Ramit Sethi Pushes Back On Frugal Habits With One Key Insight: 'Very Few People Talk About Increasing Your Earnings'
Receiving regular insights from personal finance experts can help you set long-term goals and adopt good money habits. However, most of the strategies revolve around saving money and ruthlessly cutting costs. That's why "I Will Teach You To Be Rich" author Ramit Sethi proposed a different path.
"Very few people talk about increasing your earnings," he said in a recent video about mastering your personal finances.
Sethi then shared the mentality you should have when thinking about your income and expenses, plus some strategies you can use to boost your earnings.
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There Is No Limit To How Much You Can Earn
There are limits to how much you can reduce expenses. If you earn $5,000 per month, you cannot reduce expenses by more than $5,000 per month since you need housing, groceries, and other essentials. You can operate more efficiently to save money, but every penny-pincher always bumps into the necessities and gets stuck.
However, there is no limit to how much you can earn. Sethi explains that most people operate as if they have been given a fixed pie that dictates how much they earn. Since people are always taught to cut these expenses above all else, it's easy to view income as a ceiling instead of looking for ways to boost your income in a meaningful way.
Sethi says that an extra $500 per month can change most people's lives. He then upped the ante and asked how your life would change if you made an additional $5,000 per month. Having these thoughts can shift the conversation from relentlessly cutting costs to discovering better ways to make extra money.
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Adopting An Abundance Mentality
Suppose you're thinking about going on a vacation. You have a destination in mind, and it may have been on your list for a few years. However, there's one problem: it's a very expensive trip.
People without an abundance mindset may wave off their bucket list item and say that they can't afford it. However, an abundance mindset can make that dream trip more attainable. Sethi says that if you want to travel to that major destination, look for ways to make more money.
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