ron: Yeah.
[00:13:16] Ramit: Yeah. It’s always the same number. People always have a very similar number of how much more they want to make. And how much you’d like to have in savings?
[00:13:27] Ron: Eventually, probably like to have at least a 100.
[00:13:32] Ramit: 100k in a savings account. Okay. And what would happen one day when you have that? I feel actually very confident you will have that. What will happen on that day?
[00:13:45] Ron: Probably nothing. I’m sure I’ll still be pretty nervous, or I know it’s just–
[00:13:50] Ramit: That’s so crazy. So in other words, you could spend your whole life trying to get to this arbitrary number, and then one day when you reach it, which you actually will, then you realize the entire life that I spent agonizing over $5, $10, $50 actually meant nothing because my feelings are highly uncorrelated with the numbers in my bank account.
Cristina and Ron’s story vividly illustrates how money scripts can create tension in relationships and hinder financial well-being. Ron’s fear-based approach to money, rooted in his past experiences, clashes with Cristina’s more balanced view. Recognizing these scripts is the first step towards changing them.
By challenging these ingrained beliefs and developing more empowering mindsets, couples like Cristina and Ron can work towards a healthier relationship with money and with each other. This process of self-awareness and growth is key to breaking free from limiting beliefs and creating the rich life you truly desire.
Actionable Steps to Build Your Rich Life
Now that we’ve explored the “why” behind wanting to be rich and some of the psychological factors at play, it’s time to translate that understanding into concrete action. Building your Rich Life isn’t just about dreaming big—it’s about making consistent, intentional choices.
Remember, this journey isn’t a sprint; it’s a marathon. The key is to start where you are, use what you have, and do what you can.
1. Get Out of a Tough Financial Situation
If you’re dealing with debt or struggling to make ends meet, your first priority should be stabilizing your financial situation:
- Pay off your debt: Create a strategic repayment plan. List all your debts, interest rates, and minimum payments. Consider focusing on high-interest debt first while making minimum payments on others. A structured approach can help you become debt-free more quickly and save money on interest in the long run.
- Plan out your expenses: Implement the Conscious Spending Plan we discussed earlier to have a clearer picture of how you’re spending your money.
- Review and reduce unnecessary subscriptions: Cut services you don’t use regularly.
2. Start Saving for Your Goals
Once you’ve got your immediate financial situation under control, it’s time to start planning for the future:
- Long-term savings: Start or increase your contributions to retirement accounts like 401(k)s and IRAs.
- Short-term savings: Set up separate savings accounts for specific goals, such as travel, a new car, or a down payment on a house.
- Automate your savings: Set up automatic transfers to your savings accounts.
Remember, the goal here isn’t just to save for the sake of saving. It’s about funding the life experiences that fit with your personal definition of “rich.”
3. Earn More Money
While cutting expenses is important, there’s a limit to how much you can save. On the other hand, your earning potential is theoretically unlimited. Here are some ways to increase your income:
- Negotiate your salary: Many people leave money on the table by not negotiating their salary. Research industry standards, document your achievements, and prepare a compelling case for why you deserve a raise. Remember, even a small increase can significantly impact your long-term financial health.
- Start a side hustle: Explore opportunities to earn additional income outside your day job. This could be freelancing, starting an online business, or turning a hobby into a money-making venture.
- Invest in yourself: Acquire new skills or certifications that can make you more valuable in the job market.
Remember, earning more isn’t about greed or materialism. It’s about creating more opportunities and freedom in your life. One of the most effective ways to increase your earnings is through salary negotiation, a skill that can significantly impact your financial future.
However, many people find salary negotiations challenging or even intimidating. That’s why I’ve created a comprehensive guide to help you confidently navigate this crucial conversation. In this video, I explain the salary negotiation process step-by-step, offering practical tips and strategies to help you articulate your value and achieve the compensation you deserve.
Your Rich Life Awaits
Becoming rich isn’t just about accumulating money. It’s about creating a life rich in experiences, relationships, and personal fulfillment. By defining what “rich” means to you, addressing your money scripts, and taking concrete steps towards your financial goals, you’re not just working towards wealth – you’re designing your ideal life.
So, I’ll ask you again: Why do you want to be rich? Whatever your answer, let it guide you toward making financial decisions that align with your values and aspirations. Your rich life is unique to you, and it’s waiting for you to claim it.
Ready to take the next step? Download my Ultimate Guide to Making Money now.
