Here’s How Ramit Sethi Would Invest $1M — Should You Follow His Advice?
Written by
Ashley Donohoe
Edited by
Jenna Klaverweiden
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The UBS Global Wealth Report 2025 noted that there were nearly 24 million millionaires in the U.S. in 2024. While having $1 million goes a long way toward giving you financial freedom and security, it also comes with important decisions about how to manage wealth.
In a recent YouTube video, Ramit Sethi explained that reaching $1 million shifts your mindset toward risk management and legacy, and he walked through what he would do with that amount. Find out whether his investment advice might work for you.
Also see seven money traps keeping you broke, according to Sethi.
Have a ‘Boring’ Core Portfolio
You might think that millionaires have some magical investments with very high returns, but Sethi, as a self-made millionaire, said he’s instead taken a more traditional approach for his core portfolio.
“Personally, the vast majority of my money goes into the same boring index funds that every single person has access to,” Sethi explained. “The only major difference: bigger numbers.”
Invest Sparingly in Alternative Investments
Alternative investments include things like crypto, gold, hedge funds, collectibles and real estate. While the Charles Schwab 2025 Modern Wealth Survey found that 45% of U.S. investors were interested, these investments often come with limited liquidity, higher volatility and potential complexity.
Since there’s a higher risk of earning nothing or losing money, Sethi said alternative investments would make up only around 5% of his portfolio.
Follow Tax Optimization Strategies
When you have $1 million, minimizing taxes is even more important. Sethi brought up common strategies, including harvesting losses to offset gains, converting traditional IRA contributions to Roth and planning your estate with taxes in mind.
Since taxes can be complicated, Sethi suggested seeking the help of experts, including financial planners and accountants. He also recommended hiring only those with flat or hourly rates.
Practice Philanthropy
“Once you are at a million dollars, money stops being just about you,” Sethi said. “In fact, at the highest level of a rich life, it is always about other people.” In addition to using your wealth to live the life you want, consider using some of it to improve other people’s lives.
Being a philanthropist can also help you. According to Rush University Medical Center, giving to others can boost your life satisfaction, physical health and mood.
Is Sethi’s Advice Right for You?
Sethi’s advice for millionaires focuses on avoiding investing too much money in overly risky assets and prioritizing more time-tested options, such as index funds. The idea is that investing consistently in these funds over time helps you grow wealth more reliably. Plus, losing the small amount you put into riskier assets likely shouldn’t hurt you as much financially.
To decide whether his advice is right for you, consider your risk tolerance, lifestyle, time horizon and understanding of different investments. Any investment carries the potential for loss, so it’s important to understand all the pros and cons of what you’re putting your money into.
Also, working with a financial advisor can help you understand which investment strategies are right for your goals and financial situation.
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