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Ramit unpacks what happens when a couple earns more than $1 million a year but still feels like they’re living month to month, and how a lifestyle built around family, community, and tradition can become almost impossible to afford.

Ramit Sethi of I Will Teach You to Be Rich talks with Margo and Kevin, 42 and 52, who live in Brooklyn with their five children. They take home around $600,000 a year and have approximately $11 million in assets, yet only around $50,000 in savings. Once Ramit uncovers expenses missing from their original plan, including private school tuition and summer camps, their fixed costs climb above 100% of their take-home pay, revealing that they’re spending more than they make every month.

Their biggest challenge isn’t simply earning more money. Kevin has taken on most of the finances while Margo has had limited visibility into their overall financial picture, and neither of them has a clear picture of where their money is actually going. Ramit helps them confront how community norms and family traditions shape what they see as non-negotiable, and the difficult choices they may need to make around private school, their homes, their children, and the lifestyle they’ve built.

In this episode we uncover:

• How a couple earning over $1 million a year can still live month to month
• Why they describe themselves as “rich poor people”
• How missing expenses push their fixed costs above 100% of their take-home pay
• Why $160K in tuition and camps completely changes their financial picture
• How a $400K–$500K mold crisis wiped out much of their financial cushion
• Why they have $11 million in assets but only around $50K in savings
• Why Kevin manages most of the money while Margo has limited visibility into their finances
• How childhood money lessons shaped their “earn more, spend more” cycle
• How community and tradition shape their spending
• Why they may need to make major changes to their homes, education costs, and spending to finally start saving and investing

Chapters:

(00:00:00) Introduction 

(00:02:00) Why they call themselves “rich poor people” 

(00:25:00) Ramit opens up their numbers 

(00:43:00) The hidden expenses pushing them over 100% 

(01:06:00) How their childhoods shaped their money habits 

(01:11:00) How community and tradition shape their spending 

(01:15:00) They finally confront what has to change 

(01:33:00) Why $11M in assets still leaves them cash poor 

(01:36:00) Private school, their homes, and the difficult decisions ahead 

(01:58:00) Follow-ups

 

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Transcript:

Ramit: Let me read you something from your application that caught my attention. You wrote, “At the moment, we are rich poor people, high income with no savings, and living month to [00:05:00] month.” Tell me about that
Margaux: it’s exactly what I wrote. Thank God we’re very fortunate to have a beautiful life, and my husband makes a very nice living. He works really hard, and he built everything himself. So, you know, it’s not anything that was given to us. It was something that was, worked for.
And in the grand scheme of things, if you look at his income, we’re considered a top whatever percent wealthy people.
However, there’s a struggle to pay the bills month to month So every month he’s figure out how to pay the bills ’cause he does the money? I don’t know if it’s month to month. It’s more like, at the end of the year when we’re getting down to the bottom of things, like h-how is it that we’re short?
Ramit: You’re short at the end of the year?
Kevin: Well, there’s not much left when there should be
Ramit: Which is it? Are you short or there’s not much left?
Kevin: I wouldn’t say losing. Hmm.
Ramit: wouldn’t say losing.
Kevin: But spending every single penny
Ramit: Okay. And then what is a rich poor person?
Margaux: Somebody that lives a wealthy [00:06:00] life, very comfortable lifestyle, owns homes, is able to go on vacations, and at the same time has such a high cost of living, there’s no savings. There’s no cushion.
Ramit: Mm.
Margaux: Margo, when you wrote that application, what was going through your head?
So for a long time, I’ve seen my husband working really hard, sweating for making things work, keeping up a very, I would say high lifestyle, paying the tuition bill with private school, and just trying to keep everything intact and keep everybody happy. And, I think he consistently would say, “I don’t understand. How is it possible that this is what I made this year, and I don’t have anything left at the end of the year? It’s another year. How is it possible?” And so I started to listen to some podcasts on finance and,
just trying to, you know, figure out how I could help us as a couple, as a family [00:07:00] financially, shift the energy and shift it the way things are going so that we’re-
Ramit: application though sounds like there was some tough stuff going on. Like, at the moment we are rich poor people. What was going on then?
Kevin: We have
Margaux: a very high tuition bill, that’s a very big part of our income. And my dad helps with some of it, and we decided that we’re gonna, take on the whole thing next year. So if that being the case, that’s gonna be an even more difficult, pill to swallow next year with everything going up.
The food is consistently going up. The tuition bill goes up a little bit every year, and we have, five kids to pay tuition for
Ramit: You have five kids in private school?
Margaux: You have five kids in private school? Yeah.
Ramit: Oh, wow. Okay. So let me make sure I understand. Margo, your dad was helping with some of the tuition bill. You both decided, we’re gonna do this on our own, and when faced with the cost of five kids in private school, knowing that even with the help from your dad, you were already not putting aside a lot of money, and now it’s gonna be even a bigger [00:08:00] expense.
You’re like, “What are we supposed to do?”
Margaux: Exactly
Ramit: Is that what brought you to applying to speak to me?
Margaux: Yes. Okay.
Ramit: Good to know. Kevin, what’s your take on this whole s- situation as Margo described it?
Kevin: You know, as the kids get older, they get– it’s more expensive to take care of them. So just maybe that pressure she felt of kids starting to go to college, getting older, having more needs. She
Ramit: Who feels more pressure about money?
Margaux: Kevin.
Ramit: Ah. Is that because you manage the day-to-day or what?
Kevin: It’s been a part of my history, worrying about money
Ramit: you worried for a long time?
Kevin: Oh. You worried for a long time? It’s always there somehow. As I get older and I’m dependent on a business to keep performing- … it’s becomes a question, you know, when am I putting away savings, and when is that gonna benefit me?
Ramit: Gotcha. Okay.
Money Stress in Marriage
Ramit: when you think about the word money, and money in your relationship right now, what’s the first word that comes to mind?
Margaux: fun
with
Kevin: we have fun with it
Ramit: Money’s fun. Okay.
Kevin: Yeah.
Margaux: Stress
Ramit: Fun, stress. [00:09:00] Okay. How long has money been a source of stress for you?
Margaux: I think it was maybe a few years into the marriage- where it started to become stressful for Kevin, because I don’t really deal so much with the finances.
He’s the one that makes the money and pays the
Ramit: So is he the one who’s stressed out about it,
Margaux: Yeah, but it causes stress in the relationship because when he’s stressed about it, I’m the one who’s running the home. So it becomes a questioning of what’s, you know-
Kevin: Yeah, she gets the brunt of my
Ramit: worry. He does. So you get stressed, Kevin, and then you start asking questions. Why are we doing this? Can’t you save money on that? Is that how it works?
Kevin: Uh, sort of. What else?
Ramit: So you get stressed about money, and then how does it rub off on her?
Kevin: I wanna understand the stress. So you get stressed out now- St- well- … how does it rub off on her? I could get upset about it, be in a bad mood about it.
Just, you know, things like that, where she’ll get the brunt of that, and then-
Ramit: Margo, you wanna add anything?
Margaux: It affects the dynamic of the relationship because once he’s stressed about money, things just feel like they’re constantly revolved [00:10:00] around that, and it’s, “Why is the bill this high?” “I don’t know, hon. Let’s look at it together. I brought it home. Why don’t you look at it?”
And it’s like, oh, kosher meat in New York. We’re feeding, an army in the house. And it’s a lot. I don’t know. I don’t know what to say. I was never one to, ir- responsibly go shopping and buy myself things that I shouldn’t. So it’s kinda like we both don’t know why we’re in this position constantly.
Ramit: this position constantly. You
Kevin: He’s confused.
Margaux: He’s confused. I’m trying to…
Ramit: I have a question for you ’cause this is t- twice now. So I asked, “How do you feel about money?”
He goes, “Fun.” You go, “Stressed,” but it’s actually him feeling stressed. What do you feel?
Margaux: It’s fun to make it. It’s fun to make it. Okay. And then I ask how, do you feel confused about money? You go, “He feels confused.” What do you feel? I feel That we live a very high lifestyle, and in order to be able to keep our kids in private school and keep this lifestyle, we have to find a way to make more income because it doesn’t seem to me, that there’s anywhere very significant where we can cut.
Ramit: You agree?
Kevin: Yeah.
Ramit: Okay.
Margaux: Do you agree? Uh, yeah. Okay. But maybe
Ramit: But maybe- Are [00:11:00] we about to have the shortest conversation in the history of this podcast? Y’all just need to make another, what, million bucks?
Margaux: half a, another half a mill, right.
Ramit: Call it a day.
Kevin: good. Until we’re not.
Margaux: Call it a day. And coming up. And there’s another something that we didn’t mention, was that we have plans to build a summer home. Okay. So, it’s been in the making for a couple years now. we’re living in a, like this house the way it is, and, we would love to be able to fix it. That’s a big thing for us. But it’s like, how?
Ramit: Okay.
Jersey House Debate
Ramit: What’s a time in the last few months or even year that you have disagreed about money?
Margaux: Kevin thought that maybe it would be a possibility to move to New Jersey. It would bring our expenses way down because the schools there would be a lot less than what we’re paying in New York.
And I don’t wanna move there,
Ramit: You don’t wanna move to Jersey? No. Okay. Why?
Margaux: It’s just not for me. It’s, like, really quiet and desolate in the
Kevin: slower pace.
Margaux: it’s just, I’m not [00:12:00] ready to make that move. It’s a big move. the pressure would really decrease by a lot. I think that the cost of living would go down. But it’s a very different lifestyle, and it’s a commitment
Kevin: I brought it up a few times, but I knew it was off the table. She wasn’t doing it, so I just gave up after a little bit
Margaux: after a little bit. Is that
Ramit: but it’s a very different lifestyle How long did you talk about this and disagree about this? I brought it up a few times, but I knew it was off the table. She wasn’t doing it, so- Oh … I just gave up after a little bit. Is that a typical trend? You bring something up-
Margaux: No,
Kevin: Is that a typical trend? You bring something up- No, this is a big move, you know, to do that.
The idea that there’s a lot of, s- whatever you wanna call it. There’s a lot of liquid sitting in the home.
Ramit: If we
Kevin: sold it, invested some,
And had a strategy of how to earn on that, it might bring the pressure down that we’re under and just live a better lifestyle.
A little lower key, a little less hectic
Ramit: And Margot, you said no because you don’t wanna move there. It’s-
Kevin: And sh– yeah That’s our, like, safety net, and
Ramit: … it’s an asset that hopefully will keep going up.
Margaux: Have it for, our children down the road if we decide to move or to [00:13:00] change, our lifestyle and, go somewhere else, so we have an asset.
Ramit: That what he was proposing? You have an asset- But I’m not gonna sell
Margaux: Yeah, but I’m not gonna sell that now because
we have a great home. We live in a really great block in a great neighborhood.
The kids are happy. We’re very comfortable.
Ramit: We have a lot of kids. Okay, so you wanna keep it the way it is for now? For now-
Margaux: So you
Ramit: And then I have a question. You mentioned we have this asset so that one day we may give it over to the kids.
But you have five kids in one house, right. I know you have other houses, but this one, how do you envision distributing a house to five kids?
Margaux: they’ll sell it, and they’ll distribute the funds
Ramit: money …
Margaux: They’ll split the money
Ramit: Okay, cool. Have you talked about this? Oh.
Kevin: That’s the plan, but not
Margaux: the norm for- Yeah
where we come from.
Ramit: What does that mean, where we come from?
Margaux: We live in a community in Brooklyn … And we all live in kind like the same area. Yeah. And, so my grandparents left their homes to my parents, and my parents will probably leave, their homes.
And, generally speaking, everything has just consistently [00:14:00] gone up in value.
Ramit: So this is what you’ve seen happen for generations. Yeah. So that’s the plan here.
Kevin: Okay. Margot-
Ramit: feels most frustrating to you about your financial situation?
Margaux: The hamster wheel of constantly just trying to keep up, pay the bills, and at the end of the day, there’s no savings. And it’s the same thing year after year, and we need to, educate ourselves, figure this out on our own, ’cause obviously nobody’s gonna teach it to us, and we have to have a plan.
And it’s enough is enough. There’s,
Ramit: is
Margaux: Enough is
Ramit: Hey, I love that phrase. Enough is enough. Let’s fucking do it. Gotta do it.
Margaux: We gotta do it. Enough’s
Ramit: enough. How long have you felt this way, like, “God, this sucks,” when it comes to money?

Margaux: from where we come from, almost everybody sends to, to private school, and everybody seems to be struggling to keep up, not just us.
And if you think about it logically, it makes absolutely no sense. Like, how we’re just going and spending all this money every year. We don’t have savings. Our kids are not set up. What is this doing for us? we want a [00:15:00] certain future, and if we’re not gonna make the changes now, we’re not gonna get there.
It’s just logical. If you see where we are now and where we wanna go, we’re not kind of, like, on that path.
Narration: I’m not sure what the dynamic is between the two of them because there’s so much information coming at me. But a few things are clear to me already. They both have a story about money, and I can tell that they have repeated this story a lot. And it is entertaining. I’m kind of enjoying it, but I’m wondering when are we gonna get to the real stuff? I mean, after all, the application speaks for itself.
I think the way they’ve set it up is this traditional sense of he makes it, she spends it. But I think there is something deeper beneath here. I just don’t know what it is yet.
Allowances and Saying No
Kevin: we do spend. We go out for dinner a couple nights a week. The kids go. They come. They get allowances.
Ramit: How much is their allowance?
Kevin: My one in college, I’m probably giving 300 a week to-
Ramit: They get my– One in college, I’m probably giving 300 a week to- 300 a week? Yeah.
I was once 18 years old. Weren’t you both? Yeah. Did you need [00:16:00] $1,200 a month for food?
Kevin: No, I know. I was working at 16, so I didn’t come from- I … all this giving
Ramit: all this privilege. Hold on,
Kevin: I grew up without money, so I knew how hard it was to get 10 cents out of my, my dad. May he rest in peace. Um, because at 15 I was working for myself. I was all on my own. Yeah,
Spending Lifestyle Tensions
Ramit: what do you think is stopping you from changing this financial situation?
Kevin: I like the fun. We like to go away. We go to Italy in the summers. We just got back from a fantastic ski trip in Europe. So those things are tempting to me. I spend on them. There are certain things we could cut out, but then, I feel like we’re just not enjoying what we like to enjoy.
And that-
Ramit: the crux of it though?
Margaux: I mean- No. We went to Europe because it was a quarter of the price as to go to
Ramit: margo, listen, listen, I’m gonna repeat what you just said out loud so
Margaux: It was literally…
Hello, America
Kevin: Instead of going to Vail,
Margaux: We
Kevin: decided to take our family of seven to Europe.[00:17:00]
Margaux: our family of seven to Europe. Aren’t we- It was- … economically- It was cheaper … conservative? Care to respond? It was cheaper. Significantly cheaper.
Kevin: respond? It was
Margaux: sticking with it. But It was- That same, that was the same. No. It was significantly- I’m trying to save you here
it was literally significant. Was it not significantly
Ramit: sticking with
Kevin: But it was ex- at the same time, it was
Ramit: the same time- S- d- do me a favor,
Margaux: All right. But
Ramit: trying to save you here.
Kevin: Literally significantly.
Was it not significantly cheaper?
Ramit: Yeah. It was literally
Margaux: saying, okay,
Ramit: make our own decisions in life. God bless. Fair enough. All right.
CSP Not Done Together
Ramit: shall we take a look at your numbers?
Margaux: your numbers? If you’d like to. Oh, the
Ramit: if you’d like to. Oh, the mood shifted. That’s interesting.
How was it to do the conscious spending plan together?
Margaux: We did not do it together.
Ramit: Okay. Now I just wanna point out, this is quite an interesting scenario because Margo, you’re the one who applied. Part of the instructions are that you should do the CSP together.
Did you see that?
Kevin: Yes.
Margaux: Okay. Now, I just want to put, it’s quite an interesting scenario because Margo, you’re the one who applied. Part of the instructions are that you should do the CSP together. Did you see that? Yes. So I was like, “Let’s do this together. I don’t… What do we have to do?” Okay. And Kevin said, “I’ll do it. I’ll take care of it.”
Money Talk Avoidance
Ramit: you say, “I’ll take care of it”?
Kevin: did you say, “I’ll take care of it”? Because if I went to her with a question about something, she doesn’t have the answer. Okay.
On what I’m spending a month on, whatever, the cars, the subscriptions.
She’s not really aware,
Ramit: so it’s don’t ask her ’cause she doesn’t know.
Margaux: [00:18:00] it’s don’t ask her because she
He wants to change, but I feel like He’s not committed to, just figuring it out with me somehow
How Others Afford It
Ramit: do other couples do this? it?
Kevin: Do you have other couples? I don’t know. A lot of, couples that we know are dependent on, of course, themself, what they earn, but there’s a lot of extra help in our community.
Well, you guys-
Ramit: Well, You guys, at least right now, for the moment, do, have a limited amount of that. So you don’t know how other couples do it. Margot? How do other couples
Margaux: This is a conversation that we have consistently. How is everybody else doing it? You’re making X amount. How is everybody else
Ramit: there possibly a podcast that shows in depth what other couples talk about behind closed
Kevin: doors?
No, like we were home for, Passover this year, and I could have laid down in the middle of the street a soul around There’s no one in Miami. Everybody went to
Margaux: of, 10 families home.
Everybody’s away. How is
Kevin: everyone’s on a-
Margaux: bill? Paying their summer homes and vacat-
Ramit: Okay, I understand the curiosity. That is interesting, but is this like a woe is me?
Margaux: No, no, we’re very appreciative of the lifestyle we live. Absolutely not. Okay. We’re [00:19:00] very, very fortunate. But you’re wondering, like, how do they do it? But how does… Like, you’re making a nice salary. Like, how is this possible?
Ramit: Cause,
Kevin: we’re spending it. There’s a part of my brain that doesn’t know how to put aside, and when I do and it’s there, it’s just in the bank. So that doesn’t do anything for
Do It Together
Ramit: I will show you different ways of changing it, but problem number one is that you did not actually do this together. That is the problem. When I met my wife, not surprisingly, I knew a lot more about money. It would’ve been really easy for me to be the money guy. “Hey, I’ll do this. Give it to me. Blah, blah, blah. I have the thing that works already.” And what do you think would’ve happened had I done that?
Kevin: I that? That would just would’ve continued-
Ramit: Yeah. It would’ve been me being the money person for our entire relationship. She would’ve had no visibility. Once in a while, she would’ve probably gotten anxious, maybe disagreed with me. Maybe I would’ve said, “Ah, it’s fine,” blah, blah, blah, ’cause I know all this stuff in my head. Maybe one day I get hit by a bus.
Maybe she doesn’t know what to do anymore. Maybe Morgan Stanley or, God forbid, Wells Fargo calls her up, tries to charge her one point five percent [00:20:00] AUM. She’s defenseless, crying. Now we don’t know what to do. Plus, she’s paying fucking AUM to a worthless financial advisor.
what happens? I’m looking up from hell. I’m there because I didn’t help my wife become equipped about money the way that I was. Right.
Margaux: Right.
Ramit: Not a good situation, especially if you yourself are not particularly equipped. Right. Shall we change this?
Margaux: Yes, sir.
Kevin: Thank you.
Narration: Um, actually before we do that, let’s talk about how they talk over each other, they interrupt each other. Like, what are you noticing about their general communication style, and what might that suggest about them? I’m finding it really diff… I don’t know about you, but I’m finding the communication style pretty difficult.
I’m not used to having couples who talk over each other and talk at me at the same time. It’s a little overwhelming. And I think what’s going on here is this need to share their story.
Everyone feels like, “I just need to make sure you know what’s going on.” And I also think there’s a bit of, “This is what the people around us do, and so this is what we’ve learned and this is just natural. This is how our parents probably talk. This is how we talk.” But I’m an outside third party. I’m here to gather information.
I’m here to help. And part of what I suspect is gonna happen in today’s conversation is the [00:21:00] stories they tell themselves, everything from the way they think about money to the way they communicate with me, with each other, those will probably need to come under question. They may need to change those things.
At least that’s my suspicion.
We’re gonna take a look at the numbers right after this
Ad break 1
Ramit: Let’s take a look at the numbers. Kevin, I would like you to read off the word in bold and the number next to it for this entire box, please.
Go ahead.
Assets,
Kevin: 11 million
Ramit: uh,
Kevin: Uh, investments, half a million. Savings, it’s about accurate.
Ramit: Wait, are you gonna read
Kevin: are you reading? Oh, 50,000, yeah. Debt, student loans, credit cards,
2.3 million.
Ramit: Total
Kevin: net worth,
Ramit: 9.25 million. Okay. What do you think about those numbers?
Kevin: 9.25
Margaux: So-
Ramit: wealth in your homes
Kevin: worth in your homes In assets, we’ll call them.
Ramit: Margo, what do you think about those numbers?
Margaux: think about those numbers? Just the savings is ridiculous. Okay. For, in comparison to the assets. Yeah.
Ramit: [00:22:00] Okay for,
Margaux: And,
Ramit: Yeah And, yeah. about the good stuff?
Kevin: Yeah, that’s good. The net worth at the end of the day,
Ramit: Thank God. I know.
Kevin: God.
Margaux: know. We’re
Ramit: This is the most depressing f- How many digits in this fucking number? One, two… A lot. A lot of digits. I never heard a more depressing answer.
“Thank God. Ah, fuck.” That’s the response?
Kevin: fuck. That’s the response? No, it’s good. We’re very, very appreciative of what we
Margaux: really are very fortunate.
Kevin: What,
Ramit: are the assets, by the way? Um,
Kevin: the assets? Um, it’s, uh, homes and, my business. We have two.
Margaux: the two homes.
Ramit: homes. How much are those worth total?
Kevin: Between,
Margaux: I’d say about nine
Kevin: million
Ramit: Um, between, I’d say about nine, eight or nine. 9 million for the two homes. Yeah. Great, and then the business you valued at 2 million? Yeah. Okay. How did you value that, just out of curiosity?
Kevin: I was offered a buyout at that number. Whoa. But I didn’t
Ramit: I didn’t take it. We have a real business value on this show.
Amazing. Yes. Too many times people come on this show, they go, “Hmm, I make 150K. That’s probably worth $22 million.” I go, “What the fuck? Ah, whatever.”
Margaux: No,
Kevin: I had an offer that I declined.
Ramit: I declined. Amazing. All right, well [00:23:00] done. Your investments at 500K, what are those investments in?
Kevin: Stocks
Ramit: Okay, like a 401K type of thing?
Margaux: It’s
Kevin: It’s not 401ks. It’s
real stocks. Between
Ramit: Individual stocks? Yeah, individual stocks.
Kevin: Individual
Ramit: it. Savings at 50K, low compared to assets. I think you recognize that, Margo. And then what’s the debt, 2.3 million? What is that?
Kevin: That was just the, mortgages.
Ramit: That’s just the, mortgages.
Margaux: Yeah.
Ramit: Two mortgages. Yeah. 9 million value, 2.3 million left to pay. Yeah. What’s your interest rate on both of those?
Margaux: They’re fantastic.
Kevin: It was during COVID, so the rates were cheap, 2.9- Is that what it was? 2.9 to, 2.9, yeah
Ramit: Well done. Al
Income And Distributions
Ramit: l right, Margo, can you read off the combined gross monthly income, please?
Margaux: please? Zero.
Ramit: Yeah. That’s interesting. Y’all make $0 gross?
Kevin: I put the net.
Ramit: the net. The net is 50K a month. Yeah. Where’s the gross?
Kevin: It’s probably 70, 60s.
Ramit: You make 60K gross and [00:24:00] 50K net? I don’t think so
What’s your gross income per year, ballpark?
Kevin: What’s your gross income per year, call it? Let’s call it, s- 700.
700. You pay any taxes? What- Yeah … does that look like? Like your tax rate-
Margaux: it, s-seven hundred.
Ramit: S- 700. 700. Do you pay yourself a salary?
Kevin: a salary? Yeah, of course, that is the salary that I pay myself
Ramit: 50k net is the salary you pay yourself. Net. And are you an S
Kevin: yeah. Yes.
Ramit: Okay. You take distributions as well? Yes. How often?
Kevin: I could get it in once a year.
Margaux: How
Ramit: year. How do you decide how much you can take?
Kevin: depends what’s there at the end of the day. Ah.
Margaux: Ah.
Kevin: the end of the-
Ramit: what’s
Margaux: be tough for planning. Yes, because
Kevin: the business fluctuates. There’s years we’ll have an incredible year, I’ll be able to pull a lot more, and then there’s challenging years with, all that’s gone on in the business that I’m in.
Tariffs plays a big role, shipping, the consumer.
Margaux: kind of
Ramit: And there’s challenging years with,
Margaux: I do, wholesale.
Ramit: I’m in, I do, wholesale. Wholesale. Okay. So you have
Importing certain types of goods.
Tariffs have affected those goods- Yes … making it more expensive. Yes. Is your net [00:25:00] income down over the last, say, year or two?
Kevin: Um, yeah
Ramit: Okay. Got it. We’re gonna find out the approximate gross monthly income that you would make in order for you to net 50K. Okay? And we’re gonna put it in.
We might be right or wrong, it depends, but considering I don’t see any pre-tax deductions like a 401, it will be relatively straightforward given that you live in New York, et cetera. So we’ll be able to extrapolate that. That will clarify a lot of stuff.
So y’all are making about $96,500 per month gross. How does that number strike you?
Kevin: It’s a nice number. Beautiful number.
Ramit: Margo, 96,000? It’s a very
Margaux: high
Ramit: It’s a lot of money, right? It’s more confusion. More confusion. Right.
Margaux: More confusion. More confusion. All
Ramit: So did you know that approximately y’all make about $1.15 million per year?
Margaux: per year? Do you, though? No,
Kevin: run the numbers like that
Ramit: I just took what you made and I added on taxes, et cetera, reverse engineered it. It might be off by a few [00:26:00] tens of thousands here or there, but in the grand scheme, here we are. Now, by a show of hands, who knew that you make approximately 1.05 to $1.15 million per year? Put your hand up if you knew it. Okay, Margo says no. You put a half hand up. What is that?
Kevin: Yeah, I know what I make. I just, it’s not always that number.
Ramit: Yeah, Some years up, some years down, but just in general, we have to average it, right? Yeah. To pick something. Right. Did you know that?
Kevin: Yeah.
Ramit: Okay. All right.
Can we go down the rest of these? Sure. All right. Margo, what’s this number here under fixed costs?
Margaux: 67%?
Ramit: 67%. So typically, I like to see that number below 60%. And for very high earners, which I would call you, at netting, $600,000 a year, that number should probably be way under 60% in general. Now, y’all have five kids, and you live in a very expensive area. So, all right, I don’t mind if it’s 60, but too high.
Okay? [00:27:00] Let’s keep moving. What’s the investment number, Kevin?
Kevin: What does that say? A thousand?
Ramit: Now, I don’t know about you, but I don’t really believe 1,000%, and I don’t believe you’re putting $500,000 a month into investments.
Kevin: Was that a monthly- Yes … thing? Oh, it was. Sorry. No.
Ramit: This should be zero,
Kevin: Yes.
Ramit: That’s more like it. So nothing is going to investments. No. I kinda liked it better at 1,000%, but- Yeah … reality is reality. All right, let’s keep going. Savings are at 80%, that’s wrong. I don’t think you spend $30,000 a month on vacations,
Kevin: No.
Margaux: right. So I’ll- Let’s keep going. Okay.
Vacation Spend Reality
Margaux: savings are 80%, that’s wrong. I don’t think you spend $30,000 a month on vacations, but- No, that’s,
Kevin: I thought this was yearly. Sorry, my bad.
Ramit: I thought this was yearly. Sorry, my bad. So you spend 30K a year on vacation?
Kevin: At the least.
Ramit: What’s the actual? Don’t be shy, just-
Margaux: spend more than that.
Kevin: Trip alone was that.
Margaux: It was 20.
Kevin: trip. No, was it? It was 30.
I would say 30.
Margaux: say 30. I, we don’t spend more
Kevin: I would put another 10 on that.
Ramit: I would put another 10 on that. That’s it, 40? 40 for a-
Kevin: let’s call it that.
Ramit: No, let’s not. Let’s call it the real number. I feel like it’s way higher than 40.
You all have five [00:28:00] kids. You obviously like to travel nicely.
Margaux: Let’s call it the real number. I feel like it’s way higher. Yeah. You all have five kids. You obviously like to travel. I’m telling you, we don’t, we use points.
Ramit: No. All right,
Margaux: Okay. Fine. Is it more than 40?
Kevin: Let’s call it 40.
Gifts And Birthday Costs
Ramit: Gifts says 10,000. That’s wrong ’cause that’s 10,000 a year you give in gifts. Is that right? What’s the gifts?
Margaux: Gifts, like big family, so baby gifts, wedding gifts. I don’t know.
Kevin: Birthdays,
Margaux: Thing.
Ramit: How much you give for a wedding gift these days?
Margaux: give for wedding gifts? We just gave a thir- his friend 360
Ramit: Just gave a, his friend 360. Okay. Sounds reasonable to me- what about for birthdays?
Kevin: I don’t know, my daughter just got a ring for, it was 500,
Ramit: a ring for 500. 500 for a ring? What about the birthday parties and dinners and stuff like that?
Margaux: It’s more like I’ll do a Friday night dinner and invite my family over.
Ramit: Does anybody know any numbers?
Kevin: my family over.
Does
Ramit: do you
Margaux: okay. Every, I just, every Friday night
Ramit: Let me put- let me tell you something.
I am asking simple questions. Income, how much do you spend on vacation per year? I’m not asking complicated questions. I don’t even mind if you’re off by $10,000. What I’m looking for are straight answers from you, and neither of you can give it. [00:29:00] In fact, what I notice is that you live in your story. So what you’re doing, you don’t realize it though, is you’re giving me just the scratching of the surface, I don’t care if it’s 100 or 10,000, I truly do not care. It’s your money and your life. I want you to both start dealing with reality. Give me a ballpark number and estimate high, but don’t give me, “We spend $500 on a ring,” ’cause it’s bullshit
Margaux: Okay, it was a thousand dollars on Marie’s birthday. We took her out for dinner.
Kevin: I mean, it’s easily a thousand on the boys,
Margaux: So figure a thousand
Ramit: Okay. Could it be higher?
Margaux: Marie’s birthday was the last one. We spent $1,000. Total.
Ramit: Everything. Ring, cake, food, decorations, taxis, Ubers, et cetera, all of it.
Margaux: We don’t do that stuff. Yeah.
Ramit: 1,000 bucks, good. You have five kids. I know the youngest is maybe not as costly. Maybe. All right, so 5,000 there plus 5,000 for friends and family, 10,000 a year.
Sounds reasonable to me. I’m gonna change it to [00:30:00] 1,000 a month, which is 12,000. I don’t mind. I’d rather have you have a little bit of extra.
Vacations, I’m gonna say, 3,500 Emergency fund? Nothing. Nothing. Okay. And then guilt-free spending. Well, if the numbers we just put are true, y’all have 12,000 extra dollars per month.
Kevin: What about groceries?
Do you have any clue how
Margaux: interesting. Sixty-seven percent fixed costs. Let’s drill into it, okay? Your
Kevin: there’s a large meal. Yeah.
Ramit: Shabbat- Yeah
which means there is a large meal. Okay.
Kevin: the meat is kosher.
Ramit: The meat is kosher. Let’s look. Let’s look.
Fixed Costs Deep Dive
Ramit: So I wanna look at your fixed costs ’cause they’re very interesting. 67% fixed costs. Let’s drill into it, okay? Your mortgage is $11,000.
Kevin: For the two homes, yeah.
Ramit: $11,000 is very reasonable, especially for a couple making 96,500 a month gross.
Margaux: So
Ramit: well done on that. Utilities 2,000. All right, insurance 5,000. What’s that?
Margaux: Insurance
Kevin: is a high
insurance, for the family is 4,500 a month[00:31:00]
Ramit: for the family is 4,500
Margaux: I don’t see how it’s 5,000 if just our health insurance is 45, and then we have auto, dental, and homeowners. How did you get to 5,000?
Kevin: The medical insurance comes through the company, so yeah, it is a little higher then.
Ramit: How much?
Kevin: Let’s call it seven. Okay.
Ramit: Let’s call it
Kevin: You all see the pattern? Yeah. What is it? That, that we don’t really know our set expenses. Exactly. Yeah.
Ramit: Let’s continue on. Car, 2,500 a month. Does that include gas?
Margaux: No, it doesn’t. No? It’s not 2,500 a month. It is?
Kevin: 2,500 a month. It’s 3,000.
Margaux: You didn’t- Do
Kevin: be more efficient for me to just take every number and just double it?
Margaux: Think it would be more efficient for me to just take every number and just double it? Well-
Kevin: why
Margaux: are we doing this? I don’t know. What the hell is going on? No, but also calculate the number properly. I don’t
Zooming Out On Patterns
Ramit: D- I wanna just zoom out for a second and ignore the numbers. So can we all take a second and like almost as if there’s a game of chess being played, I would like you to zoom up and look at what’s happening on the chess board. You asked Margo to come and [00:32:00] meet because obviously something does not feel right.
There’s a high income. Yes, you live a very nice life, but like where’s the money going? So you fill out all this stuff. You wanna be a little bit more harmonious, a little bit more united, a little bit less, annoyed and annoying a- about all this stuff. Like, why is money such a problem when we make presumably a lot of it? Like, what are we doing wrong? So you get the CSP. The instructions explicitly say do it together.
You don’t, and here we are now, right? Again, I’m not here to beat anybody up. I wanna help you understand your own behavior.
Kevin: Yes
Ramit: What are we noticing from looking at these numbers? Kevin?
Kevin: that we don’t really know our own-
Ramit: Yes. The numbers are wrong. I don’t mind that the numbers are wrong. Almost everybody I talk to, the first time they do their CSP, the numbers are wrong. Some of this stuff is a little complicated the first time around. But importantly, I noticed that Kevin, you said, I’ll take care of the CSP,” But looking at the numbers, they’re all wrong. So what are we to make of this, “
Kevin: Hey, Kevin, let’s do this together.” Yes. “I’ll take care of it.” But looking at the numbers, they’re all wrong. So what do we make of this, Kevin? Then, then I [00:33:00] don’t know what I’m spending probably
Ramit: Yes, I agree.
Feeling Excluded
Ramit: Margo? He doesn’t include me in
Margaux: He doesn’t include me in the finances. He just gives me the brunt of his, upset about it and his stress.
Ramit: He doesn’t include you in the financial conversations. I agree with that. Anything else?
Margaux: We’re not making any segue. We’re not
Kevin: not on the same page with it
Margaux: him.
We’re definitely not on the same
Ramit: on the same page, not making progress. That’s what I’m hearing. Yeah. And
how does it feel to you? How would you put it?
Margaux: I get it that he feels like this is his territory, and I am in charge of a lot in our lives. I’m in charge of the kids and the household, and I make a lot of decisions.
However, I think that it would be a lot better for our family, our marriage, our finances, and everything in our life if we start to be a team and we start to work on this together because, obviously it needs work. It’s not gonna work itself out sure. You are very busy. I’m very busy, but this is important
Ramit: but this is important. Love it. Great. Uh, Kevin, when you are thinking about money and, the CSP or managing expenses, et cetera, what are you [00:34:00] feeling when you think about sharing more information with her?
Kevin: It became a,
Margaux: an
Kevin: argument or stress for her, so I just decided to, not do that to her
Ramit: Because? ‘ Cause
Kevin: not being on the understanding that I have and she has are not being met,
Margaux: Yeah
Money Talks Breakdown
Kevin: then it just becomes frustrating.
So I guess I just took it to myself to manage.
Ramit: Can I paraphrase? Tell me if I’m getting this right.
Kevin: I paraphrase? Tell me if I’m getting it right. Sure.
Ramit: Whenever we talk about money, it doesn’t really go anywhere. We get in a fight, it gets stressful. We don’t see eye to eye. She doesn’t understand money the way I do. So if we’re gonna have those conversations and fight, I might as well just do it myself, and that way she doesn’t need to be bothered, and I can deal with whatever problems there
Kevin: Well said.
Partners Not Solo
Ramit: And now that you’re hearing Margo’s reaction to some of this, what do you think about that idea?
Kevin: I’m more open to sitting and coming up with a [00:35:00] plan that we can both focus on, share thoughts, and, be on the same page with everything that’s going on.
Ramit: Good. You’re open to it. I appreciate that. Margo, you’ve been asking for that, so I appreciate that coming together a little bit. I also think if I can be candid, these numbers are, like, very wrong. So I actually think not only might you be open to it, you might actually need Margo’s help when I brought my wife in, and it took us a long time, it was hard, man. I could’ve done it myself much easier, but I was like, “Nope, we need to both be partners in this,” but guess what I discovered after several years of working for us to come together?
I was like, “Oh, shit. She’s actually better at some of this than I am.” I was like, “I’m the I will teach you to be a rich guy. How’s my wife better at this?” But actually, I needed that. Not just that I’m open to it or I want her, but it’s like, oh, she’s actually fucking good at this. I just didn’t put her in the position and us in the position which you now can.
Okay? [00:36:00]
Income High Spending Higher
Ramit: All right Let me just summarize what we know about these numbers. I see a very high income, almost $100,000 a month gross. That’s more than most people make in a year. Okay? I see a high net income, 50K a month take-home. That’s $600,000, a huge amount of money.
Now, I understand that you have high living costs. I understand where you live. Your mortgage is low. Like, wow. Unbelievable. And, I see some expenses that are really high. And as I dig in, I go, “Uh-oh,” I don’t think you really know your numbers enough for us to, go line by line. But I can essentially see what you are telling me, which is at the end of the year, you don’t have much to show for it.
You have a beautiful house. Your kids go to private school, and you take some nice vacations, yes.
Narration: hey, listen, I need to cut in here because I know I’m about to get 5,000 comments from people [00:37:00] saying, “Boo-hoo, another high-earning couple.” let you in on a little secret that they don’t even know yet.
They are spending more than they make every single month.
Tuition Shock Reveal
Kevin: Camps, sleepaway camps we left out
Margaux: You didn’t put tuition in there. Where’s the tuition bill? Yeah. That’s a huge, huge, huge bill.
Is-
Ramit: per year?
Margaux: Sure, sure. Coming year. 150.
Ramit: And then what about the camp?
Kevin: Camps came down a little bit this year, close to 10,000.
Yeah
Ramit: fifty plus 10K, one sixty?
Margaux: 160
Ramit: I like how, s- once in a while you have somebody, feeling between the couch cushions. And remember, like, when we were kids, we used to find a quarter? We’re like, “Oh my God,” “I’m going to the arcade.” But in your case, we just found $160,000 of hidden expenses in your couch cushion.
So if I’m doing the math right, we’re at around 13,000 a month. I like how that was just left off, by the way. Yeah.
Fixed Costs Over 100%
Ramit: Beautiful. Hey, what’s that fixed cost number right now? And then I would do gross- What’s the number? Yeah, you’re spending more than you [00:38:00] make every single month.
Margaux: single month. That’s about exactly where we’re at, we’re just right at the border we tinker.
Under, over, under, over, under.
Ramit: But do you understand that when you spend 103% on fixed costs, you actually are way underwater because you also have travel, which is not included in fixed costs. You also have gifts, you have eating out, you have all the discretion. That’s tens of thousands per year. So you are spending far more than you make every single month.
So
Margaux: Now it makes sense why h- he’s so worried and stressed.

