I Got My Own Netflix Show... Here’s How | Ramit Sethi (#446)

Making, Managing, and Spending Money - April 24, 2023 (almost 2 years ago) • 01:21:06

This episode of My First Million features a conversation between Sam Parr and Ramit Sethi. They discuss the success of Ramit's new Netflix show "How to Get Rich," its impact on his podcast downloads and social media following, and the overall positive reception from viewers worldwide. They also delve into various aspects of personal finance, including making, managing, and spending money, drawing on examples from Ramit's show and their own experiences. The conversation concludes with a discussion of Ramit's approach to business and his future goals.

Ramit's Netflix Show Success: Ramit shares the overwhelmingly positive response to his Netflix show, noting its high ranking and the significant increase in engagement across his platforms. He highlights the global reach of the show and the personal connections viewers are making with the content.
Investing Philosophies: Sam and Ramit discuss their contrasting investment approaches, with Sam advocating for steady index fund investments and Ramit emphasizing the importance of compound interest. They also touch upon the risks and rewards of alternative investments like cryptocurrency.
Making vs. Managing Money: Sam and Ramit differentiate between making and managing money, agreeing that managing money effectively requires a different skill set than generating income. They acknowledge that many entrepreneurs, despite their business acumen, struggle with managing their finances.
The Importance of Conscious Spending: Ramit introduces the concept of "money dials," encouraging listeners to identify what they truly enjoy spending money on and to spend extravagantly in those areas while cutting costs mercilessly on less important things.
Ramit's Approach to Spending and Convenience: Ramit details his high spending on convenience, outlining his systems and protocols for streamlining daily tasks and travel arrangements. He emphasizes the value of hiring and empowering a skilled executive assistant.
The Value of Discipline and Patience in Personal Finance: Sam and Ramit discuss the common struggle with financial discipline, illustrated by examples from Ramit's Netflix show where participants deviate from agreed-upon financial plans. They highlight the importance of long-term vision and patience in achieving financial goals.
Standing Out and the DNS List: Ramit discusses his philosophy on standing out, which includes making unconventional decisions and talking about potentially controversial topics like politics. He explains his "Do Not Sell" (DNS) list, a policy of refusing business from customers with credit card debt.
The Importance of Monetization: Ramit and Sam agree on the importance of monetizing content early on, even for artists and creators. They discuss the benefits of generating revenue to support business growth and creative endeavors.
Ramit's Business and Future Goals: Sam and Ramit discuss the possibility of selling Ramit's business, highlighting the challenges and considerations involved. Ramit expresses contentment with his current business model and his desire to reach a wider audience.

Transcript:

Start Time	Speaker	Text
00:00	Ramit Sethi	I will say, the show came out and it was number 9 on all of Netflix the first day, number 6 the next day. The reception has been insane... way bigger than I ever thought.
00:10	Sam Parr	like how many how many messages are you getting
00:12	Ramit Sethi	Oh dude, I've given up on... like, I usually get about 1,000 to 2,000 messages a day, just generally. Including DMs, emails, everything. Because I'm on my newsletter and all this stuff, it... when I open up Instagram in the morning, it just keeps refreshing like over and over in my DMs.
00:40	Sam Parr	ramit what's going on man we're live
00:42	Ramit Sethi	what's up sam ramit from how to
00:44	Sam Parr	I will teach how to... what? What am I saying? Why can't I think of the name of your business?
00:49	Ramit Sethi	your intro you're giving me you don't even know the name of my company you better try that again
00:53	Sam Parr	I will teach you to be rich. You know why I confuse it all the time? It's because one of my favorite books of all time is Felix Dennis' book, and I always confuse it with "You." His is titled "How to Get Rich." Well...
01:03	Ramit Sethi	Right, well, you want to know something even more confusing? My new Netflix show is now called How to Get Rich.
01:10	Sam Parr	dude what's going on
01:12	Ramit Sethi	what's up
01:14	Sam Parr	so you you just had a show come out 2 days ago or 3 days ago right
01:18	Ramit Sethi	yep how how's it been netflix
01:20	Sam Parr	How's it been? Have you noticed that the revenue of your business or the podcast downloads that you have are going up?
01:28	Ramit Sethi	The reception is like out of control. I'll give you the numbers, but I thought the show was great. I did not expect it to be in the top 10 on Netflix. The number of emails I've gotten... I just gave up on even being able to keep up with my DMs. It's just wild. Podcast numbers right now: the podcast is number 12 on all of Apple. I'm very proud to say we have displaced Ben Shapiro. So, you know, one bigot at a time, we're going to take him down. The number of social media followers is fantastic. Just like the best part of all is people are posting pictures from their family rooms all over the world. You can tell a lot by seeing a family room; you know, you can tell just a ton about someone's life. Then you see the same show in every one of those photos. It's kind of like cosmic; it's like humanity is all watching the same thing, which is pretty cool.
02:28	Sam Parr	What percentage increase of downloads per episode has your podcast experienced?
02:34	Ramit Sethi	well it hasn't even been out a week so I can't even tell you yet
02:37	Sam Parr	but well you could look at your current your current numbers can't you of the podcast
02:42	Ramit Sethi	I don't know I guess I'm not as sophisticated as you
02:45	Sam Parr	I can't... Yeah, I mean, I would have thought that you know how to log in to things. But yeah, I understand. I guess I overestimated your ability. What?
02:53	Ramit Sethi	What I can only be good at a couple of things, and then the rest I'm pretty deficient at.
02:59	Sam Parr	So, I've known you, Ramit, for a while now and I've been following you for... it feels like a decade. I don't remember what year you started doing it, but it feels like you've been... I mean, you were like one of the OG bloggers. So, like, basically, yeah.
03:11	Ramit Sethi	I started about 20 years ago
03:13	Sam Parr	Oh, it was 20 years ago. Wow! So basically, I know my best friend is Neville. I met him because I was a fan of his blog. I found his blog because of Noah Kagan's blog. I found Noah Kagan's blog because of probably Tim Ferriss, and then I probably found Tim Ferriss because of you. It was like this illuminati of business and financial bloggers, but a little bit lifestyle-y. You've been doing that; you were like the OG. I remember you would teach classes, you wrote a blog post, and you hung up flyers on the Stanford campus.
03:45	Ramit Sethi	you know
03:45	Sam Parr	Like, I'm going to do a personal finance class or something like that. Then that kind of parlayed into one thing, which led to another thing. Now you have this pretty big business. I've talked to a lot of people who work for you. It's a pretty amazing company that you've built. Then you came out with a podcast. You told me you were going to come out with a podcast, and I was like, "Okay, this sounds interesting." You're a little late to the game; you've been doing this for 20 years. Let's see, your podcast is actually amazing. You did something that I've always wanted to do, but I didn't think people would do it. So basically, you could explain it, but you tell—or people tell you—all of their finances, and they put their faces on the videos. So, like, it's not really anonymous. Then you parlayed that into, you've had all these books along the way, and you've parlayed that into just a brand new Netflix show that's now one of the most popular in the country. I mean, you've done a lot of stuff, right?
04:29	Ramit Sethi	I love your intro! This is better than any intro I can give myself, so thank you. It sounds so linear the way you say it, like I sat at a chessboard and just mapped it out. But if you go into the details of it, it's actually crazy. For example, yeah, I did hang up flyers, and I did try to get my friends in the dining halls in college to come to my free event. Nobody came for like a year and a half. Nobody would come to my event. I would struggle to get people to attend a free class on money, and I got like a handful of people over that time. The reason for that, I later learned, is that people don't really like going to events about money; it makes them feel bad about themselves. So I was like, okay, you know, when you're young and you're really hungry, you think, "This isn't working. The world needs to hear what I have to say." You can either give up—and sometimes you should—or, in my case, I thought, "These kids are so lazy; they don't even want to come to a free class. I'm just going to start a blog." So that's the path. It wasn't like flyers and then a Netflix show. There was a lot of trying and failing in between the two.
05:38	Sam Parr	but so you're only in your twenties when you're teaching that I mean what the hell did you know about money
05:43	Ramit Sethi	I had gotten pretty good at money, actually. My dad, you know, came from India, as my mom did. My dad is pretty savvy with money. He got me to open up a Roth IRA when I was like 14 or 15 years old. He helped me do it with a custodial account. I took my scholarship money, which I got for college, the first check, and I put it in the stock market. I thought I was a genius in 1999; everybody was so cool. I lost half of that pretty fast. Funny enough, though, I kept investing because I was working at a pizza place and doing some sales. I used to think investing meant picking stocks. So, I bought three stocks when I was in high school. One of them, Excite@Home, went bankrupt. Another one, JDSU, why the hell was I buying telecom stocks? I don't know, it also went bankrupt. Then, a third stock was a little company called Amazon.com, which I've held since then, and it's like awesome now. The lesson for everybody listening: everyone goes, "Oh, that's so cool, Ramit! So cool! I just gotta pick the next Amazon!" And Sam and I go, "No, you don't! You're never gonna pick the next Amazon. That was complete luck. Do not do that strategy." The real lesson there is: don't try to pick individual stocks. Pick a nice target date fund or index fund and then let it ride. You will have more money than you know what to do with. Of course, that's you and me. If Sean were here, he'd be telling us about some crypto stuff that we talked about last time, which, of course, went down by 65%. Before we continue, I'd just like to give a big shout-out to all the people on YouTube from the last episode we did who didn't like me very much, you know, they're the crypto guys.
