Ramit Sethi joins Sam days after his Netflix show “How to Get Rich” debuted at #9 globally. They cover the three money skills nobody talks about together (making, managing, spending), Ramit’s money dial framework, Sam’s HubSpot portfolio, how to spend without guilt, luxury brand mechanics, why Ramit banned thousands of customers, his experience filming Netflix, and whether he’d ever sell his business.
Speakers: Ramit Sethi (guest, founder of I Will Teach You to Be Rich), Sam Parr (host)
The Netflix Launch [00:00:00]
Sam: What’s up, Ramit?
Ramit: What’s up, Sam?
Sam: I will teach you to be rich. I always confuse your name with Felix Dennis’s book, “How to Get Rich.”
Ramit: You want to know something even more confusing? My new Netflix show is now called “How to Get Rich.”
Sam: You just had a show come out two or three days ago. How’s it been?
Ramit: The reception is out of control. I thought the show was great, but I did not expect it to be top 10 on Netflix. Number nine the first day, number six the next. The number of emails — I gave up on even being on top of my DMs. Podcast is number 12 on all of Apple. We displaced Ben Shapiro, so one at a time we’re getting there.
The best part is people posting pictures from their family rooms all over the world, and you can see the same show on the TV in every photo. It’s kind of cosmic — humanity all watching the same thing.
Sam: I’ve been following you for what feels like a decade. You were one of the OG bloggers. You hung up flyers at Stanford for a personal finance class. That parlayed into a book, then a podcast, and now a Netflix show. You’ve done a lot.
Ramit: It sounds so linear when you say it, like I sat at a chess board and mapped it out. But if you go into the details, it’s crazy. I hung up those flyers and tried to get my friends to come to a free class on money for a year and a half and nobody came. I later learned: people don’t like going to events about money because it makes them feel bad about themselves.
So I was like, these kids are so lazy they don’t even want to come to a free class. I’m just going to start a blog. That’s the path — not flyers to Netflix show. There was a lot of trying and failing in between.
Twenty Years of Building [00:08:00]
Sam: You started about 20 years ago?
Ramit: Yeah. My dad opened a Roth IRA for me when I was 14 or 15 with a custodial account. I took my first scholarship check and put it in the stock market. This was 1999. I thought I was a genius.
I lost half of it pretty fast. I was picking individual stocks — bought Excite@Home, bankrupt. JDSU, bankrupt. And a third stock from a little company called Amazon, which I’ve held since then. Lesson: don’t try to pick the next Amazon. That was complete luck. Pick a target-date fund or index fund and let it ride.
Sam: So you and Shaan disagree on investing?
Ramit: We agree on a lot but disagree on some things. I love index funds. Average returns of seven to eight percent are phenomenal if you understand compound interest. At eight percent, money doubles roughly every nine years. And you don’t just put money in once — you keep contributing. The train goes faster and faster. At a certain point, you can’t stop it.
I get a thrill from staying in luxury hotels. My investing is very boring.
Sam’s HubSpot Portfolio [00:15:00]
Sam: My money right now — I sold my company and received a lot of HubSpot stock. The reported number was $27 million, and you know, it was right around there. But the sale price changed because the stock went from around $367 to nearly $870 before coming back down.
I haven’t sold a share. I just never log in and look at it. Besides that, I own some Airbnb stock from when my wife worked there, and then just normal Vanguard index funds.
Ramit: That’s awesome. So many people mock that strategy, but they don’t understand how much it truly costs to fiddle around with your asset allocation. Making turkey for Thanksgiving — once you put it in the oven, let it cook. Do not fiddle around with it.
Sam: You said something on your show about people confusing making money with managing money. When I started making money I thought, great, now I’ll do real estate and deals. Then I got into it and realized I’m not good at that. Making money and managing money are totally different skills.
Ramit: There are actually three: making, managing, and spending. All three are distinct skills. People primarily focus on making. Managing feels dry, so people try to make it sexy and mess up. And spending — nobody consciously thinks about it. Everyone teaches us how to save; nobody teaches us how to spend meaningfully.
The Money Dial [00:23:00]
Sam: You and I agree that I’m terrible at the spending thing. You’ve told me: when I want to go to Europe, one rule — no budget. When I want to dress better, one rule — no budget.
