Why You Should Be Asking $30,000 Questions

UPDATED: May 22, 2024
PUBLISHED: September 30, 2020

Earlier this week, I got an email from a reader who asked me if they should switch their savings account because the interest rate had dropped from 1.05% to 0.8%. And they were mad. I asked them, “How much does that actually add up to?” They hadn’t run the math. It turns out it’s about $2 a month on a $10,000 balance. My response? “Why are we even talking about this?”

See, most of us are obsessed with asking $3 questions when we really should be asking $30,000 questions. We’re obsessed with cutting back and feeling guilty about spending $3 on our morning coffee, but we never stop to ask ourselves, “How much are we paying in investment fees?” For many people, that’s tens of thousands of dollars.

Did you know that if you’re paying a 1% advisory fee, you’re likely to lose about 28% of your returns? It goes straight in that advisor’s pocket. Did you know that if you don’t have the right asset allocation, the way your investments are set up, that you’re losing tens of thousands of dollars? Have you ever thought about negotiating your salary, which over the course of your lifetime can be worth well over $100,000? Or what about optimizing your debt payoff for your student loan, credit card, car payment, worth tens of thousands of dollars?

Most of us are obsessed with $3 questions, but we really should be asking $30,000 questions. Get those right and you will never have to worry about how much it costs to buy coffee or an appetizer.

Read next: Go for Big Wins: How to Optimize Your Spending


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Ramit Sethi is the author of the New York Times best-seller I Will Teach You to Be Rich and writes for more than 1 million readers on his websites, IWT.com and GrowthLab.com. Ramit and his team build premium digital products about personal finance, entrepreneurship, psychology, careers and personal development for top performers.

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