07:26	Sam Parr	you saw the comment
07:27	Ramit Sethi	I read every comment, dude. I love it. They go, "This guy's such an old fuddy-duddy." And what I really want to do, Sam, is come on here and let's go to the comment section and just see what happened to all these folks who lost 60% of their money. I wonder if they think the same thing... Anyway, it was a fun episode last time.
07:45	Sam Parr	We... I don't know if you heard the episode. I always give Sean a hard time because his opinion and my opinion on investing are totally opposite. Well, not totally opposite, but we disagree on a lot. On the pod, I was going, "Sean, look, if I made a bet with you, or like if I was a genie and I said you can only start your own company and invest your own money in your own company, but you can't buy crypto, you can't invest in startups, you can't do any cash-flowing things, you can't do anything. All you could do is put it into this one thing. We'll call it an index fund, but whatever it is, you get a regular return of 8% a year." Now, it's regular. It's not... you know, the theoretical bit is that it's 8%, but it's lumpy. But let's just say 8% every single year. But you can't invest in anything else other than your business. Would you do that? He was like, "100% absolutely not." And in my head, I'm like, "Dude, that's like the greatest incident."
08:40	Ramit Sethi	on earth
08:40	Sam Parr	what are you talking about that's the greatest thing on earth
08:43	Ramit Sethi	Okay, I heard that episode. I was laughing so hard! I loved it, actually. It's fun to hear two people with totally different opinions. I will say, although I'm like you, I'm a huge fan of index funds. Average returns of 7% to 8% are actually phenomenal if you understand compound interest and time.
09:03	Sam Parr	that is a lot of money does 8% double in 9 years
09:07	Ramit Sethi	Approximately, 72 divided by your return rate—if we say 10% nominal—is about every 7 to 10 years it doubles. So, yeah, you're right in the range. That doesn't sound like a lot if you're putting in like $1,000 or $2,000, but what people forget is that you don't just put money in once; you keep contributing. It's like you've got a train that's going faster and faster, and you're pushing the train. It starts to go really fast, and at a certain point, you can't stop the train. It's humongous. So anyway, I love hearing the back and forth. I personally was 100% with you. I'm like, "8% all day, baby!" I love average returns; that's fantastic. But, you know, some people think differently or they get a thrill from investing. I don't get a thrill from investing; I get a thrill from staying in luxury hotels. That's what I love, but my investing is very boring.
09:56	Sam Parr	Well, so my money right now... I basically have, you know, I sold my company to HubSpot. A lot of that was HubSpot stock. How much did you...?
10:03	Ramit Sethi	sell it for sam you gonna tell
10:06	Sam Parr	us no I I don't like talking about it
10:09	Ramit Sethi	Sam's so transparent with every other number on the show, except for how much money is in his bank account. Sam, what's up with that?
10:14	Sam Parr	the reported number was 27,000,000 and you know it was it was
10:19	Ramit Sethi	more or less
10:20	Sam Parr	It was right around there, but here's the thing: I'm going to reveal it a little bit. Here's the thing, which is the sale. I received a whole bunch of HubSpot stock, and six months... or you guys can... I think we sold in February of two years ago. So you guys can go look at it. I think the stock was $367 when we sold. Then, over the next year, as a bunch of my stock was like, you know, I got it monthly or quarterly or something like that, as I was getting it, it almost tripled or doubled in half. So it went up from $367, I think, to $870. The price materially changed. Of course, then it went back down to like $300, and now it's back up. So the price materially changed because of that. But here's the deal: I own HubSpot stocks. I haven't sold a share. I didn't sell it when it was at its peak. I was like, "I'm just never going to log in and look at it." We own Airbnb stock because my wife worked there, or works there, and we got a bunch of that. Besides that, I just own like the normal 80/20... whatever. I don't even know what it's called, the normal Vanguard index fund, and then some type of bonds, whatever the normal bonds are. Besides that, there's a little bit of real estate, but besides that, it's like nothing. I don't really own any... I've never actually sold a stock in my life. Yep.
11:40	Ramit Sethi	and that's awesome that's awesome
11:42	Sam Parr	I think it's awesome so many of my friends mock me
11:44	Ramit Sethi	It is awesome! No, no, no, no, no. They don't know what they're talking about. They see... they get the thrill out of tweaking their asset allocation. I go, "Listen, if it's a thrill to you, great. But if they actually understood how much it truly costs them, they would be shocked." You actually deeply understand personal finance, so you know that it's kind of like making a turkey dinner for Thanksgiving. Once you put it in the oven, you let that thing cook. Do not fiddle around with it; you're just messing it up. But it's really hard, even for super smart people, especially entrepreneurs who love control. They really feel the need to fiddle around, and it's so counterproductive with investing. So I totally agree with you.
12:23	Sam Parr	You said something awesome on your show, which is that people confuse... I forget how you phrased it, but you said something about making money versus managing money. When I first started making money, I was like, "Oh great! Now I'm very confident. I feel I'm pretty good at making money. I'm in the 99th percentile of income." Then I thought, "Well, that's pretty easy. I could do this real estate thing, and I can do this deal and this thing." But then I started getting into it, and I was like, "Shit, I'm not great at that." Because I'm creative, and I can invent things from scratch. However, when it comes to investing, that's not always the case. It's more about due diligence and running financials. For a real estate company, oftentimes it's more about just being really good at Excel than it is about inventing something from scratch. You said that on the show the other day when I was watching, and I thought that was amazing. I didn't actually learn that until I made a few expensive mistakes regarding managing versus making.
13:19	Ramit Sethi	That's cool! Yeah, that's totally true. I think there are three aspects: making, managing, and spending. All three are very distinct skills. Everybody primarily focuses on the first one—making money. I understand why people want to make more money. Managing money feels very dry, and therefore, people are incentivized and driven to make it sexy, which can lead to mistakes. Then there's spending. No one really consciously thinks about it. You know, I always say that everybody teaches us how to save, but nobody teaches us how to spend meaningfully. So, those three models would be good for anyone really thinking about how to live a rich life, specifically around their money. It's important to think about those three models and consider what it would take to be really good at each.
14:04	Sam Parr	I don't... I'm not good at the spending thing, and like, there's been multiple times where I've called you and I'm like, "I'm gonna go to Europe," and you go: > "Oh, I'll tell you what to do, but only one rule: no budget." Or I'll be like, "I wanna dress better," and you say: > "Great, I have a list of cool stores. One rule: no budget." And yeah, you're pretty dogmatic on a handful of things, and you're somewhat... well...
14:27	Ramit Sethi	To you, I wouldn't say that to a school teacher. I'd say it to a rich dude who sold his company for a lot of money. So I go, "Listen, if you're going to be looking at the price tags and you're going to be looking through the money lens of cost, imagine you put on a pair of glasses and it's cost." I go, "I'm not doing that with you. You're too rich. You can't be looking at cost. There are other money lenses for a guy like you to use, which is totally appropriate." But when did you feel comfortable spending? In my late twenties, I started to make it a practice to get good. I'll give you an example because fitness—we both love fitness. Dude, I follow all your videos. I'm like, "This guy, what are you doing, the combine or something?" That was hilarious! So Sam's posting all this insane stuff. He's doing like a 60-inch vertical jump or whatever. It's crazy! Your squats are like out of this world. I'm like, "God, this guy, how does he do it?" Anyway, I had to have a little fun with Sam, so I go, "Hey Sam, nice 375 squat. Why don't you try practicing for a spelling bee and try something challenging?"
15:29	Sam Parr	dude I called you a douche and everyone thought we were actually angry at each other yeah
15:34	Ramit Sethi	yeah yeah yeah so but but you're
15:36	Sam Parr	And you've always been comfortable, I mean... like, dude, I just feel guilty buying a $2,000 jacket. And also, it doesn't necessarily bring me joy, which is a whole other thing. But I also definitely feel a sense of...
15:46	Ramit Sethi	now that's yeah
15:46	Sam Parr	That's like, I think, value. That's a vibe or that's a valid thing. But I don't... I feel guilty. You don't have guilt around somebody spending.
15:54	Ramit Sethi	No, never. Let's talk about why. When I was in my late twenties, I was like, "Okay, I want to learn how to get fit." I never knew about fitness when I was young. We didn't even use the word "protein" in my house... it was not a thing, really.
16:07	Sam Parr	Yeah, no, like that's... if you told my parents that a Coca-Cola has 40 grams of sugar, they would be like, "You might as well tell me there's a billion grams," because I don't know what that means. You know what I mean? Like, that means... yeah.
16:16	Ramit Sethi	Okay, so same. Now I'm really confused because I'm like, how does Sam look so good if he didn't even like protein?
16:23	Sam Parr	because I learned like I
16:24	Ramit Sethi	what age
16:25	Sam Parr	Well, I was a college athlete, but... and so I knew about fitness. Then once I left college and got fat, I married a woman who cared about this stuff. She kind of taught me. She's like, "Hey, you know just because it says low fat, that doesn't mean that it's good for you." And I was like, "Oh..."
16:40	Ramit Sethi	true or like the slim gym is meat
16:43	Sam Parr	Yeah, I was like, "The Slim Jim is meat; it's good for you. This is keto, right?" Like, I didn't know, you know what I mean? It's like, "Go-Gurt is yogurt; therefore, it's good."
