Ramit Sethi, a self-made millionaire and the author of "Money for Couples," is changing the way families talk about money. With insights from his podcast also titled "Money for Couples," Sethi advises parents to steer clear of the phrase "we can't afford it." He suggests that such language can negatively impact children's financial outlook. Instead, Sethi encourages parents to explain financial decisions by articulating the norms and culture they establish within their household, thereby promoting a positive relationship with money.
Sethi, who has interviewed over 1,000 couples, asserts that a healthy relationship with money isn't necessarily tied to one's financial status. Many individuals with stable jobs and incomes still experience a sense of scarcity due to their upbringing. Sethi would "ban" the phrase "we can't afford it" from homes, emphasizing that it can have lasting effects on people's financial perspectives.
"I love saying no, and sometimes no is all you need to say." – Ramit Sethi
Encouraging open dialogue about finances, Sethi believes in getting children involved in family financial tasks. By participating in activities like planning a family trip or purchasing a family car during their teenage years, children can build a solid foundation for understanding money management. This involvement teaches them about the realities of taxes and financial trade-offs.
"That is how they start to learn about taxes and trade-offs. That's how you equip them to be successful in the real world." – Ramit Sethi
Sethi's book "Money for Couples" offers guidance on managing finances in relationships, further advocating for transparency and communication. Through his podcast discussions, he highlights how many individuals recall hearing the phrase "we can't afford it" during their upbringing. Such memories often shape their adult relationship with money, underscoring the importance of how financial conversations are framed at home.
Sethi challenges the traditional notion that children should be shielded from financial matters. He argues that discussing money openly equips them with the skills they need to succeed in the real world.
"Deep down, most people believe that money is a bad thing, that kids need to be shielded from [it]," – Ramit Sethi