“The most important way to grow your wealth is really simple and almost deceptive,” he says. “And even though they look boring, they actually work.”
If you do these three basic things, “you'll end up with a lot of money in the long run,” Sethi says.
The first and most important way to increase your wealth is through investing. “Each year, automatically invest a certain percentage of your income and increase that percentage by 1%,” Sethi says.
Investing in low-cost index funds like the S&P 500 can grow your money, similar to the “secret investments” accessed by wealthy people, Sethi says.
“We tend to believe that rich people have access to secret investments and make huge amounts of money doing so,” he says. “Listen, I have access to those investments, but I can tell you right now, they typically don't perform any better than a simple S&P index fund.”
S&P has historically performed well. From January 1926 to June 2023, the index had an annualized total return of 10.34%, said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.
“The general truth is that you can get great returns with simple, low-cost, long-term index funds,” Sethi says.
After learning how to invest your money, the next step to increasing your wealth is to seek a fair wage, Sethi says. “Learn salary negotiation skills and receive a salary commensurate with your worth.”
Companies may still be lowering their public salary ranges, so it's important to keep negotiating to get the highest amount. Pay experts say the top of the pay range should be 40 to 60 percent higher than the bottom. But in reality, the average salary range for job listings is about 28%, according to a report from Bloomberg.
Doing your research and looking for information about what others in a similar position are doing is an important step to ensuring fair compensation, Sethi says.
When it comes to salary negotiation, you can ask a recruiter who is familiar with the candidate's salary range. Recruiters may have more up-to-date, personalized information available than in online databases.
Madeline Machado, a reverse recruiter in Tampa, Florida, previously told CNBC Make It: Don't accept the first offer you're given, she added.
These three steps are simple and doable, Sethi says. But those aren't steps people commonly take.
“You know why people don't do that? Because we're taught that to get rich we have 30 screens and all the P/E's and we have to pick stocks. .Investing is like gambling,” says Sethi. “None of that is true.”
Sethi says investing, unlike gambling, is not, and should not be, a form of entertainment. Investment and financial management are routine tasks, he added. Sethi spends “less than an hour a month” managing all his money.
“Real investing is boring. It's like watching paint dry,” he says.
“People talk about investing like it's entertainment. We have to buy GameStop, we have to do this,” he says. “If you want to be entertained, get a dog. If you want to be entertained, watch my Netflix show.”
Don't miss: Want to be smarter and more successful with money, work, and life? Sign up for our new newsletter.
Get CNBC for free Warren Buffett Investment GuideThis book compiles the millionaire's #1 advice for everyday investors, the dos and don'ts, and three key investment principles into a clear and simple guidebook.
