Psych Yourself Rich — Interview with Farnoosh Torabi

I had recently had a chance to interview Farnoosh Torabi about her new book, Psych Yourself Rich. Farnoosh is a personal finance writer and TV personality who has appeared on the Today Show, Bank of Mom and Dad, Wall Street Confidential, etc. As a big money-and-emotions person myself, her ideas appealed to me.

Here’s the interview.

Could you tell us a little bit about how you came to write Psych Yourself Rich, and who you believe would most benefit from the book?



While working closely the last two years with young adults and families suffering from financial setbacks, I often found myself playing the role of therapist, instead of money coach. I could sit there and give people as much technical advice about the best order to pay off your debt, how to make more money, how to save on certain items in their budget, etc., but without exploring the emotional issues these people had with money first, no improvements could ever be made.

I love how you talk about the term rich in the context life experience and behavior leanings, instead of joining in on the popular argument about whether or not $250,000 = rich. If someone had to pick one thing from your “formula for rich” to focus on first, what would that be, and why?



The first thing to focus on in that formula for rich is personal savings. To see your savings account grow you will not only be in a more secure place with your finances, but you’ll feel empowered and confident in that money relationship. You’ll be motivated to continue to make wise decisions with your money. It’s interesting…once I started getting into savings gear and would see my bank account grow I didn’t care for frivolous things anymore. I no longer obsessed over buying clothes and shoes. I would, instead, long for more meaningful things like buying a house or taking a vacation somewhere overseas.

I completely agree with your statement that “With defined ambitions, we suddenly don’t need or want many things that we previously may have coveted. The phrase having it all doesn’t literally mean having every material thing in the universe. It means having what you need and some things that you want and overall feeling very pleased and content with your life and your relationships in the long run.” Is there a story behind how you came to that conclusion?

I came to this conclusion in my personal life early on when I moved to Manhattan at 22. I quickly learned the truth about trade-offs in life. Living on a $40,000 a year salary in one of the most expensive cities in the world forces you to become very good at narrowing down your needs and wants. I wrote about this in my first book, You’re So Money. When you build a specific hierarchy of needs and wants based on your goals and your means, you won’t miss having all that other “stuff.”

Speaking of relationships, you point out that money plays a huge role in a couple’s relationship. You suggest bringing up money while dating by asking general money-related questions like ‘How did you pay your way through college?’ and ‘What is your earliest memory of money?’. What do you suggest doing if you don’t like the answers you hear? The logical thing would be to try to find someone you’re more compatible with, but love is not well-known for being logical.


No…love and money are both irrational beasts. But get this – studies show we are hard-wired to marry our financial opposites. Savers are attracted to spenders and vice versa. So what’s more important than finding your financial clone is that – whatever your money habits are – that you find common ground, agree to mutual goals and strive to achieve them as a couple. If you can freely communicate with your partner about money and have good debates, that’s what’s going to keep the marriage strong. It’s not that one person makes more than the other … or one person has expensive tastes.

You also talk about fear being a major emotion when it comes to finances. I think fear can be alternately paralyzing or highly motivating when it comes to the things we do to make money — it can keep us in situations that aren’t the greatest, or jump start us on a new path. When you got laid off from your job at TheStreet.com, how did fear help you to really strike out on your own?



I visualized my worst fears. I took myself to that deep, dark scary place where I would fall behind on my bills for lack of income. I imagined moving back home with my parents. Then, after scaring myself straight, I came up with a to-do list of all the actions I could take to avoid those worst-case scenarios. I started working on anything I could get my hands on, even if it was just temporary. I channeled my fears, took control of my emotions and directed that adrenaline towards a more constructive path.

How could others use fear as a motivator to do things like go into business for themselves, change careers, or get their life on track?



The fear of failure is very powerful. One female entrepreneur who owns her own marketing firm recently told me that she tastes fear every day to keep her working harder. “I’m self-supporting. If I don’t bring in revenue, no money comes in, which means I can’t pay my mortgage or make car payments. Failure is not an option. Being destitute is not part of my life dream,” she tells me. If you think like that, it’s inevitable that you will succeed in your career.

Finally, what’s the most important first step you believe folks could take to get the mindset they need to build their financial lives?


Define what “rich” means and feels to you. It’s purposely the first chapter in the book. The better you can get at seeing rich as security, the better off you’ll be. Rich is not accumulation. It’s not multimillion-dollar homes and Ferraris. It’s about being in control of your income, having proper savings and addressing your personal and professional goals. Forget what your neighbor is up to. Forget what the media dictates. No one cares more about your money than you.

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