The Rich Life

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Quote

“Money isn’t everything, but money is nice.” - Parker McCollum

The Rich Life

Let’s be honest. Regarding education platforms, Netflix is not what comes to mind first. That’s assuming you don’t count the lessons on doing drugs and slinging penny stocks from the Wolf of Wall Street as valuable (for some of you here I wouldn’t be surprised).

Recently though, Netflix summoned its inner finance professor and released How To Get Rich with Ramit Sethi. After seeing the chatter build-up on Twitter I figured it was time to waste away 8 hours of my life trying another hyped-up series.

Surprisingly, it was great.

Not only did the series educate the viewer on multiple topics, but it also did the most important thing any TV show can do. Entertain.

The wide variety of characters and outrageous stories keeps the viewer interested. Even for those who know a thing or two about finance, it’s still enjoyable to see what the outcome is going to be for these individuals battling for control over their finances.

In case you want to save 8 hours of your life, here are five takeaways from the series.

Let’s get into it. 🤝 

Don’t Play With Debt

The biggest crutch for a number of people on the show is credit card debt. When one breaks the numbers down it’s easy to see how just affording your minimum payment can quickly turn into a major financial burden.

Start missing these payments, and it’s bad news. Not only will your credit score tank, but you’ll also begin to have the 8th wonder of the world (compound interest) work against you when the credit card’s interest rate kicks in.

Here is a snip from Credit Karma highlighting why you should just pay off those credit cards immediately.

(PS: Credit card calculator linked below to help you out if this is you)

Know Your Numbers

While a strict budget isn’t required, Ramit does mention the importance of having a “conscious spending plan.” What does this mean?

Simply put, it means being aware of where your money is going and knowing how you are going to handle changes in your income.

I can vouch that this does actually help. While I don’t set myself a budget at the beginning of the month, I do track my spending. The best way to see your progress is with percentage goals. For me, this is 25% investments, 25% savings, and 50% spending (rent, groceries, gas, golf, fishing stuff, etc)

This one plays into the next topic well.

Spend Away

Some finance nerds will tell you to save every dollar and live underneath a rock.

If you have read my other posts like Life Is a Stock Chart, you know that I am not a fan of this approach.

Ramit is very similar. As long as you have your spending accounted for (as previously mentioned), it’s okay to save up for nice trips, big weddings, or special hobbies.

Just make sure you keep yourself on a leash and don’t end up digging yourself into a hole, especially if that hole involves credit card debt.

Income Matters, Kinda

Public service announcement.

Just because you make more money doesn’t mean you have to spend it.

One of the characters runs a woodworking business that she quit her main job to pursue full-time. Pretty dope. What’s not dope is that as soon as she had a “good month” she went out and purchased a $1,300 purse.

Another character was paid $25,000 a month in child support for her daughter. Shortly after this was mentioned she admitted that she spent over this due to her housing costs (this thing was a mansion) and shopping addiction.

There are multiple examples of ignorant spending on the show. The lesson is, you could make $50,000 a month or $5,000 a month but it won’t matter if you see it as an excuse to spend more.

Money Talks

This lesson is actually one that my girlfriend said she found most helpful.

Over the course of the 8 episodes, Ramit sits down with a number of different couples to try and help them with their finances. A common hurdle in these conversations is partners not being honest with each other when it comes to their debt, spending habits, and income.

For example, one individual on the show was sitting on an $80,000 loss in draft kings stock. Did his wife know? Nope.

Have tough conversations first. The topics can include combined finances, savings rates, housing budget, and of course, fun money (aka fishing trips).

The first time will probably be uncomfortable, but tell it like it is, even you crypto bros.

Conclusion

I hope you enjoyed these takeaways.

While there were a few points I didn’t totally agree with (an email for another time) overall the concepts were great to educate people on how to build wealth.

If you know someone who boycotts Netflix, send them this email to see if they will give it a watch. Or if you watched the series, let me know your thoughts.

Thanks for reading, catch you in the next one my friend. ~ Cade

Cade's Finds

Credit Card Calculator - If you are trying to get out of credit card debt here is a helpful calculator you can use to calculate your payment, interest amounts, etc.

Health Is Wealth - This post by Jack Raines on The Most Important Asset You Never Think About…your health.

Best Memes

We are onto them now.

Not finance related, but where are my other yee haw people?

Nothing in this email is intended to serve as financial advice. Do your own research. Thanks for reading, if you have any questions, comments, suggestions, etc. about the email don’t hesitate to send me a reply.