Kevin: agreed
Ramit: stressed. Kevin? Uh, agreed. Did you know this before now?
Kevin: Did you know this before now? Yeah, I knew it. I just, I left a few things off, I guess, for you to say.
Ramit: You want me to, you wanna put me through my paces?
Kevin: You want me to– you want to put me through my paces? I want you to earn this.
Ramit: this. Okay,
Kevin: we’re back on.
Ramit: Um, so what do y’all think about that?
Margaux: Um, what, h- I don’t know how we’re gonna do how we’re gonna [00:39:00] pay that tuition bill
Ramit: Mm-hmm. This year. Yes. It’s a big, it’s a big one. Yes. It’s a huge amount. What else are you realizing? You had problems before tuition was being covered. You still had problems.
Margaux: We have to allocate savings before spending somehow.
Yeah.
Ramit: Yeah. I don’t know. Are you realizing that this is a pretty bad situation?
Margaux: I guess so, yeah Kevin, what were your answers? Yeah,
Ramit: yeah. Yeah. Kevin, what are you
Kevin: Yeah, I agree with what you’re saying, but I have a tendency to look at it a little different where, okay, we’re getting through the year, we’re behind a little. A good distro could bring everything back.
Ramit: And then what?
Kevin: And then what? And then, th-
Margaux: what? And then,
Kevin: we did have a decent cushion. Which if it didn’t get wiped out, I don’t know if we’d be sitting here
Ramit: What happened?
Margaux: There was mold. The kids were having health issues and,
and we went to do- a doctor that was recommended that didn’t take insurance- Oh … and the treatment was, at the time, not covered on insurance. Oh. Now-
Kevin: mold in your house?
Yeah. Yeah. Really bad black mold covered the entire bod
Ramit: that was recommended- Oh … that didn’t take insurance, and the treatment was, at the time, not covered on insurance. Oh. And- You had, really bad mold in your house
Margaux: You had, really bad mold in your house? Yes. Yeah, really, like [00:40:00] black mold covered the entire under the vinyl
Ramit: Oh my God. With five
Kevin: and each kid had
Margaux: It
Kevin: and the doctor visit was 11,000 per kid, and we
Ramit: how much did it cost for mold remediation?
Kevin: didn’t take all of them. Okay. How much did it cost for all three of you? That was, all this that we just mentioned was about $400,000,
Margaux: And we didn’t,
Kevin: half a million
Margaux: for some reason we didn’t have the right home insurance We didn’t get back anything, barely anything.
Ramit: Half a million dollars for mold. Horrible. Is it all fixed now?
Margaux: There’s a little work to be done, probably 10 to 15,000 worth
Ramit: okay. The money part, this sucks, but just the idea of this thing could be lurking-
Margaux: Yeah … anywhere,
Ramit: with kids is like…
Margaux: everywhere
Ramit: Totally. Okay. Y
Health Costs Keep Coming
Ramit: eah. Is the plan to get the remediation again, and then- I
Margaux: like- n- yeah
Ramit: Fair enough. You can fight -one battle, two battles, even three battles at [00:41:00] once, but 10 battles just too much. Yeah. Okay.
Margaux: Now I have two kids on herbal remedies, which has been fantastic, and they’re doing great but, what is it? Every month it’s about 500 a month for that.
And then the human growth hormone for my daughter. She stopped growing when, with this, all this health stuff
so that together is about 1,000 a month, yeah. 1,000 a month
Grocery Spending Reality
Ramit: point out a couple of other things on your fixed costs.
Groceries at 4,000 a month.
Margaux: At least.
Just Friday night dinner costs 500 between the meat and the groceries and the- Yeah … whatever it is. 4,000.
Ramit: What do you think about that number for a family of seven?
Margaux: I don’t know. I have no idea. Is it high?
Ramit: It’s really
Margaux: I go to Trader Joe’s, and then I’ll fill in in the more high-end grocery store near us,
And then … the meat is really ex- really expensive
Ramit: Meat is really expensive And is that a necessity?
Margaux: To eat meat? Yeah I mean-
Ramit: I mean, that amount?
Margaux: I don’t do, I don’t… Nothing-
Ramit: I can tell by your
Margaux: goes in the garbage.
Ramit: answer is no. Nothing goes in the gar- Like,
Margaux: Like, we’re eating. It’s not like food waste. It’s
Ramit: That’s not what I’m talking about.
Kevin: Could you have pasta or [00:42:00] do you need the meat? Yeah. ‘Cause pasta’s a tenth of the price
Ramit: could you eat what I ate when I was a kid? Then again, my family didn’t make 96,500 a month,
Margaux: not buy Kosher organic chickens?
Ramit: I cannot buy organic chickens. Kosher organic chickens. Yeah. How much does that cost,
Margaux: About $28, $30 for a chicken
Ramit: $30 for a whole chicken. And how many of those do you buy?
Margaux: on Friday night I buy one, but then there’s a roast, there’s a chicken, there’s a vegetable. There’s another, like, meat dish. Mm-hmm. There, there’s rice. Then there’s, like, the salads and- Mm. You know. There, it’s a big meal every Friday night.
Narration: You know I love these stories. We didn’t go to Vail. We went to Europe. It was cheaper. We love points.
Shabbat dinner every Friday. Oh, and we have to have kosher meat. Think about what any of these stories individually represents, and then all of them combined. These stories are basically ways to distance themselves from having to make tough decisions about money.
I’m not sure the two of them have ever actually said [00:43:00] no when it comes to money, because of course, we have to do this dinner. We have to have this type of meat. We have to go on this vacation. Actually, we’re saving money. We’re actually really economical. These types of stories make it hard for me to actually deliver on what people come to me for. It’s fascinating. They will write these applications. They will go through a ton of screening, and when they come to me, they almost put a force field up by telling these stories. They don’t realize what they are doing, but they are trying to insulate themselves from me getting to the heart of the matter. I gotta find a way to get through this
Ad break 2
Ramit: I’m feeling, a bit stuck.
Margaux: Okay
Ramit: And why? One, I feel on shaky ground because not only are the numbers incorrect, which I don’t mind. But we’re off by maybe $25,000 a month. We’re not off by $2,000 a month. We’re off by tens of thousands a month.[00:44:00]
That’s number one. Number two, when I ask, some questions about things like food, you actually have really good answers. Like, well, we have this thing on Friday there’s a lot of people, et cetera. All that may be true, but that doesn’t solve a problem here, which is like if we can’t even agree that, oh, maybe we’re spending kind of a lot on food, 4,000 a month is an astronomical amount.
Is it?
Margaux: Is
Ramit: Yes. Most people who come in to speak to me, as a couple, maybe they have a young kid, they spend roughly
Kevin: eight
Ramit: to 1,000
Margaux: one kid?
Ramit: Yes, but most of them don’t shop to a number. As the family grows, of course it’s more expensive, especially as the kids get older, they’re eating a lot of food, no doubt. But, there are economies of scale to be had, and at five kids, here’s the fact: If you wanna feed your family like an amazing, set of food, you could do that.
Absolutely you can do that. You have the income to do it. But you can’t do that [00:45:00] and do tuition and do summer camp and do vacations and do the insurance that you have and the mold remediation and, and, and When was the last time either of you said no to spending money? She brought up wanting to
Kevin: summer camp and do vacations and do the insurance that you have and the mold remediation and. When was the last time either of you said no to spending money? Okay. She brought up wanting to send one of the boys on a summer… It’s like a three-week program for them to go. I said no to that.
Ramit: Margot, what about you?
Margaux: Instead. I don’t know. It’s more me consulting with Kevin, should we purchase this or can we purchase, this right now? So you have said-
Ramit: with Kevin. Should we purchase this, or can we purchase, this right now? So you ask him, “Can we purchase this, or can we do this thing?” And then he says?
Margaux: Not right now or yes, we can
Ramit: Yeah.
Vibes Not Numbers
Ramit: and what are you realizing from his mastery of these numbers?
Margaux: you realizing from his mastery of these numbers? I don’t think he’s aware of the numbers.
Ramit: Exactly. So when Kevin responds to you, “Yes, we can do this,” or, “No, we can’t,” where do you think it’s coming from? ‘Cause it’s not the numbers.
Margaux: based on,
h- his bank account and credit card bills. I
Ramit: I think it’s just a vibe.
Margaux: a
Ramit: How [00:46:00] do I feel today? Do I feel good? Do I feel bad? Did I get these orders in? What’s the distribution maybe gonna be three months from… It’s just a vibe.
Margaux: Right.
Kevin: Like I said, I’m a giver. Like why did my son need the car? I’ll say, “Well, he’s gonna spend 300 on Ubers to get around, and then he’s gonna, be on us for our cars when we don’t have it, and that’s just another, burden to deal with.”
Ramit: This is vibes. This is what I’m talking
Kevin: This is vibes. That’s what I’m talking about. Right. So the car makes sense for a few hundred dollars more for him to be independent, go to work,
Ramit: What do you mean independent? You bought him the car. That’s not independent.
Kevin: What do you mean be independent? You bought him the car. That’s not independent. Well, he has to get to work, so if he can’t get to work every day, I’m paying for him to get to work.
So I think, that I would spend more money on him if I didn’t get him the car
Ramit: Are we here to make changes or are you here to explain
Kevin: I’m telling you why But
Ramit: I appreciate knowing and I wanna know some of the why, but I’m not interested in rehashing the stories. Because the more you tell me the stories of why you’re doing what you’re doing, the more you concretize your, narrative [00:47:00] about yourself.
Well, Ramit, I told you, look, we had this and then we had that, and I figured this, and if he didn’t do that, then he would’ve done that, and now you just spent three minutes explaining to me and where are we?
Margaux: But The cars is a big example because hard for him to make the change, but, I’m willing to downgrade my car. There’s a Kia with a third row. How do we get rid of it? No, it’s too much of a hassle because They’ll charge us more to give the car back.
But okay, we have to go further and try to find a solution on how to get rid of the car and get a cheaper car, even though BMW won’t let us cut the lease early. But, like, still
Ramit: You all are just doing it again. In fact, you’re doing what I just told you’re doing. You’re going right back into the story. I don’t care. I’m not trying to be disrespectful. You came here because you want change, but what you are doing is you’re just rehashing the old story and explaining why.
Do you wanna walk out of here being like, “Ah, we told this guy all the reasons. We changed nothing, but we told him all the reasons we do what we do.” Is that what you want? No. No. We want a
Margaux: We want the solution.
Ramit: okay, so why are we going back and telling me about your third wheel and this and that? I don’t, it’s irrelevant.
No,
Kevin: No, because you’re looking for ways for us to [00:48:00] save.
Ramit: I’m not. I haven’t even gotten there. I’m looking for you to understand what is going on here, and you don’t yet understand it. Why is it that your wife comes to you and says, “Can we do this?” And why do you give her that answer?
Kevin: It’s in that moment of what’s going
Ramit: Exactly. You just arbitrarily pick. Yes, no, the sun is in orbit. I- what?
Kevin: No, it’s based on things that are going on in my life.
Ramit: Based on things that are going on in my life Right, but there’s no use of actual numbers. And until you both realize that your understanding of reality is so out of alignment with the numbers, then you will keep making decisions based purely on vibes.
Right now, you make very close to no decisions based on numbers. Why? Because there’s such an abundance of money, at least seemingly. With a high income, it’s like, do we really need to track the price of Pringles? No. Who gives a fuck? But the problem is it’s not just Pringles anymore. It’s multiple cars, multiple properties, camps, multiple tuitions, and on and on and on.
And it actually has gotten to the point [00:49:00] where even at a million dollars a year, you actually can’t keep up.
Cut Costs Or Earn More
Ramit: So you have choices. What are the choices you have?
Margaux: We need to cut, costs
Ramit: could cut costs. What else?
Margaux: Make more money.
Ramit: Anything else?
Margaux: I don’t know. What would be else besides
Kevin: spoke about discussing it together and
Ramit: That’s good …
Kevin: With plans
Ramit: think that’s really good. Coming up– Doing it together is a good part of the process. I totally agree that needs to happen.
out of cutting costs and earning more, which one are you more philosophically inclined towards? Do you wanna earn more or do you wanna cut costs?
Margaux: earn
Ramit: You wanna earn more.
Margaux: I think we’re both always trying to earn more. So the only thing we can change is how much we spend.
Kevin: Amazing.
Ramit: The only thing we can change is how much we spend. Okay, amazing. So you propose Margot focusing on cutting costs, and Kevin, you propose earning more so do you see right here, right now, you’re already out of alignment. Right there with that fundamental question, what approach should we take? If you don’t actually talk about that and agree on it, then each of you is rowing in a different direction for the next [00:50:00] ten years. So how are you going to come to a resolution on that?
Kevin: Discuss it more.
Margaux: Get all the numbers on paper-
Ramit: Sh- we just did
Margaux: to the T. Yeah, you
Ramit: It’s a good team yeah, you can improve your accuracy, I agree, but y’all are here. You might as
Margaux: but you all
Ramit: well make a decision right now. Earn more or cut costs?
Margaux: Let’s make a decision right now. Earn more or cut costs? If we can have earn more in our power, that we would’ve had it already, so we have to cut costs.
What choice do we have?
Kevin: I’m trying to think of areas where we can cut
Margaux: and
Kevin: And how much it would save us at the end of the day. I don’t know those numbers. So cutting costs for now is probably a good strategy until there is more earning, and then hopefully we’ll know what to do with the extra earning as we leave here and get some advice from you.
But, uh until then, it looks like if I earn more, we’re gonna spend more, and it’s just gonna be a cycle
Ramit: What’s a decision? Down grade our spending. It’s just, it’s a nerve-wracking thought. Because?
Margaux: I don’t feel like I’m overspending. And
Kevin: I think where? Where can I cut-
Margaux: keep doing that. Okay, where could we cut? Okay, but, you know, I’m not [00:51:00] gonna buy less food.
That, how could we buy less food? We’re not gonna not send our kids to private school next year.
Kevin: Or camp. We’re not
Margaux: ready to change their
Kevin: ready to change their- Or vacations.

Kevin: What do we- That’s what happens when we discuss cutting costs. We don’t know where to cut them or how much value that cut would bring to the table
Margaux: I don’t think we know how to cut costs. I don’t know, I think we know how to live differently. This is what we’ve been doing for 20 years,
Kevin: It’s what we’ve been doing forever. Yeah. Earning, spending, earning, spending. Make more, spend more. So-
Margaux: think we have to allocate a certain amount of time a week where we sit down and we put our time and effort into this, and it’s gonna be a project, but it has to get done
Kevin: to get done.
Okay.
Stop Homework Make Decisions
Ramit: was good, but that doesn’t work for me.
I’ll tell you why. You all just gave yourself homework.
What better scenario will you have to make big, bold decisions than literally right here with me watching?
Margaux: here with me watching? But we need your guidance. We don’t know what to
Ramit: Okay, well, you can ask questions, [00:52:00] but you didn’t do that what you did was there’s a feeling of discomfort in the room because holy shit, we’re actually having to talk about this substantively for the first time in a long time, and unconsciously it’s like, “Oh, this shit feels bad, so let’s do this.
Let’s agree that we need to sit down and talk about it, and we’ll do it, and it’s gonna be hard, but we’ll do it.” It all sounds great. It’s very PC. It’s very nice. The problem is you didn’t do the one thing that matters, which is make decisions right now.
Are you gonna cut costs? I did not hear both of you agree to that
Margaux: Yes, we’re gonna cut costs. I agree to that. Do you agree to
Kevin: Yeah,
Ramit: That’s the first time I heard a question asked. That’s the next thing I wanna point out. Do the two of you ask each other questions, or do you just talk?
Margaux: We just talk. Exactly.
Ramit: You cannot get where you need to go by just talking at each other. Because what’s happening is, although you are both quite polite, which I appreciate, if I had a sport right here on the table, it would be, like, boxing. Not that you are [00:53:00] fighting each other, that’s not what I’m saying, but you are each in your own corner, and you come to the middle to basically deal blows. They just happen to be like, “This is what we need to do.” “Well, what about this?” “I can’t do this.” And there is no team. And how can you be a team if you don’t ask questions of each other?
“Hey, what do you think?” “Oh, you say we can’t cut groceries? Tell me more about that.” I don’t buy the groceries, so I don’t know, And then you say, “Hey, you mentioned, it’s not gonna be a good year. What do you mean by that?”
Kevin: I’ve definitely asked those questions.
Ramit: I don’t think you’ve asked a single question substantively about money of Margot while we’ve been sitting here
Kevin: substantively about money of Margo while we’ve been sitting here Not while we’ve been sitting here, but when we do discuss it and I take out the credit card bills-
Ramit: we’ve
Kevin: Oh, you do? What do you say? And I s- no, I say, what could we do without?” And it comes back as, I’m getting what I need to run our home.”
So how much pushback can I get? Should I tell, “Don’t buy food or buy less of the food”?
Ramit: Yes. But also asking the question when you have a credit card bill in your hand and saying, “What can we do without?” While I think, Margo, you need to be more open to [00:54:00] spending less, a lot less, I do think that waving around a credit card bill does not evoke cooperation, especially if somebody’s a mom of five and she’s running the household, and somebody’s coming in saying like, “What, what the f- what can we do with this?”
Even I would be like, “I don’t know. I’m running this shit. If you wanna do it, you do it,” but like, what are you talking to me about?
Margaux: That’s exactly it
Ramit: It’s not setting up a healthy conversation. Here we can have a healthy conversation.
Therapy And Money Mess
Ramit: In therapy, do you two see a therapist?
Margaux: No. Um, not really.
Ramit: Okay. Would you be open to it?
Margaux: Yeah. We have someone that we talk to once every so often.
Ramit: Open to it?
Margaux: Yeah.
Ramit: Kevin? Yeah, I’m open. Amazing. Great. I highly recommend it, in part because having these conversations, having a facilitator who can help point out certain things you definitely do not notice on your own, invaluable. We’ve done it. A lot of my guests have done it. Highly recommend. Okay?
Kevin: funny, I could do it in my business, but not in my personal life, so but-
Ramit: funny. A- actually, that’s a great way to put it. [00:55:00] I can’t figure it out, so therefore I’m gonna get help. If I’m the two of you making $96,000 a month, I’m like, “We come first. We, the two of us, because without us, everything else falls apart.”
Kids are unhappy, houses go away, everything dies. So we will put ourselves first. What is it gonna take? Well, we need to be communicating. And even though, yes, we’re nice and we love each other obviously, everybody needs a little help sometimes. Boom. Not denying that. Yeah. Okay. When you’ve looked at how your money is set up, the way that you talk about money, do you think your money set up is simple or complicated?
Kevin: It’s definitely not simple
Margaux: it’s not organized. It’s messy. Messy?
Okay. You wanna fix it? Yes
Ramit: Good answer. Kevin? Of course.
Margot Money Childhood
Ramit: I wanna know, Margot, what you remember about money when you were a kid.
What did your family say about money?
Margaux: My family didn’t talk about money much. There was enough of it, and my dad was the breadwinner. I [00:56:00] remember every Sunday night my dad would leave, cash for, my mom, on her bathroom, sink and that was her money for the week. And, it was never really discussed. It was never a stress.
It was never an issue.
Ramit: They say any phrases you remember like, money doesn’t grow on trees or can’t afford it or, spend money on education, any of those things?
Kevin: No. Okay.
Margaux: Maybe once in a while, you know, it’s too expensive.
Kevin: Did you have a
Ramit: As I was getting to be a teenager, yeah. Hmm. She, you know, um, yeah, I was more of a little kid. Okay. Did you have a job when you were a teenager?
Margaux: Yeah. I was a tutor through high school, and I was, a lifeguard in the summers, and I worked at summer camp. And I saved all that money, and I invested it from a young age, and that’s my investments.
Ramit: You serious? Yeah
Margaux: And then anytime I made money, I would put more into it.
Ramit: You have half a million dollars in investments. That came from you as a teenager?
Margaux: A portion of it is also stocks that my grandfather bought me that I never sold, I held onto. Cool.
Ramit: So this thing about your grandparents gave you investments and then you as a teenager invest your money, it’s [00:57:00] all quite interesting to me. Who talked to you about investing? Most teens don’t know about it
Margaux: Um, nobody.
Ramit: And then I had some money, and, I would get a little bit of cash from my grandparents, and my dad’s like, “I’ll put it in your bank account, and I’ll save it for you.
Margaux: We’re gonna save it.” So I would always save, and then, like, when I worked at camp and lifeguarding, my friends would, like, spend their money at the end of the summer, and I would give it to my dad to put in my bank account. So I never spent any of the money that I made. I always put it into the stock market.
Ramit: We need to make changes starting today. Great.
Kevin Money Scarcity
Ramit: Kevin, what do you remember your family saying about money when you were younger?
Kevin: Money was a issue. There was not much of it. I’m the youngest child. I worked from a young age. 15, same system. Making, spending, doing well, spending, I was never taught any kind of managing money skills in any way, shape, or form
Ramit: younger.
what did your parents do for a living?
Kevin: My dad had retail stores.
My mom stay-at-home mom. And then he was in the [00:58:00] ticket business, which was very successful. But then there was some state regulations that come into place, and when he lost that, I was about 13. So from then on, I really never went to him for money.
Never asked.
Ramit: Did he struggle with it?
Kevin: Yeah, they both did.
Ramit: Okay. Are they still alive?
Kevin: My mom is
Ramit: Your mom. How’s she with money?
Kevin: Right now she’s supported by the brothers and sisters. We support her. They did have two homes. They sold them.
Money Lessons From Parents
Kevin: They lived off them. They spent it, invested some that went bad. Not the smartest sequences,
Ramit: form. Do you think your dad knew how to manage money? Seems like he knew how to make it.
Margaux: to make it.
Kevin: He could make it at times. He was unbelievably creative, but he had no clue how to manage it. It was in his suit pocket
Ramit: Ah, and did he spend a lot?
Kevin: like- Did lot? No, my mom did. Your
Ramit: Your mom spent a lot. What’d she spend it on?
Kevin: Whatever. Brand names, shoes, clothing.
Ramit: Does this sound familiar? Not that it’s an identical situation, but, like, [00:59:00] the dynamic. Dad is good at making money. Do we know anybody like that? Sort of,
Kevin: yeah. You? Yeah, me. I know.
Ramit: me. I know. There’s only three of us in this room.
Kevin: What the hell’s wrong with you?
Margaux: on here?” No.
Ramit: He doesn’t think so. No, I know. What
Margaux: don’t know that he thinks he’s good at making money though.
Ramit: on here? I’m like, what? I don’t know that he
Margaux: said it 20 ago.
Ramit: thinks he’s good at making money though. Y- you said it 20 minutes ago, “I’m good at making money. Nobody taught me how to save.” What’s the reluctance of admitting this?
Kevin: of admitting this? It’s not a reluctance of admitting. He
Ramit: worked.
Kevin: Seven days a week. I do, but I, he didn’t enjoy anything.
So maybe that’s part of the, the problem. I saw that and I’m like, “What kind of way is this to live? Work, make money, not enjoy it?”
Ramit: Oh, okay. So got
Kevin: So that-
Ramit: gotta enjoy the money that we make, hence the nice living standard of living. Okay, fine, fair enough.
Credit Card Bill Dynamics
Ramit: your mom, spent a lot of money on things around the house and stuff.
Kevin: n-
Ramit: Materialistic. Okay. Again, I’m not applying directly here. I haven’t quite heard that, but think of the way that you wave the credit card [01:00:00] bill around and bring it to your wife. What is the implication behind that?
Margaux: First,
Kevin: to get an understanding of why it’s nine pages long.
Margaux: Second of
Kevin: all, to…
I don’t have an answer for
Ramit: Second of all, to… I don’t know really. I don’t have an answer for that. Is it possible that you see her, at least in part, as spending a bunch of money that doesn’t need to be spent?
Kevin: Or at least in part, the spending of much money that doesn’t need to be spent? I think that, but then the few times we do a review, I’m like, “O- okay, makes sense.” food is food. Education’s education.
Ramit: know, food is food. Education’s education. Not really.
Kevin: Camp’s camp. No, it isn’t. It is in our world, and that’s sort of the-
Ramit: think that might be the problem?
Keeping Up Pressures
Margaux: be the problem We live in a community where everybody sends to one of three schools, and everybody sends to one of three camps, and everybody
Ramit: the phrase? Keeping up with
Margaux: Joneses
Ramit: y’all.
Kevin: But they’re looking us at where the Joneses, like,
Ramit: This is the problem. It’s called pluralistic ignorance Yeah. Everyone is in on it, but no one wants to admit it.
Kevin: I feel like there’s no escape from it.
Ramit: I feel like there’s no escape from it Of course there is. We looked at a public school for my son. [01:01:00] Yeah
Margaux: we told him we’re not gonna bust our butts to send you to private school. You’re not even working that hard.” It’s the first time in 16 years that his grades are up.
But do we pull him out for the last two years of his high school to, and put him in public school?
Kevin: Him alone is 50,000 a year. So-
Ramit: Sorry, I’m not interested in the stories again. I’m not interested in rehashing that, and I
Kevin: No, not a story. How could I put him in an environment that he has never been in, that’s filled with things that we don’t believe
Margaux: but it’s just one part of the picture.
Kevin: just a hard decision. I know. So that’s why the decision’s hard, so we keep doing it.
Ramit: with the Joneses.
Kevin: No, keeping up with what community values. I wouldn’t say Joneses so much, but there are community values.
The value of learning our heritage, being in a environment that we feel is safe for our child, not in a public school environment,
Ramit: guys, I’m not pushing you. It’s not my place to tell you to send your kids to public school or private school. It’s up to you.
Kevin: No, I’m just throwing this out that these are part of the decisions we have to make. So I’m [01:02:00] always gonna make the one that I feel is gonna benefit my child in the long run,
Margaux: it. Keeping up with the Joneses. Boy, don’t I love this, and it is a rare opportunity that we see today where we have a couple that is literally keeping up with the community around them.
Narration: And I pointed this out to them, and did you notice their response? “Oh, well, I mean, we’re not really keeping up with the Joneses. This is our tradition. These are our rituals.” Think about what that represents. That answer’s almost a impenetrable story that I cannot argue against.
Who am I, Ramit Sethi, to come here and say, “Well, um, those traditions are actually putting you in the poor house”? I can’t really say that. So they expect me to go, “Well, I guess that makes sense.” That’s not gonna happen on this podcast. I will not allow couples, whether they are earning $75,000 a year or a million dollars a year, to thoughtlessly spend and then assign the blame to their heritage, to their [01:03:00] rituals, to the community that they live in. No, you chose to make those decisions, and if you want to, that’s okay.
It’s your money. But we cannot blindly say, “Well, I do that because everybody else did that, and that’s what I saw growing up.” Okay, and you’re an adult. It’s time to take responsibility for your decisions, and we’re gonna start doing that right now
Margaux: Ad break 3
Rich Poor Reality Check
Ramit: you do not have enough money to send your kids to private school starting now. You have no money set aside for college for your kids. You have no retirement for yourself, although you do have two expensive properties which you could sell, but you both are extremely reluctant to discuss that.
Margaux: No.
Ramit: Exactly. Where, why would I sell? That would just give us more access to go through. No. Because fundamentally, you don’t trust yourselves. Any money we have, we as a couple spend it. So having our money in real estate, at least it’s locked up, so even we cannot spend it. At least that is safe
Margaux: At least that is safe. But it’s also an asset. It’s not a, unintelligent thing to say, “Let’s have our savings in real estate-
Ramit: On one hand, you’re telling me having an asset is [01:04:00] intelligent, it’s smart, it’s gonna grow in value, it has grown in value, and on the other hand, in your own application, you’re telling me we live month to month making over a million dollars a year, and we can’t figure out how to spend less.
Margaux: So we, we need to cut costs
Kevin: Okay.
Ramit: If I put your numbers back up on screen right now, we
Margaux: put your numbers back up on screen right now,
Ramit: would get nowhere.
Margaux: we would get you nowhere. Why?
Ramit: Because when I’ve asked you about groceries, you were not willing to concede even $1. When we talk about school, you’re not willing to concede In fact, you doubled down.
Vacations, have not heard either of you entertain even the concept of that. In fact, if anything, you’re underestimating how much you spend and you have this idea, “Oh, we’re actually saving money ’cause we didn’t go to Vail. It’s actually quite good. We love points.” Where are you gonna cut? You two actually read the situation better than you think because you both said, “Where are we supposed to cut?”
Exactly. In the situation you have put yourself, where you live, the choices you have made, you have actually created a knot that is so tight it is impossible to untie unless you decide to play an entirely [01:05:00] different game
Margaux: We’re open
Kevin: to that. You are? Yeah.
Ramit: Okay. Margo?
Margaux: Yeah. All right. Marta? Yes. What’s the entirely different game? Like, move?
Ramit: You t- you tell me. Let’s play it out. What
Kevin: play.
Define The Rich Life
Ramit: are some options if your goal is to stop being stressed about money while making a million dollars a year, to actually feel good about money? What else would be the vision here? What’s the rich life vision? Really.
Margaux: I’d like to build my summer home. Okay. I would love to have, a ski home one day
Ramit: ski home, where’s it gonna be?
Margaux: I don’t know.
Ramit: Okay. And then the summer home, where would
Margaux: the summer home, where would that be? The summer home we have already, which we just wanna build. Okay. And, yeah, not being stressed about money. Being able to spend in a way where we feel like we’re living a comfortable life- … and we’re also saving at the same time
Ramit: build. Okay. And, yeah, not being s- stressed about money. Being able to spend in a way where we feel like we’re living a comfortable life- … and we’re also saving at the same time. Okay. Wanna add anything?
Kevin: Rich life vision is, in my opinion, the least having s- savings, something to show for it at the end of the year that you could move forward [01:06:00] with and save each year on
Because life’s moving quickly. In 20, 30 years when I turn around and we’ve married off our kids and we’re looking at each other, we wanna have, like we said in the beginning, our assets of course, if we could hold onto them.
But we wanna have
Margaux: money
Kevin: we can en- enjoy that time. I don’t wanna be working at
80, 77, 75.
but I could have a few fantastic years and work and the knots untied, and there are ways to save and put away that money. I just have to learn how to actually do that
Ramit: I’ll tell you, especially with a business owner that’s consistently making a million bucks, a million dollars can make up for a lot of financial mistakes.
A lot. Like, if you’re making a million dollars, there’s just so much cash sloshing around that you can kind of make things work. I’ll tell you when it stops.
Usually, it stops when somebody stops making that kind of money, like their business [01:07:00] goes down.
We all know business owners, it goes down, down, down, down, down, and it goes down forever, and that’s over. So that’s number one, when that ends. Number two, it ends when, the person is unable to sustain anymore. Maybe they get older, injured, whatever,
And then third, this is the most rare, is when they simply have such high expenses that they just can’t keep up with them and they just drown. In your case, it may be a combination here. The expenses are astronomical, you could untie the knot line by line, or you could simply say, like, “This isn’t the way we wanna do it.”
Kevin: it.
Community Knot Explained
Ramit: I’ll tell you why I think it’s difficult for everybody right now, is that this is what you’ve known. And Margo, you said we were born into the knot. What’d you mean by that?
Kevin: into the known. What’d you mean by that? I was just gonna say that
Margaux: We live in a community that is, very traditional, and it’s the same schools that I went to is the school where my kids are going to. And, the holidays cost a lot of money. The cost of living is so much higher even when you account for inflation, that the percentage of my [01:08:00] income of what I’m paying for tuition and food and just basic cost of living compared to my parents … It’s so much more astronomical. So they were able to do it, and it made sense.
I think there’s a lot of couples my age that are having the same struggles to keep up
Ramit: It’s very insightful, and your conclusion thus far has been what?
Margaux: Something has to change. Something has to give
Ramit: has been giving so far?
Margaux: What has been giving so far? What has been giving is every single penny of what we’re making
Ramit: And more And more
Margaux: And more
Ramit: more than you make. You’re basically hoping it all works out. And maybe next year you take a nice 100K distribution. That might cover some debt you’ve accrued, but what happens the year after and the year after? Essentially what you’ve done is you’ve taken on a massive amount of risk. Massive. It works until it doesn’t.
Tuition Help And Emotions
Ramit: One question I have, Margo, is, you mentioned your dad used to help with the tuition. How many kids was he paying for in private school?
Margaux: He would offer to pay for just, a portion of one of the school’s tuitions. This year was it, 70? [01:09:00] 70 out of
Ramit: of how much?
Kevin: Two hundred.
Ramit: And then you mentioned that he will not pay for the tuition.
What happened in that conversation?
Margaux: We just felt like we wanted to be independent and not have to ask This is our family, and it’s something that we should be doing on our own.
Ramit: on our own. Okay. I appreciate that. Is this the first time you’ve looked at the numbers of how much it’s gonna cost for paying for private school for everybody? We
Margaux: Is this the first time you’ve looked at the numbers of how much it’s gonna cost for paying for private school for everybody? We know the numbers because that’s one of the biggest expenses that we have, I think it’s the first time that we looked at it in the context of what are we spending on other than that, and what is he making?
Ramit: And what is he making? So what do you think? Where’s the money gonna come from?
Margaux: Hence, that’s when I put the application in Oh,
Kevin: the money gonna
Margaux: For it to come here. I’m like, how do you think we’re gonna do this next year? Like,
Kevin: come from? Hence, I put on the application. That’s when I put the application in. From cutting other costs, of course. How do you think we’re gonna do this next year? Cutting in other areas to support that, we feel very strong about that. Okay. But-
Margaux: feel very strong about that. Okay. But w- where are we gonna cut?
Ramit: gonna
Kevin: Shall we look? Shall we can look.
Pick Numbers For College
Ramit: Okay, I’m gonna put these up on screen, but let me suggest something. You mentioned [01:10:00] private school is very important to you for the kids. Is paying for their college important, too?
Margaux: Yes. I don’t know that they have to go to American private university that costs $90,000 a year. Now, I’m okay with, you know, city university. I’m okay with international. How much?
Ramit: Do they have a blank check? Somebody wants to go to NYU, can they go? Is there a number?
Margaux: We’re living month to month. We’re not planning. We’re
Ramit: Exactly,
Kevin: We’re not at
Ramit: two of you are not willing to pick numbers. So that is what we’re going to do now. Oh my God.
Margaux: Oh my God.
Ramit: I take a lot of joy in this. It might not be as joyful for you, but for me
Margaux: I’m so happy that we’ve brought you joy from Brooklyn, New York
Ramit: I’m happy that we’ve brought let’s recall a couple of things here.
Assets, what’s that number again? Can everybody say it out loud? One, two, three. 11
Margaux: million 11 million.
Ramit: 11 million. Never heard a more morose group of people talking about $11 million.
Kevin: Oh, 11 million.
Ramit: [01:11:00] Oh, $11 million.
Kevin: we’re very thankful. Don’t… We’re very extremely fortunate and thankful.
There’s no question about it.
Margaux: I
Ramit: yeah. I heard you guys say that before, but I don’t feel it.
Margaux: We’re very nervous.
Ramit: I appreciate that. That is honest. We are nervous.
Margaux: a joke.
I have five kids to, to support. We have a crazy tuition bill coming up in September. Yes. September 1st,
we do not have a plan on how we are gonna get through the year next
Ramit: to support. We have a crazy tuition bill coming up in September. Yes. September 1st,
Margaux: and then talk. We do not have a plan.
Ramit: which already some good is due probably soon. I still have to pay, so count on that. Oh. And we do not have a plan on how we’re gonna get through the year. Okay. Sit back in that mic. We do not have a plan.
Urgency And Shut Up
Ramit: This is the first time I have heard a sense of urgency from you. This. How many hours into our conversation are we?
I
Margaux: I don’t know.
Ramit: Living in your old story. You are finally saying, as the clock ticks down, “We do not have a plan and we are nervous.” And I appreciate that because finally you might be ready to change.
Margaux: ready to
Ramit: This is not a joke. It’s not. You have five kids, you have very high expenses, and as long as everything keeps going great, yeah, you could kinda make it work, sort of. But the [01:12:00] day it doesn’t, you are in serious trouble, and if it happens two bad years, it’s over.
Well, you got $11 million, but you’re gonna have to make some really tough decisions you don’t want to. So it’s time.
Kevin: And
60 Second Cost Cuts
Ramit: normally, what I tell couples is they need to get these numbers to less than 60% on the fixed costs What I would like to do is spend 60 seconds max, going through your fixed costs and each of you calling out what number you can reduce your fixed costs to. Who wants to go first?
Kevin: Save the car payment
Ramit: Okay, what do you wanna take it down to?
Kevin: Half.
Ramit: How are you gonna do that?
Kevin: Get rid of my car. Use my son’s.
Ramit: Get rid of my car. It’s my son’s. Love, love it. Dad is repo’ing his own son’s car. I fucking love it. Good job. All right, 1,200, very nice. That takes you down to
Margaux: 105%.
Ramit: 105%. Margo, you’re up next.
Margaux: Groceries, we could take it down to three.
Ramit: Yes, good answer. 3,000. 3,000. Okay, you’re up, Kevin.
Kevin: What’s all this miscellaneous things that we forgot?
Margaux: [01:13:00] MyCSP
Ramit: adds 15% because most couples do not carefully track their fixed costs, and they have expenses that they do not account for, such as maintenance on their car, some pet accident, whatever stuff they don’t account for. If you are in a financially difficult position, you cannot afford to have 15% just unaccounted for, especially when it’s $6,680 a month. Right. So what number should we have that is your overflow buffer that’s reasonable but under control?
Margaux: What’s that? I don’t know. What do you think? Two for miscellaneous a month?
Ramit: . Y’all have three teenage kids? Put them to work. Like what? They are the ones who figure out what’s miscellaneous. You ever gotten them involved in the money? They just
Margaux: They just ask for money, and he says yes.
Ramit: Yeah, they ask for money ’cause they are not involved in it, just like they ask for food ’cause they don’t have to cook it.
But maybe when it comes to miscellaneous, we can cut this number down to, I say, 1,000 because [01:14:00] we are going to effectively enlist the help, first of each other, and second of our kids. Because by the time they get older, by the time they’re 18, 19, they need to know this stuff. They need to know how to plan a grocery list, how to plan a vacation.
This is how kids learn, so you can change the trajectory of their lives. All right, we’re at 1,000 bucks here. Y’all are at 91%.
Kevin: Okay.
Ramit: What other changes you wanna make? $2,000 a month for clothes? I don’t think so.
Margaux: You wanna lower that number? I’m- I
Ramit: Is
Margaux: really love my job. There’s seven people in the house. Yeah.
Ramit: do they shop?
Kevin: Amazon Basics add
Margaux: Anna … Zara- Don’t
Ramit: me that bullshit. Where else do they shop?
Kevin: Where Zara, H&M-
Margaux: Yeah, we’re very Zara, H&M. That’s where we are. J. Crew.
Kevin: Yeah.
Margaux: Yeah, there’s no brand name. There’s none of that. I don’t buy brand name.
Kevin: She just bought me this
Ramit: It’s very
Margaux: n- She just bought me this.
Sparenos. 10 bucks, J. Crew, when they’re on sale, extra sale, that’s where I buy him his stuff.
Ramit: I buy things Wow, I’m
Kevin: I have had these for six years
Ramit: I
Margaux: for six years. Guess that… Those? 63 bucks, Bloomingdale’s [01:15:00] on Memorial.
Ramit: I mean, y’all can talk all you want. You can play the sitcom game with each other, but our time is running out, and you’re gonna go home saying, “Wow, we really had
Kevin: it to 1,000? Cut it in half?
Ramit: I’m not gonna just make up numbers
Margaux: What’s a normal number for that?
Ramit: Well, let’s break it down.
Kids, how much do you want to give each kid per month for clothes?
Margaux: In other words, give each kid their own allowance- Sure … and let them work with it?
Ramit: Wouldn’t that be a great way to teach them?
Margaux: Yes.
Ramit: bet you they wouldn’t be buying J.Crew anymore.
I don’t know. Who cares? It’s up to them. Figure it out. And if they can come to you and if their goal, this isn’t enough, go, “Okay, make the case. Put a PowerPoint together and make a proposal, but right now this is how much you get. Good luck.”
You’re taking so much burden on yourself, especially with five kids.
Margaux: much burden.
Ramit: And yet you’re just, like, giving them what they want. $2,000 a month for five kids is a lot of money, Pick a number. It’s way less than this.
Margaux: a thousand? Okay.
Ramit: 1,000, and that means you have to pick a number that each of them
Margaux: That includes my clothes,
Ramit: That includes my clothes? You’re not getting any new clothes for a while. Okay.[01:16:00]
Margaux: got it.
Ramit: I feel like this is preposterous but with the expenses you have incurred every month, like $13,000 of private school per month, there are no new clothes.
Margaux: These
Ramit: the trade-offs you end up having to make if you want what you said you want. We want savings. We wanna have upward trajectory, not downward. Well, then you have to make tough choices. If it were anything, it’d actually be probably less than that. It’s probably more like 700 a month, if that. We didn’t spend, as a kid, $100 a month on clothes. We didn’t. We got cheap, shitty clothes from Kmart and Target. We didn’t know any better. Your kids live in Brooklyn, so they do know better. That’s part of the not. So it’s gonna be very difficult for you to be like, “Here’s $100 a month. Good luck.” They’re gonna look different than their friends A lot of quiet over here.
What,
what are you realizing? Realizing we don’t
Kevin: realize we don’t have to do some of the things we do. Yeah, we’re giving too much to the kids, for sure.
Ramit: Yes, and that the costs of the situation you have put yourself in are more than are immediately apparent. [01:17:00] The community you live in it costs more than just the mortgage and the schools.
It’s also the food and the type of clothing. None of these things would be normal in a different community or geographic area. So again, if you wanna live there, it’s fine. It’s up to you, but these are the costs that you-
Kevin: it comes with
Ramit: , exactly. I’ll put it at 1,000. I don’t know if you’ll hit it, but I think you could
Kevin: easily.
Ramit: Well, y’all are at 89%. It’s still too high. You’re spending more than you make every month No money for college. No money for savings That’s,
Margaux: that’s the price we pay with this tuition bill.
Ramit: bill. Yep.
Structural Deficit Revealed
Ramit: So what you are now seeing is that you have structurally put yourself in a position where you just don’t have enough money every month, and it is crazy to say that making $96,500 per month, but you are paying multiple kids’ private education in New York. That’s it. What do you wanna do?
Kevin: I don’t know. If you start to cut out the tuition, you’re talking about life-changing [01:18:00] events.
So it’s off the table.
Ramit: Can I make a proposal?
Kevin: Yeah.
Margaux: First
Ramit: all, I really like what’s happening right now. You two gave it a fair effort. You did. You did a nice job bringing some numbers down. That was good. I’m noticing that you are both realizing this is not as easy as you thought. I appreciate that. And so now we’re gonna make some tougher decisions.
All of this based on what you told me you want. You wanna be able to have a comfortable life. It is important to you that you send your kids to private school, et cetera, et cetera. Okay, so how are we gonna do it? Well,
Real Estate Maintenance Math
Ramit: there’s one number jumping out at me right here. What’s that number?
Margaux: You wanna sell my summer home?
Ramit: The assets Assets $11 million. Appreciation. So right now you’re at $11 million, and presumably those numbers grow over time because they are your houses. Well, first off, they cost money. That I didn’t really even see.
Kevin: Upkeep is tremendous on
Ramit: Where is that? I don’t see it here. Another 30, $40,000 missing per year at least
Margaux: much? For [01:19:00] what?
Ramit: A proper way to do it is to take your house and take 1 to 3% of the purchase price every year for maintenance.
Every year. Now, I know and you know the prices in Brooklyn, Manhattan, et cetera. When I estimate how much it would cost me to own, it’s like 3 plus percent because everything’s expensive there.
Sticker Shock Repairs
Ramit: People don’t understand
Kevin: Yeah, to get the plumber to come to the house is three fifty
Ramit: had somebody come…
I gotta tell you something. I rent a place there, and, we have this fridge, and I told– I love posting on Twitter about how I rent, not own, ’cause people think I’m stupid, and they don’t understand costs in New York, Brooklyn, whatever. The handle on our fridge was loose. Do you know how much it costs for somebody to come and fix a fridge handle?
This is a nice fridge. I estimated at least $1,000, probably double. Three guys wearing booties came into our apartment, came, looked at it, go, we don’t have the right part.” Come back a few days later. Imagine how much that costs in New York.
Cash Poor Reality
Ramit: [01:20:00] So the upkeep on your home’s very expensive, you are cash poor, you’re losing money every month, but you have $11 million in assets.
What’s occurring to you right now?
Margaux: Rent out our summer home for the winter?
Ramit: That’s one way to go.
Kevin: one way
Ramit: I like that option.
Okay, that’s one.
Sell Or Rent Options
Ramit: Why don’t we put all the options out on the table?
Kevin: out the business is in there. Should we take that off?
Ramit: The business is in there. Should we take that off? No, I think it’s fair to put it in there. 2 million bucks is fair. I wouldn’t, but you could. Already have a choice in it. Okay, great. So that’s an option. What about with the houses?
Kevin: What about with the houses? What other options are than selling one, renting one,
Ramit: What other options are there than selling one, renting one, Those are the options. You never put those out on the table. Sell them, rent them. How would that change your picture?
Margaux: What could we get for the summer house? don’t know
Kevin: I never put it out there
Ramit: how much could you sell it for?
Margaux: for?
Two. 2
Kevin: much
Ramit: Two. 2 million? It’s not bad. And then you… the house you live in, that’s the big one, right? What is that, like Seven?
Kevin: Yeah, between six and seven. Damn. Seven million
Ramit: Damn. $7 million house and spending more than you make. [01:21:00] This is house poor But
Kevin: year it goes up
Ramit: it goes up. Yeah, but where’s the money? I hear you. And then is there another house?
No, like, land or something you’re building or all that stuff?
Kevin: The summer home. That’s
Ramit: summer home. That’s the one in Jersey?
Kevin: to go on the ground.
Ramit: Ah. Hmm what do you think, Margo?
Margaux: We have plans, but we’re not going forward with anything
Ramit: Are you open to renting it? Renting it out-
Margaux: it out for the summer?
No, ’cause where would I go? Right. Are you
Ramit: Are you open to renting it out for the summer?
Margaux: open to
Kevin: where would I go?
Ramit: No, ’cause where would I go? Right. Are you open to selling it?
Margaux: Selling? I, I don’t wanna be open to selling it. That’s my summer home. Yeah. That’s my future
Ramit: you open to not taking any more vacations for the next- 10 years?
Margaux: 10 years? Yeah. Yes. Really? S- I don’t wanna sell my homes.
Ramit: homes. I love that answer. You’re willing to not take vacations for the next decade if you can keep your house.
Margaux: With the hope that I’ll start making money and Kevin will start making more money. And in two years w-where Isaac is out. And so that’s a big [01:22:00] relief. What, are
Ramit: but he’s gotta go to college
Margaux: I don’t know that Isaac’s going to college. We’ll see.
Ramit: One way or another though, like the next kid’s gonna go to college. Like, … there’s a factory you’ve got with five kids that even if one doesn’t go, whatever, there’s gonna be something else. So I appreciate maybe one or two won’t, fine. But we’re still-
Margaux: in two more years, Ray will be done with college and Isaac will be out of high school, that’s a relief. Now we
Ramit: but once we, in two more years, once we have that, Ray will be done with college- … Isaac will be out of high school, that’s another, like that’s a relief.
Tuition Vs Lifestyle
Ramit: Can you tell the kids we’re not gonna pay for college? Would you be open to that?
Margaux: No, I would not tell them I’m not gonna pay for college, but
he can go to Hunter College or Baruch, which is a good business school, and you pay city tuition prices. It’s not-
Ramit: pay city tuition increases. It’s not He’s gonna pay or you’re gonna pay?
Margaux: pay? Good question
Ramit: the answer?
Kevin: don’t know. I’d probably tell you in two years when the time comes.
Ramit: Y’all are the parents. You decide
Margaux: So maybe we don’t have to pay Reese full tuition next year. He found himself a job there that he’s gonna start working next year. Why do I have to pay my son’s second year full college tuition and dorm? It’s a big bill.
Why do I have to always be struggling for the [01:23:00] kids?
Kevin: Again, that’s something where we came from. They’re constantly building up their kids, bringing them into the businesses that they created. I
Ramit: understand. My parents are the same way. My community is the same way. They will spend an effective unlimited amount for education for their kids, even if it puts them into debt. I understand deeply. However, my group of Indian parents and my parents’ friends, their spending was radically different than this.
First of all, they didn’t make this kind of money, but second of all, we didn’t go to private schools, camps, vacations, none of it. We had no clothes. Like, go look at an Indian kid’s picture. We don’t look good. Indians have a Indian glow-up. Indian parents want us to not look that good, so we focus on school.
Again, I’m not saying it’s right or wrong. Different communities, fine.
But, like, the math is the math And I wanna say one thing. It would be difficult for me as a kid whose parents live in a six or $7 million house and take quite nice vacations and stuff like that for them to put me into, let’s say, $95,000 of student [01:24:00] loans. That would be difficult. Again, it’s up to you. If you were to just be like, “We’re not paying it,” I’m like, “Cool. I’ll help you tell them.” But is something a bit out of whack? What do you think?
Margaux: I agree. It’s again, it’s the system that we’re tied into.
Yes. The elementary and high school tuition is so high, and now with the cost of living being so high It’s, like, almost impossible to pay the… We’re, we’re tinkering on just being able to get by, but This has happened to us for so many years now.
What do you think Well, you don’t own a home, so I would assume you would sell one of the homes ’cause you’re a believer in renting
Ramit: You’re a I’m a believer in running the numbers, yeah. What else would I do?
Kevin: But you would sell something that you know is gonna appreciate?
Like in 18 months,
Margaux: Also,
Kevin: be worth another million than it
Margaux: rental market in here is, slim to none
Ramit: I’m sorry, are we asking me what I would do or are you trying to convince me you’re right?
Kevin: What worries me is that I’ll burn through that money
Ramit: because your dad did that, and that’s what you’ve seen, and that’s what you know.
But there are people who do it [01:25:00] differently
Kevin: Right. With investing and putting away money and making that money work for you-
Ramit: It’s not
Kevin: It’s not my specialty … it’s not my specialty. So what?
Margaux: You ever heard of a book called I Will Teach You
Kevin: Be Rich? See right there? Yeah, I see it. You
Margaux: You ever read it?
Kevin: I have not. It’s specialty
Ramit: your specialty because you never did the
Kevin: I don’t know. We look at assets as very important value, but I hear you, and I did bring it up. He did bring it up
Margaux: He did bring it up.
Ramit: Okay, so back to your original question. What would I do? What I would do is I would talk to my partner and I would say, ” What do we want? What do we really want? Because our whole life, we grew up here, we went to these schools, now our kids go to these schools. Everybody we know is around us. Every Sunday we do the same thing. Every Friday night we do this thing we know.
It’s our ritual. It’s our heritage. It’s what we know.
We make a ton of money, and we have not been able to get ahead in many years, and we take one step forward, it seems like two steps back. Even when we save four, five, $600,000, this thing comes out of left field and just kneecaps us. Do we want to go the next 30 plus [01:26:00] years like this? More importantly, what are we teaching our kids? Because it sure seems like the lessons our parents taught us about money, which were close to none, are the ones that we are teaching our kids. Keep up with the Joneses. Of course, we want continuity, live in the same neighborhood. It’s gonna be even more expensive for them.
How are they gonna compete? How are they gonna even keep up? So if we don’t make changes, they are going to be in our position in 15, 20, 30 years, but it’s gonna be even worse for them, and they’re not gonna know why. So we can’t just delegate this and pass it on to them. We gotta actually make changes now.
It’s gonna be hard ‘ cause this is what we know. So what do we want? I think we want, as a family unit, to understand the value of money. I think we wanna enjoy our lives. I think we wanna set our kids up for success. We wanna teach them valuable lessons. How do we do that? Well, first of all, we make a lot of money, so earning more is not really on the table.
I hope we do, but we already make a million dollars. We can’t make it work. Two million’s gonna be the same thing. We have [01:27:00] assets. We probably need to tap into some of those assets. There might be one house. We sell that house.
go great. I can invest the money and make 10 times also. Here’s the fact of the matter. You’re losing money every month. You cannot continue on this way. Bottom line. How many years of private school tuition would selling that house get you?
Margaux: of private school tuition would selling that house-
Kevin: it would get us through a five-year period
Ramit: periods Five years, that’s not enough. Pull him out
Margaux: Why don’t we send Isaac to school for the next two years in Jersey?