16:52	Ramit Sethi	Totally. Okay, so when I graduated, I didn't even have the college athlete thing. I did well in school or whatever, but I said, "I want to start getting fit." It was in my mid-twenties. I had a friend at work, and I was like, "Dude, can you show me how to work out?" I was pretty skinny; I was a really skinny guy. You hear clues in the world, whether it's with work or fitness or whatever. The world gives you clues as to where you stand. That can be true even in meetings. For example, if somebody shows up 5 minutes late repeatedly, that's a clue. Maybe you're lower on the power totem pole, and you've got to learn to read the clues to know where you stand. I remember multiple people when I was in college calling me "skinny." Now, as a guy, that's actually not a good thing to be called—at least, I didn't like it. I just thought, "Oh, I'm genetically skinny. That's just how I am—a skinny Indian guy." But I didn't want to be that anymore. So, a friend of mine showed me how to work out. He was like, "Okay, do you like to eat spaghetti?" I was like, "Yeah." He said, "Do you like bread?" I was like, "Yeah." He asked, "Do you like milk?" I was like, "Okay." He goes, "Yeah, you need to eat all of that." That was just like, "Oh!" What I thought I was doing was actually not getting me the goals I wanted. So, I started to eat more. I actually started to track it, and I realized what I thought I was eating was totally off base—just common for all of us. But it took me until my late twenties when I moved to New York, and I got there, and like everyone looks great.
18:26	Sam Parr	yeah
18:27	Ramit Sethi	Just everybody looks good, fashion-wise and fitness-wise. I'm like, did everyone attend a class that I was absent for? How the hell does everybody know how to hem their pants correctly? I lived right by a gym, and it took me four months to get the courage to walk into that gym and say, "I want a personal trainer." It had nothing to do with money; I had money. But I knew that once I said that, I would actually have to follow through. So, I finally got the courage. After four months, I walked across the street, went into the gym, and picked this guy, a random trainer who happened to be walking by. He was actually a great strength trainer, and I ended up training with him for about five years. I learned so much before I switched over to bodybuilding and trained a little differently. But that was like starting to pay for value, and I realized, "Oh my God, you can get better results. You can get faster results." Sometimes, if you pay for a different restaurant, you get a better experience. That was important to me. While at the same time, there are other things I just don't care about, and I don't pay for at all.
19:27	Sam Parr	On the show, there was this couple. They're like maybe only 38 or 39, but they're grandparents. I forget their names.
19:36	Ramit Sethi	yeah monique and donnell
19:37	Sam Parr	Yeah, and they're very likable, but I got so angry watching them. Because on the show, you sit down and... I hate this experience that you had with these people because it happens to me sometimes. They sat down and expressed everything they want in life, or at least everything they want help with. They say, "We struggle with this," and you say, "Alright, here's the plan. Does everyone agree to the plan?" And they go, "Yes, we totally agree to this plan. This will help us get to where we want to go." That plan includes selling a whole bunch of stuff from a storage unit. It includes not spending a certain amount of money, like not buying... I think he was spending $500 or $600 a month on video games or something crazy. Then you fast forward two weeks later, and he orders this big box. They open the box, and there are literally like eight pairs of jeans and a $120 pair of shoes. And you're like, "What the hell, man? You said you wanted this, and we agreed that the actions are this." Then he tries to justify it, saying, "But I need these jeans," and there are literally eight pairs of them. Then there's this other woman who has this $1,100,000 house. She says, "I'm... you know, my kids are grown now. I don't need this huge house. I'm going to sell it and get a smaller house just because I don't want to take care of this." Fast forward a few weeks later, she sold the house and went and bought a $2,200,000 house that's even bigger. And she goes, "Yeah, but I need this." It pissed me off so much that these people were doing this. I was like, "What the hell, guys? Where's the discipline in this?" I think that's a huge difference between some people and others who achieve certain things. I just want to nail it in their heads: "You guys realize how hypocritical you are to yourself right now, you know what I mean?"
21:23	Ramit Sethi	Well, I've... so I'll tell you. You know, when I was in my early twenties, starting with showing people how to invest and stuff, I was super judgmental—like, super. It's like, "Oh my God, you need to open up a Roth IRA! Do you understand how 7% compounds?" I could actually see people's eyes glaze over. I could basically see their soul leave their body. I'm just like, "Oh, this isn't connecting." But I didn't know how to read the clues. I thought if I pushed them harder, if I showed them another chart, they'll get it. And I can tell you that that doesn't work. So when you're saying that you hated this, I'm actually smiling because I kind of love that. I love when people say one thing and do another because, to me, it's like that beautiful contradiction of humanity. All of us say we want something, and we do something different. To me, it's like a puzzle. Okay, I know that you're doing that in the domain of money. I totally get it. I've seen it a million times. So how can I figure out a way to reach you, which gets you to see the contradiction and change your behavior—not me to impose it on you? Totally different view, and I think much more effective. That's what you see on the show.
22:39	Sam Parr	Yeah, well, you're a patient. It just... but it still angered me because I liked them. They're very likable, and you want them to win. It's like Ramit's show. It's kind of like "Queer Eye for the Straight Guy," but for money. You root for them, like, "Oh, we're going from zero to hero," or "We're taking someone who's cute, but we take the glasses off, and all of a sudden she's a model." You know what I mean? It's like a high school movie where you root for them. But I'm like, "You guys, these mistakes you're making are so obvious!" It's angering me that this is going to make you not achieve what you want to achieve. That really frustrated me while watching it.
23:16	Ramit Sethi	Well, I like that. I like... I want you and I want all the millions of people watching to feel something. That alone is a win because with money, we don't usually feel anything except overwhelm and shame. So I like that you're watching this and going, "God, this is so obvious now." I will say, you have built discipline over like decades.
23:36	Sam Parr	yeah
23:36	Ramit Sethi	You have been practicing at it, right? For a long time. Some of us don't even grow up with discipline in our lives. Like, I grew up with discipline around reading a spelling book, literally for two and a half hours a day. I could do that, and I did very well at that. But the discipline to be empathetic? I didn't really grow up with that. I was like a utilitarian type of guy. So, I think that it's fun to watch people and it's fun to watch them find their own path to get where they're going. And you know what? People are people. Some people do it, some people don't. That's kind of the beauty of humanity. Not everyone is going to succeed, and that's how it goes.
24:17	Sam Parr	The other interesting thing was the same couple that I'm referring to. They had this... so these folks, I think their annual household income was maybe $90,000 a year. This woman, about that, quit her job and did this woodworking thing, which is awesome. But they had this storage unit that I think cost $400 a month. We opened up the storage unit and, sorry folks if you're listening, it was garbage. It was like an old used microwave, plastic toys, and containers from Target. It was just junk. The amount they probably spent in two months was worth more than the entire stuff. And it was like, "Dude, why aren't you selling this microwave?" He goes, "Well, I need it." That also bothered me because, dude, Americans have so much crap. This couple, I think, is very normal, very average, and I was shocked at how much stuff people have. It made me want to go through my closet and just get rid of everything. I'm like, "Dude, we don't need any of this junk. Not only does it not make you happy, it brings you down." It was just so much stuff. Is that normal, that you said, to people with so much stuff?
25:27	Ramit Sethi	yeah okay so I had never gone into people's houses until a few years ago with my business and I had had offers from producers and stuff to go into someone's house but it was always this sort of like go into this couple's house and then like finger wag at them and tell them all the things they're doing wrong it's just not my vibe I don't wanna do that I'd actually ask them like what do you love spending on let's go do more of that come on you want a nice bag cool let me show you how to get more and finally there was a producer who is a friend of mine and she said like come on you really gotta come out this one's special so they drove me to new jersey and I went into this young woman's apartment it was a new apartment complex very nice she had a jeep outside and the minute she opened the door I thought to myself I should have done this 10 years ago because you can tell so much by going into the entryway of someone's house okay at the time I was living in manhattan most of my friends had somewhat similar apartments to me we kind of live in a similar way when I walked into her apartment there were beautiful candles like nice diptyque style candles there were probably 15 or 20 of them those are very expensive so I'm taking it in okay cool she loves candles there was a gigantic tv okay that's pretty interesting and I asked her to pull up on her phone and read off the top 10 emails in her inbox it was like target pier 1 you know whatever stores this starts to tell you a lot about someone it's basically clues and like you may see a living room I see how much percentage of her net income is going to fixed costs and I'm able to start to figure out what's really going on with her with folks like on the show you can totally see the amount of stuff people have and after a while that stuff starts to control them when I ask people like what's your rich life almost nobody says a bunch of $10 items from target I can guarantee that they might say I love a beautiful sweater I love trips with my kids etcetera I go cool let's spend more on that and let's cut back on the stuff that you don't care about and that really resonates with people
27:42	Sam Parr	Yeah, it's just like... I grew up in Missouri. I grew up in a very normal household. All my friends growing up are normal, and then I go back and I look at how I grew up and where my friends... Oh my god. Like, my parents have a stereo that still has a cassette tape player, and I don't think they've turned this on in 15 years. It's like, I'm like, "Hey Mom and Dad, you should throw that away. It doesn't even work." And they go, "Oh, but you know, we're gonna..." I'm like, "You guys, you don't have a tape. You don't even have a cassette!"