Ramit: I say that to rich people who sold their companies. I’m not saying that to a school teacher. For someone like you, looking at price tags is the wrong lens. There are better lenses.
Sam: When did you get comfortable spending?
Ramit: Late twenties. I wanted to get fit — I had been a skinny Indian guy my whole life. A friend told me to eat more, track it, lift heavy. I moved to New York and everybody looks great. It took me four months to get the courage to walk into a gym across the street and say I want a personal trainer. Once I started paying for value, I realized: oh my God, you can get better results when you invest in the right things.
Let me run the money dial exercise with you. What do you love spending money on?
Sam: Flying first class on anything over three hours. Nice Airbnbs over hotels. Going out to eat. Leaving huge tips. Toys — four-wheelers, motorcycles. Services: trainer, nutritionist, cleaners, assistant, laundry.
Ramit: Perfect. Now: if you quadrupled your spend on that, what would your life look like?
Sam: I’d get someone to actually put my clothes away instead of leaving them folded on the floor. Someone to handle all the dog cleanup. An assistant to go through my to-do list twice a week.
Ramit: Dream bigger. What about flying private?
Sam: That would be awesome. Have an assistant coordinate travel — just tell me when to show up.
Ramit: I love it. Now here’s what was different about your answer versus most people’s. You immediately knew what you’d do. Most people have a linear answer — I’d just eat out four times a week instead of twice. But a Michelin-starred restaurant isn’t just “more Chipotle.” The guy in DC who said he’d take his family because they can’t afford those places — that’s when it becomes real. You need that crisp vision, because otherwise what are you working for?
The Three Money Skills [00:33:00]
Sam: What’s your monthly spend?
Ramit: I don’t think on a monthly basis — I think annually. I’d say probably hundreds of thousands of dollars per year on convenience. Maybe $300K, give or take. When I travel, I have an executive assistant who handles everything — scheduling, haircuts, complex travel, interacting with my travel advisor. She knows my exact seat preferences for every flight. We have a travel protocol that gets activated when I go somewhere — she handles my email, food gets sent to the hotel in advance.
I have a program called Delegate and Done — it covers the 35+ things my assistant does and how we run our weekly check-in meetings.
Sam: Do you feel guilt about spending?
Ramit: Never. When people ask about their rich life, almost nobody says a bunch of $10 items from Target. They say: trips with my kids, a beautiful sweater, a great dinner. So let’s spend more on that and cut back on stuff you don’t actually care about.
My wife is a personal stylist. She goes into people’s closets and fills trash bags. One client: forty bags donated. Once something comes into your house and becomes part of your identity, it’s almost impossible to get rid of it. So I’m very careful about what I bring in. When I buy something, I want it to be the best, and I want to keep it for a long time.
Filming Netflix [00:42:00]
Sam: What was filming the show like?
Ramit: A week before filming started, they found an office in LA. They designed it in 24 hours — walked me in and said give us feedback. It looked like a white person selling their Airbnb. All geometric shapes, wooden accents, very live-laugh-love. I pulled out my Pinterest board of Japanese minimalism and wood and stone and unlimited budgets. They started laughing. We hashed it out.
On the first shoot day in the office, there were maybe 30 people. Multiple cameras, sound crew, producers, makeup. If 30 people were around me during a conversation I’d feel like an animal in a zoo.
The unexpected part was going into people’s homes. More Americans would be comfortable talking about their sex lives than their credit card debt — that’s actual research. Learning to make people comfortable with a camera crew took some learning.
Sam: Do they pay you?
Ramit: I get paid as Talent — that’s the Hollywood term for host — and I’m also an executive producer on the show.
Watching the Couples [00:48:00]
Sam: There was a couple on your show — Monique and Donnell, I think — who agreed to a plan, including selling a storage unit full of stuff and cutting video game spending. Two weeks later he ordered eight pairs of jeans. It drove me crazy.
Ramit: I love that reaction. When I was in my early twenties I was super judgmental. I’d show people another chart thinking if I pushed harder they’d get it. That doesn’t work. Now when someone says one thing and does another, I love it. To me it’s a beautiful puzzle. I know you’re doing this in the domain of money. I’ve seen it a million times. So: how do I figure out a way to reach you, which gets you to see the contradiction and change your behavior — not me imposing it on you?