Margaux: For
Ramit: I don’t think the public school in Brooklyn is just the right one. And what about the other kids?
Like I cannot
Margaux: You want to pull them out of that? So I c- I cannot move them. Can’t do that. Okay. Absolutely not. All right. It’s not an option, but the high schooler, well, Why can’t we take a loan for the college one?
Ramit: Where’s the money coming from?
Margaux: For, we’ll pay it monthly. Let him pay some of it. He’s working
Ramit: For the… We’ll pay it monthly. Let him pay some of it. He’s working. That doesn’t solve the problem. Why? Because that’s a drop in the bucket. Is it? Yeah.
Margaux: Drop in the bucket. Is it?
Ramit: It’s 30 grand. Y’all are spending 150 plus per year on kids’ education.
Kevin: So
Margaux: you take that down to 120, ’cause you’re minusing the older one- … that’s not a drop in the bucket.
Ramit: If you take that down to 120- … minus-ing the older one- … that’s not a drop in the bucket. If you take, keep going. I like that. [01:28:00] Okay.
Margaux: and he can pay it, and if he wants to go to my dad and ask him to help him, he can do
Ramit: Great. That’s good. One. What else?
Margaux: Isaac goes to school in Jersey, which is half the tuition.
Ramit: Okay, that’s two. How-
Margaux: can go to Ocean Township and live by your mother during the week. I- that’s 50,
Kevin: Those are some hard decisions we have to discuss and make.
Margaux: Okay, but you’re selling my
Ramit: sell the- Wait, wait, wait, wait, wait. Hold on, hold on.
Margaux: no. Hold on … so
Ramit: let me correct
Margaux: pay this tuition, where he’s not even flourishing in this private school.
We’re killing ourselves to get through this tuition, and he’s not a studious kid
Ramit: Talking about these things does not mean you are making
Kevin: No, of course. I know that.
Ramit: Margo’s on a roll here Yeah I actually want you to encourage her because the two of you have not been able to unlock this. She’s on a roll. You can see it, right?
Kevin: Yes If you’re-
Ramit: you’re getting help, meet her energy and exceed it.
You go like, “Oh my God, that’s a really good idea. I never thought of that. What else could we do,
Margaux: so if he takes out a loan
let him start to contribute. We’ll meet him where he’s at, and the rest will be, have to pay over time. In other [01:29:00] words, “Ray, we need your help. We’re in a position where we’re spending more than we’re making, and we need you to chip in for the tuition.”
And I also don’t need to give him $300 a week. It’s ridiculous. Let him work this summer, save it. Do the best he can. Let him start to hustle a little bit. I don’t know.
Kevin: Okay. That’s awesome.
Margaux: awesome. So that’s- So That’s 30. So
Ramit: and do the best he can. Let him start to hustle a little bit. I don’t know Okay. That’s awesome. So that’s fifteen- Security So he needs to find a way to do it. He needs to find a way to do it.
So you can cut that down to 50 bucks a week. Good luck. Looks like you’re eating ramen. Fine. Figure it out. And-
Margaux: His tuition
Ramit: who’s paying that?
He is?
Kevin: Maybe cut that in
Margaux: He is? We’ll give him a, we’ll pay a portion of it now, so maybe cut that in half. 15 will be a loan for when he finishes and he’s working, he can pay it, and the other 15 he has to pay, half and we’ll pay half.
Hard Cuts Math
Ramit: How much do I reduce this number by? It currently says 16,000 a month for tuition.
Kevin: If you’re reducing him, it’s three thousand a month.
Ramit: Okay … through this.
Margaux: I don’t wanna sell my summer home. So let’s do what we can right now to get through this. Thirteen thousand
Ramit: takes you down to 88%. Okay. What else?
Margaux: My son in [01:30:00] high school’s tuition is forty-eight.
Ramit: It’s $4,000 a month.
Kevin: school’s
Ramit: wanna see what would happen if we took it down?
Kevin: month.
Margaux: would happen if we took it down? Sure
Kevin: wanna see what would happen if we took
Ramit: Watch this number at the top right, fixed costs.
Kevin: right, fixed costs.
Ramit: Dropped down to 80%.
Margaux: That’s it? We’re still at 80?
And we still have to get to 60?
Ramit: solution? Yep
Margaux: That’s cr– We have to get to 60?
Ramit: You could keep it higher. You are in a very expensive time in life, et cetera.
But right now you have very little liquid cash. It’s actually terrifying because you have about a month’s worth of savings. If something happened to you, y’all are in big trouble. One month’s worth of savings and your expenses are astronomical. Even with these changes we made, it’s $40,000 per month
Margaux: so let’s say hypothetically, now we got rid of Ray and Isaac. But we’re still not where we have to be. Yeah, because Sam-
Ramit: kids to school is a huge amount of money
Margaux: Is there anywhere else we [01:31:00] can cut without selling the houses? So what if we did rent out? Is it worth it to do that?
Ramit: We’ll just net out, 2,500 a month, okay? Watch what happens. Your fixed costs drop 3%, 77%.
It’s interesting, but not that interesting
Margaux: month. Okay. Watch
Ramit: I once had a woman on this podcast who, wanted a beach house, and she was saving every last penny.And it was causing her a lot of anxiety and stress, and I asked her, “What is behind this beach house?” and she told me that she grew up, they went to the beach, she wants the same thing for herself. And I said, “It sounds like a lovely vision. Is it possible there are any creative ways to get to this beach house?” And I proposed to her, what if she just rented a nice one for a week or two or something like that? And it, it kinda struck her. She was dumbfounded. She had never considered it.
can see. She’s in a different position than the two of you. You already own a house. You’re already accustomed to going there. Again, it’s different. It’s the same knot. It’s the people. It’s the same knot. It’s– I grew up there. The kids go to camp there. I love my summers. Like,
Yeah
Kevin: we say the year is so hard, but all my [01:32:00] friends are there. It’s really very
Ramit: We say that we are so hard, like all my friends are there, every girls, it’s it’s really very important part of my life. I get it
Kevin: important part of my life. I get it. Everyone picks up from Brooklyn and goes to Jersey. The North Shore area. The whole… So it’s the
Community And Identity
Ramit: can I tell you my perspective here? Yeah. So I’ll never tell a couple, a family, “Pack up and move I, I get that. It makes no sense, especially when you have your community embedded where you are. But where you are is not serving you, at least financially speaking.
And obviously it’s not serving you relationally because you all flew all across the country to see me. So this is not working. And again, it’s not working, and you’re having great years. A million bucks a year is fucking awesome as a business owner, but it’s not working. So if it were me and I wanted to stay with my community, but I couldn’t make this work, this is what I would do.
Big, bold changes, okay? Easy for me to say. I know that, but that’s why you came to me. I would get rid of one or both houses. I don’t know which ones. I would find a place that’s more inexpensive. I know it’s difficult for five kids. I know that. I know this is not [01:33:00] easy. But this is why sometimes we need to hear from someone else.
I would not own a second place. We simply cannot afford it. Finally, with the school, the kids would have to not be in private school.
It’s just not feasible. Now, if I could do that for three or four or five years and bank a shitload of money, and I would know the exact amount we need to have, which would allow us to pay for the kids’ college, perhaps, if that’s a priority, have a retirement and know the exact number that we need so we never have to go down, but rather go up, and I could do that for five years at a million bucks a year, if you actually contained your costs dramatically, you could lock away hundreds of thousands of
Kevin: million bucks a year, if you actually contained your costs dramatically, you could lock away hundreds of thousands- Well, also, if we have eight million earning interest and bringing in more money, it’s more money. Massive. We’ve had this conversation. Don’t think we didn’t. Okay. Liquidate. Yeah. Cash rich, invest it, rent.
Yeah. Step away from a lot of the problems. It’s so hard to do when you’re doing it for 40, 50 years of your life. You’re living in that same situation. It’s hard to just say, “Okay, liquidate. I’ll have eight million in [01:34:00] the bank, great. It will earn X. I could still make this. We’ll compound it.” but we’re living a completely different lifestyle than we’re mentally and physically used to.
It’s really hard. It’s a tough one. I love that option, but then the other part of me says, “Fuck, how could I do that?
Margaux: I gotta
Kevin: away from the community I was born into?”
Margaux: Why step away? Maybe it’s, a little bit different neighborhood. Maybe it’s a
Kevin: a block away
Ramit: it’s really hard it’s a tough one It’s really hard I love the, I love, I love that option. But then the other part of me says, “Fuck, how do I do that?” I gotta step away from the community I was born into. Why step away? Maybe it’s, a little bit different neighborhood.
Maybe it’s a few blocks away. It’s a little different. I know it’s not the same. I get it. Even a block away can be totally different. I get that. But again, this is not working
Kevin: not working.
Margaux: His parents sold their houses- Yeah
went through the money and ended up- This is less than 20
Kevin: parents sold their houses. Yeah. Went through the money. Listen, it lasted them 20 somewhat years
Ramit: we make sure that doesn’t happen?
Margaux: happen? How?
Kevin: I don’t think they did it that way. How?
Ramit: Y’all could invest in simple funds. You’ll be fine. I’m not promising some get rich quick bullshit. It’s simple. The investment part is not the hard part. It’s the two of you getting aligned on expenses. But if you had, I don’t know, eight million dollars, just interest?
Kevin: Two forty.
Ramit: Yeah, [01:35:00] $240,000 a year in safe withdrawal income coming from that.
So he would still be making, let’s just say, a million dollars a year. So you’re still bringing in the current income, plus you would have an extra $240,000 a year of money, which you could use however you see fit, probably saving.
Margaux: But that money would go towards rental of the home and the summer home. It would equal $200,000. Well, if you
Ramit: But that money would go towards rental of the home and the summer home. It would equal $200,000. If you chose to spend that much, it would. I have a lot of people to house. Yeah.
Margaux: You could. I have a lot of people to house. Yeah.
Kevin: Like you said, you can go to a different area where it’s a little bit less, but you’re still within the community.
Margaux: you wouldn’t be in Brooklyn, that’s for sure, because there’s nothing less than 10
Kevin: Of course you would. But, I, listen, I hear you
Ramit: Here’s the facts. Having multiple kids in private school, plus college, plus cars, plus food, all that stuff, it just doesn’t work. There’s no magical answer that I can give
Kevin: There’s no
Ramit: You wanna do?
Kevin: magical answer to that I know What do you wanna do? So that’s a lot to be discussed. We have to sit down and discuss things But yet at the end of the year, I if I make double [01:36:00] the income, with our habits, who knows if there’d be anything left anyway at the end of the day.
Yeah. But so we’d have to come up with a system, put it into effect, and make some hard decisions that we don’t want to. But,
Ramit: The one thing I wanna say is time is not on your side all are getting older, and a high income can help if you start late in life. Okay. Luckily, again, you have millions of dollars of property. That’s a enviable asset to have.
So my message to you is from the surface it seems okay, kind of like the way you look at your neighbors and you’re like, “How are they doing it all?” And maybe they are with parents’ help, maybe they make even more money than you think, or maybe they’re in similar situations where they’re just like, “Oh my God.” But when you have a family of five where you live, in those schools that you’re in, with the lifestyle which I understand, even a million dollars a year, it’s really difficult 20 years from now, I’m gonna be hopefully doing this podcast. Say I have one of [01:37:00] your kids come on, and I ask them about how they grew up, and I ask them what they learned from their parents about money. What are they gonna say?
Kevin: And any of them would say, “We had a great life. We have what we need. We’re getting it all. Um, are we teaching them the value of money? I would say, mm, probably not so well.
Ramit: Okay. Margo?
Margaux: I think that they witness us struggling and arguing about money. And I think that I don’t know that they feel the actual value of what things cost because they get a lot.
Ramit: Mm-hmm.
Margaux: What is the right way to have them being a part of this financial situation?
Ramit: Outstanding question. At four or five, they should be watching you click a button to pay the credit card bill, “Help me push the button. Great job. This lets us have a roof over our head.” Get them involved, have fun. At seven or eight, they’re coming to the grocery store with you, and you’re talking about, “Here’s how much we have to spend.
Can you [01:38:00] help me do it?” Age appropriate, small numbers. Keep that going. 10, 12, they should be the ones picking what’s on the menu when you’re eating out. “Here’s how much we have. What are we gonna get? Where are we gonna go?” As they get older, we’re talking about that same principle, the grocery store, the restaurant.
Now it’s with bigger amounts of groceries. Birthday party, “Here’s the amount. What do you wanna do? It’s up to you. You’ve gotta make the trade-offs. You’ve gotta tip the vendor,” all of that. Then it’s buying a car. Then it’s taking a family trip. By the time they graduate, they know taxes, tips. They know what it’s like to get ripped off.
They know maintenance costs. Right now, how much do your kids know of those things?
Margaux: We don’t even know. We don’t go into a vacation like calculating exactly how much we’re planning on spending.
Ramit: That’s not effective.
Margaux: have some sort of concept of money, yeah, but they don’t have a concept of it in relation to how much we have available to spend
and what, so what about the [01:39:00] 16-year-old?
Ramit: They should be close to running part of the household when it comes to finances.
They should be investing. They should be having a certain amount of money. I would not be giving a 16-year-old a bunch of money to go out and buy clothes compared to how much money they have to invest. Sure, they can have a little bit for fun.
For sure, they’re a 16-year-old, enjoy. But they’re talking about the difference between saving and investing, something that the two of you do not do. So all of this is a bit moot until the two of you get aligned, because you cannot do the thing where you go, “Do as I say, not as I do.” they’ll read right through that.
They’re too smart. So I appreciate the questions. They’re awesome questions. But until the two of you actually are dialed in with your money, until your fixed costs are at 60, even 65%, and you’re saving at least 10, 15%, investing 10, 15%, guilt-free spending is way down, they’re just gonna see this as a show, and I don’t think they’ve ever seen you make tough decisions about money. I’m s-
Investing And Next Steps
Kevin: And if we have money to invest, where would it go?
Ramit: 401k is a great place to start, especially with the options you have, or perhaps a SEP IRA. There’s a few different types of accounts that [01:40:00] business owners have access to. Within that account, you could pick simple index funds.
That’s where I have the majority of my money. We can’t predict the future, but we can see that typically it’s returned about 7, 8% after inflation every year.
That’s a lot of money
So the investing part is not difficult. The suggestion I have is that the two of you do start a book club, each of you. If anything, I would actually involve your older kids and be like, “We’re all gonna read this together.”
Okay. If you wanna change things, you need to really take it seriously, and your kids would actually need to see that. If I talk to them in six months, I should ask them what happened as of six months ago. They’d be like, “Holy shit, my parents really changed.” And I would challenge you to think about what that change is
Kevin: what
Ramit: and what you want them to see, ’cause right now
are equipped to the house, graduate college not really knowing anything about money, and I don’t want that for them.
I don’t want it for you
Speaker: The stories that we tell ourselves through the generations are incredibly sticky, and they can be things like, “Of course we send our kids to [01:41:00] college.” They can be things like, “Of course we buy a house.” so when I am speaking to this couple, and I am even proposing the idea that perhaps they can’t afford to send multiple kids to private school, perhaps they can’t afford to pay for their college, perhaps they might need to sell a beach house, you can see that it almost does not compute.
Why? It’s not that they’re stupid. They’re very intelligent. It’s that we are talking about generations of beliefs that have been passed down. It’s not easy to get rid of those things. One of the key lessons of money for couples is that money is not just about numbers on a page. It’s about beliefs. It’s about social systems.
It is about things that are passed down consciously or unconsciously, orally or not. And that is exactly what we are seeing here, a system, an interlocking system of beliefs that are showing up right there on their CSP, where they live, what schools the kids go to, what [01:42:00] activities, even where they go on vacation.
But sometimes those beliefs simply do not align with where you are financially, and that’s when you have to make some very difficult decisions.
My point is not that they should sell the house today. point is that I don’t think they’ve ever even considered the alternative. What if we took the money and invested it? What if we took five hundred thousand dollars of that and put it aside for the kids’ education, or a million?
What if we felt less stressed and actually had a vision together? But until they can rid themselves of this restrictive story, “We must own houses. We can never sell until we die,” they will be in this position forever. Margo and Kevin My wish for Margo and Kevin is that they systematically deconstruct the stories that they have surrounded themselves with.
You do not have to spend $4,000 on groceries per month. You do not have to send [01:43:00] five kids to private school, including college. You do not have to live in two different houses until the day you die and struggle with money, because that’s what everybody else does.
You choose. Right now, in a way, it almost seems like they are on autopilot with their stories, and you cannot live a rich life on autopilot.
Followups
Speaker: Unfortunately, Kevin and Margo did not submit any follow-ups. This is tough for me because I spend a lot of time with guests. I want the best for them, and I get involved. This becomes important to me. But I also think there’s an element of I’m not really surprised. I think that when you are faced with very difficult decisions, especially when you tie your identity to where you spend your money, it’s easier to just say, “We’re not gonna do it.
We’ll deal with it later.” Unfortunately, time is not on your side, especially as you get older, and I truly [01:44:00] wish for both of them to make radical changes and to do it sooner rather than later when they are forced to.
So Margo and Kevin, I wish you the best. Please keep in touch. I appreciate you coming on here. It’s a difficult conversation, and I really hope you’re able to make some huge, bold changes.

Last Updated on September 28, 2026 by Katie

Pinterest is the reason this blog has readers. I don’t say that lightly, and I’ve known it for a long time.

The proof is in my Analytics. Over the last 28 days, Pinterest sent me around 11,000 visits.

Google sent 656.

My best pin right now, nearly 60,000 impressions in the last month, was made in July 2022.

It sent 1,196 people to my blog in the past 30 days alone. [I haven’t touched it since.] It’s been quietly working for four years.

None of this happened quickly, and none of it was tidy. Pinterest is a slow build, and even now a good chunk of my pins sink without a ripple.

I once had my account flagged for spam after sharing a pin I hadn’t checked properly. It was an honest mistake, and it still made my stomach drop.

So this isn’t a “sign up and watch the money roll in” post.

But if you think of Pinterest as somewhere to post pretty pictures and hope for likes, you’re using it wrong.

It’s a search engine, and that changes how you should approach it.

7 Benefits of Using Pinterest as a Blogger or Business

I’ve spent years on Pinterest, and it still gets written off as a place for recipes and wedding mood boards.

Below are the seven reasons I think it deserves a place in your traffic plan, with my own numbers wherever I have them.

Some are big wins and some come with fine print, and I’ll flag which is which.

1. It’s a Search Engine, Not a Social Network

Most social platforms run on people you already know.

You post, your followers see it, and if you’re lucky someone shares it. Skip a week and the whole thing goes quiet.

Pinterest works the other way round. Nobody opens it to see what their cousin had for lunch.

They open it with a question, or a half-formed idea: how to start a blog, what to cook on Tuesday, how to earn money from the sofa.

That’s search behaviour, and the numbers back it up. Adobe research, cited in Forbes’ piece on Pinterest for small businesses, found that 39% of consumers use Pinterest as a search engine.

Forbes describes its primary purpose as being a visual search engine, which is a fair summary.

The practical consequence is that keywords matter far more than follower count. The words in your pin title, description and board names are what get you found.

Picture someone typing “fun remote jobs” into the search bar. They’re probably not ready to apply for anything yet.

They’re browsing, collecting ideas, saving things for later.

My post on fun remote jobs that are hiring is written for exactly that person, and a pin is a good way to meet them while they’re still in that mood.

Fair warning: if your Pinterest plan is to post a pin and wait for likes, you’re treating it like Instagram. Likes don’t pay anyone. Being found for the right search does.

Takeaway: before you design a single pin, write down the phrase you want it to be found for, then put that phrase in the title.

2. People Arrive Ready to Buy

There’s a difference between someone scrolling for a laugh and someone scrolling for a decision. Pinterest tends to attract the second kind.

People use it to plan things: a kitchen refit, a wedding, a career change, a side hustle.

Planning comes just before spending, which is why the benefits of using Pinterest look so different from what you’d get from a viral tweet.

Forbes cites Sprout Social data saying 85% of weekly users have bought something from a pin. Treat any single statistic with some suspicion, but the direction is hard to ignore.

Pinners are shoppers with a list. For a business with a product catalogue, that means shoppable pins, which let people buy without taking a scenic route via your homepage.

For a blogger, it means readers who arrive wanting to do something, not just read about it.

You can see it in my own numbers. My pin for 15 Best Remote Jobs for a Midlife Career got 1,560 outbound clicks in the last 30 days, a 3.0% click rate.