28:10	Ramit Sethi	you can't
28:10	Sam Parr	play anything on it this is
28:11	Ramit Sethi	A great lesson is that we have to be very, very conscious of the things we buy. Because once they come into our home and become part of our identity, it is almost impossible to get rid of them. Everyone listening is like, "Oh yeah, those people, why don't they just get rid of it?" I'm just saying, look in your closet. You know, my wife is a personal stylist. She goes into people's closets and helps them do closet cleanses. She handles all their image and stuff like that. She will show me how many trash bags she fills with clothes to be donated. Sometimes, in a small closet, it can be six trash bags. One client, I think, had 40 bags that were taken out and donated. It is really hard to get rid of stuff. That's why, for me, I go, "I'm going to be super careful about what I bring into my house—clothes, electronics, whatever." When I get it, I want it to be the best. Then, when I get the best, I want to keep it for a long time. You don't have to do the same, but I would say develop your philosophy about what you're going to buy and how long you're going to keep it. Otherwise, you're just going to end up inundated with a bunch of junk.
29:16	Sam Parr	We had Neil Patel on the podcast, and people got so angry at him because he said, "I spend... I think he said he spends $200,000 a month in monthly expenses." He broke that down, and then we had another person come on and do the same thing. I think I spend, personally, around $20,000 to $30,000 a month. I remember when I was 22, starting my company, I spent $2 a month, including rent—like nothing. I remember thinking, "If I spent $20 a month, I can't even imagine what I would spend with $20 a month now." Now that I spend $20,000 or $30,000 a month, I think, "Oh yeah, I could make a dent with $100 a month." I could use that. Anything above that, I actually think it's challenging, but maybe I'll find my way one day. How much do you think you spend a month? Have you found thresholds where it doesn't feel any better than a lower number?
30:16	Ramit Sethi	Oh, this is a great question! Well, I think that thresholds are, to me, less interesting than what are the things that I love to spend a lot of money on and what are the things I don't care about. I'm extremely polarized, and I actually want everyone to be polarized. For me, the worst is if people go, "I spend a little bit here, I spend a little bit there" or "I try to cut back 5% here and 5% there." I'm just like, that sucks. That's not an effective strategy, and it's not even fun.
30:45	Sam Parr	so but you you say that
30:46	Ramit Sethi	this concept of
30:47	Sam Parr	you you you say don't do $5 problems do $30,000 problems I think is that right
30:51	Ramit Sethi	Don't ask $3 questions; ask $30,000 questions. People go, "What are you talking about, Ramit?" Let me explain. Most people agonize over coffee and whether they can get an extra dessert. I say that's irrelevant. If you want to buy a coffee or two, go ahead; that makes no material effect on your finances over the long term. But $30,000 questions are things like, "What's my savings rate?" For example, do I save and invest 12% per year? Okay, great. What if my partner and I make an agreement that every year we're going to increase that number by 1%? If you just made that decision alone, that's worth hundreds of thousands of dollars—more than all the coffee you'll ever buy in your life combined. What's my asset allocation? That's a $300,000 question. What is my debt payoff date? If you have debt, I guarantee you do not know the exact month and year you're going to pay it off. You should know that. For my spending, I love talking about this because I always encourage people to come up with their money dial. What is the thing you love spending on? Should we just do this right now?
31:55	Sam Parr	yeah yeah yeah
31:56	Ramit Sethi	let's do this with you sam okay what is your what what do you love spending on what's the one thing
32:01	Sam Parr	Flying first class. So when I fly, if it's above 3 hours, I prefer first class. I don't love fancy hotels, but I like nice Airbnbs because I prefer apartments over smaller hotels. I enjoy going out to eat and love leaving huge tips. If the service is good, I like to give a 100% tip. I also like toys, such as four-wheelers and motorcycles. I love action sports and things like that. What else do I like? I also appreciate services.
32:35	Ramit Sethi	got your gym
32:36	Sam Parr	Yeah, I got my gym. Oh, so the gym would be somewhat like a toy, but I love services. So I spend: - $400 a month for a trainer - Another $600 a month for a nutritionist who I can just ask questions to I also have: - Cleaners - Someone to come and cook - An assistant who does my laundry I love all types of services, but not too many... okay things.
33:04	Ramit Sethi	Love it! Okay, great. So, I think for everyone listening, let's highlight a couple of things on that first question. Play along with us: What is the thing you love spending money on? Most people's answer is eating out; that's the number one money dial. Number two is travel, number three is health and wellness, and number four is convenience. You basically have all of those, but that makes a lot of sense. You've been very successful financially, so you've added money dials. Most people start with eating out. Okay, fine. Pick one of your money dials. Which one would you say gets you super pumped and super excited?
33:41	Sam Parr	services so convenience
33:42	Ramit Sethi	Great! Love it! I'm the same; convenience is my money dial. I love it. I'm obsessed with it. People think I'm like a serial killer when they hear how I dial all my stuff in, but I don't care. That's what I love. Okay, here's question number 2: If you were to quadruple the amount you spent on that money dial, what would your life look like and feel like?
34:04	Sam Parr	I think it would actually be awesome. For example, right now I have a service that does my laundry and brings it to my door. I also have this wonderful woman who cleans my house, but she doesn't put my laundry away. What I would love to do is just say, "Hey, I'll pay you more money. Just make sure that my closet is always organized and my clothes are put away." My clothes will just stay nicely folded on the floor in my closet. So, small things like that. Or, if my dog goes to the bathroom outside, sometimes I'll forget to clean it up. Then I'll realize there's a bunch of it, and I'm like, "I gotta go clean it up." It's nice to have someone come and just handle all of that. I would love someone to handle all types of cleaning and organizing in my house.
34:47	Ramit Sethi	Okay, I think I like your answers, but I think you gotta dream a little bigger. You could get all that with like $100 a week.
34:53	Sam Parr	dude I I
34:54	Ramit Sethi	Got to face everybody. Everybody look at Sam's face; he's like lost right now. Go ahead, I'm going to take you with me on this.
35:00	Sam Parr	I think I'm quite bad at like dreaming big
35:05	Ramit Sethi	yes that's why I'm here
35:11	Sam Parr	alright so I'd say what do we do now
35:15	Ramit Sethi	what else would you do I said quadruple not at a $100 a week
35:19	Sam Parr	I would have an assistant come to my home twice a week, and we would go through my to-do list.
35:25	Ramit Sethi	Love it! What else? Think about traveling. Think about cleaning your car. Think about how you travel with your family.
35:36	Sam Parr	It would be awesome to fly private occasionally with my whole nuclear family.
35:43	Ramit Sethi	and who would coordinate all of that
35:45	Sam Parr	right now me
35:47	Ramit Sethi	well not in this quadruple scenario who would you have
35:51	Sam Parr	I'm gonna say, Amanda, my family and I want to go from Saint Louis to New York around this date. Hook it up! There are going to be 8 of us. Just tell me when to show up and have a car there.
36:01	Ramit Sethi	Love it, love it! And then you mentioned that you love tipping, which I love too. I am a huge fan of huge tips. I've told people that part of your rich life very likely should be generosity. How would that fit in? Like, the person who cleans your house, what might you do in terms of spending more there?
36:19	Sam Parr	I would probably... so, like, over Christmas, I gave her a $200 bonus. I think it would have been cool to say, "Here's $1,000, just thanks."
36:26	Ramit Sethi	There you go, alright. Love it. This is awesome. Okay, so for everybody listening, the question is: You've already identified your money dial (the thing you love). Now, what if you could quadruple your spending? Now, I'll tell you what I loved about Sam's answer, and then I'll tell you what was different about Sam's answer compared to most people's answers. Sam was immediately like, "Oh!" He knew exactly what he would do. He's like, "My clothes sit on the floor of my closet" (which, by the way, is barbaric, Sam). That's so... He goes, "I'm gonna get someone to hang them up." Okay, great.
36:55	Sam Parr	By the way, I love that... I feel like most of my closest friends are Indians. The Indians that I'm friends with, like Neville, they're always immaculate. There's never clutter. Of course there's never clutter!
37:06	Ramit Sethi	Oh yeah, yeah. And their clothes are... yeah, well, it's that. Thank you for saying that. Immaculate! I love that. I'll take that: the immaculate.
37:14	Sam Parr	I was just at Neville's house today, and I'm like, "Neville, you never have clutter. Everything is always perfect."
37:20	Ramit Sethi	wow neville my man okay he's gonna be so happy to hear this man
37:24	Sam Parr	it's true
37:25	Ramit Sethi	2 people talking about you behind your back and actually saying nice things
37:28	Sam Parr	no he's immaculate
37:29	Ramit Sethi	That's the best! Okay, what is different about Sam's answer than most people is that, you know, he's talking about fairly expensive things, right? Private jet, etc. Now, don't let that turn you off. I'll tell you what the most common answer I get is. I told you that people go out to eat, and I go, "Okay, if you could quadruple your spend—which is why I call it a money dial—you could turn that dial up like a serial, what would it look like?" Most people have the same linear answer. They go, "Well, I'd probably have to go on a diet because I'd be eating out four times a week." I then ask, "Hey, listen, would you still eat at Chipotle?" They stop for a second and go, "Oh, probably not." It's a human tendency that we just take what we're doing and multiply it by four—same thing, but linear. I want to stop them; I want to dimensionalize it. I ask, "Where would you eat?" Now they're thinking. There's a guy in D.C. who says, "I have a list of every Michelin-starred restaurant." I ask, "Who would you take with you?" He gets very quiet and says, "I'd take my family because they can't afford to eat at places like that." So, when you're thinking about your rich life, it's so important to understand where you are today, what's important to you, and if you can spend extravagantly on that thing, what does it look like, feel like, smell like, taste like? Because you need that crisp vision. Otherwise, what are you working for? Why are you going to invest and save? Once you have that vision, I want to take my family to New York. I want us to go to Central Park and all have a picnic there. You can see what you're going to eat and what you're going to do, and it's just so beautiful. It smells fresh in the fall. That's when it becomes much easier for me to say, "Okay, we know you want to spend extravagantly on that. Now show me what you want to cut costs mercilessly on." So, that is the way that we start to craft a rich life.
