If you’re feeling stuck financially, or like you’re not in control of your money, you’re not alone. Studies consistently show that a majority of Americans feel as if they’re constantly playing catch-up with their bills.
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However, there is good news. In a recent video, self-made millionaire Ramit Sethi shared his thoughts on why people feel stuck financially — or less financially comfortable than those around them — and how to change this mindset.
There’s a common misconception that either everyone is living month-to-month, or that they’re relying on credit cards to fund their lavish lifestyles. But this isn’t necessarily the case.
“The way you feel about your money is not correlated with reality,” said Sethi in the YouTube video post on his I Will Teach You To Be Rich page.
To illustrate this point, he mentioned how he’s met people earning $100,000 who feel like they don’t have enough money. But he’s also met those who earn $300,000 who feel the same despite taking multiple annual vacations, sending their kids to private school and maxing out their 401(k) accounts.
What’s important is understanding the difference between the actual numbers and your feelings surrounding your own finances. “Your feelings about money are uncorrelated with the amount in your bank account,” said Sethi.
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Sethi did acknowledge that wealth inequality is a very real problem. Using data from one 2024 study, he noted the following:
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The top 10% of households have an average of $6.9 million and hold roughly 67% of all household wealth.
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The bottom 50% of households have an average of $51,000 and hold roughly 2.5% of all household wealth.
Acknowledging the need for systemic change, Sethi emphasized the role of the individual in managing their money — and feeling financially secure.
“Two people can have the very same income. One is stressed out, the other is thriving. Why? In part because of the way they look at their money and because of the choices they make,” Sethi noted.
According to Sethi, not everyone is richer than you are. However, it might feel like they are. There are several reasons for this:
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You don’t feel in control of your money (or like you take two steps back whenever you take one step forward). It’s not about numbers alone.
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Money stress often comes from not understanding your own finances. It feels like you’re money is controlling you — not the other way around.
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Social media makes it feel like everyone else is living the high life. There’s no credit card debt and no financial stress. It’s all about living that luxe lifestyle, even though many people aren’t.
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You don’t know your numbers — or what’s “enough” to feel financially secure. In that case, your feelings aren’t correlated to the actual number in your bank account or your income.
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You don’t have a vision for what your “rich life” looks like. Instead of making your own vision or dream, you’re comparing yourself to what others are doing.