Someone weighing up a career change in their 40s or 50s isn’t casually browsing.

They’re making a big decision and they want a proper list, which is what my post on the best remote jobs for a midlife career change gives them.

Pro tip: send pins to pages you control, such as your own post or product page, and keep any affiliate links there.

You decide what people see when they land, and you’re less likely to trip Pinterest’s spam filters.

3. Pins Last for Months, Even Years

A social media post has a shelf life measured in hours. A Pinterest pin can have one measured in years, and I can show you the receipts.

The pin sitting at the top of my account right now was made in July 2022.

In the last 30 days it picked up 59,425 impressions and sent 1,196 people to my blog, a 2.0% click rate. It’s four years old. [I haven’t touched it since.]

It’s still the top pin on my account for impressions, and it points to my guide on how to get paid to be a virtual friend, which is why that post keeps finding readers long after I stopped thinking about it.

It isn’t a one-off either. My pin about filling out forms for money picked up 1,009 clicks (2.1%) in the same 30 days.

That’s three pins with over a thousand clicks each in one month, working away while I get on with something else.

Forbes makes the same point about evergreen content. Pins that aren’t tied to a season or a trend can keep working all year, and how-to content suits it best.

That matches what I see. My best performers are all “how to” and list posts that will be just as useful next year as they were last year.

The catch: this is the slow part. A pin rarely explodes in week one. Plenty of mine have flopped, and some still do. If you judge Pinterest after a fortnight, you’ll quit before it starts working.

Takeaway: make pins about topics that will still matter in a year, and give each one months to prove itself, not days.

4. You Don’t Need a Following to Get Found

You might assume you need thousands of followers before Pinterest is worth your time.

On most platforms that’s true. The algorithm mostly shows your posts to people who already follow you, so no audience means no reach.

Pinterest is different, and it’s the point about the benefits of using Pinterest that beginners tend to underestimate.

Forbes cites eMarketer data showing that 96% of Pinterest searches are unbranded. In plain English, people aren’t looking for a particular company or creator.

They’re looking for an answer or an idea. Nobody has ever typed “Remote Work Rebels” into Pinterest to find me.

They type things like “morning shift remote jobs” or “entry level remote jobs”, and my pins turn up because the wording matches, not because anyone knows my name.

That levels the field. A brand-new blog with a well-worded pin has a fair shot at appearing alongside established sites, because the pin is competing on relevance rather than reputation.

Forbes puts the advice down to a consistent content strategy, not a big name.

Levelling the field isn’t the same as skipping the work, though. You still have to research keywords, design pins that stand out in a crowded feed, and publish regularly for months.

Lots of people give up at week six because nothing has happened yet, which is roughly when nothing was supposed to have happened.

If you’ve tried Instagram or TikTok and got worn down by follower counts, this is the platform that doesn’t care.

Takeaway: put your main keyword at the start of the pin title, then repeat it naturally in the description.

5. It Takes the Pressure Off Google

Relying on one traffic source is like running a business with a single customer. It works nicely until they leave.

For most bloggers that customer is Google, and Google keeps changing the rules.

Forbes points out that organic traffic from Google may be dropping, with more searches ending without a click and AI overviews answering questions before anyone reaches a website.

Pinterest, it argues, can help fill that gap.

My own Analytics tells the same story. In the last 28 days Pinterest sent me over 11,000 sessions across its two source lines.

Google sent 656. To be fair, Google traffic is growing for me, up 174.5% on the previous period, but from a small base, and I’m not planning to build a business on a percentage.

One of the more underrated benefits of using Pinterest is that it gives you a second route to readers that doesn’t depend on ranking on page one.

Pins get found through Pinterest’s own search, the home feed and related pins, which is a completely different set of doors from the ones Google controls.

Now the awkward bit. By my own numbers, I’m heavily reliant on Pinterest, which is a bit rich given the point of this section.

Pinterest can change its algorithm too, and having my account flagged for spam once was a short, sharp reminder that I don’t own the platform.

Takeaway: treat Pinterest as one engine, not the whole car. Check where your traffic comes from every month, and keep building things you own, like an email list.

6. The Tools Are Free (Your Time Isn’t)

Most marketing channels charge you before they give you anything. Pinterest lets you start for nothing.

A business account is free, and among the benefits of using Pinterest for a blog or shop, the price is hard to argue with.

According to Pinterest’s own creators’ guide, the business account is built for creators and brands, and it unlocks special pin formats, the Creator Hub and more detailed analytics.

The same guide suggests connecting and claiming your website. Forbes adds rich pins to the list.

These pull information from your website and are more informative than regular pins, which gives you more room to use keywords and stand out in search results.

The analytics are where the free tools earn their keep. Here’s a habit I’d recommend. When I sorted my top pins by impressions, my 2022 pin came first.

When I sorted them by outbound clicks, my midlife career pin came out ahead, with 1,560 clicks against 1,196.

Impressions are nice for the ego. Clicks bring the readers.

Pro tip: in Pinterest Analytics, change the “Sort by” menu on your Top Pins list to outbound clicks. It shows you which pins are earning their place.

The honest trade-off is that free in money terms doesn’t mean free in time.

Designing pins, writing descriptions and checking what’s working takes hours every week, and the results are slow.

You’re paying with patience instead of cash. For most people starting out, that’s a better deal, but it’s still a deal.

7. The Audience Is Wider Than You’d Think

If you’ve written Pinterest off as a place for wedding boards and wallpaper ideas, the audience has moved on from that image.

Forbes points to a Pinterest report showing that men make up more than a third of the platform’s global audience, skewing towards Gen Z and millennials, with interests in fitness, style, wellness and self-care.

The geography is wider than most people assume too.

My Analytics for the last seven days shows 2.5K active users from the United States, followed by India (171), Singapore (137), Hong Kong (92) and Canada (86).

The UK comes sixth with 65, level with South Africa. I write from Norwich and my home country barely makes the top five, which is humbling in a useful way.

For a remote work blog, a global audience is the whole point. Remote work isn’t tied to a postcode, and neither are the people looking for it.

Pinterest lets a small blog be discovered by someone in Singapore without a marketing budget, a translator or a lucky break.

And if you take to it, it can become a job in itself. Businesses hire people to run their Pinterest accounts, which I covered in my guide to Pinterest remote jobs.

Takeaway: don’t assume who your audience is from the stereotype. Open Audience Insights in Pinterest Analytics and check who’s actually engaging with your pins.

So, Is Pinterest Worth It?

For me, yes, and the Analytics screenshot is the argument. But the benefits of using Pinterest come with strings attached.

It’s slow, plenty of your pins will flop, and one careless share can get your account flagged. I know because I’ve done all three.

If you want a starting point, keep it small. Set up a free business account, pick one blog post you’re proud of, and make a pin with the search phrase in the title.

Then make another next week, and the week after. Check your outbound clicks in a month, then again in three. Don’t judge it any sooner than that.

Some of those pins will do nothing. One of them might still be sending readers and/or buyers in 2030.

Need Help With Pinterest?

Everything above works, but it also takes time, and time is what most bloggers and small business owners are short of.

There’s keyword research, pin design, writing descriptions, scheduling and checking analytics, then doing it all again next week, for months.

That’s a lot of admin before Pinterest starts paying you back.

If you’d rather hand it over to someone who has already been through the slow start, the flops and the spam flag, that’s what I do.

I’m a Pinterest manager for bloggers and small businesses, and you can see how I work and get in touch on my Hire Me page.

No pressure either way. If you’d rather do it yourself, the steps above are all you need to get started.

Learn More About My Pinterest Manager Services.

Need help now?

Shoot me an email via my Contact Page.

Last Updated on September 28, 2026 by Katie

Pinterest is the reason this blog has readers. I don’t say that lightly, and I’ve known it for a long time.

The proof is in my Analytics. Over the last 28 days, Pinterest sent me around 11,000 visits.

Google sent 656.

My best pin right now, nearly 60,000 impressions in the last month, was made in July 2022.

It sent 1,196 people to my blog in the past 30 days alone. [I haven’t touched it since.] It’s been quietly working for four years.

None of this happened quickly, and none of it was tidy. Pinterest is a slow build, and even now a good chunk of my pins sink without a ripple.

I once had my account flagged for spam after sharing a pin I hadn’t checked properly. It was an honest mistake, and it still made my stomach drop.

So this isn’t a “sign up and watch the money roll in” post.

But if you think of Pinterest as somewhere to post pretty pictures and hope for likes, you’re using it wrong.

It’s a search engine, and that changes how you should approach it.

7 Benefits of Using Pinterest as a Blogger or Business

I’ve spent years on Pinterest, and it still gets written off as a place for recipes and wedding mood boards.

Below are the seven reasons I think it deserves a place in your traffic plan, with my own numbers wherever I have them.

Some are big wins and some come with fine print, and I’ll flag which is which.

1. It’s a Search Engine, Not a Social Network

Most social platforms run on people you already know.

You post, your followers see it, and if you’re lucky someone shares it. Skip a week and the whole thing goes quiet.

Pinterest works the other way round. Nobody opens it to see what their cousin had for lunch.

They open it with a question, or a half-formed idea: how to start a blog, what to cook on Tuesday, how to earn money from the sofa.

That’s search behaviour, and the numbers back it up. Adobe research, cited in Forbes’ piece on Pinterest for small businesses, found that 39% of consumers use Pinterest as a search engine.

Forbes describes its primary purpose as being a visual search engine, which is a fair summary.

The practical consequence is that keywords matter far more than follower count. The words in your pin title, description and board names are what get you found.

Picture someone typing “fun remote jobs” into the search bar. They’re probably not ready to apply for anything yet.

They’re browsing, collecting ideas, saving things for later.

My post on fun remote jobs that are hiring is written for exactly that person, and a pin is a good way to meet them while they’re still in that mood.

Fair warning: if your Pinterest plan is to post a pin and wait for likes, you’re treating it like Instagram. Likes don’t pay anyone. Being found for the right search does.

Takeaway: before you design a single pin, write down the phrase you want it to be found for, then put that phrase in the title.

2. People Arrive Ready to Buy

There’s a difference between someone scrolling for a laugh and someone scrolling for a decision. Pinterest tends to attract the second kind.

People use it to plan things: a kitchen refit, a wedding, a career change, a side hustle.

Planning comes just before spending, which is why the benefits of using Pinterest look so different from what you’d get from a viral tweet.

Forbes cites Sprout Social data saying 85% of weekly users have bought something from a pin. Treat any single statistic with some suspicion, but the direction is hard to ignore.

Pinners are shoppers with a list. For a business with a product catalogue, that means shoppable pins, which let people buy without taking a scenic route via your homepage.

For a blogger, it means readers who arrive wanting to do something, not just read about it.

You can see it in my own numbers. My pin for 15 Best Remote Jobs for a Midlife Career got 1,560 outbound clicks in the last 30 days, a 3.0% click rate.

Someone weighing up a career change in their 40s or 50s isn’t casually browsing.

They’re making a big decision and they want a proper list, which is what my post on the best remote jobs for a midlife career change gives them.

Pro tip: send pins to pages you control, such as your own post or product page, and keep any affiliate links there.

You decide what people see when they land, and you’re less likely to trip Pinterest’s spam filters.

3. Pins Last for Months, Even Years

A social media post has a shelf life measured in hours. A Pinterest pin can have one measured in years, and I can show you the receipts.

The pin sitting at the top of my account right now was made in July 2022.

In the last 30 days it picked up 59,425 impressions and sent 1,196 people to my blog, a 2.0% click rate. It’s four years old. [I haven’t touched it since.]

It’s still the top pin on my account for impressions, and it points to my guide on how to get paid to be a virtual friend, which is why that post keeps finding readers long after I stopped thinking about it.

It isn’t a one-off either. My pin about filling out forms for money picked up 1,009 clicks (2.1%) in the same 30 days.

That’s three pins with over a thousand clicks each in one month, working away while I get on with something else.

Forbes makes the same point about evergreen content. Pins that aren’t tied to a season or a trend can keep working all year, and how-to content suits it best.

That matches what I see. My best performers are all “how to” and list posts that will be just as useful next year as they were last year.

The catch: this is the slow part. A pin rarely explodes in week one. Plenty of mine have flopped, and some still do. If you judge Pinterest after a fortnight, you’ll quit before it starts working.

Takeaway: make pins about topics that will still matter in a year, and give each one months to prove itself, not days.

4. You Don’t Need a Following to Get Found

You might assume you need thousands of followers before Pinterest is worth your time.

On most platforms that’s true. The algorithm mostly shows your posts to people who already follow you, so no audience means no reach.

Pinterest is different, and it’s the point about the benefits of using Pinterest that beginners tend to underestimate.

Forbes cites eMarketer data showing that 96% of Pinterest searches are unbranded. In plain English, people aren’t looking for a particular company or creator.

They’re looking for an answer or an idea. Nobody has ever typed “Remote Work Rebels” into Pinterest to find me.

They type things like “morning shift remote jobs” or “entry level remote jobs”, and my pins turn up because the wording matches, not because anyone knows my name.

That levels the field. A brand-new blog with a well-worded pin has a fair shot at appearing alongside established sites, because the pin is competing on relevance rather than reputation.

Forbes puts the advice down to a consistent content strategy, not a big name.

Levelling the field isn’t the same as skipping the work, though. You still have to research keywords, design pins that stand out in a crowded feed, and publish regularly for months.

Lots of people give up at week six because nothing has happened yet, which is roughly when nothing was supposed to have happened.

If you’ve tried Instagram or TikTok and got worn down by follower counts, this is the platform that doesn’t care.

Takeaway: put your main keyword at the start of the pin title, then repeat it naturally in the description.

5. It Takes the Pressure Off Google

Relying on one traffic source is like running a business with a single customer. It works nicely until they leave.

For most bloggers that customer is Google, and Google keeps changing the rules.

Forbes points out that organic traffic from Google may be dropping, with more searches ending without a click and AI overviews answering questions before anyone reaches a website.

Pinterest, it argues, can help fill that gap.

My own Analytics tells the same story. In the last 28 days Pinterest sent me over 11,000 sessions across its two source lines.

Google sent 656. To be fair, Google traffic is growing for me, up 174.5% on the previous period, but from a small base, and I’m not planning to build a business on a percentage.

One of the more underrated benefits of using Pinterest is that it gives you a second route to readers that doesn’t depend on ranking on page one.

Pins get found through Pinterest’s own search, the home feed and related pins, which is a completely different set of doors from the ones Google controls.

Now the awkward bit. By my own numbers, I’m heavily reliant on Pinterest, which is a bit rich given the point of this section.

Pinterest can change its algorithm too, and having my account flagged for spam once was a short, sharp reminder that I don’t own the platform.

Takeaway: treat Pinterest as one engine, not the whole car. Check where your traffic comes from every month, and keep building things you own, like an email list.

6. The Tools Are Free (Your Time Isn’t)

Most marketing channels charge you before they give you anything. Pinterest lets you start for nothing.

A business account is free, and among the benefits of using Pinterest for a blog or shop, the price is hard to argue with.

According to Pinterest’s own creators’ guide, the business account is built for creators and brands, and it unlocks special pin formats, the Creator Hub and more detailed analytics.

The same guide suggests connecting and claiming your website. Forbes adds rich pins to the list.

These pull information from your website and are more informative than regular pins, which gives you more room to use keywords and stand out in search results.

The analytics are where the free tools earn their keep. Here’s a habit I’d recommend. When I sorted my top pins by impressions, my 2022 pin came first.

When I sorted them by outbound clicks, my midlife career pin came out ahead, with 1,560 clicks against 1,196.

Impressions are nice for the ego. Clicks bring the readers.

Pro tip: in Pinterest Analytics, change the “Sort by” menu on your Top Pins list to outbound clicks. It shows you which pins are earning their place.

The honest trade-off is that free in money terms doesn’t mean free in time.

Designing pins, writing descriptions and checking what’s working takes hours every week, and the results are slow.

You’re paying with patience instead of cash. For most people starting out, that’s a better deal, but it’s still a deal.

7. The Audience Is Wider Than You’d Think

If you’ve written Pinterest off as a place for wedding boards and wallpaper ideas, the audience has moved on from that image.

Forbes points to a Pinterest report showing that men make up more than a third of the platform’s global audience, skewing towards Gen Z and millennials, with interests in fitness, style, wellness and self-care.

The geography is wider than most people assume too.

My Analytics for the last seven days shows 2.5K active users from the United States, followed by India (171), Singapore (137), Hong Kong (92) and Canada (86).

The UK comes sixth with 65, level with South Africa. I write from Norwich and my home country barely makes the top five, which is humbling in a useful way.

For a remote work blog, a global audience is the whole point. Remote work isn’t tied to a postcode, and neither are the people looking for it.

Pinterest lets a small blog be discovered by someone in Singapore without a marketing budget, a translator or a lucky break.

And if you take to it, it can become a job in itself. Businesses hire people to run their Pinterest accounts, which I covered in my guide to Pinterest remote jobs.

Takeaway: don’t assume who your audience is from the stereotype. Open Audience Insights in Pinterest Analytics and check who’s actually engaging with your pins.

So, Is Pinterest Worth It?

For me, yes, and the Analytics screenshot is the argument. But the benefits of using Pinterest come with strings attached.

It’s slow, plenty of your pins will flop, and one careless share can get your account flagged. I know because I’ve done all three.

If you want a starting point, keep it small. Set up a free business account, pick one blog post you’re proud of, and make a pin with the search phrase in the title.

Then make another next week, and the week after. Check your outbound clicks in a month, then again in three. Don’t judge it any sooner than that.

Some of those pins will do nothing. One of them might still be sending readers and/or buyers in 2030.

Need Help With Pinterest?

Everything above works, but it also takes time, and time is what most bloggers and small business owners are short of.

There’s keyword research, pin design, writing descriptions, scheduling and checking analytics, then doing it all again next week, for months.

That’s a lot of admin before Pinterest starts paying you back.

If you’d rather hand it over to someone who has already been through the slow start, the flops and the spam flag, that’s what I do.

I’m a Pinterest manager for bloggers and small businesses, and you can see how I work and get in touch on my Hire Me page.

No pressure either way. If you’d rather do it yourself, the steps above are all you need to get started.

Learn More About My Pinterest Manager Services.

Need help now?

Shoot me an email via my Contact Page.

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Ramit unpacks how to manage money as a couple after a job loss and what happens when one partner carries most of the financial responsibility while the other starts stepping back.
Ramit Sethi of I Will Teach You to Be Rich talks with Isabelle and Ryan, 37 and 40, who have been married for 12 years and have a four-year-old daughter. After Ryan was laid off from his $150,000 software engineering job, Isabelle became the sole earner. They have around $1.2 million in assets and an $800,000 net worth, but two mortgages and fixed costs at 83% of their income have left them trying to figure out how to manage their money on one income.
Their biggest challenge isn’t simply how to budget or save money. Isabelle manages most of their financial planning and decision-making, while Ryan struggles with money anxiety, guilt around spending, and feeling shut down when he tries to get involved. Ramit helps them understand how childhood scarcity shaped their relationship with money, how to communicate about finances without falling into a parent-child dynamic, and how reducing their fixed expenses could give them more freedom to actually enjoy the money they’ve built.

In this episode we uncover:

• How to manage money as a couple after a job loss
• How to budget on one income without letting financial anxiety take over
• Why Isabelle feels exhausted managing their financial future
• Why Ryan feels guilty spending money despite their $800K net worth
• How a $3,000 espresso machine exposes his money anxiety
• Why their fixed costs have reached 83% of their income
• How two mortgages are putting pressure on their monthly budget
• How childhood scarcity shaped their relationship with money
• Why their dynamic has started to feel like a parent-child relationship
• How clear money rules and lower fixed expenses could help them become a team

Chapters:

(00:00) Introduction

(02:00) Why Isabelle feels responsible for their financial future

(04:00) The purchase that exposes Ryan’s money anxiety

(09:50) How losing his $150K job changed their roles

(39:00) Ramit opens up their numbers

(48:00) Why they’re paying two mortgages

(01:04:00) How childhood scarcity shaped their money dynamic

(01:23:00) The parent-child dynamic they’ve fallen into

(01:38:00) Ryan and Isabelle make a new financial plan

(02:07:00) Follow-ups

 

This episode is brought to you by:

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Facet | As of the date of this recording, Facet is waiving the enrollment fee for new annual members, and for my audience, Facet is offering $300 into your brokerage account if you invest and maintain $5,000 within your first 90 days. Head to facet.com/ramit to learn more about which membership option is best for you. Offer has been extended to 12/31/2026. #FacetAd
Apply to be coached for free on this podcast at https://iwt.com/apply

 

Transcript:

[00:00:00]

Isabelle: There’s this real concern if I die, he’s SOL.

Ryan: I got laid off, then I kind of fell off and I’m just like, okay, I don’t deserve anything.

Isabelle: I’m the one that’s making a lot of the decisions, and that gets really tiring.

Ryan: Every time I try to get more involved, I just feel like I’m shut down and I’m just belittled for it, so I just don’t.

Ramit: It seems like you want him to be involved, but when he tries to get involved, you don’t approve of it.

Isabelle: I think that sounds accurate.

Ramit: You feel the need to control and direct his involvement with money.

Isabelle: I mean, I do like being in control.

Ryan: Maybe I have a bit of a phobia that I’ll make the wrong decision because I feel like my decisions are judged quite frequently.

Ramit: You have 83% fixed costs. You have no savings, no money for vacation. Your guilt-free spending is getting chipped away.

Isabelle: Yeah.

Ramit: And if one of you loses your job again, we got problems.

Isabelle: I mean it.

Ramit: In lots of relationships, one person ends up handling the money, and we see it all the time on this podcast. One person, often the woman in a heterosexual relationship, [00:01:00] pays the bills, makes the plans, and thinks about the financial future.

At first, feels normal. It’s even helpful. But here’s the problem. The more one person takes over, the easier it is for the other person to step back and even stop trying. So eventually, what you will find is one partner thinking, “Why am I the only one dealing with this?” And the other’s thinking, “She’s got it under control.

She’s so much better at this than I am.” That is exactly what’s happening with Isabelle and Ryan. They’re 37 and 40 years old. They’ve been married for 12 years, with a four-year-old daughter, and Ryan lost his job six months ago, but it turns out their money problems started way before that. Isabelle feels like she is carrying their whole financial future all by herself.

Interestingly, Ryan says every time he tries to get involved, he feels judged or shut down. I wanna know how they ended up stuck in these roles. Why did money become something stressful instead of something they do together? [00:02:00] And ultimately, what is it gonna take for them to start working as a team? Let’s meet Isabelle and Ryan.

Isabelle, you wrote something on your application that caught my eye. You said, quote, “I’m exhausted being the only one actively thinking about and managing our financial future.” Tell me more about that.

Isabelle: I’m the one that’s making a lot of the decisions, the, the day-to-day decisions, the big decisions, the long-term decisions, and that gets really tiring.

Ramit: Okay.

Isabelle: But then the other thing is that I feel like we’re, we’ve been in, and are in a little bit of a limbo because he’s, you know, uh, Ryan lost his job a while ago now, and I think that that’s led to a lot of stress and anxiety about, uh, money, about finances, about we can or cannot spend on this, about trying to find work.

And I been doing a lot of future planning and a lot of thinking, and there’s this very real concern I have that if I die, he’s SOL.

Ramit: Mm-hmm.

Isabelle: Right? Like, there’s this notion that I, I’ve, I’ve started, you know, thinking about, like, getting a will [00:03:00] set up, getting, like, life insurance. I’ve been thinking about all of those things, and that’s made me realize that I think I’m holding up a lot of the financial structure in the household.

I would like trying to move towards a place where I could know that if I were gone, I could trust him to continue that moving forward.

Ryan: I’m mostly here for her. I’m not gonna lie about that. Okay. Um, I’m the classic money anxiety person. I would definitely like to find, like, a more of a comfort point, like she was saying.

Um, we do have conversations about money from time to time.

Ramit: Mm-hmm.

Ryan: I feel like sometimes it improves in the short term, and then it kind of falls apart again.

Ramit: What’s it?

Ryan: The whole, like, um, aura or, like, teamwork or anything like that. Um, one of the things that we kind of run into is the concept of spending makes me nervous, I guess, and I unconsciously, over the course of the next few weeks or so, kind of gradually fall off.

Isabelle: I feel like we’re not… We’re doing okay. You know, I still feel like even on a single income, where, where we are, like, I think we’re okay, and I think he’s, a lot of the times, carrying a lot of stress [00:04:00] and anxiety about small day-to-day spending that I think is trivial.

Ramit: What would… What’s an example of something small that he focuses on?

Isabelle: I, I He just said, “I knew that was going to come up,” ’cause I told you it was gonna come up. We were at a home goods store just last weekend. Mm-hmm. He went off to look at some things while I was with our daughter, and he sent me a picture of two ice cream scoops.

Ramit: Okay.

Isabelle: One was $6, one was $14. I was with our daughter.

I couldn’t really think about it, focus on it. I was just like, “Just get whichever. Just, just get whichever. Probably the one with the little swoopy handle that we like.” And then I didn’t really pay attention to it. He put one in the cart. When we get to the register, it was the $6 one.

Ryan: Mm-hmm.

Isabelle: And I sa- I think I said as we were paying, like, “Did you really get that one?”

Like, and I didn’t see this until after. He texted me, um, when he was comparing the two like, “I feel poor.”

Ramit: Uh-huh.

Isabelle: And then I was just… And, and I still sit and think to myself, like, we- are not poor.

Ramit: Hmm.

Isabelle: It’s, it’s… I don’t think about those things. Yeah. I don’t stress, I don’t stress about that level of purchase, and [00:05:00] I feel like he does, and it sounds…

I don’t know. It just feels like a very tiring way to live. But-

Ramit: Uh, Ryan, what was going on when you were at the store looking at the scoops?

Ryan: Well, I just feel like, um, a lot of those little decisions add up. So when it’s looking at, like, those smaller day-to-day things, I do feel like with my income gone, it was fairly large and sizable.

Ramit: Mm-hmm.

Ryan: Kind of just felt like maybe it’s a better idea to spend a little less. Um, $6 here, $6 there, over the course of, like, a week or months does add up.

Ramit: When you both hear the description of what happened at the store with the ice cream scoops, and you zoom out, what role is each of you playing in that dynamic?

Ryan: I’d say that she’s kind of taking on almost a maternal role if I’m asking for permission, which she shouldn’t be.

Ramit: And what role are you taking on then?

Ryan: Um, like a child or…

Ramit: Yeah. Parent-child dynamic. Yeah. He, yeah. I think that’s quite accurate. He was, he was

Isabelle: asking for permission, and I- Yeah … and I just, like, I didn’t care.

Mm. To be honest. Mm. It was just- Right, and

Ryan: you didn’t care,

Isabelle: so I went with the less value one. Just grab one of them. Like-

Ryan: I’m

Ramit: not so sure- Yeah … I agree that you didn’t [00:06:00] care.

Isabelle: You don’t think so?

Ramit: No. Mm. Because what happened at the checkout?

Isabelle: You’re right. You’re right.

Ramit: What did you say? “

Isabelle: Did you really get that one?”

And it was very much a, a judgy tone. I c- I, I don’t feel like I need to give permission for those kinds of purchases. I kind of wish he’d just… And we’ve talked about this before, like, there’s a lot of instances where he’ll get the cheaper item, and, and I’ll say, like, “Why didn’t you just get the nicer one that’ll last longer or the, you know, that, that you actually wanted instead of the cheaper thing that will then either not be useful?”

So what role are you playing? I, I don’t know. What-

Ramit: Think about it

Isabelle: I feel like oftentimes I’m the decision-maker in things. Mm-hmm. And I feel like I’m the one who can make the informed decisions-

Ramit: Mm-hmm …

Isabelle: because I, I have a better understanding of where our finances are. Um, I just don’t wanna be making the informed decisions all the time. That may- I’m

Ramit: not interested in what you want and don’t want.

Okay. I’m only interested right now in what role were you playing.

Isabelle: I mean, if we’re following along with the same dynamic, I am the parent in that- Mm-hmm … [00:07:00] dynamic.

Ramit: Mm-hmm. And you’re-

Isabelle: It’s the same way that, like, my, my daughter might come up and say, “Can I get this or that?” And I’m making that decision.

Ryan: Well, I feel like there was a right decision, obviously.

‘Cause she got upset when I got the cheaper ice cream scoop. Oh,

Ramit: so

Ryan: she- So- The right decision- And I was leaning towards the cheaper scoop, but I just asked her which one she wanted, and she said she didn’t care, so I bought the cheaper one ’cause I felt more comfortable with it, and then she kinda lashed out about it.

Ramit: Why’d you, why’d you even ask?

Ryan: I don’t know. It’s just-

Ramit: Think about it.

Ryan: Maybe I have a bit of a phobia that I’ll make the wrong decision because I feel like I’m, my decisions are judged quite frequently.

Ramit: Hmm. Okay. Money obviously makes both of you uncomfortable. Is that fair to say?

Ryan: Right.

Ramit: Ryan says yes.

Isabelle?

Isabelle: I, uh-

Ramit: If not, feel free to disagree with me.

Isabelle: I don’t feel like it does.

Ramit: Okay.

Ryan: It, it does come up enough. Like, I know that, um, one of the things that you talk about is guilt-free spending. We’ve jokingly said that, or she’s jokingly brought up that, uh, there’s no such thing as guilt-free spending. [00:08:00]

Isabelle: For him.

For you. For him

Ryan: specifically. If I buy myself something nice, I dwell on it and feel guilty about it for like- Forever … the rest of my life. Pretty much,

Ramit: yeah. Okay. Is it when you buy something nice, it’s racked with guilt, or is it when you buy anything?

Ryan: I’d say anything in the short term, but in the longer term, the larger purchases more so.

Okay. Like, I’m a huge, um… This is an example of a larger purchase. I’m a huge coffee person. Mm-hmm. I used to run a roastery, and I bought a $3,000 espresso machine back when I was working, and we could afford it. Mm-hmm. It wasn’t a big deal, but I still feel like it was a silly thing for me to buy in terms of the cost, and I feel guilty that I bought that.

Ramit: Hmm. Uh, how does guilt show up for you? Where do you feel it?

Ryan: It’s like a heavy feeling in the chest- Mm-hmm … I suppose. Or sometimes I feel like maybe I’ll misconstrue a comment or a little joke that she made, and this is where it gets really bad in terms of money, and I’ll feel like I’m being attacked, and I’ll shut down.

Like, what’s an example? She’ll make a little comment about the cost of, like, my espresso machine, and she’s just, like, half-joking and didn’t really even give it any thought, and I’ll feel like she’s been dwelling on it for [00:09:00] months or something. Mm-hmm. Mm-hmm. And I’ll just, like, either walk away or give, like, one-word answers and just kinda-

Ramit: Got it

Ryan: shut down. Do

Ramit: you remember what kind of, um, joking comment you make?

Isabelle: I, I don’t know. I’m trying to think about one that might have been. I know we had a couple of friends over lately, and I, I made some comment about the $3,000 espresso machine and the very fancy grinder and very… Like, there, there’s a lot.

Mm-hmm. What’d

Ramit: you say?

Isabelle: Uh, I said something like, “Oh, I think we have about $5,000 worth of coffee equipment here.”

Ramit: Hmm. And do you agree that when he purchased it, you both could afford it?

Isabelle: Yes, I, I do think so.

Ryan: But then I got laid off, which is becoming- Yeah … more common in my field, and then I kinda fell off, and I’m just like, “Okay, I don’t deserve anything,” and I didn’t really buy anything.

I didn’t feel like it was the time for that sort of purchasing.

Ramit: When did that happen?

Ryan: Uh, probably about seven months ago.

Ramit: Okay. Sucks.

Ryan: Yeah.

Isabelle: Yeah, I vividly remember.

Ramit: What was your first thought when that happened?

Ryan: You know, I wasn’t actually upset at first, which is funny because, um, she’s mentioned before that we might be fine if I did a [00:10:00] career pivot or went for slightly less money and became more comfortable.

Ramit: Okay.

Ryan: But I have a hard time coming to terms with reducing my earning power that much ’cause- Why? Well, this is a career that I’ve had for, like, 11 years, right? Like, I’ve been a software engineer for 11 years. It pays pretty well in the past. Um, it had a lot of flexibility in terms of remote hours and things like that, which is changing.

Ramit: Did you feel anything at all, or were you like, “Okay”?

Ryan: I was like, “Okay.” I mean, to be honest, it didn’t hit me quite as hard the first time ’cause I was getting the severance, which covered the first few months. Mm-hmm. And I wasn’t happy there, if I’m totally being honest with myself.

Ramit: Mm-hmm.

Ryan: Like, I was doing fine as far as every metric went, but I didn’t feel like that was valued despite the communication.

Do you feel it’s

Ramit: common that you stay in situations that you don’t like?

Ryan: Yeah, probably in terms-

Ramit: Career? Any other parts of life?

Ryan: Career primarily. Um, one thing we talked about when I was looking for employment is I wanted to move, and this is a huge life decision, so I don’t blame her for disagreeing, but I wanted to move a little bit further west so I could look at more jobs [00:11:00] out and, like, um, out closer to the coast, which is where a lot of the tech companies are.

Ramit: Mm-hmm.

Ryan: And she just pretty much just said no- Mm … and then we were done with the conversation.

Ramit: And that’s where you are today, like-

Isabelle: Yes, that’s where we

Ramit: are today … you say no, you still wanna do that for better job opportunities. Is that right?

Ryan: I was tempted, yes. I- it’s something I wanted to at least talk about or put on paper, but it just felt like instantly dismissive of my career when-

Ramit: Right

Ryan: being, like, honest. We moved to California for her career, and she won’t move 20 minutes west for me.

Ramit: I see. Okay, um, Isabelle, what do you do for a living?

Isabelle: I am a professor at a university nearby.

Ramit: Got it. And how long have you two been married for?

Isabelle: 12 years and a couple weeks.

Ramit: Oh, cool. Congrats. Kids?

Isabelle: One child, yes.

How old? A, a four-year-old daughter.

Ramit: Okay, great. All right. How do decisions get made in your household?

Isabelle: It’s probably going to be me for- Okay … for most s- for most decisions, I would say. We have our, our financial system set up in a particular. That was probably [00:12:00] entirely me, which was setting up, like, a joint checking account, setting up credit cards connected to that for each.

We each have individual checking and credit cards, like, separately, where I don’t look at his, I don’t track it, I don’t- Mm-hmm … do anything with it. Like, that, that was all set up by me. I’m the only one looking at things like life insurance. I’m the only one looking at things like a will. Um-

Ramit: When was the first time you had a serious conversation about money?

Ryan: Probably when we were getting married. We had, like, the s- the, the standard discussion- What’s that? -about, like, what we’re comfortable spending at each time, um, what we’re looking for in terms of where we wanna live in the future, all of that.

Ramit: How much you’re comfortable spending? What do you remember saying?

Ryan: At the time, we were making considerably less- Oh, yeah … so it was, like, $50.

Isabelle: You’re right. I remember that. I remember that. It was… Yeah, yeah.

Ramit: So you sh-

Isabelle: It was premarital counseling I-

Ramit: isn’t it kind of interesting that now, 12 years later, you are texting about a $6 ice cream scooper?

Ryan: Yeah, that’s fair. I don’t think it’s about the ice cream [00:13:00] scoop.

Um, it’s probably just because I feel guilty about some of the other larger purchases, and maybe I just make assumptions based on that.

Ramit: I kind of love the idea that they were both in the store, and he’s agonizing over whether to buy ice cream scoop number one or ice cream scoop number two. It tells me so much about their relationship.

What layers are you noticing here? Here’s what I’m noticing. I’m noticing that instead of being curious of her partner when it comes to how he chooses to spend money, she kind of puts him down, and that makes me understand why he might not wanna participate in money in this relationship. She feels like she does everything, but also little jabs after checkout, “Oh, you bought that one?”

Quite interesting. So I’m starting to suspect that whatever dynamic they have with money is co-created, and definitely a lot of it is due to control. Let’s find out if I’m right. I’m gonna take a wild guess. Maybe you’ve been putting off seeing a doctor for a [00:14:00] while for some unexplained condition. Hey, why is my left eye blurry?

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When I first started IWT, I was the person who answered every single customer service email, but I didn’t really love it. And as the company grew, I couldn’t really keep up, so I hired a great customer success team that has taken over ever since. If you are looking for help with your customer service in your business, one great option is this episode’s sponsor,

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Ryan: at iwt.com/expertsession

Ramit: What else did you talk about in the survey? Investing- I

Isabelle: don’t think it was any- …

Ramit: kids.

Isabelle: Some of it was that detail stuff, and then some of it was larger picture, like-

Ramit: Wait, this doesn’t sound very substantive.

Isabelle: No, I don’t think I- No, it wasn’t

Ryan: super substantive. We have had discussions about saving as well, and-

Ramit: What do you talk about? [00:18:00]

Ryan: Well, usually it falls back on her. I end up feeling kinda dumb, to be blunt. Like, I’ll bring up something like, um, “Maybe we should, like, start investing in stock.” But that’s the absolute worst thing you can do.

And I’ll be like, “Okay.” I don’t know that

Isabelle: I phrased it like that.

Ryan: You pretty much said that. Okay. What did you say then?

Ramit: Actually, yeah. Let’s recreate- Let’s recreate this conversation. So when did this happen? I like this.

Isabelle: Oh, it was probably a couple weeks ago, wasn’t

Ramit: it? Perfect. Okay. Who, who brought it up?