39:26	Sam Parr	What does your... you know, the phrase, like, everyone thinks, or a lot of people, I imagine, see "I Will Teach You to Be Rich" and they think, "This guy's a douche." And then whenever you change it and you say...
39:37	Ramit Sethi	wait hold on I've I've never I've never heard anyone say that that's actually
39:40	Sam Parr	well good shocking to me
39:41	Ramit Sethi	no I'm just kidding they say it on reddit all
39:43	Sam Parr	yeah
39:43	Ramit Sethi	They go, "Yeah, the number one way people introduce me on Reddit is they say, 'Hey, you should read this guy's book. It's called I Will Teach You to Be Rich. I know it sounds like a huge scam, but it's actually not.'" And, you know, it's been 20 years or whatever, 10 years. I go, "Alright, fine, I accept it."
40:01	Sam Parr	Well, you come up with this good line that 100% redeems yourself, which is: "It's about living... what's your rich life?" Which is totally great because you're like, "No, money's a component, but your rich life could be anything." And so that's actually quite redeeming. Your rich life, you said, is like convenience. So what is your... I don't know how we say this without sounding lame... your "convenience stack"? Like, what is your...
40:24	Ramit Sethi	okay what
40:25	Sam Parr	what's that look like and what's and what's your budget for that
40:29	Ramit Sethi	I have an unlimited budget of software that things that are important to me
40:33	Sam Parr	Quit yanking my leg. Quit being academic. How much do you spend a month for this amazing setup?
40:39	Ramit Sethi	Well, I don't think on a monthly basis. So, you know, I don't want anyone to be thinking on a monthly basis except for your conscious spending plan. In order to have a bigger perspective, you need to think on an annual perspective minimum. For me, I would spend... well, if I factor it all in, probably hundreds of thousands of dollars per year on convenience.
41:01	Sam Parr	So, I broke it down for you. Is $300,000 the right number, or is it on the upper side of that?
41:06	Ramit Sethi	It's hard to say. Let me give you an example. If I stay at an amazing hotel, which I love, would that be part of convenience? It's quite pricey, or would it be part of luxury or experience? I don't know, but I'll tell you the big components of it. I want to wake up in the morning and have every single thing in its place. So much so that if I go blind, I know exactly where everything is. That means my food is ready. It means that my calendar invitations have the link in the same place, which takes me to the exact same thing. It's all about convenience. My meetings are scheduled, and when I travel, I have an assistant who's amazing. When I travel...
41:44	Sam Parr	is that a w 2 a w 2 employee or yes or okay
41:49	Ramit Sethi	W is a very experienced, seasoned executive assistant who knows how to work with other executives and everyone in my life. She would be responsible for everything from day-to-day meetings, scheduling haircuts, complex travel planning, and interacting with a travel adviser, things like that. She knows my preferences, so we document it all. She knows if I'm flying a four-hour flight, this is the type of seat, and this is the exact seat I'm going to sit on. What I love about having an assistant is that they become basically your spokesperson or your right-hand person. They have to be able to interact with people at CEO levels and at every level, so that's super important for me. When I travel, I have a travel protocol that gets activated. This means she will handle my email a little differently. If I'm going somewhere, I'll have food sent ahead to the hotel if I'm staying in certain locations, so it's like healthy food. I can try to stay on plan as much as possible, things like that. Over time, we just document it, and it becomes part of a standard operating procedure (SOP).
42:58	Sam Parr	didn't you guys have like a program on like working with someone like that
43:02	Ramit Sethi	I still have it. It's called Delegate and Done. This is about how to hire an assistant, including the 35+ things that my assistant does. It also covers how to run our meetings, specifically how we conduct our weekly check-in meetings. We have all that stuff, all templates. It's awesome!
43:21	Sam Parr	I'm gonna buy this this is good alright what else
43:25	Ramit Sethi	We'll give you a link for the show notes, but that's for people who are like, "I want to assist a smoothly running system. I want an assistant who's smart. I'm not looking for the cheapest; I'm looking for the best." I want to empower them to be able to handle everything for me. That's awesome! And what else? Oh, training. So, I have a personal trainer; he's awesome. I go there and train with him. We have goals for the show. For example, I knew exactly what I wanted to look like. It was funny because I went in to get fitted for some clothes. My wife was styling me, and I went in and I was like, "Okay, this is the size I'm going to be." I was way bigger than that size at that time.
44:05	Sam Parr	you were you fat or muscle
44:08	Ramit Sethi	A little of both. I was bulking, so I had more muscle, but I still put on some fat. I knew I was going to start cutting. They were trying to be very polite to me, but they were like, "We would recommend you don't go that small." I was like, "Listen, I'm a professional, and I know exactly what I'm going to do." They were trying to be really polite about it, but I could see them exchanging glances with each other. I was dying; I was loving it. You know, everyone says that when you're going in for a wedding fitting or whatever, you're like, "Yeah, I'm going to lose like 15 pounds," and like, no one does. So, of course, I was like...
44:43	Sam Parr	I'm not telling you to lose weight but step on the scale and subtract 15 and just be that yeah
44:50	Ramit Sethi	Yo, I was laughing so hard because my wife and I have trained, and we know what we trained for, like our wedding, for example. We know the process, and I was very confident; my trainer's awesome, etcetera. So, I went back in for the first fitting. Nobody believed me when I said, "Just do what I said, please." Then I came in for the next fitting, and I wanted to play a trick on him. From the fitting room, I said, "Oh my God, this doesn't fit at all!" But it actually fit perfectly. So, that is an example where getting help for convenience, for what's the look, and for the training protocol, that kind of stuff is important.
45:32	Sam Parr	Was it what you thought it was going to be? I mean, Sean has always wanted to have a Netflix show. What do people know?
45:39	Ramit Sethi	about it about it
45:40	Sam Parr	yeah
45:42	Ramit Sethi	Okay, so I have filmed before, like in a studio with my crew and things like that. This was completely different; it was on a whole other level. So, I'll give you some examples. The week before the show started filming, they finally found an office in LA—literally 7 days before. They designed it and they were like, "Come on in and walk through it and give us your feedback on the design." So, first of all, they designed it in 24 hours. That means they took a blank office and put a full design in there. I walked in and I was like, "It looks like a white person is selling their Airbnb." It has all geometric shapes on the wood. I'm like, "No, this is not me."
46:29	Sam Parr	like a live laugh love sign like a neon sign
46:31	Ramit Sethi	yes exactly I was like
46:33	Sam Parr	this is not
46:34	Ramit Sethi	So then, yeah, exactly. I was like, "We're not doing this. No, not for a Netflix show." Then they were like, "Oh, well, do you have any suggestions for us?" Of course, I had a Pinterest board of interior design home offices that I pulled out. My style is wood, stone, Japanese design, and minimalism, and basically, I had an unlimited budget. They took one look at that and just started laughing because they're like, "Dude, what are you talking about? We have a budget and we have like 2 days to finish this office." So anyway, we hashed it out and came up with something that I think looks pretty good. When I went in the first day, the crew was shooting just in an office, which is a totally controlled environment. There could have been like 30 people—huge, multiple cameras, sound producers, makeup. It's embarrassing.
47:30	Sam Parr	like having a yeah
47:31	Ramit Sethi	it's like like
47:31	Sam Parr	It's like you're performing, it's like you're acting. Really, not just like... shoot the shit. Or not shoot the shit, but you know, whatever you do when you normally record. You're like having a conversation with someone. Dude, if 30 people are around me, I would be like, "Dude, I feel like... yeah, like an animal in the zoo."
47:44	Ramit Sethi	Yeah, well, it's funny you say that. I like day-to-day activities, doing what we're doing right now. I love it! I feel really comfortable chatting with you or doing an Instagram thing. But being in the limelight, especially in public or for things like my birthday, I have never felt comfortable. I actually dread it. Even for my 40th birthday, I was dragging my feet... dragging it! Even though it's a rich life and I always love bringing my friends and family together, my wife noticed this and she asked, "What is wrong with you?" I said, "I don't know." I was so indecisive. She then asked, "Do you want me to just plan it for you?" When she said that, it was like the magic words. I said, "Yes, please!" Because this is one thing in my life I just feel so uncomfortable doing. Once she started to plan it, everything took off, and I was thrilled! For this show, the first few days, I felt a little uncomfortable. The other unexpected part was going to people's houses. People open up their homes; it's the most intimate thing you can do in America—to open up your home and talk about money. Most Americans would be more comfortable talking about their sex lives than their credit card debt—that's actually research! So, really knowing how to make people feel comfortable with a camera crew and producers, that took some learning. But overall, I thought the crew was amazing. They really helped me feel good and kind of come into my own.
