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1. Always have one year of emergency funds

One year of emergency fund savings “is more conservative” than most finance experts might recommend, Sethi acknowledged. But it helps him (and could help you) sleep better at night.

“It’s in a savings account, totally liquid and that’s what it’s for,” explains Sethi.

Good places to keep an emergency fund include bank accounts, particularly high-interest savings accounts, as well as premium chequing accounts that require a minimum account balance to waive monthly fees, but keep all the bank account perks.

Good high-interest savings account options include:

  • EQ Bank: This online-only bank offers one of the best high interest rates on savings and deposits in Canada. Customers can expect to earn on every dollar deposited, but still have the freedom to pay bills using the no-fee account. For instance, save $10,000 in an EQ Bank savings account as an emergency fund and earn $400 in interest.

  • Scotiabank's Momentum Plus Savings Account: As one of the Big 5 Banks, Scotiabank is a reputable traditional bank with plenty of in-person branches. Right now, new clients can earn 6.05% on every dollar deposited for the first three months. There are no fees and no monthly minimum required on the account.

  • Simplii Financial High Interest Savings Account: This online-only bank never charges monthly fees and offers some of the best bank promos. Until July 31, 2024, new clients can earn 5.9% on eligible deposits for five months, before it drops to the regular 0.40% earn rate. On a $10,000 emergency fund deposit that's approximately $290 in interest income.

Good premium bank account options include:

  • BMO Performance Chequing Account: This is BMO's perks-rich every day bank account. While it comes with a monthly fee of $17.95, this fee is waived if you maintain a daily balance of $4,000 or more — a great option to park an emergency fund. Open and fund your account before the end of July and your savings will earn 5.5% interest.

  • Scotiabank Ultimate Package: This premium banking plan comes with a pretty hefty monthly fee of $30.95, but the fee is waived if you maintain a daily mimimum balance of $6,000. Use it as a place to park your emergency fund and also get access to a long list of perks and value-added banking services, such as unlimited debit transactions, no-fee international money transfers as well as unlimited Interac e-Transfers.

2. Save 10% + invest 20% of gross annual income

Sethi is a fan of investing in the S&P 500 — or similar passive index funds or low-cost exchange-traded funds (ETFs), which tracks the performance of the largest companies in the equities markets. While all equity investing will experience ups and downs, historical returns shows that long-term buy-and-hold strategies consistently trend upwards. For instance, the S&P 500 — the go-to benchmark for the US equity market — has seen gains of around 80% since February 2019.

If you don't plan to become an active trader, a good way to start investing is through index funds. In Canada, the gold-standard fund is the S&P/TSX Composite Index (TSX:SPTSX). This is the index fund most investors and portfolio managers use to benchmark market performance.

Unfortunately the price per share for the S&P/TSX Composite Index (TSX:SPTSX), is prohibitive for most investors — with the price of one share hovering just over $22,000.

Instead, look for exchange-traded funds (ETFs) that track the S&P/TSX Composite Index (TSX:SPTSX). Good options include:

  • Vanguard Canada Inc S&P 500 Index EFT (TSX:VFV)
  • Vanguard FTSE All Cap Index ETF (TSX:VCN)
  • iShares Core S&P 500 ETF (TSX:IVV)
  • SPDR S&P 500 ETF Trust (TSX:SPY)
  • Vanguard Total Stock Market ETF (TSX:VTI)

Keep in mind, the above funds are the Canadian equivalent to index funds often cited by Warren Buffett and other buy-and-hold investors as the top options for passive investors.

To get started with investing you'll need an online trading account

To start investing you'll need an online brokerage account. When choosing, select an account that helps educate you on the assets you're interested in, while keeping your trading and ongoing account fees to a minimum. Good options include:

Invest in real estate without buying a home

Another option is real estate investing. While property purchases will often require a large injection of cash — and, as Sethi points out, tying up your money in one financial purchase isn't always wise — a good alternative can include real estate investment trusts (REITs).

REITs offer real estate exposure — a great alternative to fixed income investments — but with the benefits of liquidity, since they are bought and sold like stock.

There are more than 40 REITs listed on the Toronto Stock Exchange (TSX), as of 2019, and 19 of these are included in the S&P/TSX Composite Index (TSX:SPTSX), the index fund investors use to benchmark market performance.