Ryan: I did- Okay

’cause I was trying to look at, like, getting more involved in money, ’cause she wanted to talk about it.

Ramit: Can you recreate it and I will just listen? Do it as realistically as possible.

Ryan: I was wondering if maybe we should set some money aside, and I could start handling, like, investments for us and kind of research it and figure that out and make an individual stock portfolio.

Isabelle: Are you thinking about, like, individual stocks, like selecting-

Ryan: Not individual ones …

Isabelle: different places?

Ryan: Not like I’ve got a good feeling about Disney or anything.

Isabelle: Well, that’s what, that’s what wasn’t clear to me. Because when I think about investing, it’s, like, investing in, you know, probably a [00:19:00] retirement account and thinking about funds that are diversified.

Ryan: Right. Well, we’re not really recreating the conversation then.

Isabelle: I know. Maybe we should have like- But I’m realizing that there was a misunderstanding there from the beginning.

Ramit: Well, what, what’s with the performance? I don’t- I feel like you’re both performing for me, and I’m not interested- No … in a performance.

Because if y’all are here to put on a performance, then you’re gonna walk out with me reacting to your performance. Yeah. I don’t really think you want that.

Ryan: Yeah.

Ramit: Do you think that we could recreate that conversation as it actually happened?

Ryan: I was thinking about putting some money aside just to start investing in stocks on my own, so I’m kind of handling a bit more.

Isabelle: I mean, I don’t know if that’s a great idea, honestly, because, uh … I, I can’t. I honestly can’t remember what I said, Ramit.

Ramit: Yes, you can.

Isabelle: No, I can’t. I’m trying to think about what I said. You said

Ryan: it’s one of the worst things we could do.

Isabelle: That’s what you’re remembering of

Ramit: it. Well, let me tell you what’s going on here.

I suspect that you think it’s gonna look bad if you actually- It’s- … say what you said, and so you’re trying to mask it by saying something polite. It’s quite

Isabelle: possible, yes. I don’t remember saying that, but maybe [00:20:00] I did, and I should trust your memory of it. That’s fair. I probably did say that’s one of, one of the worst ways that you could invest, and I don’t like hearing that coming out of my mouth now.

Ramit: That’s fine.

Ryan: I just feel like that’s an example. Like, every time I try to get more involved, I just feel like I’m shut down, and I’m just belittled for it, so I just don’t.

Ramit: Mm-hmm.

Isabelle: Yeah, and I’m hearing that and just feeling like shit about it ’cause that’s not what I wanna do either.

Ramit: Mm-hmm.

Isabelle: But …

Ramit: Finish the sentence.

Isabelle: I mean, I feel like I’ve put in a lot of time and effort to try and be more informed about things, and so I’m asking for his help on decisions, but he’s not at that same level of informed, and then that’s frustrating, too. I don’t know where to go from there.

Ramit: It seems like you want him to be involved, but when he tries to get involved, you don’t approve of it.

Isabelle: I think that sounds accurate.

Ramit: Ice cream scoop all the way up to investments.

Isabelle: I think that’s accurate.

Ramit: So what do you wanna do [00:21:00] about that? Because I can give you a bunch of whiz-bang stuff. Oh, let’s look at the numbers, look at the percentages. Doesn’t change anything. What is going on that you feel the need to control and direct-

Isabelle: Mm-hmm

Ramit: his involvement with money?

Isabelle: I mean, I do like being in control. I feel like currently I’m more knowledgeable about it, and I, I, I think that that’s something that I try to leverage. But I am realizing that I probably need to just step back.

Ramit: Really?

Isabelle: I worry that if I step back, then things won’t get done or things won’t

I don’t wanna say be done right, but be done right.

Ramit: Mm-hmm.

Isabelle: Um-

Ramit: And if that happens?

Isabelle: Then we’re not going to be in a good financial situation moving forward. We won’t have a secure future, or we won’t have savings, or we won’t have something to fall back on for our daughter, so[00:22:00]

Ramit: Keep going

Isabelle: That’s what gives me anxiety at night is, is thinking that if I step back, things are going to fall apart

Ramit: Mm-hmm

Isabelle: And I don’t like that feeling either, but, but it’s very hard to stop

Ramit: Y- you’ve heard stories of, um, wife telling her husband, like, “Clean the kitchen counter” Mm-hmm And then he cleans it.

She goes, “You didn’t do it the right way. Now I need to do it” Mm-hmm This is kind of a-

Isabelle: Don’t look at me

Ramit: Wait, did this happen? Yes.

Ryan: Well, sort of. Um, she says that I make the bed wrong, so any time I make the bed, she’ll go up and remake it. Or any time I sweep, she’ll re-sweep.

Isabelle: Hmm. It’s a pattern, and it’s not just in finances.

Ramit: Talk me through it

Isabelle: If I want it to be done and if I want it to be done correctly, sometimes it’s easier to do it myself

Ramit: Okay, so just do it

Isabelle: Then, but I’m tired all the time, and I’m exhausted, and I don’t have the time to be doing all of these things, and I don’t want to feel like if I make the wrong decision, it’s all entirely my fault

Ramit: What do you get out of being a martyr?[00:23:00]

Isabelle: I don’t know. I don’t know

Ramit: Think about it

Isabelle: A sense of

It’s not satisfaction, but a sense of contribution, a sense of like- Mm-hmm … I’m putting everything out there and no one can say that I’m not, you know, doing X, Y, or Z, trying to

Ramit: do this. Because I’m working. I’m, I’m taking care of our daughter. I’m doing the finances. Right now I’m the breadwinner because he doesn’t have a job.

I’m even cleaning the kitchen counter the right way.

Isabelle: Mm-hmm.

Ramit: It feel good?

Isabelle: I don’t think it’s… No.

Ramit: Hmm.

Isabelle: Ugh. I

Ramit: think it feels kind of good in a way.

Isabelle: There’s probably some truth to that, yeah. Hmm. Because I’m, I’m very accustomed to always being on top of things and always being productive and always, always, always, always moving.

Part of that is probably coming from the fact that I was functionally an only child of immigrant parents who did not speak English.

Ramit: Okay. Got it.

Isabelle: Um, and so from a [00:24:00] very, very, very young age, I was the main translator. From the age of 11, I knew our parents’, our mortgage better than my parents did. Like I, I, I was very accustomed to that and I’ve always Had that type of control in that respect.

Ramit: What’s the downside of trying to take on control in every part of your life?

Isabelle: I get burnt out. Mm-hmm. And I get exhausted.

Ramit: What else?

Isabelle: Well, like I said, I, I always kind of have this fear of I’m the only one making the decisions, and what if I’m doing something wrong and there’s no one… You know, I don’t have a, a cross-check or, or some- someone to have input and validate or challenge decisions that may not be correct.

Ramit: Okay. What else? I

Isabelle: mean, one of the things that I worry about too is my daughter seeing that and then replicating it herself, ’cause I’m replicating my own patterns, and I know that to some extent.

Ramit: She’s four, right?

Isabelle: Mm-hmm.

Ramit: She sees it already.

Isabelle: Yep.

Ramit: What about your partner?

Isabelle: Well, I think that he’s starting to…

Well, not starting to, but I think getting to a point where he feels like his input isn’t valued and his decisions aren’t valued.

Ramit: So therefore he…? [00:25:00]

Isabelle: Shuts down.

Ramit: Yeah. Disempowered. Says, like, “I can’t even get an ice cream scooped the right way, so you deal with it.”

Isabelle: Mm-hmm.

Ramit: Why not just keep doing this the rest of your life?

Isabelle: The big thing for me and the thing that I, the reason that I want to try and to, to, to make progress towards breaking these patterns is because I think a lot about our daughter. Mm-hmm. Like, that’s, that’s really the main thing for me. I feel like if it was just me and him-

Ramit: Mm-hmm … I,

Isabelle: I feel like I probably would be okay to continue this on.

But, A, I don’t want her to grow up and feel like she has to do the same thing, ’cause it’s tiring. But then the other thing that I worry about is, like, if I walk out of the studio today and get hit by a bus- Mm-hmm … and that’s something we need to think about, but, like, right now our retirement plan is primarily my pension.

Mm-hmm. Like, my income would fall through. All of… You know, so that’s, that’s the other thing that I worry about too. Like, if something were to happen to me, then this whole structure falls apart.

Ryan: I warn you, I’d be upset, but I think we would carry on in some, to some degree. Most of our passwords are, like, in a vault, et [00:26:00] cetera.

Um, and my current financial situation is pretty largely determined by where we’re located as well. So if I was able to take Sophia and move, we could probably find something else. But, like, we’d figure something out is what I’m saying. I, I have thought about it. It’s not like I go through and I brainstorm for it, but I don’t think we’d be completely screwed.

Ramit: How do you receive that, Isabelle?

Isabelle: I don’t know if I believe it necessarily.

Ramit: Mm-hmm. Why do you think she doesn’t necessarily believe you?

Ryan: She doesn’t have a lot of faith in my decision-making- Okay … or a lot of what I do.

Ramit: Do you demonstrate engagement and excellence with money?

Ryan: No, but I feel like any time I try to, I just kinda get shut down, and I don’t like debating, so…

And she’s much stronger when it comes to that.

Ramit: Mm. Well- Morbid or not, one way to win the debate is if your partner’s dead. There’s no one to debate with anymore. I’ll do it my way.

Ryan: Right.

Ramit: Who else? Yeah. I would prefer not to [00:27:00] get to that level.

Isabelle: I, I

Ramit: would

Isabelle: also

Ramit: prefer- What do you think? …

Isabelle: not to get to that.

Ramit: I would prefer not for my wife- I would prefer-

to die in order for me to have a way to engage with money.

Ryan: That’s true. I mean, I’d still be uncomfortable, but I mean, I was, I was in my 20s when we were married. It’s not like I was completely

Ramit: They seem like real concerns, Isabelle.

Isabelle: Yeah.

Ramit: I’m worried about this, I’m worried about that. You worry a lot, right?

Isabelle: I feel like when we were dual income and I f- you know, when I was maxing out his 401, when we had all of this set up, when I had my- Mm. Like, I feel like I, I wasn’t worrying about it as much then.

Ramit: You’re telling me that you were not stressed or worried about things in your household when he had a job?

Isabelle: That’s true, I think.

Ramit: I don’t believe that. You

Isabelle: don’t think so?

Ramit: No way. Not in a million years.

Ryan: I, I well agree with that to some extent. I-

Ramit: Did she worry before when you had a job or no?

Ryan: I think she did. Um, we were, um, dual income-

Ramit: Mm-hmm …

Ryan: and we were making considerably more than we needed to.

Ramit: And?

Ryan: And [00:28:00] honestly, in her case, it paid off because I,

Ramit: I lost my job at this point.

I, I just wanna know, was she worried or not?

Ryan: Yes.

Ramit: Okay. What is this? What’s with the masks? The stories you’re telling yourself, “I don’t worry.” I

Isabelle: don’t

Ramit: worry. What, what, what’s, what’s going on here?

Isabelle: I don’t know, maybe it’s the story that I wish I was telling-

Ramit: Uh-huh …

Isabelle: instead of the one that I am. Which is

Ramit: I, I was calm, I was cool and collected.

Right, right. But then this thing happened to him, and now I’m forced to be worried.

Isabelle: Mm-hmm.

Ramit: Have you all been to therapy?

Ryan: I’ve been to individual therapy, but we haven’t done couples therapy.

Ramit: Why?

Isabelle: I mean, I suggested it once

Ryan: You suggested it and then stormed off after a bit of

Isabelle: an argument about money Yes, ’cause I was very frustrated and upset at that point in time What

Ramit: was

Isabelle: going on in that conversation?

I, I think I’d asked him something about, like, how his job search was going or, you know, something to that effect, and it felt like he responded in a very elevated manner. Like, it felt like he kind of snapped a little bit. Yeah. And then I snapped back- Mm-hmm … and said, [00:29:00] “I think we need to go to therapy.”

Ramit: Okay.

Isabelle: And I don’t know that you… I don’t know if you responded. I feel like I just blacked out and left.

Ramit: You just stormed off and didn’t wanna talk-

Isabelle: Yeah, I just left … so I just

Ryan: kinda let you be eventually.

Isabelle: And then we didn’t bring it up again.

Ryan: Yeah. And I feel like, um, for me, I’d just been ghosted after a, a second or third round interview, and I was kind of not feeling great, so maybe there was a little bit more emotion in my voice at that point-

Ramit: Mm-hmm

Ryan: that wasn’t intended or directed towards her.

Isabelle: I think maybe there was stress and worry, but there was also more positive components to it than there are now. I feel like I was worrying about, you know, are we setting aside enough for, for retirement? Like, am I structuring these savings in a way that makes sense?

But there was also this trade-off of, “Oh, hey, but if we do this, we can also travel,” or, “Hey, if we do this, we can also, you know, do these other positive things.”

Ramit: Mm-hmm.

Isabelle: And I feel like what’s been lost more so is I’m not thinking about that anymore. As much- The

Ryan: positive parts.

Isabelle: Yeah. Like, I, I feel like some of the extra income and some of the [00:30:00] extra that we had was going towards-

Ryan: Fun

Isabelle: fun. Quote, unquote fun. And now we’re in a position where, like, I feel like I’ve cut all of that, and what’s left-

Ramit: Mm-hmm …

Isabelle: is this, and it feels much heavier.

Ramit: Mm. If and when Ryan gets a job, that you will both feel good about money?

Isabelle: I think I would feel better, but I think I’m also in a position now where I still…

Like, this, this is, this is a new threat or a new anxiety that’s been introduced where I- I’m still thinking about, like, are our systems set up well enough? Is he set up well enough so that we could move forward?

Ramit: What’s your answer to my question? Would you feel good about money?

Isabelle: See, I wanna say yes, but the answer is probably not immediately or not easily.

Ramit: I think the answer is no.

Isabelle: I, yeah.

Ramit: Yeah. I, I don’t know why it’s so difficult to acknowledge there are parts of yourself that may be at odds with the way that you wanna present yourself.

Isabelle: Mm-hmm.

Ramit: Mm. I feel like I’m battling with a ghost right now. Every question I ask, I’m [00:31:00] getting defensive reactions and, “Well, I, I should feel like that.

I like to think I would feel like that.” But-

Isabelle: Yeah …

Ramit: it’s all a bit of a show. And I wonder if you do that here, how much of that is happening when the two of you talk to each other.

Ryan: Yeah, I mean, that’s quite possible. You brought up the example of would she be worried about money. I think we both would be anyway because we were.

We were super comfortable basically. Like- Mm-hmm … we had twice the income we have now, and our expenses were pretty minimal. Um, we were contributing, like, above advised levels to, like, our- Mm-hmm … retirement. And I still felt like I had, like, no decision-making ability. I mean, when, when I bought the $3,000 espresso machine, I felt like crap.

Yeah. And I still do, like, two years, two, three years later so.

Ramit: So you’ll– Like, the fixation on the income without actually s- focusing on what’s really going on here, to me-

Isabelle: Yeah …

Ramit: it’s not adding up. Here’s what I’d like to do. Mm-hmm. I want you [00:32:00] to go outside and have a really honest conversation about what you wanna get out of this.

Because if you would like to continue, I would love to continue with you. Mm-hmm. I think there’s a lot of layers to dig into here. But if we’re gonna keep up the show, it’s not for me Let’s take a few minutes, they’ll escort you out, and then we’ll come back and let me know what you decide. Okay? I’m being a little tough on them.

You know why? Because they are both wearing masks, almost like it’s a performance. Now, I’m not sure if they know they are or not, but either way, I am not connecting with who they really are, so I’m effectively shaking them because I wanna see that mask fall off. I don’t mind who they are beneath it.

Everyone does stuff that’s embarrassing. Everyone says stuff that’s maybe not perfectly politically correct. That’s okay. This is a common thing, and the first step is actually acknowledging that we are different people [00:33:00] in different situations, but I need to know who they actually are if we want to make changes.

That is why I am being a little tough on them.

Ryan: What did you decide?

Isabelle: Um, well, we’re back here.

Ramit: Uh-huh.

Isabelle: So that was

Ramit: one thing.

Ryan: I’m glad.

Isabelle: Very glad. I would say part of my profession is I’m, I’m, you know, a, a third part performer. So I, I teach- Mm-hmm … and I do professional development, and I do workshops, and a lot of that involves presenting yourself in a particular way, speaking in a particular way, and also maintaining a, a sense of credibility and professionalism in how you present yourself.

And I think because of that, I’m used to sometimes masking certain things that I don’t particularly wanna share or be very honest about.

Ramit: Yep.

Isabelle: Um, but the other reason that I was telling him I wanted to, to continue is because you’re telling me things I don’t wanna hear.

Ramit: Wow.

Isabelle: And sometimes I think we need people to do that.

Ramit: I’m honored. That’s-

Isabelle: So congratulations. You’re making me very [00:34:00] uncomfortable.

Ramit: That’s never my goal, but that sometimes is the byproduct.

Isabelle: Yeah.

Ramit: Yeah. Well, I appreciate you, um, sharing that.

Isabelle: Mm-hmm.

Ramit: And I can only imagine some of the ways that you’ve had to professionalize your appearance- Mm-hmm … the way that you show up as a woman, daughter of immigrants.

Isabelle: Mm-hmm. As a person of color and as a person who’s young in a space of professional development,

Ramit: yes.

Exactly, yes, especially in an academic environment.

Isabelle: Mm-hmm.

Ramit: So let’s acknowledge that, and the fact that you came back and you said, “This is making me uncomfortable, and I wanna walk towards that”- Right … that’s a huge sign for me, a positive sign. Mm-hmm. So I appreciate you coming back. Thank you. Ryan?

Ryan: I think I’ve been deflecting too much.

Uh, I think that at some point, I don’t know the main reasoning, maybe I just felt like my opinion wasn’t valued, so I just kind of quit trying or caring, and I should’ve been putting more effort into it. And I have a lot of guilt, which is the reason for that.

Ramit: [00:35:00] Mm-hmm. Do you wanna be here?

Ryan: Yeah, I wanna be here.

Ramit: Okay. I’m glad you’re both back. I’ve been pushing hard, and I wanna acknowledge that. I know what it takes to be in those seats. It takes a lot of work. It takes a lot of effort. I would be remiss if I let you walk out of here and I had spent hours reacting to the words you had said, but we hadn’t really gotten to the truth.

Mm-hmm. That’s why I’ve been pushing. So what do you say we keep moving forward?

Ryan: Yeah. Of course.

Ramit: Okay.

Ryan: Let’s do it

Ramit: Honestly, it’s pretty impressive to see them come back in the room and share this new energy that they are bringing in here. That’s one of the reasons that I try not to be too aggressive when I speak to couples.

‘Cause I can browbeat anyone into saying, “I need to save more in my Roth IRA,” but the minute they walk out of the room, they’re not gonna do it. When people see this almost judo that you’re playing with each other, they start to realize, “Oh, if I wanna get something out of this, I need [00:36:00] to take the initiative.”

And I’m seeing that here. Both of them are saying, “Hey, we’re ready.” That responsibility is important, especially because when you come on this podcast, sometimes you might discover parts of yourself that you didn’t even know exist. And what’s worse, sometimes you might not like what you see. But the fact that they are back and they are pushing on, I’m all for it.

We’re gonna take a look at the

Ryan: numbers right after this.

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Ryan: code Ramit.

Ramit: I’m gonna take a look at their [00:39:00] numbers by pulling up their conscious spending plan.

Let’s take a look. Assets, $1.2 million. Investments, $175,000. Savings, $68,000. Debt, $688,000. Total net worth, $800,000. Fixed costs, 83%. That’s quite high. Investments at 3%, savings at 0, and guilt-free spending at 15%. Very interesting here. So as I throw those numbers up-

Ryan: Mm-hmm …

Ramit: what was it like to do the conscious spending plan together?

Ryan: Yeah, the plan, I don’t know if I’d really say it was together. She filled in, like, a guess of what she had, and I went over it and verified it. Mm-hmm. But maybe we didn’t do it together, if I’m being honest. Like, we had two different versions that kind of joined together- Mm-hmm … after working on it separately.

When you say, “How did it feel to do it together?” that kind of shines more light into the dynamic we have.

Ramit: Yeah.

Isabelle: Yeah. So I- I’ve had a conscious spending plan. I’ve had our conscious spending plan for over a [00:40:00] year- Mm-hmm … maybe two years now. So I, I had the plan. I have all of the accounts. I know what our spending is.

I track that regularly. Um, and then I think I, I kept, like I was trying to ask, “Can we, you know, sit down and walk through this together?” Um, it, it kind of kept not happening, and as I probably usually do, I just ended up doing it. So yeah, I don’t think it was together necessarily.

Ramit: Yeah. Turned into a transaction, huh?

Isabelle: Yeah. Yeah.

Ramit: Okay. Probably a great illustration of how money works- Yeah … right now in your relationship.

Isabelle: Right. Right.

Ramit: Okay. Let’s go through the numbers.

Isabelle: Mm-hmm.

Ramit: My hope is that by the time you walk out of here- Were you to do another CSP, you would do it together.

Isabelle: Mm-hmm.

Ramit: Okay. What do you think of those numbers?

Isabelle: I think they’re pretty good.

Ramit: Mm-hmm.

Isabelle: Honestly. One of the things I’m proud of in that box is that our only debt is mortgage debt, so I worked very, very hard. We worked, not just me, we worked very, very hard, um, to knock down kind of existing debt that we had. I think our, our [00:41:00] investments could be higher, and I think that’s a consequence of not figuring out what any of that meant or was until our mid-30s.

Ramit: Mm-hmm.

Isabelle: Um, but other than that, like, I’m, I’m pretty happy with where we are there.

Ramit: Good. Yeah. I love hearing words like happy and proud. Mm-hmm. Proud is my favorite word that people use to describe how they feel about their numbers. That’s awesome. Well done. Ryan, how about you?

Ryan: I feel pretty good about it, definitely, in terms of having assets.

Um, I feel like we have done a lot as far as that goes.

Ramit: Do the numbers mean anything to you?

Ryan: Yeah, they do. They mean that, well, we’re fairly comfortable, I guess, from the look of it.

Ramit: Mm-hmm.

Ryan: I can probably buy the $14 ice cream scoop.

Ramit: Hmm. Is that for real? Is that what you take away from this?

Ryan: Part of it, yeah.

Ramit: What else?

Ryan: That maybe I’m a little anxious about my purchases still.

Ramit: You know that, right?

Ryan: Yeah, I know. You already know that. I already knew that. Like, I’m not taking a lot away from it. I feel like with me, part of the problem is I [00:42:00] know what I … I know it’s irrational, and maybe I would benefit from therapy more so than discussing it.

Like I- Not

Ramit: maybe Yeah. For sure.

Ryan: Yeah.

Ramit: What I take away from your response is there’s a cloud in front of you, this cloud of anxiety that doesn’t let you actually see these numbers and see what they mean, and I would love it for both of you to be able to see all of your numbers and actually make meaning out of it.

Right. So one way to do that might be therapy, continued discussions, and what we’re gonna do today. Mm. Okay? Let’s see. Ryan, can you read off your combined gross monthly income, please?

Ryan: Sure. Gross monthly income 12,594.

Ramit: Okay.

Ryan: Net monthly income is $9,189.

Ramit: All right, so $12.500 per month. That’s her income. I know that right now- Yeah.

Mm-hmm … you don’t have an income. That’s a household income of $151,000. All right. Fixed costs, what number is that, Isabelle?

Isabelle: 83%.

Ramit: That’s pretty high.

Isabelle: [00:43:00] Yes. It doesn’t feel high on a day-to-day for me.

Ramit: Really?

Isabelle: I feel like we have made a lot of adjustments in our day-to-day already that have helped mitigate some of that change.

But I- Like? Like where we eat out or don’t eat out, like the kinds of activities we sign our daughter up or not for. Good. Like, we- we’re having a big drop-off in daycare spending now.

Ramit: You two may be the only couple who actually adjusted your spending down- … after cutting half your income out. Well- Like, this never happens.

Isabelle: So, uh, yeah. That’s why I think it-

Ramit: Are, are you guys hearing me? Have you ever taken the compliment? No.

Isabelle: No, I haven’t. I’m terrible at taking compliments.

Ramit: Y’all are pivoting off to some other thing I don’t care about.

Isabelle: Thank you.

Ramit: Take the compliment. Take the- Thank you. It’s amazing. Nobody ever does this. Okay.

You guys are unique That’s amazing. I also have never heard anyone with 83% fixed costs say that it doesn’t actually feel that stressful.

Isabelle: Like, I’m not worried about am I going to make the mortgage payment, or are we going [00:44:00] to have enough to cover the gas bill, you know? That-

Ramit: Mm.

Isabelle: That’s what I- Mm … think of when I think about money stress, is, uh, we- we’re going to meet all of our fixed costs, and we’ll have some left over.

Ryan: I will say that I’m pretty proud that we lost effectively half our income, and we still managed to kind of avoid dipping into savings, which is something that people generally have to do at that point. Yeah. Yeah,

Ramit: we- Big time. It’s incredible. It’s, it’s there. Your emergency fund is 68- It’s … Yeah … let’s just say $70,000.

Isabelle: Yeah. And we haven’t- And

Ramit: that’s 10- … we haven’t really touched that … that’s roughly 10 months of expenses, maybe nine months.

Isabelle: Yeah.

Ramit: Yeah. That’s impressive. All right, let’s look at the rest of the numbers. Investments are at 3%. That 3% post-tax is a 529.

Isabelle: Yes.

Ramit: So y’all are putting money aside for your four-year-old instead of for yourself.

Isabelle: Part of it is that I have a, a solid pension. Okay. And so I have, uh, 8% taken pre-tax. Hmm. So that’s already accounted for. That’s why my net monthly income is, is that chunk lower.

Ramit: Hmm.

Isabelle: Um, and I also have that small additional 403for mine.

Ramit: 150 a month for that. Mm-hmm. Mm-hmm.

Isabelle: [00:45:00] Um, when Ryan was working, we were maxing out his 401, but that had been a recent development.

I logged in and increased the contributions myself.

Ramit: Mm-hmm.

Isabelle: But I don’t know where that account lives right now. I can’t access it. I can’t put money into it. I

Ryan: could

Isabelle: show you. I can’t access it. I don’t have the dual auth for it.

Ryan: I logged you in.

Isabelle: But … So we, his, his retirement contributions have stopped entirely.

Yeah,

Ryan: my retirement contributions have stopped.

Isabelle: That’s, that’s the- I need to move it over … the net reason why that’s zero. I’m actually in the process

Ryan: of doing that. I’m trying to get a check.

Ramit: Is this an issue, like, the fact that right now he’s not contributing to his 401?

Isabelle: I think it’s an issue. Yes. Yes. Um- Oh.

Why? I’ve-

Ryan: I,

Isabelle: I thought it was. Because what if I go outside tomorrow and get hit by a bus?

Ramit: Yeah. What if?

Isabelle: I think, I think he won’t have anything to fall back on. Part of what’s been an- annoying me, I don’t know about that, is I’ve been asking, “Can you move this to a non-employer account?”

Ramit: Mm-hmm.

Isabelle: Like, can you move it to just a standard, you know, IRA or something else?

And I think you’ve been saying, “Yeah, I’ll look into it,” for a while now.

Ramit: You drag your feet, [00:46:00] Ryan?

Ryan: Sometimes, yes.

Ramit: Hmm.

Ryan: Yeah.

Ramit: Why?

Ryan: If I’m being totally honest, maybe there’s a degree of, like, false hope. Like, I was interviewing multiple times and I’m just like, “Yeah, this job’s really close. I’m gonna get it, and I’ll just move it over to another employer 401.”

Mm-hmm. And then it fell apart at the last minute.

Ramit: Mm-hmm, mm-hmm. Investments are at 3%, again, going to your five two nine. Savings are at zero.

Isabelle: That reflects how I’ve essentially always functioned around savings, which is what we have left over goes into the spare savings- Ah … high-yield savings account. And then if we have the money for a thing, we do it, and if we don’t, we don’t.

Ramit: So this is interesting now. Now I’m seeing.

Isabelle: Now it’s stressing me out.

Ramit: Right. This approach, which is a little sloppy-

Isabelle: Mm-hmm …

Ramit: of like, “Hey, like, let’s just cover everything and then whatever’s left over we’ll put in savings”- Yeah … that works when you have, like, oodles and oodles of money.

Isabelle: Mm-hmm.

Ramit: Because you can’t…

I mean, bread is bread. You’re, [00:47:00] there’s no amount you’re gonna spend on bread that’s gonna materially affect you. So at 300K, you’re doing great. Yeah. And now you’re realizing, oh my gosh, savings is not growing at all. Yeah. Okay.

Isabelle: Yeah.

Ramit: And then finally, we go down to guilt-free spending, 15% or 1,356. Is that accurate?

Isabelle: Uh, that’s probably high.

Ryan: Typically, we go months without spending anything, but then we have, like, a large lump purchase. Hmm. What would it be-

Ramit: I’d say- … that’s a lump one?

Ryan: Um, we have an upcoming trip to Iceland that- Great … she paid for in advance.

Ramit: It’s, it’s interesting. Looking at your numbers, all the spending is quite reasonable-

Ryan: Mm-hmm

Ramit: in the category. Groceries, 650. Afterschool care, 350. Pet costs, 135. Mm-hmm. But then I notice- Yep … two mortgages.

Isabelle: Yes.

Ramit: So we’ve got a mortgage- That’s the, that’s the- … on a house and a mortgage on a condo. Can you walk me through it?

Isabelle: That is … Well, I can tell you that’s what’s feels like it’s killing us sometimes.

The long story or the short story?

Ramit: Give me the short first, in one sentence.

Isabelle: The short story is we are paying the mortgage on my mom’s condo

Ramit: What’s the longer story?

Isabelle: Uh, the longer story is my dad passed away a few years [00:48:00] ago.

Ramit: Mm-hmm.

Isabelle: Uh, she was living three hours away. My mom was living three hours away and could not sustain it.

She’s older, she has mobility issues, and so we decided to move her down here.

Ramit: Okay.

Isabelle: Um, much more expensive in this area, and so the house that she sold in Central California was in no way going to pay for a, a home here. Um, so we put the entirety of the house value into the condo down pay- into the down payment for a condo.

So- How,

Ramit: what percent?

Isabelle: About 50%.

Ramit: Okay. So that’s why the-

Isabelle: That’s why

Ramit: it’s- … amount you’re paying is so low.

Isabelle: Yes.

Ramit: Yeah.

Isabelle: Yes.

Ramit: Okay. And how many more years on that condo?

Isabelle: 28.

Ramit: 20. Okay. More years. Let’s just say 30. And how about on your house? Yeah, and,

Isabelle: and it’s

Ramit: a

Isabelle: high percentage. Yeah.

Ryan: Interesting. It’s, um, it’s worth saying that, um, her mom also owns additional property that she’s looking into selling that would cover a large chunk of that.

Ramit: Yeah. Really? Well,

Isabelle: she is, yes.

Ramit: How soon?

Isabelle: Soon. That’s, that’s, that’s been a point of disagreement between us. Um, she has a home in Mexico that she is trying to sell, but it’s been a couple years now, and she’s-

Ramit: Couple years? …

Isabelle: moving [00:49:00] slow on it.

Ramit: Give me your phone. I’ll knock this out in 15 minutes. What do you mean?

Yes. What? A couple of years?

Isabelle: I think she’s struggling with letting it go.

Ramit: How much will she make?

Isabelle: Uh, about enough to pay off the condo.

Ramit: Hmm.

Isabelle: About 200 or so.

Ramit: That’s quite interesting. And would she take the money and pay off the condo?

Isabelle: I think so, but I think the reason she would do that right now is because she knows that Ryan doesn’t have a job and that we’re Paying it ourselves

Ramit: Mm-hmm.

Ah, she knows this?

Isabelle: Yes, she does. Yeah.

Ramit: And what does she feel about that?

Isabelle: Um-

Ramit: Does she feel stressed?

Isabelle: I think so, yes. I think she feels m- enormously more stressed than I do, um, because I- How is that

Ramit: possible?

Isabelle: Well, she comes from, uh, from, you know, my childhood and from our upbringing, she comes from a place where, you know, she remembers a time when my dad lost his job, and they were within inches of losing the house.

I see. So her stress is coming from a place of, “If I don’t do this, you’ll- you’re going to lose everything.”

Ramit: But, but not enough for her to sell the house?

Isabelle: Yeah.

Ramit: No. W- w- does she have, uh, social security?

Isabelle: Yes. Okay. That’s her only [00:50:00] source of income.

Ramit: That covers what she needs on a day-to-day basis- Yes … or do you have to put in extra?

Isabelle: No, that, that about covers what she needs.

Ryan: Mm-hmm.

Ramit: Okay.

Ryan: Period. Right. I mean, if worse came to worse, theoretically, we have talked to her, and she’s okay with moving in with us and renting said condo.

Ramit: Mm.

Ryan: But we haven’t really quite approached that yet.

Ramit: Do you think you need to do that?

Ryan: Not quite yet, but I think we’re encroaching on that territory if I can’t find something else.

Ramit: You might be surprised, but these numbers are okay to me. Let me tell you why. First, while 83% is way higher than I like to see, I can see that all of their fixed costs are quite reasonable except for having two mortgages. Next, I can see that their savings, while they are saving $0, they actually have 10 months of savings, so if they wanna stop saving, okay.

Their guilt-free spending, 15%, not bad for a one-income household. Yeah, there are a couple things that I noticed. They don’t have any money for vacations, and they’ve talked about liking to travel, et cetera, [00:51:00] et cetera. If they wanted to continue like this, they could, but that’s actually what troubles me. So if anything, I wanna help them sharpen their spending so that it becomes very clear

Ryan: who they are, what they love, right in their CSP.

I also know that if we took it out, we’d be back down to 60% for fixed costs, approximately.

Ramit: Shall we look?

Ryan: We can,

Ramit: sure. Let’s take a look. Let’s zero out the condo. Down to 66%. Yeah. Yeah. You know, y- you have cut back on other things- Yeah … and fixed costs. I can see that. It’s impressive. Um-

Isabelle: Yeah, a lot of those numbers are reflecting-

Ramit: Yeah

Isabelle: serious cutbacks in the last- That you’ve cut back. Yes.

Ramit: Yeah. Yeah. No savings, um, except for this 70K that you put aside when times were flush. Right.

Isabelle: Right.

Ramit: I notice things like no- Yeah … vacation money.

Isabelle: Which kills me.

Ramit: Mm-hmm, ’cause I know that vacations are important to you.

Isabelle: Yes, it is.

Ryan: Yeah. Up until now, it hasn’t really been an issue.

I think it will be more of an issue long term because that factors in the fact that we paid for some of the [00:52:00] vacations and a large chunk of it already, so.

Ramit: Oh, like Iceland? Yeah.

Ryan: Yeah.

Ramit: Where did that money come from?

Isabelle: It came from the before times- Oh. … I’ll say. So-

Ramit: BL, before layoff. Okay.

Isabelle: Yeah. Um, yeah. Well, I acknowledge it was sloppy, but a lot of the time we had enough income- Yeah

for many years that my strategy was I will just, you know, take whatever’s left over in the checking account at the end of the month- Mm-hmm … bring it down to, like, eight grand, say, send over the rest to high-yield savings, and oh, look, there’s enough money there to book this trip. So-

Ramit: Ryan, what are you hearing when she describes this?

Ryan: I don’t know.

Ramit: Are you hearing a well-developed financial plan?

Ryan: Not really necessarily.

Ramit: Yeah. But isn’t it interesting that in your relationship she’s the one in charge?

Ryan: Yeah, th- that’s true. I mean, I feel like if I try to develop something, it’s dismissed. But I don’t really pay attention to what she’s doing, and maybe I should be as well.

Maybe sh-

Ramit: Not maybe.

Ryan: Yeah?

Ramit: Yes. I find this pattern is very, very common where- Mm … we have the person who’s the money person, [00:53:00] and they have, like, multiple spreadsheets. How many spreadsheets do you have?

Isabelle: Oh, no. I don’t have any spreadsheets other than this one.

Ramit: This is the only one?

Isabelle: I keep everything on an app.

Ramit: Okay. Does that count? How many times a day do you log into your app? Okay,

Isabelle: they- Any time

Ryan: I buy something, I get a, “

Ramit: What, what’s this $12 charge?” Thank you very much. So they are in the guts of- I know … the finances, and then the partner doesn’t pay attention, goes, “Ah, you’re so good at it. You’re better at math than I am.

You handle it. You’re so good.” And then what it turns out to be is that the person who’s the money person actually does not really have a developed system. Mm-hmm. They just move numbers around, here, there. They think that managing money is paying bills. I find this is very common, especially with women who come on here.

Mm-hmm. Paying bills is managing money. That’s not managing money. That’s like pushing paper. Yeah. Computers can do it better than us. But nobody in the relationship, even the money person, is talking about the important things. What percentage is automatically going to savings? What’s our investment rate?

Are we gonna have enough at [00:54:00] retirement? How do we plan for this vacation that we wanna take? Right. These are big questions. Right. But most of us end up being concerned about the price of pickles.

Isabelle: Yeah.

Ramit: Sound familiar?

Ryan: Yeah.

Ramit: Yeah.

Isabelle: Yeah, I would agree.