49:15	Sam Parr	Do you get paid directly to do it, or are you hoping that this is just marketing for everything else you do?
49:22	Ramit Sethi	I get paid as talent, which is what they call somebody who would be a host. The Hollywood term is "talent." And then I'm also an EP, or executive producer, on the show as well. "Oh, that's great!"
49:35	Sam Parr	there is
49:36	Ramit Sethi	yeah yeah
49:37	Sam Parr	And will they fill you in on how many people watched it? Or is Netflix, I think they're like notorious for not telling you stuff, right?
49:44	Ramit Sethi	Correct. There are some things that they release, but they don't typically share actual numbers. I will say, like, the show came out and it was number 9 on all of Netflix the first day, number 6 the next day. The reception has been insane—way bigger than I ever thought.
50:03	Sam Parr	like how many how many messages are you getting
50:05	Ramit Sethi	Oh dude, I've given up on... like, I usually get about 1,000 to 2,000 messages a day, just generally. Including DMs, emails, everything. Because I'm on my newsletter and all this stuff, it... when I open up Instagram in the morning, it just keeps refreshing like over and over in my DMs, and I'm like, "What am I supposed to do with this?" I don't even know.
50:28	Sam Parr	You have been, like... I've noticed on Twitter - we've been friends for a while on Twitter - you've become more polarizing. And I have a feeling that part of that is on purpose. Is that true?
50:43	Ramit Sethi	like you mean polarizing because of politics
50:46	Sam Parr	Yeah, but also, like for example, I agree with you about buying a home. You and I agree that you should do it because you want it, not because it's a good investment. The numbers show it's actually not a good investment. It could be a good investment, but that's mostly luck every once in a while. Do it because you want to, and at best, assume it's a great store of value. But it's not necessarily going to be like a wonderful return, you know? But like, you'll tweet, "Look at this! I think you'll say, 'Look at this moron. They think X, Y, and Z. What are these idiots going to believe?'"
51:17	Ramit Sethi	or no no no hold on I do not say that but I do not say that I would never call some
51:22	Sam Parr	You say that about political stuff. Sorry, but you are harsh on the home buying thing, and you're also harsh on other topics. You're not harsh on that thing, the home buying thing, but you will call people morons for mostly political stuff, I think. But okay.
51:41	Ramit Sethi	I guess I have something against right-wing extremism. So, yeah, I'm pretty straightforward and direct about that. I don't accept it, and like, "Fuck that." When people and I talk about raising taxes on the rich, including me, I go, "Yeah, we should." I pay historically low taxes, and we should raise them. People are kind of shocked when they hear a guy with money saying, "Oh, I actually enjoy paying my taxes. I feel really good about them, and we should actually raise taxes." People are like, "What the hell?" They also feel shocked when they hear a money guy saying, "Buying a house actually might not be the best investment." So, it's funny. I will say, when I talk about real estate, I definitely mix it up. Sometimes people will go, "Ramit, you're so negative about buying a house." I go, "The fact that you think my advice, which is to run the numbers on the biggest purchase of your life, is negative tells you how far the Overton window has shifted." If someone says you should actually calculate the biggest purchase of your life, that's being negative? I go, "No, no, no, no, no. You have to run the numbers." As you and I know, Sam, a lot of times it's just not that great of an investment. Index funds could often, not always, but often outperform.
52:55	Sam Parr	more often so more often
52:57	Ramit Sethi	Yeah, depending on the city, and for everybody listening, I’ve rented for about 20 years. I have made more money renting than I would have owning. I’ve rented in San Francisco, New York, and LA. In New York, for example, I kept a very close eye on the real estate market. It would have cost me 2.2 times more to own the equivalent units—same neighborhood, same view, same size, same number of bedrooms. So, if it was a $3,000 apartment, it would have cost like $6,200 to $6,400 a month when you factor in all the phantom costs: interest, opportunity cost, maintenance. I just took the $3,200 and put it in the market and made way more money with less hassle.
53:43	Sam Parr	But your political thing, that's like on your list of things to do to stick out, right? You have a list here of how to stand out, and you say: > Unconventional decisions stand out. Talk politics. Yeah, yes. Talk politics. Yes, that's what I meant.
53:56	Ramit Sethi	let's talk about it yeah yeah so I I had this youtube video I did many years ago which was like why I don't talk about politics I think it's still up on youtube and I was like hey guys I am like you know I'm not gonna talk about it and I had my reasons and 2016 happened and I was like no way no fucking way not in the country I grew up in where we have comments like let's ban muslims until we figure out what's going on I go what the fuck this is this is crazy I and you know what I studied in college right I studied propaganda social influence and persuasion cults I studied that and I start to see the same dynamics happening here I go if I can't speak up a first generation successful guy who was lucky and also worked hard became successful you know in in the ways business and all this stuff if I can't do it then who can and so I started to do it and people flipped out the first few posts I made were like stick to finance I go first of all they always are the same type of people who tell me this and and they expect because of the way I look they expect me to kinda roll over and be like oh sorry you're you're right you're right I come right back at them I go I'm not gonna stick to anything this is my feed and I'll tell you exactly what's going on by the way I happen to know a little bit more about this than you and they are shocked I and I post their comments to me it's quite illuminating when you see so over the last like 5 6 years I've actually had like thousands of conversations thousands of political conversations why because I actually don't get the chance to talk to people like this in real life people who go like we should like cut all taxes taxes are theft and then I go like tell me why like what about the roads you drive on who should do that and I I really get to understand get inside their minds and sometimes I post the conversations because I want you to see a lot of people go we should like we should reason we should have conversations I go take a look at these conversations like I'm very patient with them but yeah I do think that people are afraid to talk about their genuine political beliefs or to say like this is actually wrong because they're worried about what's gonna happen to their business my business is based on my reputation and I go look if you're gonna leave if if you don't agree that young people should have access to voting rights then don't buy my book I'm totally fine with you leaving my community and I believe that
56:25	Sam Parr	But you have a list of other things on here, and some of the things I wanted to talk about. So, what's the DNS list? The "Do Not Sell" list? And how does that make you stand out?
56:33	Ramit Sethi	Oh, so, well, when you... so let's... the whole concept of standing out is that the world wants you to be vanilla.
56:40	Sam Parr	I sold out my business. Have you noticed? I see... I say that line all the time on this line. I still love it.
56:45	Ramit Sethi	you appreciate you saying it okay thank you everyone make sure you hear that credit
56:49	Sam Parr	No, I give credit, but that line, "the world wants you to be vanilla," I use that all the time. And I'm vanilla, by the way. I could say it.
56:58	Ramit Sethi	No, I don't actually think so. Okay, look. Vanilla means the world wants you to be like everybody else, and it comes out in peculiar ways. The world wants you to be vanilla. They go, "Sam, you're throwing money away on rent. You should buy a place." Now, for some people, buying a house makes perfect sense. But if you're 23 years old and you don't know where you're going to be in three years, it doesn't make any sense. The world wants you to be vanilla. They tell me, "Ramit, you should stop cursing on your YouTube videos." I go, "But that's how I talk." Sometimes I hear stuff that's crazy. What do you want me to say? You want me to stop because of the algorithm? No, I'm not living my life by an algorithm. The world wants you to be vanilla. When they told me, "Ramit, you shouldn't sell programs. That's scammy. You should give it all away for free." I go, "No, this is a profitable business, and I'm totally comfortable charging thousands of dollars for programs that are going to change your life. Start a business, find a dream job." One of the things we did was we decided early on that we are going to be highly selective about who we allow to be our customers. Oh, I remember this: highly selective.
58:02	Sam Parr	Yeah, I didn't tell a guy who was like, "I'm going into credit card debt buying your stuff," and you go, "You're banned. You can't buy our stuff anymore."
58:08	Ramit Sethi	Yeah, I... oh no, I've banned thousands of people. Thousands. The DNS list stands for "Do Not Sell." Oh, that's what it is. It's a very extensive list of people who we simply will not accept their money. So, policy number one is: if you have credit card debt, you cannot join our flagship programs. Those are the expensive ones. Why? Two reasons. 1. If you actually understood how credit card interest rates work, you would never spend $2,000 on a program. You would pay your debt off first, get financially comfortable, and then come back to us. 2. The type of people who join with credit card debt often have a lot of pressure on them. They think, "This has got to work. I'm down to my last dollar." I go, "No, you can't make huge changes in life if you have that kind of pressure." So, slow it down. Here's a free chapter from my book, and please don't join. Come back when you're ready; we'll be here. If they still join, we ban them for life. I think for any entrepreneur listening, you don't have to do the same thing I do, but the...
59:11	Ramit Sethi	If you really elevate yourself, you go, "Hey, I'm spending tons of time building the best product or service in the world. Therefore, I'm going to be selective about who I allow to join my business." Like Hermès, [they're] very selective about who they allow to buy their Birkin bag. Think about elevating yourself. Make sure that you're actually good enough to elevate yourself, and then be selective. It actually builds a much better and more profitable business.
59:36	Sam Parr	You say: - Don't be the first mover - Wait to write a book - Start making money - Follow your natural tendencies So, for example, I love slow, long-term thinking, so that's what you're going to do. And you'd be horrible at starting clubs in Miami. Then you have a framework of fast, deep, and long. What...? I agree with the first mover thing. The "write a book" thing I actually agree with too. Writing a book seems like a pain in the ass, by the way. And what... "start making money," what do you mean?