For instance, the S&P/TSX REIT Index (SPTSRE:IND) trades at just over $300 per share (as of April 2024). This sector-based index created by S&P Dow Jones Indices is comprised of REITs with individual fund weightings capped at 25% (meaning, no one REIT can capture more than 25% of the index). Other options that offer an entry price below $100 per share (as of April 2024) include:

  • Allied Properties REIT (AP-UN.TO): Urban office space with holdings in Canada's largest cities. Approximate price per share: $17.35
  • Boardwalk REIT (BEI-UN.TO): Multi-family rental communities with holdings from across Canada. Approximate price per share: $72.35
  • Can Apartment Prop REIT (CAR-UN.TO): Focuses on residential apartment buildings that include apartments, townhomes and manufactured community sites. Holdings across Canada and the Netherlands. Approximate price per share: $45.30
  • Choice Properties REIT (CHP-UN.TO): Focus on work/live communities across Canada. Approximate price per share: $13.15
  • Crombie REIT (CRR-UN.TO): Focuses on grocery-anchored retail, mixed-use developments and retail related to industrial use. Approximate price per share: $12.80
  • CT REIT (CRT-UN.TO): Closed-end fund with a focus on income-producing commercial properties across Canada. Approximate price per share: $13.80

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3. Pay cash for large expenses

Sethi says big holidays, weddings and engagement rings fall under this category.

“This one is controversial,” he noted, but the strategy of paying for cash accomplishes a few money management strategies. The first benefit is that paying cash means the buyer must build delayed gratification into all big purchases. This habit also helps you avoid unsecured debt — often the most expensive form of debt, such as credit card debt.

To avoid the use of credit cards, Sethi sets goals for these large expenditures and saves monthly towards the total cost of the large expense.

Another option is to create an account and to start saving, but then use a rewards credit card to buy the item. The full cost of the item can be put on the credit card and the debt can be repaid from your saved funds.

4. Never question spending money on books, appetizers, health or contributing to a friend’s charity fundraiser

Sethi has a book-buying rule: If he thinks it’s possible to learn even one transformational lesson from the book, he’ll buy it.

Contributing to a friend's charity fundraiser is a no-brainer: It's Sethi's committment to building experiences and community, not just a savings account.

But appetizers? Sethi says in his youth his family would never get appetizers on the rare occasion they out — it just wasn't in the budget. Now that he's an adult, with the finances to afford this small luxury, he gives himself the opportunity to indulge. For Sethi, this indulgence is something that “feels incredibly rich” to him; it brings him joy — and that's the true purpose of money and financial decisions.

5. Book business class for flights more than for fours long

Yes, the seats are more expensive than flying economy, but Sethi argues that the cost helps a person go from “from disparagement to curiosity." he said.

If paying for first-class flight tickets still feels out-of-reach, consider joining a travel rewards program that will help you subsidize the cost of more expensive flights through rewards.

6. Always buy the best and keep it as long as possible

You don't have to spend exorbitant amounts to buy the best, but it does mean doing your research and ignoring the noise around status symbols. For instance, Sethi takes pride in his four-door Honda Accord. The car is more than 15-years-old and still going, simply because it's a very reliable car model. Any savings Sethi has from keeping his car can be applied elsewhere.

7. Don’t limit spending on health and education

Growing your knowledge base sets you up for greater success.

“I want to learn from great [finance] teachers by taking accounting classes,” Sethi said.

Tending to your health yields a better quality of life. Sethi says that getting help from a personal trainer, for example, can help with your workout and nutritional regimens.

8. Earn enough to work only with people you respect and like

“Whom you surround yourself with matters profoundly,” he noted. “Ideas seep into your consciousness, values seep in.”

If you feel stuck with a jerk at work, explore transferring to another department and a different boss. Don't be afraid to let people know you are open to opportunities.

9. Prioritize time outside the spreadsheets

“Yes, you should know your numbers,” Sethi said of money matters.

But at a certain point, he stresses, it’s time to turn the page and live a rich life with friends and family.

“I spend less than one hour per month on my finances.”

10. Marry the right person

Quite often the idea of building a life someone centres on intrinsic values, such as how a person feels about having kids or where they want to live. But just as important is how someone handles money and what goals they consider important.

As such, who you marry is actually one of the most important financial decisions a person can make.

“Maybe the most important one of all,” explains Sethi.

The partner you choose, he contends, “will effect where you live, the house you’ll buy and how much you spend.”

Talk about money early and often with your partner to create harmony around one of life’s most crucial matters.

What to read next

— with files from Lou Carlozo


1. Moneywise: You've been lied to, Ramit Sethis says, by Vishesh Raisinghani (Dec 8, 2023)

2. Diary of CEO: The Money Expert - "Do Not Buy A House!" 10 Ways To Make REAL Money: Ramit Sethi (July 20, 2023)

3. UCalgary News: UCalgary economist says impact of rising interest rates will vary from person to person

4. Moneywise: 'I'll teach you to be rich in 10 minutes', by Vishesh Raisinghani (Jan 28, 2024)


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Romana King Senior Editor,

Romana King is the Senior Editor at She writes for various publications, and her book -- House Poor No More: 9 Steps That Grow the Value of Your Home and Net Worth -- continues to be an Amazon bestseller. Since its publication in November 2021, this book has won five awards, including the New York CPA Society's Excellence in Financial Journalism (EFJ) Book Award in 2022.


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