Ramit: So w- healthy is a- I am interested because I know that money affects us, it affects our daughter- Mm-hmm

it affects everybody around us, my mother-in-law, all of it. I am knowledgeable, and if I don’t have the knowledge, I read the book, one of those, both of those. And I communicate because I gotta get my partner and me, we gotta be on the same page. That’s how it would look like. What about for you, Isabelle?

Isabelle: A healthier relationship and a healthier couple’s relationship with money would involve me being less judgmental and being more open to suggestions or ideas.

And even if I don’t agree with them initially, being open to saying, “Either we can discuss this further or can we both learn about this together and come back [00:55:00] to it?”

Ramit: Lovely.

Isabelle: Um, ’cause I was realizing that, and again, this comes back to a professional setting. In a lot of professional settings, I’m very accustomed to being the person that’s most knowledgeable in the room and the person that’s in power in the room.

Ramit: Mm-hmm.

Isabelle: I think I’m realizing that I bring that into a lot of spaces. I’m laughing ’cause I, internally, ’cause I remember he’s mentioned before, like, you’re using your teacher voice.

Ramit: Wow.

Isabelle: And-

Ramit: Insightful …

Isabelle: and I don’t mean to do that, but-

Ramit: And it’s, it’s more than the voice too, right?

Isabelle: But it’s… Yes. Yes.

Ramit: It’s a- It’s not just the voice, it’s the…

Isabelle: Yeah, it’s the mentality. Yeah. It’s the mentality of I, I have authority and I have power in this space. Yeah. Um, and I didn’t, I don’t know that I realized that I was doing that.

Ramit: That’s good. What a great realization. Um, like it’s- Like life-changing.

Isabelle: Yeah.

Ramit: Oh my God.

Isabelle: Yeah, yeah, because we don’t want that. So I

Ramit: actually think it’s incredibly courageous of both of you to be here.

Isabelle, for you to apply, amazing. For you to stay here even though you’re discovering, like, these things that are quite uncomfortable.

Isabelle: Yeah.

Ramit: Right? I appreciate you. And then Ryan, you’re here. You initially said, “I’m here ’cause she wants me to be here.” What are you [00:56:00] seeing for the reason that you are actually here now?

Ryan: I wanna be more comfortable with money. I wanna have, like, more of a say in the decisions.

Ramit: Yeah. I want you to as well. Who does the laundry in your relationship? Oh, did I open up a can of worms? I j- I just wanted a simple one. Who empties the dishwasher? I don’t care. Pick a simple one.

Ryan: We each do our own laundry.

Ramit: Huh?

Isabelle: I went on s- laundry strike- Okay … I’m gonna call that, because I was tired of doing the whole family’s laundry all the time.

Ramit: Okay.

Isabelle: And so, one, I, I don’t– we didn’t even discuss it. I think one week I just did my laundry, and I picked out all of his. And then the next week, we had two laundry baskets. Oh.

Ryan: I steal hers from time to time.

I shouldn’t reflect on, but- She doesn’t touch mine ever.

Ramit: But just as- What did you think of the fact that one day she just stopped doing your laundry?

Ryan: I thought it was passive-aggressive.

Ramit: Okay.

Isabelle: Yeah, and it probably w- Maybe … it probably was. But, like,

Ramit: yes, I agree, and what else?

Ryan: Frustrating that it wasn’t communicated.

Ramit: What a microcosm. Yeah. Here I am just trying [00:57:00] to find a simple example- Mm-hmm … and it turns out I, every- … every little thing I look under, there’s, like, a, a story that is- The whole

Isabelle: story …

Ramit: that is a microcosm of what’s going on here.

Isabelle: Yep.

Ramit: Like, I don’t mind if y’all do separate laundry, whatever.

Isabelle: Yeah.

Ramit: Yeah. But the fact that it was never communicated and that you went on strike- Mm-hmm

which meant there must have been a lot of frustration. Yeah. Like, whoa. I don’t know if you see a brighter future, but I do.

Ryan: Mm-hmm.

Ramit: There is a brighter future where the two of you actually feel good about laundry. There is a brighter future where you feel good about money, where you can talk about it, where you might disagree, you might do it differently than you’re doing it now, but you actually both are like, “Okay, we’re a team.”

Isabelle: Right.

Ramit: Do you believe that?

Isabelle: I think so, yes. I, I, yes.

Ramit: Okay.

Ryan: Yeah.

Ramit: Right.

Ryan: Yeah, I think so. Okay.

Ramit: In this family, Isabelle manages the money. She’s also recently the sole earner, and if [00:58:00] something’s gonna get done, she’s gotta do it herself. Does any of this sound familiar? Maybe for your parents, maybe for you. This is something I frequently hear, especially from the female guests on this show.

And as Isabelle takes on more and more responsibility on her shoulders, do you notice the dynamic happening with Ryan? She sends totally mixed messages. “Hey, I need you to participate in the money. Oh, you’re not doing it right, though. Hey, I need you to participate more around the house. Ah, you’re not doing it my way, though.”

And that is very confusing for the recipient. When you get mixed messages, a lot of times people simply give up because they go, “No matter what I do, I can’t do it right, so I’m opting out of this game altogether.” We do not want that in a relationship. We wanna find a way to come together, to have a vision, something that connects us, not keeps us separate.

How am I gonna get them to come together, especially if it means having to change who they are from the inside out? Do you think the [00:59:00] CSP is in a good position or not?

Isabelle: I think s- I, so yes, I think that the change that we need to make is probably to increase income, and I think we maybe disagree a little bit on how to do that.

Ryan: Right.

Ramit: Okay, let’s talk about that. So what has the discussion been around Ryan, you getting a job?

Ryan: I’ve been focusing on high earning jobs. I’ve always been the one who’s been pursued rather than the one who’s in pursuit. Mm-hmm. So this is new for me, and I think that’s part of the reason why I’m struggling with it.

Ramit: Hmm. What is your plan going forward?

Ryan: I’m currently looking at pivoting some other positions. I’m looking at moving into some tangentially, um, related fields- Mm-hmm … that are a little bit more localized, but pay less.

Ramit: How much would you make ballpark?

Ryan: Probably like 70, 80,000.

Ramit: Okay. So you used to make 150.

Ryan: Yeah.

Ramit: You would make, let’s say 70, 80 with one of these jobs. It’d be nearby your place.

Ryan: Yeah.

Ramit: And you could do it. Are you okay with that job?

Ryan: I’d probably be okay because I’d still be [01:00:00] closer to my child and have better work-life balance.

Ramit: Got it. Right. Honestly, sounds like a great plan to me.

Isabelle: Right.

Ramit: Uh, Isabelle, what, what’s your perspective on this?

Isabelle: We need to increase income, but I don’t necessarily think that’s has to be him working.

Ramit: Mm-hmm.

Isabelle: So, like, one possibility that I floated by him is that he could be a stay-at-home dad for a few years. I have the potential to make more money. I always do. I think I, I have a fair amount of expertise in my field, and I could teach summer classes and make an extra 20K.

I could take on, you know, additional grant work or additional training or additional university. Like, I c- I had an opportunity pop up in my email last week to make an extra 2K over the summer just for, you know, some, some committee work. I’ve s- I’ve floated that as an idea by him. I don’t think it would be a substantial increase in income, but it would be enough to offset some of those losses.

Ryan: If I can interject, um, I feel like that’s not necessarily the best move because she’s always telling me she’s drowning and she’s doing too much already.

Isabelle: I, I-

Ramit: Hold on. [01:01:00] I kinda love… Uh, like, this is cool. Like, nah, I think you say that, but actually I don’t believe it. I kinda love this.

Ryan: This is something we already talked about.

Now she’s bringing up something that counteracts that. It worries me a little bit.

Ramit: Right. It, like, it doesn’t add up. You’re already stressed. You’re already feeling overwhelmed. You’re on laundry strike. Although, this stay-at-home dad would solve the laundry problem. But you wanna take on more? Hmm. What do you make of that?

Isabelle: The other thing that I’ve floated by is a complete career pivot and trying to find other ways to-

Ramit: I mean, it’s really funny that in, in the example where you do not feel good, your solution is to tell him what to do next.

Isabelle: Yeah.

Ryan: Isn’t that the problem?

Isabelle: I mean, my solution- Take

Ramit: a look in the mirror. Hold on.

Laundry. No, no, no. Do you have a, do you have a, I have a mirror right here. Look, let me put this camera on. I’m gonna f- put it at you. Look in this mirror. That won’t- Look in the mirror

Isabelle: It’s funny because the first thing that I probably would have said is if I wasn’t happy with something, I would have done it myself.

Ramit: Which would be?

Isabelle: [01:02:00] No, like if I came home and, I don’t know, the toys weren’t put away- Oh, you would have done it yourself … I would, I will probably passive aggressively have put everything away myself.

Ramit: Like, like I,

Isabelle: I’ve seen this. That’s the actual truth. I’ve seen this. That’s the actual truth- Picking up the toys

and that I would have done.

Ramit: Like not, not telling anyone. Rage

Isabelle: cleaning. Like

Ramit: getting… Yeah, rage cleaning. I

Isabelle: know. Ugh. It’s rage cleaning. I’m a terrible rage cleaner.

Ramit: Um- Okay, so perhaps we can do this in a more healthy way.

Isabelle: Yeah, that’s not a

Ramit: healthy way. If you, if everything that you construct in this plan works and you still don’t feel better, what would you do?

Hint, work on this. Mm-hmm. How do you do that? How do you work on your own feelings?

Isabelle: Right now I don’t. No, I don’t. I- But

Ramit: what would you do?

Isabelle: Pro- talk to him, right? We should talk together. We should talk about meeting expectations or changing expectations possibly.

Ramit: I’m gonna suggest that the two of you maybe don’t yet have these skills.

Isabelle: Right.

Ramit: So how do you do it?

Isabelle: I mean, I still think we probably need to go to therapy –

Ramit: Agreed … for

Isabelle: one.

Ramit: Maybe get a coach. Yeah. Maybe get your own coach or therapist. Mm-hmm, mm-hmm. Like, there’s so many ways to get help besides rage cleaning and then telling him what to do. Yeah. And that’s actually- Yeah … the [01:03:00] crux of what’s going on here- Right

which is, like, total disconnection, parent-child thing, and not actually having a vision of what do I want-

Isabelle: Mm-hmm …

Ramit: what do you want, and then what do both of you want?

Isabelle: Yeah. And I think that’s what we are, especially what we both want, I think, is there, there’s a disconnect there- Yeah … right now in terms of what we see moving forward.

Ramit: I gotta figure out how this all started, and we’re gonna get into that right after this. How come everybody teaches you how to save, but nobody teaches you the skill of spending money meaningfully? It’s a tragedy to end up older and older, having atrophied at the skill of using your money to live a rich life.

I need you to take this seriously, and if you need help planning your retirement and you wanna go into scenarios and more specificity, check out Facet. Facet can help you make a plan that lets you use your money for the moments that matter to you. [01:04:00] Facet charges a flat membership fee for financial planning, never a percentage of your assets, and you get access to a team of CFP professionals, always a CFP, always a fiduciary, who help you create a personalized financial plan that meets you where you are.

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Ramit: Isabel, what do you remember your parents saying about money when you were young? “

Isabelle: We can’t afford that.”

Ramit: Mm-hmm.

Isabelle: Or, “We don’t have the money.” Um, my parents were s- uh, seasonal laborers, so my dad did a lot of farm, uh, farm and field labor. My mom was at factories. Um, so, uh, a lot of the time they would work six to seven months out of the year.

Ramit: Mm-hmm.

Isabelle: And then you made it work for the others based off of savings and unemployment and just figuring things out.

Ramit: Yep.

Isabelle: I was very accustomed to knowing where we were financially, what we could and could not afford, but it was always a, you know, we, we need to save for when we won’t have money.

Ramit: Did you tell them that?

Isabelle: They were telling me that.

Ramit: I see.

Isabelle: And, and I, I think I internalized that message very early on. I still remember I wouldn’t ask for things because I knew we couldn’t afford them, so.

Ramit: Yeah.

Isabelle: You just wouldn’t ask for it.

Ramit: Yeah. [01:06:00] What else did you observe them doing with money?

Isabelle: I didn’t observe my dad doing a whole lot of anything.

Mm-hmm. Um, I think he was always just, “I’m going to go out, and I will work as hard as I possibly can, as many hours as I can, and come home.” And their routine by the time I came along was, “I will just sign over my check and pass it along to you,” and my mom was the one who always managed everything. It’s

Ramit: common, right?

Yeah. Common in a lot of matriarchal cultures.

Isabelle: Yes. Yeah.

Ramit: Yeah.

Isabelle: Yeah, it was always just i- the mechanics, right? Like, we’re managing how we pay all of the bills. This, this way m- we maybe will have enough for X or Y but not Z. Like, it was a lot of that type of messaging.

Ramit: Did you go to college?

Isabelle: I did.

Ramit: How’d you pay for it?

Isabelle: Full ride.

Ramit: Wow.

Isabelle: Also grad school full ride.

Ramit: Wow. Very impressive.

Isabelle: Which is why I don’t have debt, so I don’t know.

Ramit: Yeah.

Isabelle: Yeah.

Ramit: That’s pretty cool. Were they impressed that you were able to do that?

Isabelle: Yes. Yes. They were both very, very proud of me. I think they valued education- Mm-hmm … quite a bit, and so that was something that they fostered from a very early on age.

I [01:07:00] still, I still tell folks my mom doesn’t know what I do.

Ramit: Mm-hmm.

Isabelle: Really, she doesn’t, she doesn’t understand what I did in grad school. She doesn’t understand quite what I do now other than I teach.

Ramit: Yeah.

Isabelle: But I think they were both very proud of that and also very, uh, thankful because if they hadn’t done that, I would’ve been in student loan debt.

There was no other way around it. There, there was, there was absolutely no way they could’ve contributed-

Ramit: Right …

Isabelle: at all.

Ramit: When you think about your relationship with your parents, your relationship with money, their relationship- Mm-hmm … with money, what messages about money do you think you internalized as a kid that you are bringing into this relationship?

Isabelle: Um, it, there was definitely the messaging of, “Your dad doesn’t know what he’s doing with money, so I will do all of it,” because when he, when he did manage the money, they didn’t get anywhere or do anything, so all of the property, they built the house, everything was after my mom started managing it.

Ramit: Mm-hmm.

Isabelle: Um, there was, there was definitely that. There was a lot of scarcity mindset around money. Like, we don’t… Like I said, I don’t, I [01:08:00] didn’t ask for things ’cause I didn’t have it.

Ramit: Mm-hmm.

Isabelle: Um- Do

Ramit: you have scarcity mindset today?

Isabelle: I think right now we have been, and I think that’s been part of, like, actu- You know, I, when, when we realized that our income was dropping, it was a very natural reflex to just say, “Okay, we are, like, we are cutting now.”

Ramit: Okay.

Isabelle: And I said we, we’ve lived on a much lower income before, so I think it was- Yeah … like, “Yep, all right. We’re, we’re not eating out at this place anymore.” Like, that’s just what it is because that’s what I grew up with.

Ramit: Okay.

Isabelle: You know?

Ramit: What else?

Isabelle: I also know that there was a lot of things I didn’t learn from them, right?

Like, my mom right now, her only income is Social Security. There’s no concept really of saving for anything other than, than that.

Ramit: Mm-hmm. Does your mom or did she ever- Dream

Isabelle: I don’t think so. I mean, I think having a house was their dream

Ramit: Yeah. Yeah

Isabelle: Which is why right now for her to, to have that house and pass it on

Ramit: Yeah, that’s meaningful to her in a way that others may not recognize.

Yeah [01:09:00] Do you dream?

Isabelle: Uh, hmm

Lo- uh, long term, I don’t know that I do

Ramit: Mm-hmm

Isabelle: Like, there’s, there’s things that I know that I enjoy doing, but I don’t know what it, yeah, what it looks like down the line

Ramit: Mm. Your mom spent a lot of time in the mechanics of money. Dad hands over the check. She makes sure the bills are paid.

Isabelle: Mm-hmm.

Ramit: Puts some money aside for when times are lean.

Isabelle: Right

Ramit: You do the same. Money comes in, your husband makes money, made money at his job- Mm-hmm … gives it to you. You sign him up for his 401. You make sure the bills are getting paid on time. It’s okay. It’s fine. You’re getting things done. Stuck in the mechanics forever, though, from one generation to the next.

Isabelle: Right.

Ramit: Even though income has gone up-

Isabelle: Tenfold-

Ramit: Yeah …

Isabelle: from what my parents [01:10:00] made.

Ramit: Yeah. No dreaming still, just mechanics. Just pure mechanics.

Isabelle: Hmm.

Ramit: What are you hearing, Ryan?

Ryan: I feel like she does dream, um, to some extent, but it’s usually smaller scale dreams like my own. Um, she’s always the first one to be watching travel videos on Instagram and all over the place.

Um, she’s s- she’s told me before that she lives for her next trip. Oh. And I consider that a form of dreaming.

Ramit: Wait, I love that. But where is it in the CSP? It’s nowhere right now. It’s

Isabelle: nowhere right now. Right.

Ramit: Yeah. Okay, got it. Fair enough. Fair enough. I actually think your reaction to the cutting of 50% income is very health…

maybe more healthy than any other couple I’ve seen on this podcast. Mm-hmm. Most people, they lose some income, and they just go, “Well, that sucks. Anyway, let’s go to TGI Fridays.” I’m like, “What the ?”

Isabelle: Yeah.

Ramit: How are you spending 75 bucks there? Mm-hmm. Anyway, the travel thing is interesting. You like [01:11:00] to travel. You said, “I dream of the next trip,” but you didn’t answer that in the dream.

Why?

Isabelle: Because that’s a zero right now. Like, I don’t know.

Ramit: Ah.

Isabelle: Yeah. I don’t know what that would look like.

Ramit: Do you think deep down you are not confident that your husband will ever make an income again?

Isabelle: Oh, no. Um, I don’t think that, I don’t, ugh. I’m having a hard… I know I should answer a yes or a no question because this was a yes or a no question. Yes, please. I think he can make an income again, yes.

Ramit: Okay.

Isabelle: Fair enough. I- I, I don’t know that I’m 100% convinced it can or maybe should be in the same field, and I don’t think that’s necessarily because he is or is not incapable of it.

I think that’s because in your previous job and, and a couple of others, like, I didn’t ever feel like you were passionate about it. And I feel like- Yeah … now might be a time to pivot or to find something that you maybe has better balance or that you care more about. And so that’s, that’s where I [01:12:00] am. Like, I, I, I think, yes, he can make an income again.

That’s, that’s not the question. I just question whether there could be things that are better fits. That was a very long answer to a very short question.

Ramit: No, it’s quite illuminating because while you may or may not be right, my perspective is- Yeah … why are you telling him what to do about his career? I,

Isabelle: uh, I don’t know.

Ramit: Like, it’s just perpetuating this parent- It’s

Isabelle: this

Ramit: parent- … dynamic …

Isabelle: yeah, yeah.

Ramit: Why don’t you tell your daughter that she’s not allowed to go into this field and do that?

Isabelle: Well, she’s, she- oh, we’re not gonna go there.

Ramit: What is she not allowed to do? She’s- It’s okay. Kids of immigrants can say what the kids… Like, you think if-

if, if my kid wanted to be an actor, I’d be like, “What the fuck?”

Isabelle: Well, that’s what I said. She’s not allowed to go into the arts.

Ramit: But I will say this. This is what I said. Here’s my real answer- Okay … ’cause, like, yeah, you know, Indian people are not, like, really into their kids becoming actress or actor in general.

However, if a kid wanna be an actor or actress, I would say, “Okay, you gotta go interview 20 actors and actresses.” Mm-hmm. Successful ones, failures- Mm-hmm … everything. You gotta ask them about their lifestyle. How much can you spend on a [01:13:00] haircut? How often do you travel? Where do you live? Can I see what your apartment looks like?

Right. And then you get honest. Like, is this the kind of lifestyle I want or not? ‘Cause if they really wanna do it, they’re gonna do it. But most kids make dumb decisions ’cause they don’t know anything.

Isabelle: Right. Right.

Ramit: All right.

Isabelle: Um- But he’s not a kid.

Ramit: He’s not a kid.

Isabelle: Yeah.

Ramit: And this whole, like, “You should do this or try that or whatever,” is just one more screw- Yeah, yeah

in the disempowering toolbox.

Isabelle: Yeah.

Ramit: Hmm. Ryan, any reactions?

Ryan: Yeah, I partially heard that I don’t think she’s go- thinks I’m going to make the same salary again, which I’m, might be me being defensive ’cause I feel the same way. Yeah. Because it was a high earning potential with a lot of time dedicated to it.

Ramit: Yeah.

Ryan: And I think that’s partially where the-

Ramit: Do you feel that your value is determined by your income?

Ryan: A little bit sometimes, uh, if I’m being honest. Yeah. I wanna say no, but yeah, I think there’s some, like-

Ramit: That’s fine …

Ryan: some truth to that.

Ramit: [01:14:00] Most men feel this exact same way. Most men see themselves purely as a provider.

Ryan: Right.

Ramit: And then, so do you see yourself as a, a provider?

Ryan: Yeah, I’d say so. I also feel like, um, in my family dynamic, like larger scale, my parents are- Don’t really talk to me much about my accomplishments other than- Yeah

Ramit: like my career. Well, well, well, what a surprise. Isabelle is behaving very similarly to what she saw modeled from her mom. It’s no surprise she feels like she needs to be in control of everything because she’s been doing basically that since she was 12 years old, almost taking on the role of a parent in her own relationship with her parents.

And there’s a double whammy, that her mom took over responsibility of the family finances because her dad was not good at money. I wonder what kind of effect that has for the next generation, as Isabelle doesn’t really seem to [01:15:00] trust Ryan. I’m curious to see what Ryan’s experience with money growing up was.

Tell me about growing up. What did they say about money?

Ryan: Worker parents, but my dad was a, um, small farmer in a rural community. Um, my mom worked at a nursing home. She worked her way up into management eventually, but she started washing dishes. And yeah, they were very much… They took a different approach, though.

I feel like, um, Isabelle began taking over, right? Taking over their finances. My parents, on the other hand, were maybe ashamed, and they didn’t pass any of that on. Mm. So any time I brought up money, there’d be, like, anxiety around it, and they’d talk ab- Did you grow up in the

Ramit: Midwest?

Ryan: Sorta, I grew up in Canada, in the rural area.

So

Ramit: Oh, wait. I don’t, I don’t have a, a metaphor for this. Is… ‘Cause in the Midwest, there’s a lot of guilt. Yeah. There’s a lot of shame. Is this common where you grew up?

Ryan: Yes, it is.

Isabelle: I would… Yeah.

Ramit: Okay. Religious or no?

Ryan: Mm-mm.

Ramit: My family- Just Canadian. [01:16:00]

Isabelle: Pretty much.

Ramit: Rural Canadians love to feel guilty.

Isabelle: I think there is- Yeah

cultural overlap- Yeah …

Ramit: there as, like, Midwest. What is that? Explain that to me. I, I haven’t heard this before.

Ryan: Yeah. Um, you know the trope that it’s, “Sorry, eh?” Yeah. Apologize for everything. Um- It’s

Ramit: like that times a thousand.

Ryan: Yeah. My parents, uh, my mom in particular, um, she’s always said that she’s really proud that she was able to raise, um, self-aware kids who put others first.

Ramit: Mm. Mm-hmm. What’s the implication?

Ryan: That you’re worth less than someone else.

Ramit: Right. They come first.

Ryan: Yeah.

Ramit: And she sees that as a virtue.

Ryan: Mm-hmm. Right.

Ramit: And do you s- how do you see that?

Ryan: I feel like it’s been plaguing me most of my life, if I’m honest. Yeah,

Ramit: yeah. Tell me. Yeah.

Ryan: Like, I’ve had problems kind of working on it.

And I did say that I’ve seen a therapist, right? That’s one thing I’ve worked on, is being more assertive, like in my career and my personal life. Yeah. ‘Cause I’m not very. Uh-huh. Which shows up with the money, I suppose. Mm. But yeah, I just… Because of the way I was [01:17:00] brought up, I was always taught that I need to take up less space, I need to not interrupt, I need to, like, always think about someone else’s feelings before I do something.

So…

Ramit: Do you have any sisters? I’m guessing no.

Ryan: I have an older sister.

Ramit: Really?

Ryan: Yeah. Mm-hmm

Ramit: In your household as a kid, who was the more dominant parent, mom or dad?

Ryan: Hmm, that’s a tough one. Um, probably my mom most of the time- Yeah … in terms of, like, who made, like, financial decisions and things like that.

Ramit: Okay. Um, my- And is your sister similarly…

Does she struggle with being assertive?

Ryan: Oh, yeah. Okay. Um- Yeah … I would debate my sister is in a much worse place than I am with it.

Isabelle: Yeah.

Ramit: Really? Like, it’s been an affliction for her? It’s caused- Yes … trouble?

Ryan: Yeah.

Ramit: Wow. Okay.

Ryan: Like, say what you will that she doesn’t let me make my own decisions, Isabelle, sometimes.

Ramit: Uh-huh.

Ryan: But she has helped me, I would say, in some sense, and which is what fostered a good relationship early on with some of that. Like, I like the fact that she saw [01:18:00] me as more than what I was, and she pushed me-

Ramit: Yeah …

Ryan: towards becoming better in my field and things like that in ways I don’t think would be possible without her.

Ramit: Hmm.

Ryan: Um, I don’t think my sister had the same dynamic, so.

Ramit: That’s tough.

Ryan: Yeah.

Ramit: That’s really tough. It’s tough to see the way that you grew up with your parents w- when you’re a kid. You don’t know any better- Yeah. Yeah … and that’s the family that you’re born into.

Ryan: Mm-hmm.

Ramit: And that’s what’s normal to you. Yeah.

And then as you grow up and you start to meet other folks and get in different circumstances like working, and you realize, “Wow, the lessons I learned were not very helpful. In fact, they’re actually quite harmful,” that’s tough.

Isabelle: Yeah. Yeah.

Ramit: I find it quite amazing how candid you are at re- especially about your childhood, and how accessible it is.

Like, you’ve clearly done work to be able to catalog the, the ways that you grew up. It’s very impressive.

Ryan: Right.

Ramit: Are your parents both alive?

Ryan: They are.

Ramit: [01:19:00] Okay. And are they together?

Ryan: They are.

Ramit: Okay. How are they with money today?

Ryan: Very poor. Aren’t you? Uh-huh.

Ramit: Uh-huh. Yeah.

Ryan: Yeah. Um- They make questionable financial decisions.

Ramit: Oh, like what?

Ryan: My dad, um, growing up has been involved in pyramid schemes. Um, my mom has been very much paycheck to paycheck most of her life up until retirement.

Ramit: Okay.

Ryan: Even in retirement, as they get money, they spend it kind of thing, like all of it, and they’re just waiting for the next paycheck to come in to buy more.

Ramit: They’re dreamers.

Ryan: Yeah, I guess you could say that.

Ramit: Waiting for the next– Success is right around the corner, the next gig, the next deal.

Ryan: Yeah.

Ramit: It’s all gonna take care of itself once we hit this next thing.

Ryan: Yeah.

Ramit: How come you’re not like that? Are you? Mm- Whoa. Wow, interesting response. Is he?

Ryan: I, I, I think I daydream, but then I beat myself up about it and don’t actually do it.

Yeah. Real good.

Ramit: [01:20:00] I don’t, I

Ryan: don’t

Isabelle: think he has the optimistic-

Ramit: That’s crazy … end, end

Isabelle: point

Ramit: of- Like a dr- You’re like a, you’re like a- … a mini dreamer, but then you’re like, “Ah, this shit will never work.”

Isabelle: Yeah. Yeah, and then, and then, and then he’s done.

Ramit: I’ve never met somebody like this.

Isabelle: Yeah.

Ramit: Okay. Okay. Which,

Isabelle: I mean, I, I actually think reflects a little bit some of your parents’ dynamics because they, they tend to, to have this belief that like, “Oh, things aren’t just going– Like they’re just not gonna work out for us,” or it’s- Mm-hmm

the curse of the family or, you know.

Ramit: That’s classic poor-

Isabelle: Yeah …

Ramit: people mentality.

Isabelle: Yeah.

Ramit: Yeah. Yeah. Like, the world happens to us. We can’t change anything about it. Right. Right. So we just are here to exist and deal with whatever comes our way.

Isabelle: Yeah. Yeah.

Ramit: Like that’s, that’s cl- external locus of control.

Isabelle: Mm-hmm.

Ramit: Like, um… And actually, a lot of times people who have grow- grown up poor for generations, there’s a lot of reasons they believe that. Right. Right. Like things have not gone their way. Yeah. And they have gotten screwed XYZ way, and so in a way it’s kind of a rational response. Also, not helpful.

Isabelle: Right. Right.

Ramit: So here now their son [01:21:00] rec- as recently as six months ago making $150,000 a year living in Southern California. That’s quite a difference.

Ryan: Yeah.

Ramit: How did you grapple with the changes in your socioeconomic status?

Ryan: Not well, I don’t think. Like, I don’t feel like I… And it’s good that I didn’t in hindsight because we’d be in more trouble, but I don’t feel like my spending necessarily reflected it.

I always felt like my peers were spending more- Yeah … and things like that.

Ramit: What messages about money did you grow up with that you are bringing to this relationship?

Ryan: I don’t feel like the messages I got about money growing up have really worked as me believing them so much as me rejecting what they do.

Ramit: Mm-hmm.

Ryan: Because I’ve seen how it negatively impacted things.

Ramit: What about the part about assertiveness and putting other people ahead of you?

Ryan: Okay, that part definitely.

Yeah.

Isabelle: Yeah.

Ramit: Okay. I didn’t know the Canadian rural thing, okay? Thank you very much. I love learning more from my guests on this show. Ramit Sethi learns the most [01:22:00] about stereotypes from around the world. Thank you to my guests. In all seriousness, I want you to notice that the way you grow up, especially some of these cultural mores, these beliefs that we have, can actually profoundly affect and harm kids as they become adults.

If the idea is you’ve gotta put someone else ahead of you, as Ryan aptly observed, that means you have to put yourself back. Just think about all the ways that comes out: school, careers, romantic relationships, money. So for parents watching this show, think about the messages that you are consciously and unconsciously sending to your kids, because 30 years from now, they might be exhibiting some of the same challenges that Ryan is here.

I actually have a lot of compassion for both of them. They both grew up with money scarcity. They both grew up with a lot of money ideas that I typically see with poor families, which is we don’t plan further than a month ahead. How could we? We’re just trying to get by this [01:23:00] month. And so even though Ryan and Isabelle are making way more than their parents ever did, they struggle to change their psychology.

So actually, it’s been really helpful to hear how they grew up. It gives me a new sense of why they’re doing what they’re doing. Now that I understand how both of them grew up with money, let me see if I can figure out what to do about it If you two had a magic wand and you could rechart, recast the way that you show up with money in this relationship- Mm-hmm

what would it be? I

Isabelle: mean, if I had a magic wand, I would completely try to destroy what has become, it feels like, a very cemented parent-child dynamic. Mm-hmm. I don’t want… I, and I, and I-

Ramit: What would you do instead? Tell me what you would do, not what you wouldn’t do.

Isabelle: What I would like to do instead is have regular communication about major decisions and try to have equal contributions-

Ramit: Great

Isabelle: towards that. Even

Ramit: if one of you earns more?

Isabelle: Yes.

Ramit: Wow.

Isabelle: Okay. I mean, the, we’ve, we’ve, we’ve kind of gone back and forth on who- Yeah … [01:24:00] has earned more- Great … over the lifetime of the, the relationship.

Ramit: Okay. Yeah. Now let’s go back and forth right now in terms of what would be in your, your magic wand vision. Go ahead, Ryan.

Ryan: Yeah. I think, um, both of us, uh, contributing equally to discussions. Okay. Or it doesn’t even have to be equal. I’d just like to have some say, like maybe, like, take one key area and move forward with that. Yeah. Um, I, I would say that, yeah, we are used to one of us making more or less than the other. Like, she said she had a free ride.

I thought that was interesting because she didn’t through all of grad school. I paid for a little bit of your grad school, too. Hmm. ‘Cause I was working during that time period.

Ramit: That’s interesting.

Isabelle: That’s true. My tuition was covered, for what it’s worth. I had a job. It just wasn’t making as much as I did previously.

Why don’t you tell her,

Ramit: Ryan? Yeah, you better remember that big old check I wrote for you. That apartment wasn’t free.

Ryan: No,

Ramit: I don’t- Is that what you want to

Ryan: say? No, that’s not what I want to say.

Ramit: Okay. All right. Sorry, I don’t mean to put words in your mouth. I’m sorry.

Isabelle: It was $650, though, which-

Ryan: It was cheap. It was, uh- It was a [01:25:00] Midwestern university, so…

Ramit: What else would you want in this- Yeah … magic wand situation?

Isabelle: Um…

Ramit: It’s gotta be bigger than this, y’all. Like, I’m glad. I want you to have conversations where you contribute, but what else? It’s a magic wand.

Isabelle: I just wanna point out that even in his magic wand scenario, he didn’t say equal conversations.

Ramit: Yes, he minimized.

Yeah. You do, you do the thing that many people do, um, when they talk about their rich life. I’ll be like, “What’s your rich life?” They’re like, “Well, one day maybe I’d like to have, like, a beach house. It doesn’t even have to be near the beach. It doesn’t even have to have a roof.” “It doesn’t even have to have a door.

Just, I j- I just wanna be able to see sand somewhere on my floor.” I go, “What the fuck kind of fantasy is this? Rich life-” “… not minimal shit life.” Okay. Ryan?

Ryan: Yeah. I would actually like to… I’d like to be better educated, and I know that takes more action than anything- Okay … and I haven’t necessarily put in the effort.

Ramit: You wanna be educated or you wanna be fucking good?

Ryan: I wanna be, I wanna be good at it.

Ramit: All right, great. I wanna excel at it. Great. What else? ‘Cause I don’t… Like, I like education. I [01:26:00] am educated. Mm-hmm. But I wanna be good at what I do.

Ryan: Yeah. Yeah. Maybe educated’s the wrong word. What is the- I wanna understand what I’m doing.

I wanna understand my actions, and I wanna be able to make correct decisions.

Ramit: Good. I agree. Yeah. Go ahead.

Isabelle: And I think, again, in a magic wand scenario, I would, I just want to not, not be as stressed or worried about things- Mm-hmm … but also not see him being stressed or worried about things that I don’t feel are worrying.

Ramit: What

Isabelle: if he’s stressed or

Ramit: worried?

Isabelle: Right, and so then I

Ramit: think it- You wanna be the one who’s responsible for fixing it?

Isabelle: No, I think that’s, that’s part of it, is being able to, you know, say, you know, “Hey, I’m worried about this,” and try to understand or contextualize it in a bigger picture. Try to tackle, try to generate plans for maybe tackling that stress or worry instead of it just being this floating cloud that’s following you everywhere.

No clo- Like, I like to kinda-

Ramit: No clouds, that’s what I’m hearing.

Isabelle: Right. Right.

Ramit: No clouds. Right. No clouds around laundry, no clouds around dishwasher- Yeah … no clouds around money, no clouds around career, no clouds around the house in [01:27:00] Mexico.

Isabelle: Right.

Ramit: It’s like just clouds everywhere.

Isabelle: Yeah.

Ryan: Yeah.

Ramit: Yeah. Let’s fix that.

Isabelle: Yeah, there’s a lot of things that we feel like we circle and circle and don’t- Ugh, … don’t get anywhere on, and- You’re

Ramit: indecisive.

Isabelle: Yeah.

Ryan: Yeah.

Ramit: Y’all wanna be decisive?

Isabelle: Yeah.

Ramit: That’s what I would put if I were you. Right. Magic wand, we become a decisive couple. Magic wand, we actually like to talk about money.

Mm-hmm. Magic wand, when one of us has a problem individually, the other will support them, but it’s up to the partner to f- it’s up to them to solve their problem. They are an adult. They stand on their own two feet.

Isabelle: Right.

Ramit: Because guess what? Y’all wanna be solving your daughter’s problems for the rest of her life?

Isabelle: No.

Ramit: No?

Isabelle: No. I would like to have her set up to be financially literate and be able to move- Yeah … on in the world herself.

Ramit: And emotionally literate.

Isabelle: Yes.

Ramit: And all of the above.

Isabelle: Right. Right.

Ramit: Well, she only does that if she sees mom and dad doing it.

Isabelle: Yeah. Mm. Yeah.

Ramit: Isabel and Ryan are not decisive, and I can tell it drives them crazy ’cause it’s driving me crazy.

Pick a simple decision. Now we don’t have to think about it anymore. Let’s execute. [01:28:00] I know I’m supposed to be talking about feelings on this show once in a while, but sometimes I’m like, can we just not? Can we just get this shit done and move on? Do what I say or don’t, I don’t care, but I can’t do this indecisive stuff anymore.

My challenge is to get them to make a decision today. Because if they don’t, they will walk out of here and be indecisive for the rest of their lives. Okay, so if you all… I love, I love the vision. Anything else in the rich life vision that you would wanna add? Travel

Ryan: I’d, I’d like to live without guilt for every decision I make-

Ramit: Good

Ryan: as far as- Yeah … on purchases go.

Ramit: How?

Ryan: Like, even when I make my biggest purchases that I put months upon months into months into researching and going over, ’cause I’m that type of person.

Ramit: Mm-hmm.

Ryan: I worry that I’m spending too much, or I worry about how she’ll think, which isn’t healthy. And, uh- Mm-hmm … she probably, she picks up on it, and then she feels like it’s too much on her, too.