01:00:06	Hubspot	Well, I think that sometimes we people believe we need to build up a huge audience before we start making money. That's actually what I did, and in retrospect, it caused me a lot of hardship. I was writing for free in 2004, 2005, and 2006. When I finally sold something for $5—it's a $4.95 ebook—I was petrified of selling. I had a pretty decent-sized audience, and a lot of people got really mad at me because they basically saw me as the "free information guy." When I tried to redefine the dynamics of that relationship, people did not like that. It would have been much better if I'd started off by saying, "Hey, this is actually going to be a business." It would have taught me to focus on the metrics that matter and set the right expectations with my audience. I went through a lot; I went through two and a half to three years of people unsubscribing from my list every day. I was using AWeber at the time, so I could see the reasons they unsubscribed. Every morning, I woke up to see 75 people saying, "You suck, you're a sellout." I was like, "Wait, what? I still give away 98% of my stuff for free! I'm selling a $5 ebook!" And they were furious. That was my fault, not theirs. Our software is the worst. Have you heard of HubSpot? See, most CRMs are a cobbled-together mess, but HubSpot is easy to adopt and actually looks gorgeous. I think I love our new CRM. Our software is the best. HubSpot: Grow better.
01:01:41	Sam Parr	We have so many people who ask me, "I'm going to do a newsletter. When do I monetize?" I usually tell them, or for a podcast, whatever. I usually say, this is a huge generalization, but for a newsletter, maybe when you're at 5,000 or 10,000 people, then you could have an ad in it. If you're just selling a product, fucking do it right away—like, day one, have it in there. Yeah, and they're like, "I should do it that early? It won't turn off my audience?" I'm like, "No, you won't." But you need that money in order to do more stuff. Also, if you turn off your audience doing this, it's the wrong thing. I remember Casey Neistat—Casey Neistat, my favorite, you know, I love him. He had this video where he talked about money. He said, "I was at peak fame in like 2016, and I was still broke." Because even though I had all of these downloads and people thought I was famous, I didn't have any money.
01:02:37	Ramit Sethi	mhmm
01:02:37	Sam Parr	And he goes, "I thought I was being a cool artist by not having YouTube ads on, but I went back and did the math. That was like $4 or $5 million a year that I was missing out on, and I was fucking broke. I was an idiot." So if you're an artist out there, don't be a fool. Take the money, because then you could keep doing more art.
01:02:56	Ramit Sethi	Listen to Sam. I wish I had learned that early on. I did not. I had the same sort of thinking, like, "Oh my gosh, monetizing will turn people off." What I didn't realize is, first of all, if you're turning them off by trying to make a living, then you've got the wrong audience. Better to know that early than later. A lot of times, people actually like it; they want to know what you recommend. So that was interesting. But most of all, if you have money, it enables you to build a better business, better people, better design, better talent—better all of it. I didn't get that for a few years. I wish I had.
01:03:33	Sam Parr	We'll wrap up in a second because I know we're at the hour, but one last question: Sometimes people come to me and they'll be like, "You know, my personal brand is really tied up in my company's brand, and that will make it hard because maybe I want to sell my company." So have you ever thought about selling "I Will Teach You To Be Rich"? Would you ever sell it, and is it sellable being so tied to you?
01:03:59	Ramit Sethi	I don't think it's sellable in the way that I would need to maintain my reputation. I have had some interest in selling the business. I remember I was at a party in New York when this kind of mysterious guy came up to me. He had a very generic name, and he was like, "Oh, nice to meet you." But he knew a lot about my business—more than any normal person would know. He knew the way I structured my funnels and basic conversion rates. I was like, "Who in the hell is this guy?" He goes, "Hey, I'm gonna be in town in a couple of weeks. I'd love to get together for breakfast." I was like, "Cool." So, you know, I was a pretty young guy working out of coffee shops and stuff like that. He invites me to the Four Seasons in Midtown for breakfast. I was like, "What the hell?"
01:04:52	Sam Parr	he knew how to tickle your fancy man you like fancy hotels
01:04:54	Ramit Sethi	Yeah, I was like, "Okay, let's go." So we get there and it's four people, including me, at the table—three others.
01:05:01	Sam Parr	guys including him
01:05:03	Ramit Sethi	So, I was like, "Cool, this is weird, but let's do it." I don't know what's going on here. I'm chatting with the guy; he's very nice. One guy's kind of silent, and the other guy is sitting there with his arms crossed, just listening. I'm trying to figure out the power dynamic here—what's going on. At one point, the guy with the crossed arms, who wasn't saying much, mentioned that he vacations in North Carolina or something like that. I go, "Oh, how far is the place from the airport?" I don't know why I asked that question, but we're talking about it. He said something like, "Oh, it's like a 5-hour drive." I go, "Wow, that's a long drive." He replies, "Oh, I don't drive; I take a helicopter."
01:05:45	Sam Parr	bingo
01:05:46	Ramit Sethi	Oh, got it! Okay, now I understand what's going on. They wanted to buy a percentage of the business—over 50%—and they wanted to, you know, basically hyper-monetize it. Now, my business could make a lot more money if I got more aggressive with my offers. We don't really run Facebook ads. For us to win on Facebook, we would need to get much more aggressive than we're willing to. I have a brand, I have a reputation, and I already have the name "I Will Teach You to Be Rich." I actually love when people come expecting to get this hard sell, and they're like, "Oh, this guy went to Stanford. He has a Netflix show. You can get his book a lot of it for free." It's, you know, it kind of surprises them. I told them blank, and I even thought to myself, "What would I do with the money? My life is great. I have an assistant, I have a trainer. I was like, I'm good. What am I going to do with extra money?" I'm actually really glad I did not sell because the business went through a big growth spurt in the next few years. But now I have the dream that I love. I have a 100% bootstrap business. I work from home, my team is amazing, and I get to go on talk shows like this to talk about my philosophy. Then people email me with their success stories, and I'm like, "Dude, it does not get better than this." I appreciate every day that I have this business.
01:07:10	Sam Parr	Is there any financial or business goals that you have as a north star? Where you're like, "You know, in 10 years it would be cool if we did this?"
01:07:19	Ramit Sethi	I'm in a... I guess I didn't expect Netflix to happen. I was not gunning for it; it just happened. So, I wanted to reach more people. That was my goal, and I've now reached more people in the last week than I have in probably 10 years. It's like my... I still try to sit with that, so I probably need to recalibrate where I want to go. But I'll tell you one thing I know from doing the podcast: when I started the podcast, I sat down and wrote a vision document. I never really do this, but I wrote it because I knew that we were going to have to get a lot of people involved, like editors and guests and everybody. I was like, "You know what? I need to just write down my exact vision." So, I was like, "Here's what the podcast is. Here are 20 sample titles that I want to do. Here are the types of people I want to have on. Here's what it's not: it's not a podcast about compound interest calculations." When I wrote that, I realized that, number one, the podcast has to be fun for me. If it's not fun, I'm not doing it. I would imagine you have a similar thing: once you make a certain amount of money, you go, "Okay, what is the other meaning?" It's got to be fun, and if it's not, or if it's not reaching the right people, I'm just not into it.
01:08:32	Sam Parr	Wanna... I mean, for everything bad he's done, he said something amazing. Kanye West said something like, "I do dope shit." There’s a story of him with Dave Chappelle. Kanye was backstage at Dave Chappelle's show when someone called him. Dave is retelling the story, and Kanye goes, "Hey, yeah, I can't really talk right now because I'm backstage with Dave Chappelle watching never-before-seen clips of the show." Then he adds, "Yeah, because my life's dope and I do dope shit," and he just hung up. In the past couple of years, he gave this interview where he said, "Money's cool, but I just wanna do dope shit," and he keeps repeating this.
01:09:21	Ramit Sethi	"Listen, I need to start talking like this now." I'm like, "What kind of celebrity shit do I need to say now that I have a show? What do I need to know?" Meanwhile, I'm just this internet dork who sits on Twitter. I make a joke about real estate or asset allocation, and then I'm like, "Alright, that was a good day." I go take a nap on the couch. I'm thinking, "I gotta learn what these guys are doing."
01:09:40	Sam Parr	Well, Sean and I have a joke, but I truly live this way. I'm like, "Would my 12-year-old self be proud of the stuff that I'm doing now?" You know what I mean? Like, do you guys like what I've...
01:09:50	Ramit Sethi	I heard you talk about this. It's crazy when you said it like that. Would my... what your 12-year-old self or my 12-year-old self... I heard you say this the other day. I went home, I told my wife, and I told her: "My 12-year-old or even 20-year-old self would not believe it. Would not believe that I'm married to you, would not believe that we travel the way we travel, that I have a business like this, like a team that's... awesome."
01:10:20	Sam Parr	you can like talk to celebrities and shit yeah it's awesome
01:10:23	Ramit Sethi	Yeah, by the way, I'm getting these DMs from celebrities, like athletes. You know, I don't know anything about sports, right?
