Ramit's Money Rules

Ramit's personal money rules and philosophy for managing finances. These guidelines aim to help people live a "rich life" by being intentional about spending and saving.

Core principles of Ramit's money rules

• Automate key financial behaviors
• Save for big expenses before you need them
• Allow yourself to spend freely on things you truly value
• Focus on the qualitative aspects of money, not just the numbers

Ramit's specific money rules

• Always have 1 year of emergency fund cash
• Invest at least 20% of gross income (start with 5% if needed)
• Never question spending on:
  • Books
  • Appetizers
  • Health
  • Friends' charity fundraisers
• Business class on flights over 4 hours
• Be able to pay in full for large expenses like weddings, honeymoons, houses

Creating your own money rules

• Write down your personal money rules
• Include both restrictive and permissive rules
• Align rules with your values and goals
• Rules should reduce decision fatigue around money
• Revisit and update rules as your situation changes

Ramit's philosophy on spending

• Money should be fun, not just about cutting back
• Spend extravagantly on things you love
• Don't stress about small purchases in areas you value
• Be willing to spend more on meaningful life experiences

Advice for creating money rules

• Start with basic financial literacy and fundamentals
• Understand your goals and risk tolerance
• Rules should provide structure but allow flexibility
• Focus on the qualitative aspects of money, not just numbers
• Use rules to support your vision of a "rich life"