Ramit: Well, she also says stuff that makes you worry, too, right?

Ryan: Yeah. [01:29:00] Yeah, that’s true. “Why’d you…

Ramit: W- we got $5,000 worth of coffee here?”

Isabelle: Yeah.

Ryan: Yeah.

Ramit: Can I rephrase it? So I want to, for us to both be able to know what are the rules before we make- Yeah … a major purchase, both of us. Mm-hmm. And once we make that purchase-

Isabelle: It’s done

Ramit: it’s done. We only feel joy about it.

Isabelle: Yeah.

Ramit: I want us to be a team. I never want us to be jabbing at each other. Mm-hmm. I want us to be supporting each other. Sure, we may have to have difficult conversations. That’s normal, but I don’t wanna be jabbing. Right. Do you see the jabbing that we’ve even talked about today?

Ryan: Yeah.

Ramit: Okay. Do you like it?

Ryan: No.

Ramit: No, it fucking sucks.

Ryan: No.

Ramit: I don’t actually th- I- No … I’ve heard you do it a couple of times- Yeah, yeah … in the examples. I don’t even think you enjoy it.

Isabelle: No, I don’t. I don’t, but then it comes out, and then I, I guess I don’t think about it, and that’s, that’s one of the things I was saying earlier.

Like, to hear, [01:30:00] to hear my words coming back out, out of his mouth is like, “Ah, shit.”

Ramit: Yes. It’s pa- Like, yeah … it’s physically painful for you. I saw you.

Isabelle: Yeah.

Ramit: And, and actually, I don’t mind that. Like, yeah, this shit is hard. It’s hard to hear. That’s why you were doing all these games and digressions and diversions.

Right. Our mind is amazing. It will do anything to avoid pain But sometimes that pain is telling us, “Oh my God, this is not right.” This is where getting help in comes from. This is where becoming a team comes from. All right, so what’s the rich life vision?

Isabelle: I mean, I had mentioned earlier in, you know, my… Our saving strategy right now is nonexistent, but I would like to keep continuing to travel.

I just don’t know how to do that yet. But- How many times

Ramit: a year?

Isabelle: Um, previously in the before times-

Ramit: No, I just

Isabelle: want an answer to my question … in the before times, once, once. Once a year. One international trip a year.

Ramit: Can part of your rich life be y’all answer questions directly?

Isabelle: No.

Ramit: Like, what the ? Because guess

Isabelle: what?

That’s fair. That’s fair.

Ramit: Remember how you said you spin?

Isabelle: Yes, yes. We’re spinning now. You are doing it right now. We’re spinning [01:31:00] out right now.

Ramit: What we do here is what we do everywhere.

Isabelle: So my… in, in my rich life vision, I would like to travel internationally once a year. Great. And I… Yeah, for myself and for my daughter.

I love taking her places.

Ramit: And Ryan, are you going or no?

Isabelle: He’s welcome to come if he wants, I suppose.

Ryan: Usually I go,

Ramit: yeah. What? What the fuck? What?

Isabelle: No, we’re, we’re joking. Yeah. That was a joke. He always comes.

Ramit: I don’t like that joke.

Isabelle: Yeah. That’s fair. I sometimes don’t know that you want to go where I’m suggesting going.

Ryan: I get that. I think we have different, like, um, goals. Like, I like day-to-day conveniences more than you do. Yeah. Like, you won’t spend anything on yourself, and then you’ll just plan a big trip and- Right. I’m

Ramit: sorry. Ryan, do you like when your wife jokes about going on vacation without you?

Ryan: She just did recently, but it wasn’t a vacation.

It was to visit family.

Ramit: Not my question. Do you enjoy when your wife jokes about going on vacation without you?

Ryan: No.

Ramit: Tell her that.

Ryan: I don’t like when you [01:32:00] talk about going on vacation without me.

Ramit: So please- That’s fair,

Isabelle: and I should not have done that.

Ramit: Okay. Thank you.

Isabelle: I’m sorry

Ramit: I don’t mind these things come up here.

I don’t mind it.

Isabelle: No.

Ramit: But I am glad because I think you may be realizing the amount of layers- Yeah … to unpack here, and I think you may be realizing you cannot do it on your own. Yeah. That, that’s not a normal type of joke or comment to make.

Isabelle: Mm-hmm.

Ramit: And the fact that you know that Ryan struggles with being assertive-

Isabelle: Yeah

Ramit: is, like, a real problem, actually an opportunity for the two of you to work on it. For Ryan to say like, “Hey, wait a minute, that, like, felt weird,” ’cause if my wife made a joke about me not– I’m welcome to go, like, no. What, what is this? Yeah. Where’s this coming from? And then for you to not say those kind of things, actually say, like, more positive things.

I would love for both of us to do it. Any thoughts going through your head right now, Ryan?

Ryan: [01:33:00] No.

Ramit: Okay. Let me know if there’s anything you wanna say. I wanna make sure that your voice is heard today.

Ryan: For sure. Thanks.

Ramit: How come I haven’t cracked a smile in the last 15 minutes? I’m supposed to be talking about their rich lives.

Give me something! A pet, something with their daughter, anything. No. Money to them is just an endless checklist of things they need to do. One of the questions I asked Isabelle was, “What if you ever just took a couple hours to watch a movie?” And before I could even finish asking the question, she said, “Oh, I, I could never.

I could never spend two hours watching a movie.” Many people, especially kids of immigrants, know what this is like because what you saw your parents model was you need to be productive. Why aren’t you waking up? It’s Saturday. Okay, you slept until 8:30 AM, time to get up. Did you study for your SATs? Did you do Kumon?

And on and on and on. And so you don’t actually build the skill of simple enjoyment. In fact, if anything, you are [01:34:00] told because you are not being productive, you are wasting your time. So you accomplish things, and you grow up, and you go to a good school, and you make a lot of money and et cetera, et cetera, et cetera.

And just like so many guests on this podcast, you do everything except learn how to live a rich life. That is what I’m trying to change for Isabelle and Ryan. I wanna pull back up the numbers in a second, but before we get to those- Mm-hmm … we need to make a decision because you got a lot of clouds floating.

Yeah. What’s the most important cloud that you need to push through right now?

Ryan: We need to put in savings for retirement or

Ramit: You do? How do you know?

Ryan: Because there aren’t none right now. There’s

Ramit: n- What do you mean? Your retirement has $175,000, and- Mm-hmm … your wife has a pension.

Ryan: Yeah.

Ramit: Do you even need to do that? Is [01:35:00] that the first decision we need to make?

Ryan: I suppose not the very first one.

Ramit: Let’s do the first one. What is it? I think it’s the job.

Isabelle: Yeah.

Ramit: Yeah. What do you want to do about it? I…

Isabelle: Yeah. And I mean, I– that’s, that’s the first answer that came into my mind, but I’m also trying not to make that decision for him.

Ramit: Good.

Ryan: Yeah. I agree with that. I feel like I’ve already, like, tried over the past few weeks to pivot to more I don’t know.

I don’t wanna say more realistic ’cause I don’t know if they are more realistic to pivot, but more accessible options.

Ramit: Okay. So what do you wanna do?

Ryan: I’m looking for what I can find that would reflect my skillset and pay reasonably in my area that would give me better work-life balance

Ramit: Okay. Well, I hope it works out, but if what you’ve been doing for the last month or two is not working, what do you wanna do?

What are your options? Lay them out on the table.

Ryan: My options would be to be a stay-at-home dad for a little while.

Ramit: Okay.

Ryan: Um, I could take something dramatically below my [01:36:00] skill set, but I don’t know if that necessarily makes sense for earning potential. Don’t tell me

Ramit: what’s wrong, just tell me the options.

Okay. You could cut your pay. What else?

Ryan: I could… Oh, what else could I do? I could invest in education to further my career

Ramit: development. Maybe grad school or something like that. Yeah. Okay, good. What else?

Ryan: Um, I could I could invest in my previous business, which was going a little bit, but fell apart a little bit at the end.

Ramit: No. Oh, well, it’s an option. Four.

Ryan: Yeah.

Ramit: Okay, what

Ryan: else? It’s just an option. I’m not saying it’s the best option.

Ramit: I like that. You’re right. I stand corrected. That’s option four. What else?

Ryan: Okay. I could… Hmm

I could look at a new personal development venture or a new business venture.

Ramit: Yeah.

Ryan: It’s related more to- We’ll

Ramit: call all those business, whether old business or new business.

Ryan: Yeah.

Ramit: Ask your wife if she’s got any options that you haven’t considered. Do

Ryan: you have any options? [01:37:00]

Isabelle: I mean, the only one on that list that I don’t think either of us has considered is taking some other kind of job, right, like a retail job or-

Ramit: Oh, I think you mentioned taking a, a dramatic pay cut.

Well,

Ryan: yeah, that’s what I

Isabelle: said. Well, I thought you, I thought that meant like-

Ramit: Could be working at Target, could be working whatever. Yeah. That’s a- Yeah … huge pay cut. I think it all falls under that.

Isabelle: Okay. That’s fair. Yeah.

Ramit: Maybe one other option I might mention is you could, um, get help with your job search.

Ryan: Right.

Ramit: Oh, yeah. You could hire a coach. You could- Career

Ryan: coach, yeah …

Ramit: do… Yeah, there’s lots of ways you- Mm-hmm … you could get into networking groups, et cetera. Okay. So we’ve got quite a few options here. I love how diverse they are. In fact, one of them, like your options were so, um, unusual that all of us were like, “Whoa” at some point.

Mm-hmm. And I think that was really cool. How are you gonna make this decision?

Ryan: I think I need to look at the pros and the cons of each decision. I need to discuss them with her.

Ramit: Mm-hmm.

Ryan: And I need to kind of weigh that against one another and-

Ramit: Can I, can I suggest like [01:38:00] would it be possible for the two of you to make this decision in 60 seconds?

Ryan: No.

Ramit: No?

Ryan: I don’t think so.

Ramit: Okay. D-do you think it’s possible, Isabelle?

Isabelle: I think it would be possible to say yes and to stick with an alternative option for six weeks or eight weeks and reevaluate.

Ramit: I think the fundamental question here is, are you gonna be a stay-at-home dad or are you gonna find a job that makes over $50,000?

Ryan: Okay.

Ramit: Which one?

Ryan: Probably find a job- Okay … I think. I don’t wanna see her continue to struggle or take on more responsibility than she can.

Ramit: Okay. How long are you going to continue your job search the way it is before you change something?

Ryan: I think it needs to change.

Ramit: Great. You’re gonna change it immediately.

What are you gonna do first?

Ryan: I’ll look into options. I’ll look into options for coaching. I will look into options that are maybe a little bit more outside of the box.

Ramit: Let, let’s pick one at a time.

Ryan: Okay.

Ramit: Do you wanna expand your job search to jobs that pay $50,000 to $70,000 a [01:39:00] year?

Ryan: Yes, probably.

Ramit: It’s yes or no.

Ryan: I’d say probably seven, 60 to 70. 60

Ramit: to 70. You wanna expand by $10,000. Okay, great. You’re currently looking at $70,000 jobs. You wanna expand it to $60,000 jobs.

Ryan: Right.

Ramit: Great. Works for me. How long you wanna give that?

Ryan: Uh, the way things are moving right now, probably a month, but- A

Ramit: month. All right. And after that?

Ryan: After that, I’d wanna look into ways that I could move into a related career that requires different skill sets that I could pick up easily and bridge my existing experience into.

Ramit: Mm. Okay. Isabel, any feedback?

Isabelle: I mean, I think, I think that sounds like a good plan. Honestly, one of the things that I’ve been feeling lately is that we’ve been stuck in this cloudy holding pattern.

Like, if you were to just to make that as a decision and go for it, then we could just go for it. Or like, if you’re thinking about doing additional certifications, and [01:40:00] it’s going to require s- whatever number of hours a week, just knowing that and committing and… Like, I’m, I’m fully behind that.

Ramit: Okay,

Isabelle: cool.

We can do what we need to.

Ramit: You know, one thing I noticed is that when there is a lack of clarity- Mm-hmm … around money, around relational agreements, then, like, sometimes the worst of us comes out. Yeah. So like, for example, we have a rule in our relationship, let’s just say, anything below 50 bucks, we’re not gonna ask each other.

Mm-hmm. So therefore, if you text me about ice cream scoops, I’m not answering. And I’m also not saying, “Why’d you get that?”

Isabelle: Right.

Ramit: Whatever. Uh, uh, I’m not concerned. We don’t– We already have an agreement. Um, if it’s not clear about how long is this job search gonna go on before changing and what’s gonna happen next, then we start to become, like, very over, looking over the person’s shoulder- Mm-hmm

and like, “I don’t know.” We don’t want that. We want clear sets of rules. If it were me, this is what I would do. I would say, number one, im- starting immediately, I’m expanding my job search to jobs over $60,000. Number two, i- if after one week I am not [01:41:00] immediately seeing interviews, I’m getting a career coach.

Now, we need to talk about how much can I, we afford- Right … et cetera, but this obviously is not working. I’ve sent hundreds of applications. Maybe I’m doing something wrong. Mm-hmm. Need to get a coach. Number three, if after… I’ll go d- all the way down to $50,000, but after that, I’m gonna be a stay-at-home dad- Mm-hmm

for at least two years, and then I will reevaluate. Like, that’s how we make decisions. Boom. And then I go, “Isabel, are you cool with that?” A- she goes, “Yeah, but here’s what we would do as a stay-at-home dad. This is my expectation. What do you think?” Boom.

Isabelle: Mm-hmm.

Ramit: What are you noticing, Ryan? I can see you taking this in.

Ryan: It’s, it’s more thought out. It’s, like, goal-oriented with timelines. It’s more like an OKR than anything.

Ramit: Exactly. Bring the OKRs into the relationship. Right. I know people say that’s fucking weird. Why use Notion or what- I don’t care. Make it systemic.

Isabelle: Yeah.

Ramit: Okay. Should we look at the CSP?

Isabelle: Mm-hmm. Yeah, sure.

Ramit: All right.

What do we need to change on this? Because o- on one hand, we’re at 83%. On the other hand, you say it’s okay. There’s a [01:42:00] couple things that jump out to me right away. Mm-hmm. What do you wanna do? Isabel?

Isabelle: I think that I need to… Well, I think that we need to solidify what we’re doing with savings and investments first.

Okay. Um, just because right now it’s this floating-

Ramit: Yeah …

Isabelle: nebulae of something. Um-

Ramit: Well, what are you

Isabelle: gonna

Ramit: do?

Isabelle: I, I would like to add some post-tax retirement savings to his account specifically, and I don’t know how much that is, but I am of the mindset that I would like to set up at least something now so that when he gets a job or if he gets more income, then we can redirect there.

Ramit: Where’s the money coming from?

Isabelle: Right now, it’s gonna have to come from guilt-free spending. I don’t think there’s any other- Okay … way of getting that out. So- And I, we don’t spend that much every month. I know that for a fact.

Ramit: Isabel, we’re talking numbers now.

Isabelle: Yes.

Ramit: I want less stories. Sure. I want you to tell me the numbers to move around.

Isabelle: Can I add at least 150-

Ramit: Sure …

Isabelle: to his post?

Ramit: Yes, we’ll do that. Tax. That’s gonna come from guilt-free spending.

Isabelle: Yes.

Ramit: And we will put it up here. Okay. [01:43:00] Ryan, do you want to add something?

Ryan: Um, I was just saying that in terms of, um, investments, I don’t mind dipping a little bit into savings. Nothing dramatic. Mm-hmm.

But if it’s, like, under, like, 10,000, I wouldn’t be super concerned.

Ramit: You would dip into savings for what purpose?

Ryan: For starting investments if they have the potential to, to earn.

Ramit: Okay. What else?

Isabelle: I think w- when I, when I look at the savings, I want to be mindful of setting aside for a vacation, so I’m trying to think if I keep something to under 3,000 divided by 12, what, like 2,250 a month?

See, then, then we’re

Ramit: So let me point out what’s happening right now.

Isabelle: Yeah. My brain is-

Ramit: You’re- …

Isabelle: moving in a

Ramit: direction … you’re down to 13% on guilt-free spending- Yeah, and I- … which is okay.

Isabelle: Yeah.

Ramit: But if-

Isabelle: There’s- …

Ramit: Ryan is a stay-at-home dad-

Isabelle: Mm-hmm …

Ramit: there’s not really money for-

Isabelle: Yeah …

Ramit: vacation.

Isabelle: Yeah.

Ryan: Right.

Isabelle: I know- So if-

that’s, that’s what I’m looking at as I look at

Ryan: I think, I think unfortunately there’s no way around it. I think it’s [01:44:00] the condo.

Isabelle: Yeah.

Ramit: Okay, talk about the condo. What do you wanna do?

Ryan: I think it needs to be looked at as either a rental property, or we need to get more assertive with your mom as far as moving in.

Yeah.

Isabelle: W-

Ramit: what’s-

Isabelle: I’m in denial about

Ramit: that … what’s the, what’s the, what’s the Spanish word for, like, Ryan, but like Ryan who’s got a lot of swag? ‘Cause like- … Rico Suave is on the fucking prowl right now. What just happened? He’s like, “Yeah, we need to do this or do that, and it needs to happen fucking now.” I was like, “What?

Who is this guy?”

Isabelle: He has feelings about the condo.

Ramit: Yeah. I know. And I like it. Uh- Listen to what he’s saying. Yeah. Ryan, speak up. Yeah.

Ryan: Yeah, I just think that it either needs to be a rental opportunity and we temporarily move her in. Maybe she splits some time in Mexico a little bit.

Ramit: Look at her.

Ryan: Or she splits some time in Mexico a little bit and she stays with us, or we just need to get more assertive about having her look into options for moving.

Ramit: Who’s we? We need to get assertive? Is it your mom?

Ryan: It’s, it- [01:45:00] it’s Isabelle. Let’s go.

Ramit: Tell her. Tell her, “I need you to…” “

Ryan: I need you to be more assertive with your mom about moving the property in Mexico to pay off the condo.”

Isabelle: Yeah.

Ramit: Isabelle?

Isabelle: So I have a very hard time with that, but I also think it’s fair, and I know that at the end of the day, that’s what alleviate finances.

So can we set a timeline? Say something like, if there hasn’t been any movement in six months, she moves in, and that’s what it is.

Ryan: Right. ‘

Isabelle: Cause we, I mean, we need, you know, it-

Ryan: Right …

Isabelle: give her time to move in, and if not, this is what’s-

Ryan: Right. If there’s no movement as far as me finding employment or her-

Isabelle: Yeah

Ryan: then yeah. I think if I’m gonna be a stay-at-home dad, we can’t have the condo-

Isabelle: Yeah …

Ryan: effectively. What if you get a job? We could probably make it work then financially until she could sort out her feelings with the property.

Ramit: I, I’m, [01:46:00] I like this conversation. Mm-hmm. I would like to be a little bit more directive- Mm

because y’all are letting your mom’s feelings, which while I respect the dynamic, you have 83%- Yeah … fixed costs.

Isabelle: Yep.

Ramit: You have no savings, no money for vacation. Your guilt-free spending is getting chipped away.

Isabelle: Yeah.

Ramit: And if one of you loses your job again, we got problems. So I don’t know. I’m not satisfied with this six months, see how she feels.

If I get a job, it’s fine. Uh-uh. We have talked a lot about Ryan being assertive. Isabelle, what about you?

Isabelle: In terms of with my mom?

Ramit: Yes.

Isabelle: Oh, I have feelings there. I know I need to be more assertive with her, but I, I struggle with s- stressing her out, so I’ll just carry it.

Ramit: Maybe your daughter will do the same thing one day when she needs to talk to you.

Mom is always stressed out, so I better not bring this up

What do you think, Isabelle? Is it time to change this?

Isabelle: Yeah, probably. [01:47:00]

Ramit: Your mom is not a fragile flower. Your mom worked seven months a year, took care of the family finances, handled a lot of things. Your mom is not a fragile flower. Don’t treat her like that

Isabelle: Yeah, it’s very hard to not see her in that way. Mm-hmm.

Ramit: How are you feeling hearing this challenging?

Isabelle: Yeah Yeah, I think I keep feeling like I can reason myself out of it, but I also know that numerically speaking, that’s just not what-

Ramit: Yeah …

Isabelle: the story is.

Ramit: That’s right. And it’s not even just about the numbers. It’s… We can work with the numbers- Yeah … one way or another.

Yeah. It’s actually the two of you as a unit saying, “What kind of life do we want to live?”

Isabelle: Right.

Ramit: And notice, it’s actually this is the moment Ryan, who has struggled with being [01:48:00] assertive, who’s in the dynamic of the parent-child, you, Isabelle, struggling with perfectionism, pointing back at him frequently, “Why don’t you do this?

How many days until that?” But now we have a moment where Ryan is actually quite assertive.

Isabelle: Yeah. “

Ramit: This is what you need to do.” And what, what is your mind telling you in the back of your head?

Isabelle: Like, I don’t know if that’s the choice I wanna make.

Ramit: Yeah. So actually, both of you have a lot of compassion for each other.

Yeah. This shit is not easy. Nobody wants to be told by somebody, “You gotta do this, you gotta do that.” Right. But actually, what do the two of you want?

Isabelle: Yeah.

Ramit: On this one, I happen to agree with Ryan.

Isabelle: Mm-hmm. I

Ramit: think there’s probably a way to say it, you know? “Hey, we need to… Of course, we love your mom. Of course, we wanna help her out.

Of course. We are fortunate we can do that. We also need [01:49:00] to start putting ourselves first. That means the way we talk to each other.” Mm-hmm. “That means the way we make decisions together, and that even means something as simple as taking vacations together.”

Ryan: Yeah. “

Ramit: I wanna go with you, and I want you to wanna go with me.

I wanna put money aside so that we can do that. I also have a hobby. I wanna continue doing that hobby. Right now, we can’t do these things when we are paying this much, and it’s not that your mom is unable to, it’s that she won’t sell the house.”

Isabelle: Yeah. “

Ramit: So I need you

Isabelle: to do it.” Yeah, she’s dragging her feet.

Ramit: Yeah, she’s

Isabelle: drag- She’s been dragging her feet-

Ramit: She’s dragging her feet … for two

Isabelle: years.

Ramit: So, so Ryan- Yeah … you might say something like, “Isabelle, I need you to make this happen, and I know it’s difficult for you. You’ve never done this in your role. If you can’t do it on your own, get help.”

Isabelle: Mm-hmm. “

Ramit: But I need you to make this happen.”

Ryan: I need you to have a conversation with your mom, and I know that it’s tricky, and I know how much the property means to her- Yeah … and how much it meant to your dad. Mm.

Isabelle: But

Ryan: I also feel like she said herself that she’s happier when she’s here, and I think it [01:50:00] would mean more to her long term to have the condo-

Isabelle: Yeah

Ryan: Damn

Ramit: Honestly The two of you are really, like you’re doing the hard work right now How are you feeling, Isabelle?

Isabelle: I was sad.

Ramit: Mm-hmm. How come?

Isabelle: Oh. I mean, it’s this whole, right- It’s this whole being a person in… Wait a minute.

Ramit: It’s okay. Take your time. We’re in no rush

Isabelle: Sorry. It’s this, it’s this whole, you know, feeling like, and I just heard it described the other day, and I hadn’t thought about it that way, but being in a sandwich generation where I’m the caretaker for a young child but also the caretaker for a parent. Um, and it’s just a hard balance ’cause I know what is…

What I would like to do [01:51:00] for one is not what is best for the other or what is best for ourselves. Um, so it’s just a hard decision-

Ramit: Yeah …

Isabelle: to feel like I’m making.

But she was also so happy when she got that condo.

Ramit: Mm.

Ryan: I think, I don’t have as strong feelings about it obviously- Yeah … but I do think a lot of what’s going on with her is just that she had planned on retiring in that house with your dad- Yeah … so she’s dragging her feet on it more, before he passed.

Isabelle: Yeah, it was their dream to…

Ryan: I understand that.

Ramit: There’s a lot in that house, I’m sure. It’s not just a house. It’s not just a financial transaction.

Ryan: Yeah.

Ramit: So there’s a way to honor that. There’s a way to acknowledge that. There’s a way to talk to your mom about that. You may not know how yourself, but there are plenty of people who can help you do that.

Isabelle: Yeah.

Ramit: But the fact of the matter is that the two of you, right now, are disconnected about money.

Isabelle: Mm-hmm.

Ramit: And this is one of the big levers. This is one of the biggest numbers on here.

Isabelle: Yeah, yeah. [01:52:00]

Ramit: Let’s fast-forward for a second and pretend it’s 25 years from now, and I meet your daughter.

Isabelle: Mm-hmm.

Ramit: And she comes on this podcast, and I ask her, “What do you remember your family saying about money when you were growing up?”

If nothing changed after today, what would she say?

Isabelle: She would probably say something similar to what I said earlier

Ramit: Almost identical.

Isabelle: Yeah. Yeah.

Ramit: Mom took on the responsibilities. Dad was kind of whatever. If he made money, he brought it and gave the paycheck. Yeah. All of that.

Isabelle: Right. Right.

Ramit: Now, let’s say you walk out of here and you make some big, bold decisions.

Yeah. 25 years from now, what would she say? I

Isabelle: mean, I, I would like her to say that both of her… Like, hey, you know, when you’re in a partnership, both people contribute to the financial decisions in a partnership.

Ramit: Mm-hmm.

Isabelle: Um, and I would also like her to see money as a, as a mechanism for a rich life or for, [01:53:00] you know, something that’s positive that allows you to do what you enjoy doing and what you find value and passion in doing, as opposed to what I feel like I grew up with, which was, let’s, you know, pay the bills and get everything done and try to save up for the next thing and so, yeah, you’re,

Ramit: you’re just- That’s what

Isabelle: your CSP is

Ramit: right now

Isabelle: bouncing along. Yeah. Yeah. So

Ramit: it’s okay, but it’s just treading water forever. It’s…

Isabelle: Yeah. Yeah. Right now we’re in a treading water-

Ramit: What if she said to me, she came here and she said to me, um, “I remember my parents making a big change right around when I was five. And I remember this because they sat me down and we talked about it.

We played a game together. We had a little pie chart, and we put money in this and that. I remember as I got older, I started to understand that my mom, Isabelle, had to talk to her mom, and she had to have a really uncomfortable set of conversations. They were difficult, but actually it ended up being good for both of them.”

Right. “And I remember my dad, actually, [01:54:00] he participated in money just like my mom. They would talk about it. They would plan on where they were gonna go. He had this hobby of coffee stuff. He used to spend money on it, but he always said, ‘This coffee is what’s important to me.’ ” Right. ” ‘This is part of my rich life.

Yours is gonna be different than, than mine.’ ” Mm-hmm. What about that? I

Isabelle: mean, that would make me very happy.

Ramit: This is how you do it. Yeah. This is how you do it. You have these conversations now, and then you teach your daughter. You don’t shield her from money. It’s not meant to be shielded from. It’s not a monster.

You talk about it with her. Yeah. Age appropriate, but you get her involved. You let her know, “This is how I grew up with my mom. This is what my mom did.”

Isabelle: Right.

Ramit: Ryan, same for you. Yeah. “I struggled being assertive. It wasn’t working for me. It actually caused a lot of fights when you were young,” tell your daughter.

Mm-hmm. “And so I had to change that. I went to this guy, saw his podcast, got a therapist, got a coach, et cetera, et cetera, et cetera, and, like, it really [01:55:00] changed things.” What do you think?

Ryan: Yeah. I think that’s, that’s probably the best move, definitely the best move to have her see me as more involved so she doesn’t have a similar dynamic in the future.

Ramit: Yeah.

Ryan: I also already know that I want her to see us both in the same way.

Ramit: As a team?

Ryan: Yeah, as a team.

Ramit: Mm-hmm.

Ryan: As is, I’m the one she approaches for secondary things a lot of the time.

Ramit: Mm-hmm.

Ryan: She’s noticed the dynamic already. Like if she wants- Yeah … to buy something, she will ask mommy and not daddy.

Ramit: Wow.

Isabelle: Yeah.

Ryan: Even when I was the one making more, so it’s, that’s an even recent.

Ramit: Wow. Kids are smart. Yeah.

Isabelle: She already knows who to ask for certain things.

Ryan: Yeah.

Ramit: Kids are smart.

Isabelle: Yeah.

Ramit: Without making big, bold changes, just glide- Yeah … right into recreating your childhood.

Isabelle: Yeah. Yeah.

Ramit: Okay. Um, what do we wanna do on the CSP?

We can project this six [01:56:00] months out. What’s gonna happen with the condo?

Isabelle: So if we project six months out, I think we, in either case, we zero it out.

Ramit: Great. In either case. Love that decisiveness. Zero. Holy . Yeah. Fixed cost just dropped- I

Isabelle: know, and I

Ramit: don’t wanna- … to 66%

Isabelle: Right … admit that. But yeah. I know.

Ramit: Next. So

Isabelle: yeah.

Ryan: I mean, yeah.

Ramit: We now have $2,765 a month in guilt-free spending. What do y’all wanna do?

Isabelle: I’ll defer to you.

Ryan: And we’ll, I think we could probably reduce that to 20%, put the 10% in savings.

Ramit: Love it. Fantastic. Let’s do it. I’m gonna add another, let’s just say 700 bucks. Um, let’s add even more. Let’s add 800 bucks to investing.

Okay. Yeah, you’re down to 21%. Y’all, that’s it? That’s life for the rest of life? We can put the rest in

Isabelle: savings. No, I need to go on vacation. Vacation.

Ramit: Oh, okay. You wanna put it there?

Isabelle: Uh- How much? Well, uh, see now I’m, uh, I always [01:57:00] get stuck in, in reverse mathing how much I would need to go. So let’s say 350.

Ramit: 350 a month, so like roughly 5,000 a year, a little lower than that?

Isabelle: Yeah, yeah.

Ramit: All right.

Isabelle: Gifts we honestly do out of guilt-free spending, I would argue.

Ryan: Yeah.

Ramit: Mm-hmm.

Isabelle: Um. That’s true. But then I don’t know what’s-

Ramit: I mean, I- …

Isabelle: what’s left

Ryan: Home repairs.

Ramit: I might question if you need to put $250 a month away. Mm-hmm. But-

Ryan: Yeah

Ramit: you know, it’s either here or there. Usually I like to see couples knowing their own retirement is dialed in- Right, right … before they start putting 250. 250 a month at a young age can actually be quite consequential.

Isabelle: Mm-hmm.

Ryan: Right.

Ramit: So just to zero it out and just to show you what would happen, all right?

Isabelle: Mm-hmm.

Ryan: I would question not having anything going into the long-term emergency fund for home repairs.

Ramit: Oh yeah, good idea.

Isabelle: Yeah.

Ramit: Fine. Let’s put it there. Home repairs, 250. That’s smart. Boom. So now you’re saving… Yeah, I agree. Well, let’s keep in mind your, um, savings account is $68,000, which is 10 months or so- Yeah.

Yeah … 11 months [01:58:00] of savings. That’s solid. Yeah. That’s nice.

Isabelle: Yeah.

Ramit: That’s nice. And by the way, this is all on one income.

Isabelle: Mm-hmm. Yes.

Ramit: You wanna do another income?

Isabelle: Yes. That’s,

Ramit: that’s- Watch

Isabelle: this.

Ramit: Let’s say 3,500 post-tax. I’m being conservative here.

Isabelle: Mm-hmm.

Ramit: Your fixed costs drop to 47%, and now you have $5,000 left- Yeah

per month.

Isabelle: Yeah. Right. Which was that, I mean, three… Yeah, yeah. That’s like a 50, $60,000 job.

Ramit: Yeah. Yeah.

Isabelle: Yeah.

Ramit: So what does that tell you? We could take the CSP numbers off screen. Yeah. What does that tell you?

Ryan: It tells me there’s flexibility in what I wanna do. Like I don’t even- Yeah … have to necessarily pick. I could probably be comfortable if we got rid of the condo, just taking a part-time job, and then being the father figure the rest of the time.

Ramit: Exactly. Yes. You have options. Seeing the numbers helps you see it, but what I’m seeing, what I just saw right now is like the clouds just cleared.

Isabelle: Mm-hmm.

Ramit: Holy shit, I could work part-time. I could do 50K job, 60K job. I could be a stay-at-home dad. Whatever.

Isabelle: Right. There’s a lot [01:59:00] of, uh, options.

Ramit: There’s a lot of… The two of you now get to decide clearly.

Ryan: Mm-hmm.

Isabelle: Right.

Ramit: And have we thought about how much you’re actually gonna have in the future?

Isabelle: I don’t know a number, honestly. I know what percentage of my salary it’ll be for pension.

Ramit: Okay.

Isabelle: I have no idea for him.

Ramit: What percentage is- At all … is that for you?

Isabelle: Um, it’s about, it’s like 68 to 70% of what my salary will be at retirement age.

Ramit: Okay. Do you know what that salary will be, ballpark?

Isabelle: Uh, it’s probably gonna be around 150, 160 at least.

Ramit: 160?

Isabelle: But it’s hard to… It’s, yeah.

Ramit: Conservatively, you think?

Isabelle: It’s conservative, yeah. Okay. That’s very conservative.

Ramit: So 70% of $160,000 will be your pension.

Isabelle: Mm-hmm.

Ramit: Okay.

Isabelle: Without including Social Security or anything else, like the 403, I’m making small contributions to.

Mm-hmm.

Ramit: I ran some quick calculations for you back of the napkin. So they include your pension, 70% at 160K- Mm-hmm … which I think is conservative. Mm-hmm. They include a $3,500 a [02:00:00] month net pay for you, Ryan, which I think is conservative as well, and to be able to make those investment contributions that we talked about.

How much do you think you would make in income when you retire? Right now, you make $151,000 a year.

Isabelle: I mean, my own back of the napkin math wants to say somewhere between one to 120.

Ramit: Mm-hmm. Okay. Ryan?

Ryan: Uh, I wanna say 150.

Ramit: Okay. According to our calculations, $187,000 a year. What do you make of that?

Isabelle: Um, I mean, that means that I can only calculate what I know for mine, I think.

I don’t, I, I don’t have any idea what, what his- Yeah … looks like.

Ryan: I do think that might be conservative for me too, based on my previous income.

Isabelle: Yeah, ’cause you were previously- The graphic can be an area … putting in a lot more. Yeah.

Ramit: Mm-hmm. So what

Isabelle: does

Ramit: it mean, the fact that it’s 187,000, probably more? I

Isabelle: mean, I see it as we’re going to continue to be [02:01:00] comfortable in retirement.

I don’t have to worry about it.

Ramit: Mm-hmm.

Isabelle: We’ll be at or above our current living… Well, inflation, but I-

Ramit: No, this factors inflation in

Isabelle: already. Yeah, yeah. Like, I think we’ll be at our, at our current lifestyle-

Ramit: Okay …

Isabelle: which is comforting-

Ramit: Mm-hmm …

Isabelle: I think.

Ramit: Ryan?

Ryan: Yeah. It, it’s comforting. I think that I agree with that.

That’s, that’s a comfortable number.

Ramit: Okay. Does it mean that you need to take on extra work in summers?

Isabelle: Probably not.

Ramit: Yeah. So let go of that.

Isabelle: Yeah.

Ramit: What else does it mean you do not have to do?

Isabelle: I mean, it probably means that I don’t have to be doing, uh… It’s not just the, the teaching in the summers thing. I pick up a lot of extra work, just, uh, just here and there and everywhere because there’s opportunities for it, and I tend to be the person of like, “Well, if I could make this extra thousand, I’ll do it.”

Ramit: That’s because of how your parents grew up.

Isabelle: Yeah. Yeah.

Ramit: And you are still following in their [02:02:00] footsteps. Right. In… Which can be good, but it’s also destructive. It’s not healthy- Yeah … to be following a rule book from 45 years ago that doesn’t apply to you today.

Isabelle: Right. Right.

Ramit: So you actually get the freedom.

Isabelle: Yeah, of time. Yeah. Can you- Time, time in making those decisions.

Ramit: Can you imagine just sitting and watching a full

Isabelle: TV show? No, absolutely not, no. Yeah. I have, I have a very hard time doing that. If I’m not actively doing something, I feel like I’m wasting my time.

Ramit: Gosh, I wonder where that came from.

Isabelle: My friends and I call it toxic productivity.

Ramit: Yeah.

Isabelle: It’s… And I, yeah.

Ramit: The only thing that has to, absolutely has to happen-

Isabelle: Mm-hmm …

Ramit: is what? What needs to change with your CSP?

Isabelle: That condo.

Ramit: Yeah.

Isabelle: Yeah.

Ramit: That’s the one thing.

Isabelle: Yeah.

Ramit: So wow. What, what I’m seeing here is each of you walking out of here with one big piece of homework. Ryan, what’s yours? [02:03:00]

Ryan: To change my job search and be supportive towards, um, moving her, towards moving the condo with her mom.

Ramit: No. One. And I don’t want process, I want outcome. What are you going to have? What is your piece of homework that you are going to get?

Ryan: I’m going to support her in approaching her mom about moving the condo.

Ramit: That’s more important than you getting a job?

Ryan: Looking at that right now, it kind of is.

Ramit: Hmm. You don’t need it.

I

Isabelle: think, I, I think the condo is my responsibility.

Ramit: I agree.

Isabelle: Y’all- I think, I think that’s, that’s my homework-

Ramit: Exactly …

Isabelle: is to either get moving on selling that house-

Ramit: Mm-hmm …

Isabelle: or moving her into our hou- Mm. Like, that’s, that’s it. Ri- I think that’s, that’s it.