01:10:29	Sam Parr	same
01:10:30	Ramit Sethi	and they're always like
01:10:31	Sam Parr	I saw you tweeted you're like I'm from the phillies or something
01:10:34	Ramit Sethi	Yeah, I'm from the Eagles, and I'm like, "Is that a basketball team?" And they don't even reply. I'm like, "Dude, I'm not equipped for this world." It's so funny. When Netflix emailed me for the first time, they were like, "Oh hi, we'd love to talk to you about a project. Do you have representation, or should we speak to you directly?" I was like, "What the hell is representation?" I didn't even know what they were talking about. I didn't have an entertainment lawyer, and I didn't know how to find one. I went on Google, literally typed "entertainment lawyer," and looked through the list. That's how I found an entertainment lawyer. I had to learn this industry seriously from the ground up. It took me a couple of years to truly start to scratch the surface because in Silicon Valley, it's very different. You tweet someone, and they'll take a meeting. The industry dynamics are different. There are subtle things, like for example, engineers are kind of regaled as the most valuable. Okay, well, what's the equivalent in Hollywood? That's not obvious from the outside. What are the cultural mores that aren't obvious? So, dude, I'm just at the very beginning of learning this stuff, but it's actually really cool to be a student of a new industry and learn, "Oh, that's how things are done here," and "Oh, there's actually kind of a reason why."
01:12:02	Sam Parr	We've just gotten popular enough now that some of the agents, you know, like the... what's it called? CAA? And I forget the other three. Yeah, there's like two or three of them where they're actually starting to talk to us. I'm incredibly turned off by the whole process. I find it to be very off-putting. I have to remind myself, well, you know, there could be a reason why this exists. Then I start talking to them and I'm like, well, these guys seem pretty nice and they're making a lot of sense. But then in the back of my head, I'm like, these people are fucking sharks. They're gonna steal from you. So, like, you know what I mean? It's like this hard dichotomy.
01:12:36	Ramit Sethi	Wait, we gotta talk about this. If you ever want to chat about it, I know these folks and...
01:12:42	Sam Parr	do you like it
01:12:47	Ramit Sethi	Yeah, that's like a weird question. Are they legit? Is a recruiter legit? I mean, it depends on what you're going for.
01:12:54	Sam Parr	yeah some
01:12:55	Ramit Sethi	You know, you're in a unique perspective because: 1. You have this huge podcast 2. You and Sean have built this amazing thing The personality, the events you've built... it's like crazy. I mean, I've watched from the early days and I've really gotten into your podcast in the last year. I'm just like, "Oh, you guys are firing on all cylinders!"
01:13:15	Sam Parr	You would have no idea how half-assed it is. By the way, our events are way more half-assed than you think.
01:13:22	Ramit Sethi	really dude the photos look incredible
01:13:25	Sam Parr	they're great they're great but like if they're thrown together yeah
01:13:28	Ramit Sethi	Real, you just show up and just like hang... fuck, that's insane! Okay, anyway, it looks great. And then you're, you know, you already have money, so you're not like super profit motivated unless it's the right opportunity. It's you and Sean, you got HubSpot involved, so there's a lot of unique things. But one thing I learned in Hollywood is: take the meeting. Always take the meeting. This is different because I turned down 9 out of 10 things. I'm just like, "Nope, nope, nope." But if you want it, it's all relationship-based, way more than tech. Just to give you an example, a lot of lawyers and PR firms in Hollywood will not even take your call, even if you're ready to hire them. Like, you have a fat check, and they will not even take your call if you're not referred by an agent or someone else like that. That's mind-blowing.
01:14:16	Sam Parr	That pisses me off. You know, I love Jay Leno. Jay Leno has this... you're not into cars, I don't think, but he's got this really cool show called "Wait."
01:14:24	Ramit Sethi	does having a honda accord not count as being into cars unfortunately not my friend
01:14:28	Sam Parr	It does not. Okay, but Jay Leno has this thing called "Jay Leno's Garage." He tells you the history of the car and why it's cool. He's got this funny bit where he talks about Ferrari. He refutes... you know, Jay Leno probably has 500 or 1,000 cars, and they're all like historical and important. Someone was like, "Why aren't there any Ferraris here?" He goes, "I refuse to buy a Ferrari." And they ask, "Why?" He responds, "Because you have to get on a waitlist to buy one in order to buy the next one." So, for example, let's say there's a GTO 250, which is like a $30,000,000 car. They only made five of them; it's a really rare car, and it's like art. He says, "I would love to own one because I think they're awesome." But they make you buy the entry-level one first, then you have to get on a waiting list to buy the next one, and you can't sell it. You have to follow all these rules. He goes, "I refuse to bow down to that bullshit, and I'm not gonna play that game. I just want to... I just now realize it's not like the everyman. I'm not like the everyman, but in some regard, I just don't want to jump through hoops. I just want to say, 'If I'm willing to give you money, please let me have it.'" So, I refuse to buy a Ferrari for that reason. Same with Hermes. I'm like, "Dude, I'm not gonna get on a fucking list to buy this shit. That's bullshit."
01:15:38	Ramit Sethi	yeah yeah yeah I I agree I respect that he is like no I'm not gonna play that game I love that at the same time I also understand why a luxury business does that so there's a a couple of great books on luxury and and there's this phrase when the ceo of volvo sees 2 volvos on a city block he's happy when the ceo of porsche or rolls royce sees 2 he gets worried and I think that that's right on luxury is a totally different beast it's a totally different way of marketing you don't want too many people to have it and so you create these barriers by the way I listen to this this rolls royce podcast so I like I love I'm not like rolls royce to me the look of it is a little gaudy for me and also I'm not really a car guy but one day I'm gonna buy a sweet car like it's gonna be amazing people are gonna be like this fucking guy told maybe bentley maybe rolls royce like I love the craftsmanship of it like the perfection of it and that's like that's one of the reasons I love beautiful clothes like they're handmade hand stitched everything is absolutely perfect I've gone to the factory in italy where I saw the absolutely beautiful well lit factory floor and I saw them making these beautiful cashmere sweaters and I go I appreciate that they are paying well that everything's done by hand they have a school in solomeo where they're teaching the next generation of artisans and craftsmen that's fantastic so I have a love of craftsmanship anyway I'm listening rolls royce came out with a podcast which is genius because if you're gonna buy a $500,000 car you're gonna listen and research every last detail you can about the car and yeah I just I'm obsessed with the details of the leather and the color matching and you know if you get a custom color on a rolls royce it's now your color nobody else can ever use it from a rolls royce if they want it they have to ask your permission to use it I'm like okay that's cool not not for me today maybe someday
01:17:42	Sam Parr	One day, let's wrap up here. But tell me, what are the luxury books? I want to write them down. I want to read them too.
01:17:49	Ramit Sethi	Alright, so one of them is called "The Luxury Strategy." Another one is called "Kapferer on Luxury." Those are two that'll get you started. I think those are really good ones.
01:18:06	Sam Parr	cool
01:18:07	Ramit Sethi	what are you reading right now
01:18:10	Sam Parr	I'm reading a lot of stuff about the mob, about the mafia. Okay, so I like crime stuff. What else have I read recently? It's lots of crime stuff. Unfortunately, I'm rereading a book on Joseph Kennedy. Joseph Kennedy, you know, the father of JFK, is a really controversial person. He basically got rich off insider trading, then became the first head of the SEC, making insider trading illegal. He was incredibly unfaithful to his wife but kind of a really good father. So, a lot of interesting things. A lot of people don't know that Joe Kennedy was like the 7th richest person in America. So, JFK was not just wealthy, but really wealthy. I'm also rereading a book on American capitalism between 1910 and 1920. It was highly unregulated. The Andrew Carnegies of the world, Jay Gould, John Rockefeller—they were really fascinating because it was super cutthroat. So, I'm rereading about that.
01:19:05	Ramit Sethi	Let me just share what I'm reading right now. One is called Unreasonable Hospitality, and that's by the guy who used to run a very high-end restaurant in New York. Another one is called Customers for Life, which is by a guy who ran an auto dealership. It's just really nitty-gritty business, and I love that. I have one called The Power of the Past. This is awesome for anyone who listens to my podcast. You'll hear me talk about money and class. Class is not really talked about in America, but it exists. It's The Power of the Past by Jessie Stryker. Then, I'm rereading The Color of Law, which is about real estate, redlining, and race in history. So anyway, those are a couple of books I'm reading.
01:19:49	Sam Parr	Well, Ramit, I like this. Yeah, we... dude, I was just thinking. I just wrote a note. We should have a podcast just on books, asking interesting people what they're reading and why.
01:19:58	Ramit Sethi	oh dude I would I would love that
01:20:01	Sam Parr	well I've just I'd we just
01:20:02	Ramit Sethi	first listener and I'll definitely come on that's a great idea
01:20:05	Sam Parr	Yeah, I mean, because that's always like one of my favorite parts - asking people what they're reading and why. But dude, I appreciate you doing this, man. You're the man. I thank you for your friendship, thank you for doing this. Congratulations on the show, it's freaking awesome! My wife and I were watching it all day yesterday, so...
01:20:21	Ramit Sethi	oh my god
01:20:21	Sam Parr	I sent you the video of us
01:20:23	Ramit Sethi	You sent me that... Dude, to know that you guys are watching this, which I spent like years doing, kept it quiet for that long, and to know that it's like inside your house and the two of you are connecting over it... Like, honestly, it's the highest praise for someone who creates anything. So thank you, it means a lot.
01:20:40	Sam Parr	it was awesome and I appreciate you doing this thanks for everything
01:20:42	Ramit Sethi	thank you dude thanks
01:20:44	Sam Parr	that's the pod

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I Got My Own Netflix Show... Here’s How | Ramit Sethi (#446)

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