Sam: The storage unit stuff bothered me too. An old microwave, plastic toys, Target containers — garbage. They were paying $400 a month to store it.
Ramit: I had never gone into people’s houses until a few years ago. The first time, I drove to New Jersey to meet this young woman. The moment she opened the door I thought: I should have done this ten years ago. Beautiful diptyque-style candles, maybe 15 or 20 of them. Giant TV. I asked her to read me the top 10 emails in her inbox: Target, Pier One. Clues everywhere. You see a living room — I see what percentage of her income is going to fixed costs.
The DNS List and Being Selective [00:56:00]
Sam: You mentioned the Do Not Sell list. How does that work?
Ramit: The world wants you to be vanilla. My business could make a lot more money if I got more aggressive — ran Facebook ads, made harder offers. But I have a brand and a reputation.
So we created the DNS list: people we simply will not accept money from.
Policy one: if you have credit card debt, you cannot join our flagship programs. Why? If you actually understood how credit card interest rates work, you’d pay your debt off first, not spend thousands on a course. And people under that kind of pressure — “this has to work, I’m down to my last dollar” — can’t make the changes we need them to make. Slow it down. Here’s a free chapter, come back when you’re ready.
We’ve banned thousands of people. The point: if you really elevate yourself, you go, I’m spending tons of time building the best product in the world, so I’m going to be selective about who I allow to join. Hermes is very selective about who they allow to buy a Birkin bag. Build that selectivity — it creates a better, more profitable business.
Sam: You say don’t be the first mover, wait to write a book, start making money early.
Ramit: I wrote for free from 2004 to whenever I finally sold something for $4.95. When I did, people were furious. They saw me as the free information guy, and when I tried to redefine that relationship they revolted. It would have been much better to set expectations from the start. And without revenue, you can’t build the team, the design, the product that actually matters.
Casey Neistat talked about this — at peak fame around 2016, he was still broke because he’d refused YouTube ads. He calculated he’d missed about $4-5 million a year. Don’t do that.
Would You Sell? [01:05:00]
Sam: Has anyone tried to buy your business?
Ramit: Yes. A mysterious guy approached me at a party in New York — very generic name, knew my business in alarming detail. Conversion rates, funnel structure. He invited me to the Four Seasons for breakfast. Turns out it was three people including me, which felt like an ambush. One guy mentioned he doesn’t drive to his vacation place, he takes a helicopter. Got it — now I understand what’s going on.
They wanted to buy over 50% and hyper-monetize the business. I said no. I actually thought to myself: what would I do with the money? I had an assistant, a trainer — I was like, my life is great. And I’m really glad I didn’t sell, because the business went through a big growth spurt in the next few years.
Now I have a 100% bootstrapped business, I work from home, my team is amazing, and I get to do stuff like this.
Luxury, Books, and Wrapping Up [01:12:00]
Sam: Tell me about the luxury strategy — you have books on it?
Ramit: Two to start: The Luxury Strategy and Kapferer on Luxury. The CEO of Volvo sees two Volvos on a city block and is happy. The CEO of Rolls-Royce sees two and gets worried. Luxury is a completely different beast. You don’t want too many people to have it.
Jay Leno refuses to own a Ferrari because they make you buy the entry-level model, get on a waiting list, then buy the next tier, and you can’t resell. He says: I’m not bowing down to that. I actually respect that, and I also understand exactly why Ferrari does it.
Sam: What are you reading?
Ramit: A lot of mob and mafia stuff. Re-reading a book on Joseph Kennedy — JFK’s father, seventh richest person in America, got rich off insider trading, then became the first head of the SEC and made insider trading illegal. Also re-reading about American capitalism from 1910-1920: Carnegie, Jay Gould, Rockefeller. Cutthroat era.
Sam: I’m reading Unreasonable Hospitality — the guy who ran a high-end New York restaurant. Customers for Life by a car dealer. The Power of the Past by Jesse Streib on class in America. And The Color of Law on real estate, redlining, and race.
Ramit: I love book conversations. Someone should do a podcast that’s just about what people are reading.
Sam: You’d be my first guest. Thanks for doing this, man. Congrats on the show.
Ramit: Thanks. My wife and I connected over it, watching you guys. That’s the highest praise for anyone who creates anything.