Ramit: Yeah, and Ryan’s like, “And not the second one.” That’s what Ryan wants to say.

Isabelle: Yes. I-

Ramit: Why don’t you say it, Ryan? It’s okay. It’s your house, too. I know. I- Be like, “I love your mom, but no. Option one.”

Isabelle: Right. Right. Yeah. I think that would [02:04:00] drive us all a little bit crazy. Um-

Ramit: So actually I think that’s really important.

Isabelle: Yeah.

Ramit: Don’t give yourself two options when option two is not feasible.

That’s true. There’s only one option.

Isabelle: That’s true. Yeah.

Ramit: So it’s, yeah. That’s the one that has to happen.

Isabelle: Yeah.

Ramit: Okay? That’s your homework.

Isabelle: Okay.

Ryan: Okay.

Ramit: And you know the timeline too. What, what did you agree on?

Isabelle: Well, I had suggested six months.

Ramit: Great.

Isabelle: From, from moving a property perspective. In

Ramit: other words-

Isabelle: It just takes time

Ramit: your payments stop in six months.

Isabelle: Yeah. Yeah.

Ryan: Yeah.

Isabelle: End of the year, roughly.

Ramit: So there you go. Yeah. Now, what is your one piece of homework? I don’t care. Get a job. Yes. And how much does that job need to pay? Over 60,000. Fine. 3,500 net per month, and you all are good.

Isabelle: Yeah.

Ramit: Whatever it is. That’s it. Clouds are cleared.

Any questions?

Ryan: No.

Isabelle: My, my, my mild question to you is I feel like you feel hesitant about that lower cutoff That value, value tied to income

Ramit: Ask him. Don’t [02:05:00] tell him, ask him.

Isabelle: Well, that’s my question. Are you going to really be comfortable in a job that pays 50 or 60,000?

Ryan: I think I’ll be comfortable with it if it’s local and it means b- a better work-life balance.

Isabelle: Okay. So we can prioritize that

Ramit: I respect that.

Isabelle: Yeah.

Ramit: What do y’all get out of better work-life balance? If you’re not taking on all these extra gigs and you have a more comfortable work-life balance, what do you get?

Isabelle: I think we get more time together- What are you gonna do with it? … honestly, and as a family.

I think maybe not be stressed all the time. Like, right now there’s a lot of things that we do where, um, we’re always, we’re always running around or we’re always trying to go from the one thing to the next. What do you get?

Ramit: I want the vision. What do you get? I-

Isabelle: I wanna watch a movie on a Wednesday. I get more ti- yeah.

I, I wanna get more time and relaxation.

Ramit: Mm.

Isabelle: And- Really? … maybe sp- well, yeah, space to do the things that I want to do- Yeah … as opposed to the things I have to do.

Ramit: Beautiful. It’s just hard. That’s a beautiful vision.

Isabelle: Yeah. [02:06:00]

Ramit: It’s pretty hard for you to say, huh? I would love that. I would love it for the two of you and your daughter to just be like, “We’re just going for a walk.”

Right. “We’re just gonna go play. We’re not in a rush.” That would actually be the coolest thing of all. It’s not about the money. You have the money.

Ryan: Right.

Ramit: Make a couple big changes and y’all are good. That’s the stuff your daughter sees, but even without your daughter, that’s the stuff that makes life-

Ryan: Right

Ramit: joyful. Gosh, there was a lot of courage from Isabelle and Ryan today, and I just wanna acknowledge how much they had to go through just to come here and to stay here. I think Isabelle kind of expected me to go to town on Ryan and tell him all the things he was doing wrong, and I think she quickly discovered she actually plays a part, a very large part, in this dynamic.

It’s uncomfortable to have a mirror reflected at you and realize, “Oh my gosh, I might be a part of this problem.” That is not easy, and to her credit, she [02:07:00] came back in here and she said, “Let’s keep going.” Incredibly courageous. One of the bravest things I have seen on this show. Ryan has taken a backseat to money, and I am very happy to say that by the end, you notice that he seemed to find his voice.

And if anything, I want more of that. I want them both to sit up straight and speak openly about the things they want, about the things they need. Now, it’s gonna take a lot of work. This is gonna be hard, but it’s also one of the most valuable things they can do for themselves and for their daughter. And now, let’s hear their follow-ups.

Isabelle: Hey, Ramit. Just doing a quick follow-up. Uh, the most surprising thing about our conversation, I think, was how uncomfortable the whole process made me feel. I’m the one who submitted the application. I’ve listened to many, many episodes of the podcast. I’ve always thought of myself as someone who’s comfortable talking about money, and honestly, it was just deeply uncomfortable in a lot of ways.

I think that’s because, uh, Ryan and I were [02:08:00] really forced to grapple with the sometimes unhealthy patterns of communication and dynamics that we’ve fallen into over 12 years of marriage. Um, all of the things that we should say that are being left unsaid or implied or hidden kind of in, in jabs or just these little ways that we talk to each other and about each other.

Um, I think for me it was really eye-opening to, to hear someone else’s perspective on those and to really think about how we can improve and better our communication as we move forward. My biggest takeaway for, for me personally, is that I think I’ve been hanging onto that house in Mexico emotionally just as much as my mom has, which is why I think I’ve been really reluctant to push on finding a solution for the condo, which is just one of the biggest hits to our fixed costs.

I’ve been trying to think about, you know, how do we increase our income? How do we lower other expenses? How do I set, you know, travel and retirement and everything on the back burner, and I’m realizing that I really can’t be doing that. Um, so I have already sat down and had a very, very [02:09:00] long and very emotional conversation with my mom about this.

We, we have a plan. We have a plan in the next six weeks to, to list the house, and it’s only six weeks ’cause we’ll both, I think, need to be in Mexico, so there’s, there’s some delay there in traveling. Um, but, but we have a plan, and I think she’s, she’s on board. She understands, and I was very grateful for that.

Um, and I’m very grateful to you and the team for, for this experience. It was great. Thanks.

Ryan: Hey, guys. Uh, Ryan here with a quick update. Yeah, so I think my biggest surprise from the whole conversation was on two different levels. Uh, the first one was just how checked out I was on our finances. Um, I was just afraid of confrontation or making mistakes, and I kind of just ended up sending a lot of those decisions Isabella’s way, and it was causing her a lot of stress.

Um, the other surprise was just how long the condo had kind of been in limbo, and so that was kind of a huge surprise for me. I realized that it’d been a while, but I wasn’t sure that it had been quite that long. I think the whole process [02:10:00] was pretty uncomfortable, but we’re definitely making steps on moving forward with that.

Um, I’m gonna be a lot more present in our finances going forward. Um, we’re scheduling discussions about money regularly, which is really good for us. I’m spending my job search for another one just kind of to look at variable incomes there. I do have a few things in the work that are my similar level though, which is good.

I’ve been interviewing and excited for that. But I think at the end of the day, I just need to kind of move forward and see what I can find and just be there for Isabella and make sure we make the right decisions together as a team.

Isabelle: It’s been I think about seven weeks since we spoke to you, and so we were just recording a quick update.

Um, we have a couple of really exciting new updates, so I’ll turn it to you.

Ryan: Uh, yeah. So I guess the most, um, [02:11:00] exciting or most dramatic, uh, change is I’ve received a job offer, which I’ve accepted for $150,000 per year, which, um, kind of resets our finances a little bit more and makes things a little bit less tight.

Isabelle: Yeah. So we’re, we’re really excited about that. Um, we’re kind of figuring out what that looks like for us now and kind of how we’re gonna be moving forward. Um, on my end with my homework, we are or have been talking to my mom a lot about selling the house in Mexico, and I think she has kind of accepted and come to realize that’s something that we need to do, and so we are moving forward with that.

Um, planning to travel there… Well, she’s planning to travel there in September to really start moving on that a little bit more. I think the other thing that I’ve realized and that we’ve realized through this process is that even if it’s no longer strictly a financial decision, even if we can afford the cost, um, with the new job, it’s still something we need to do just from a practical perspective and a personal perspective.

So that is still something that we plan to do in the next six months or so hopefully. [02:12:00] Um, I think moving forward, the biggest thing and the biggest mindset shift has really been thinking through and discussing together how we wanna, um, plan things and, and spend money consciously. You know, we’re gonna be kind of adjusting to a whole new income and a whole new approach to how we, we tackle those decisions, and I think we’ve been having a lot of good conversations already about how we’re going to do that.

Ryan: Yeah, and I just wanted to add to that, that we’ve been having a lot of these conversations, and on that note, they have been actual conversations. Um, we’ve been a lot more s- reciprocal to each other’s feedback, and we’ve been having meetings regularly discussing our finances and what we wanna do, what we wanna save for, um, what our financial goals are and things like that.

Isabelle: Yeah. Yeah. So I think we’ve, we’ve already kind of sat down and, and made a preemptive plan for what we’re gonna do once we s- once he starts the job, and I think we’re, we’re in a good place. I’m really hopeful for what the [02:13:00] next, you know, while’s gonna look like for us. So thank you so much. Thanks.

Ramit: If you wanna know the exact month and year that you will have $100,000 in your investment portfolio, sign up for my new program, Road to 100K.

I’ll help you hit that number fast. Go to iwt.com/100K to sign up

 

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Ramit unpacks how to stop overspending, take control of your money as a couple, and prepare financially for starting a family.

Ramit Sethi of I Will Teach You to Be Rich talks with Grace and Chris, who are 30 and 29 and have been married for six months. They have around $119,500 invested and unusually low housing costs, yet their finances feel chaotic and unstable. They spend more than they make, struggle to understand where the money goes, and have never had a substantive conversation about money as a couple.

The deeper problem is the dynamic they’ve fallen into. Grace handles most of the money while Chris takes a back seat, and both avoid the uncomfortable conversations they know they need to have. With children now part of their near-term plans, Ramit pushes them to confront where their habits came from and what has to change before the stakes get even higher.

In this episode we uncover:

• Why Grace feels like she’s managing their money alone
• How Chris’s avoidance keeps the same cycle going
• Why “we’ll figure it out later” keeps costing them
• How a $100 weekend budget disappeared at a baseball game
• Why 108% fixed costs are only part of the problem
• How Amazon, eating out, and social spending keep slipping through the cracks
• How inheritance, a mortgage-free home, and family support shaped their relationship with money
• How their childhoods taught them to avoid talking about money
• Why starting a family makes their financial situation more urgent
• How they can finally start making financial decisions as a team

Chapters:

(00:00:00) Introduction

(00:02:36) “I’m crying for help on a sinking ship”

(00:16:53) The baseball game that exposes their money dynamic

(00:24:22) Ramit opens up their numbers

(00:40:37) Where their $119K investments came from

(00:47:40) What their childhoods taught them about money

(00:56:46) They’ve never defined their Rich Life

(01:04:04) What happens if nothing changes?

(01:18:32) Can they make the next 15 months work?

(01:31:43) Follow-ups

 

This episode is brought to you by:

Wispr Flow | Try Wispr Flow for free at wisprflow.ai/ramit

Gelt | Gelt is taking on new clients now. Find out if you qualify at https://joingelt.com/ramit

NetSuite | If your revenues are at least in the seven figures, get the free business guide “Aligning for the Agentic Era: How AI Is Changing Everyday Work” at https://netsuite.com/ramit

DeleteMe | Get 20% off all consumer plans when you go to https://joindeleteme.com/ramit and use promo code RAMIT at checkout

Got a money question you’ve always wanted to ask me? Join me live on September 17th for “Why Your Budget Keeps Failing.” I’ll show you how to build a Conscious Spending Plan and answer your questions live. Join me: https://iwt.com/budget

Ever wondered what recruiters actually think when they see your application? On September 16th, Google recruiter Nicky Slavich will reveal what makes recruiters keep reading and when to apply even if you’re underqualified. RSVP free: https://iwt.com/expertsession

Apply to be coached for free on this podcast at https://iwt.com/apply

Transcript:

 

00:00:00.000 — 00:00:04.480 · Grace

I feel like I’m crying for help on a sinking ship, and no one is coming to help me.

 

00:00:04.520 — 00:00:05.640 · Ramit

Whoa. What’s that number?

 

00:00:05.640 — 00:00:09.000 · Grace

Grace way do I 108%.

 

00:00:09.040 — 00:00:09.640 · Ramit

What does that tell you?

 

00:00:09.680 — 00:00:11.840 · Grace

That we spend more a month than we make.

 

00:00:11.880 — 00:00:14.760 · Ramit

You have no mortgage. Correct. So where’s the money going?

 

00:00:14.800 — 00:00:20.720 · Chris

We’re going out. Amazon packages are coming to the door and we’re going out to eat. And then that just kind of stacks up.

 

00:00:20.720 — 00:00:28.440 · Grace

We had a conversation I need this amount in this amount for the taxes and the monthly bills from your paycheck. But then I’m watching them get beer after beer, buying other people drinks.

 

00:00:28.480 — 00:00:36.880 · Ramit

You two are skating on very thin ice. If I looked at these numbers, I go, give me a machete. I will cut this so aggressively.

 

00:00:36.880 — 00:00:40.840 · Grace

I would try and sit down and have conversations about it and he wouldn’t engage in it.

 

00:00:40.840 — 00:00:45.360 · Chris

I don’t know exactly how to talk about it or what’s really going on.

 

00:00:45.400 — 00:00:59.210 · Ramit

You all are on the path to losing what you’ve got and potentially having to sell the house in the future, but that still has not made you have honest conversations about money, and you’re married and talking about starting a family.

 

00:00:59.490 — 00:01:00.570 · Grace

Can I take a second?

 

00:01:03.970 — 00:02:36.420 · Ramit

How many times have you watched couples argue about money on this show? Might even be the reason that you watch. And I don’t mind because I think arguing about money is natural. It is the way that most of us relate to money. And I would rather have you disagree, even argue about money, than not talk about it at all.

 

Today I’m speaking to Grace and Chris. They are 30 and 29 years old. They’ve been married for six months. They want to start a family, and they can’t even bring themselves to have healthy conversations about money. They don’t argue. They don’t disagree. They simply do not talk about money at all. I’m going to pull up their conscious spending plan.

 

Assets $390,000. Investments 119 K at age 29 and 30. That’s very good. Savings 7350. That’s lower than I want to see. Debt is 22 K. Total net worth $494,000. Okay, so far so good, but look at the next number. Fixed costs 108%. What’s going on here? Let’s meet Grace and Chris. Let me take a look at the application.

 

Because Grace, you wrote something that caught my attention. You wrote. We are unable to make big life decisions like starting a family because he refuses to engage or participate in any of the money management. While I know that we are struggling and need to make changes. Do you remember writing that?

 

Mm, yeah. What was going on at the moment that you wrote that?

 

00:02:36.620 — 00:03:11.790 · Grace

That was a tough day for me, I think there. You know, we had had a really great conversation about where we wanted our where we wanted our life to go next, and that we are 100% on the same page about starting a family. But whenever I try and have conversations with Chris about it, it’s usually, I know what the situation is, I just need to make more money And I feel like I’m crying for help on a sinking ship and no one is coming to help me.

 

And it feels very chaotic, which causes a lot of stress. And then when you have a partner who isn’t really ready or unable to have those conversations, it makes it really hard to kind of offload and partner on things.

 

00:03:11.790 — 00:03:15.190 · Ramit

You said it feels chaotic. What feels chaotic?

 

00:03:15.510 — 00:03:23.230 · Grace

Our day to day living expenses are monthly expenses, like just the financial aspect of our life, feels chaotic and very, um, unstable.

 

00:03:23.270 — 00:03:27.470 · Ramit

Okay, Chris, what’s your take on what Grace just said?

 

00:03:27.510 — 00:03:59.720 · Chris

We don’t really set checklists, we don’t really have plans. And I and I do take responsibility for that too, because, like, I don’t know exactly what to do or how to talk about it or what’s really going on. Then we’re going out and doing this, and Amazon packages are coming to the door and we’re going out to eat and friends, family.

 

And then that just kind of stacks up. And then we look back at it and we’re kind of sinking.

 

00:03:59.840 — 00:04:02.880 · Ramit

So do you want to have the conversations about money?

 

00:04:02.920 — 00:04:05.480 · Chris

Yeah, I’m very open to it.

 

00:04:05.720 — 00:04:08.960 · Ramit

I’m open to it. Or do you want to have them.

 

00:04:08.960 — 00:04:47.080 · Chris

I want to okay. I want to she makes more money than I do in our situations. Um, so I feel like I feel like I don’t have a whole lot of, like, control in it, necessarily. It’s like, I, I, you know, paycheck to paycheck. She asks me for money, and I gave it to her. And that’s kind of it. In my role, I just feel like I’m just kind of like the side, like the side person, you know?

 

She she asks for what she needs for our, you know, taxes and our monthly stuff. And I just kind of give it to her. And that’s just kind of how it goes.

 

00:04:47.120 — 00:04:50.680 · Ramit

That’s the role, as you put it. Yeah. Who created that role?

 

00:04:51.090 — 00:04:51.770 · Chris

She did.

 

00:04:51.810 — 00:05:02.210 · Grace

Well, I did, but it was because I would try and sit down and have conversations about it and he wouldn’t engage in it. So I’m like, okay, well, if someone needs to figure out how to manage it, I’m going to manage it.

 

00:05:02.250 — 00:05:03.130 · Ramit

Is it working?

 

00:05:03.570 — 00:05:04.250 · Grace

Um,

 

00:05:05.610 — 00:05:24.450 · Grace

it’s working in the sense, like I’m good at numbers and I know what needs to go where it’s not working in the sense that I know it needs to go where. But I also am not a good person to say no to things. And we also prioritize social and like experiences beyond what we can.

 

00:05:24.850 — 00:05:26.570 · Ramit

Uh, what does that mean?

 

00:05:26.850 — 00:05:39.530 · Grace

Like we, for example, are we had family in town and they wanted to go to a baseball game. And so we’re like, yeah, let’s go. Knowing farewell, we had $100 to spend for the whole weekend and that was not going to cut it. Oh, and we still went.

 

00:05:39.610 — 00:05:40.410 · Ramit

How’d you pay for it?

 

00:05:40.450 — 00:05:45.250 · Grace

I pulled out of the money that we used to pay our taxes at the end of the year. Oh, yeah.

 

00:05:45.290 — 00:05:47.730 · Ramit

Okay. So are you good at it?

 

00:05:47.850 — 00:05:48.410 · Grace

No.

 

00:05:48.530 — 00:05:50.180 · Ramit

Chris. Is she good at it?

 

00:05:50.220 — 00:06:00.219 · Chris

She is very good at writing the plan. I see her do it all the time. She has her sheets out. She. This goes here, this goes here, this goes here. And

 

00:06:01.740 — 00:06:02.780 · Chris

life happens.

 

00:06:02.820 — 00:06:03.620 · Grace

Execution is.

 

00:06:03.620 — 00:06:03.900 · Chris

Poor.

 

00:06:03.940 — 00:06:05.900 · Ramit

Yeah, planning is good, execution.

 

00:06:05.940 — 00:06:06.860 · Chris

Planning is great.

 

00:06:06.860 — 00:06:09.300 · Ramit

And then. Are you skilled at money, Chris?

 

00:06:09.500 — 00:06:11.780 · Chris

No I know.

 

00:06:11.860 — 00:06:15.380 · Ramit

Okay. When was the last time you talked about money in a substantive way?

 

00:06:15.620 — 00:06:31.380 · Grace

I wouldn’t say really. Ever. Uh, from my perspective, whenever I try and bring up like, hey, I want to sit down and go over this plan like, I’m stressed about this. I want I want to talk this through. This is where we’re at, how it’s kind of like, I know it’s bad. I just need to get a new job with more money. It’s fine and that’ll fix it.

 

00:06:31.420 — 00:06:33.100 · Ramit

And like, what’s behind that? Chris?

 

00:06:33.860 — 00:06:38.820 · Chris

I think it’s on me. I think I just kind of curl into a little shell and

 

00:06:40.060 — 00:06:46.260 · Chris

don’t talk about it because. Because I’m just avoiding it. Okay, I honestly. Yeah.

 

00:06:46.300 — 00:06:48.870 · Ramit

Have you ever acknowledged that before today?

 

00:06:48.990 — 00:06:51.270 · Chris

Probably not. No.

 

00:06:52.430 — 00:07:06.710 · Chris

I guess I just don’t feel like stable enough. I just. Maybe it comes more of, like, an embarrassment that she talked to her. Yeah. That you’re make more money than me and I’m lower than you on that pole. And.

 

00:07:07.790 — 00:07:13.670 · Chris

Yeah, it’s kind of embarrassing. Being the male in the relationship. And so.

 

00:07:13.950 — 00:07:15.830 · Grace

And that’s something. Sorry.

 

00:07:16.150 — 00:07:24.390 · Ramit

That’s powerful. I appreciate that. Can I ask a couple questions about that? Yeah. Okay. Did you ever make more than grace?

 

00:07:25.310 — 00:07:26.070 · Chris

No.

 

00:07:26.230 — 00:07:32.950 · Ramit

And in your you mentioned it’s kind of embarrassing as a man. Yeah. What’s that?

 

00:07:33.990 — 00:07:39.030 · Chris

I don’t know. You’re. You’re supposed to be the the man of the house, the taking care of everything.

 

00:07:39.230 — 00:07:41.030 · Ramit

What does that mean? Taking care of what?

 

00:07:41.190 — 00:07:47.120 · Chris

Uh, you know, bills and the house and I. The main thing is just the bills.

 

00:07:47.160 — 00:07:52.280 · Ramit

Okay, so that’s what a man does. And then what does a woman do in this vision?

 

00:07:52.880 — 00:08:04.560 · Chris

Well she can. My goal would be for her to do whatever she would like to do. Oh, um, stay home, have a job, do whatever. Just whatever she would like to do.

 

00:08:04.600 — 00:08:07.680 · Ramit

You ever play a sport? Soccer. Football?

 

00:08:07.680 — 00:08:11.000 · Chris

Tennis? Yeah, I played baseball, basketball, football growing up.

 

00:08:11.040 — 00:08:14.440 · Ramit

Okay, that’s a lot of sports now. I’m like, I don’t know anything about baseball.

 

00:08:14.480 — 00:08:15.640 · Grace

Baseball was his main one.

 

00:08:15.640 — 00:08:16.080 · Ramit

Which one?

 

00:08:16.120 — 00:08:16.520 · Grace

Baseball.

 

00:08:16.560 — 00:08:17.040 · Chris

Baseball.

 

00:08:17.080 — 00:08:25.959 · Ramit

Okay, hold on. For football. I need to put. I know even less about football. Let me just put myself in the mindset. Okay. You all are on a baseball team. Mhm. And

 

00:08:27.160 — 00:08:39.039 · Ramit

you play first base. She’s on your team and I go hey what position does she play. And your answer is I just want to do whatever she wants. Have you ever heard that set on a team.

 

00:08:39.080 — 00:08:44.490 · Chris

No. Because normally people have like certain skill sets for different positions.

 

00:08:44.530 — 00:08:52.490 · Ramit

Agreed. So she’s playing shortstop or she’s outfield or whatever, right? Grace, what do you think about this team metaphor?

 

00:08:52.490 — 00:09:05.570 · Grace

I like the team metaphor, and that’s what I want. And that was what I was going to kind of chime in. I’m not so much of like, I make more. You make it just doesn’t really matter to me. I look at it as we’re a team, so more or less put them together. It’s one whole.

 

00:09:05.570 — 00:09:06.890 · Ramit

Thing. Is this working?

 

00:09:07.210 — 00:09:08.210 · Chris

Probably not.

 

00:09:09.290 — 00:09:46.660 · Ramit

This is a dynamic as old as time. We’ve seen it many times on this very podcast. We have a husband not particularly engaged with money. Whatever she’s handling it, she’s better at math than I am. Then we go over to the wife. Wife is the one furiously keeping spreadsheets and doing random ways of tracking things.

 

Does she know what it all means? Not really, but she manages the day to day. And when I ask them, is it working? They both go, no, but nothing changes. They have their roles and they are seemingly intractable. How long have the two of you been together?

 

00:09:46.700 — 00:09:47.580 · Grace

Seven years.

 

00:09:47.580 — 00:09:56.300 · Ramit

Seven years? Married six months ago. Right? Yeah. Congrats. Thank you. Okay, I understand in your application there’s been a discussion about starting a family. Mhm.

 

00:09:56.580 — 00:10:08.100 · Grace

We’re kind of on the same page about starting the family. It really is just my in the back of my mind are like okay, we’re on the same page of what we want to do, what we have in mind, what our family will look like with kids. Two.

 

00:10:08.140 — 00:10:09.060 · Chris

Two kids. Two.

 

00:10:09.100 — 00:10:11.620 · Ramit

Yeah. Cool. And is there a timeline?

 

00:10:12.100 — 00:10:12.780 · Grace

Um.

 

00:10:14.060 — 00:10:15.740 · Grace

Soon. Yeah. Within the next year.

 

00:10:15.780 — 00:10:16.660 · Chris

Cool. Soon.

 

00:10:16.700 — 00:10:18.700 · Ramit

Okay. Everybody’s on the same page. Great.

 

00:10:18.740 — 00:10:38.220 · Grace

So. Right. We’re on the same page. With these conversations, we have wonderful conversations. The. You know, the idea is great. But then in the back of my mind, I’m like, okay, now where is any of the money going to come from to pay for that child’s food and daycare? Daycare? Oh my God. Um, things like that.

 

So that’s where the disconnect gets kind of crisis.

 

00:10:38.260 — 00:10:51.990 · Chris

I think that, uh, like, we’re very much on the same page. We want the same things with, like, starting a family. The biggest thing with us is we just don’t bring in, like, enough money for what we want.

 

00:10:52.030 — 00:10:53.750 · Ramit

That’s it. That’s the problem.

 

00:10:53.830 — 00:10:57.430 · Chris

Well, it’s some of it, I would say.

 

00:10:57.470 — 00:10:58.630 · Ramit

What’s the rest of it?

 

00:10:58.670 — 00:11:16.670 · Chris

Just like lack of motivation. And on my side of things she like she’s a doer. Mhm. I get very comfortable in my situations and I don’t like change. Uh huh. I think that’s like the big thing that she gets frustrated with me about.

 

00:11:16.710 — 00:11:18.350 · Ramit

That you’re not motivated.

 

00:11:18.350 — 00:11:25.510 · Chris

That I just get complacent and I just get kind of stagnant in my day to day routine.

 

00:11:25.750 — 00:11:26.070 · Ramit

How do.

 

00:11:26.070 — 00:11:26.630 · Chris

You.

 

00:11:26.670 — 00:11:30.950 · Ramit

Get connected about that? How do you reconcile that?

 

00:11:30.990 — 00:11:33.150 · Chris

If I could change one thing about myself,

 

00:11:34.190 — 00:11:53.600 · Chris

that would be it. I. I hate not being comfortable, but nothing’s comfortable like going out. Doing job interviews is uncomfortable. This is uncomfortable. Talking to random people is uncomfortable. But those are just things that that move you along and even make you a better person.

 

00:11:53.960 — 00:11:56.360 · Ramit

You talk to Grace about this. Have you told you this?

 

00:11:56.360 — 00:11:57.000 · Chris

No.

 

00:11:57.280 — 00:12:02.880 · Ramit

No, Grace wants to say, I’ve been telling you this for years. Go ahead, grace, have your moment.

 

00:12:03.040 — 00:12:15.440 · Grace

No, I, I, I have known that that is in there. And I’ve known that that is the thing, right? I’ve known that that is his thing is that he is so capable, but he just hates being uncomfortable.

 

00:12:15.440 — 00:12:29.560 · Chris

I just think that I need to stop thinking about myself, and I need to think more about our future. You would think that that would be enough to light the fire and to figure something out.

 

00:12:29.600 — 00:12:30.360 · Ramit

But.

 

00:12:30.600 — 00:12:32.880 · Chris

I’m just kind of stagnant sometimes.

 

00:12:33.760 — 00:12:41.050 · Ramit

Is this a thing where it’s like, hmm, this isn’t working. Let’s have kids. That’ll fix it. No.

 

00:12:44.810 — 00:13:00.450 · Grace

I believe in him so deeply, and I know he’s so capable of, like, moving on to the next thing. But he just gets in his own way of his own initiative. And I think that’s what holds him back is more of himself. Because it’s not that he’s not capable. It’s not that he cannot move on to the next job or the next thing.

 

00:13:00.570 — 00:13:07.970 · Ramit

Do you find yourself, um, encouraging him, giving him advice? You know, if you just did this or if you say this at work, that kind of thing.

 

00:13:08.010 — 00:13:38.820 · Grace

We’re navigating that, I think, um, and that’s something that we actively work on outside of here in our own therapy. Um, because, yes, because I am a helper. I want to be a helper. And so I, I will admit, full stop. You watch me do it. I love to fill in his gaps because I know what I think he’s trying to get at, but not.

 

And I need, I know I need to control that better in myself. Um, but I, I don’t like to see people struggle or, um, have people be uncomfortable. And so when someone I love is struggling and uncomfortable, then I want to step in.

 

00:13:38.860 — 00:13:40.780 · Ramit

What if I told you that I love that.

 

00:13:42.460 — 00:13:50.460 · Grace

It’s good to struggle and be uncomfortable? And that’s where growth happens. And I know that. But it’s easy for me to do that in my career because I do that all the time.

 

00:13:50.460 — 00:13:51.060 · Ramit

Which is.

 

00:13:51.060 — 00:13:52.500 · Grace

I’m a therapist, so.

 

00:13:52.740 — 00:13:57.380 · Ramit

Okay, amazing. And and then you are in therapy as well. Couples therapy. Yeah. Okay.

 

00:13:57.420 — 00:13:58.380 · Grace

And individual. Yeah.

 

00:13:58.420 — 00:13:58.900 · Ramit

Amazing.

 

00:13:58.940 — 00:13:59.940 · Grace

All the things.

 

00:13:59.980 — 00:14:01.620 · Ramit

Okay. And Chris, what’s your career?

 

00:14:01.860 — 00:14:05.100 · Chris

I’m a warehouse manager for an industrial sales company.

 

00:14:05.140 — 00:14:12.820 · Ramit

Great. Okay. Is there a recent conversation where you can recall where you clashed or disagreed about money?

 

00:14:12.860 — 00:14:13.580 · Grace

100%.

 

00:14:13.580 — 00:14:14.340 · Ramit

Go ahead.

 

00:14:14.500 — 00:14:51.790 · Grace

Uh, it was just recently we were at that baseball game, and everybody knows you’ve wanted. You want a beer at a baseball game? You’re running about $25 a beer. Um, and we had a conversation prior to going into the weekend of like, hey, I need this amount in this amount for the taxes and the monthly bills from your paycheck.

 

You’ve got 100 left to spend for the weekend. Like just know that. And we had that conversation. And then we get to the baseball game and I’m watching and I want him to have fun. I want him to have fun. But then I’m watching him get beer after beer, buying other people drinks, and I’m like, okay, hundred dollars is long gone.

 

So what now? We’re supposed to go to dinner and do other things with this family all weekend? Where is that coming from?

 

00:14:51.790 — 00:14:54.830 · Ramit

Where was the actual conversation? Where did that happen?

 

00:14:55.190 — 00:14:56.270 · Grace

Miller Park.

 

00:14:56.630 — 00:14:56.910 · Ramit

Oh.

 

00:14:57.390 — 00:14:57.910 · Grace

Oh yes.

 

00:14:57.950 — 00:14:58.470 · Ramit

At the game.

 

00:14:58.510 — 00:14:58.990 · Grace

Aha.

 

00:14:59.030 — 00:15:01.910 · Ramit

Okay. So can we go through that. Can we actually recreate it?

 

00:15:01.910 — 00:15:02.910 · Grace

I was like, hey.

 

00:15:03.550 — 00:15:04.590 · Ramit

Uh, talk to him.

 

00:15:04.870 — 00:15:14.230 · Grace

Hey, that like that’s your fourth beer. Like, uh, where’s the money coming from for that? Like, you know, we had $100. And how are we going to pay for dinner tomorrow with your family?

 

00:15:14.230 — 00:15:19.070 · Chris

I don’t know, my family’s in town, and we’re just having fun, so we’ll figure it out later.

 

00:15:19.110 — 00:15:27.910 · Grace

And then I got up and walked away because I was like, I’m not gonna. This isn’t going to go the way I want. We’re not going to have a productive conversation. I’m just going to go sit by my in-laws. So I moved seats.

 

00:15:27.910 — 00:15:31.960 · Ramit

What happened later as you went to dinner and paid for more things.

 

00:15:32.080 — 00:15:36.200 · Grace

Um, that’s where I pulled from our annual funds.

 

00:15:36.240 — 00:15:40.680 · Ramit

You didn’t talk to each other at dinner about. Are we paying and how are we going to pay?

 

00:15:40.720 — 00:15:45.200 · Grace

Nope. I had just moved some money and was like, well, I’ll figure it out later.

 

00:15:45.320 — 00:15:50.280 · Ramit

Okay, so that’s interesting. So, Chris, you said we’ll figure it out, right?

 

00:15:50.320 — 00:15:50.720 · Chris

Yeah.

 

00:15:50.760 — 00:15:53.480 · Ramit

And then who’s we is going to figure it out.

 

00:15:54.640 — 00:15:55.040 · Grace

Yeah.

 

00:15:55.320 — 00:16:03.440 · Ramit

You’re gesturing at her grace. Grace is going to figure it out. So really it’s you’re going to figure it out later. Yeah. Grace, where did you pull money from?

 

00:16:03.480 — 00:16:29.130 · Grace

We. So we own our home. So the money that we paid, we don’t pay a mortgage, but we have, like, the taxes at the end of the year. And so, um, I have, we have like a short money market account. And so what I do is I collect that money each month and then I put it in there to grow. So this is a terrible way to think about it.

 

And I know that this is a pattern, but I pull from that money because I’m like, well, I can just hope that the short money market grows enough to make up for the 150. I had to borrow from it. Oh, yeah.

 

00:16:29.170 — 00:16:29.850 · Ramit

Does it work?

 

00:16:29.890 — 00:16:30.650 · Grace

I don’t know.

 

00:16:30.690 — 00:16:31.610 · Ramit

Haven’t checked.

 

00:16:31.930 — 00:16:33.330 · Grace

Haven’t checked. Hope it works.

 

00:16:33.450 — 00:16:36.370 · Ramit

I love the answer. I love it. You didn’t even say no. You go I don’t know.

 

00:16:36.410 — 00:16:37.410 · Grace

I have no idea.

 

00:16:37.450 — 00:16:38.210 · Ramit

We just.

 

00:16:38.410 — 00:16:39.970 · Grace

Pray it. It’s working, I don’t know.

 

00:16:40.490 — 00:16:50.610 · Ramit

Why not just tell Chris? All right. Hey, listen, I understand you bought the beers. I wouldn’t have done it. You did it. You got to figure out where the money’s going to come from.

 

00:16:50.610 — 00:16:56.810 · Grace

I don’t know, though. I get done, I get anxious that it won’t be fixed, and then it’ll be a problem I have to fix later.

 

00:16:56.850 — 00:16:58.210 · Ramit

What if he has to fix it?

 

00:16:58.250 — 00:17:20.290 · Grace

That would be lovely if I would not have, like, a full anxiety freak out about it. I’m a very like. Like I said, anxious kind of type A. I don’t know that I trust him to fix it because I don’t know that he understands. He’s not sat down with me to look at any of the numbers or anything of what I’m doing. So I guess my thought is like, how could he fix a problem that he doesn’t even know exists because he doesn’t know the foundation of the problem?

 

00:17:20.530 — 00:17:26.420 · Ramit

Maybe if you just keep figuring it out yourself, then one day he’ll magically get it. No no.

 

00:17:26.420 — 00:17:27.660 · Grace

No no.

 

00:17:27.660 — 00:17:28.380 · Ramit

Chris.

 

00:17:28.540 — 00:17:28.900 · Chris

Yeah.

 

00:17:28.940 — 00:17:29.580 · Grace

No, no.

 

00:17:29.620 — 00:17:31.940 · Grace

And this is the pattern, right? I know the pattern.

 

00:17:31.940 — 00:17:33.900 · Grace

But I cannot seem to change it.

 

00:17:33.940 — 00:17:42.740 · Ramit

Can you tell me how money flows in your relationship? Where does the money go? You both work. What happens to the money, then, grace?

 

00:17:42.860 — 00:18:03.540 · Grace

Um, yeah. So each. So I get paid once a month. Um, he gets paid weekly. Like, my paycheck immediately goes towards our monthly expenses, and that’s pretty much it. So mine. I don’t really have any of after like mine is put in and immediately distributed. Um, and then his each week is distributed differently depending.

 

And then also out of his paycheck is our gas and grocery money.

 

00:18:03.580 — 00:18:09.460 · Ramit

You mentioned his incomes variable, right. What if he didn’t make enough to cover groceries? What would you do?

 

00:18:09.500 — 00:18:19.380 · Grace

I try to prioritize making sure those annual and monthly bills are paid, and then I lower the amount of money we have for groceries. So you’re just eating ramen out of the pantry?

 

00:18:19.420 — 00:18:20.380 · Ramit

Has that happened?

 

00:18:20.460 — 00:18:23.060 · Chris

Yeah, it starts to taste boring after a little bit.

 

00:18:23.260 — 00:18:29.990 · Ramit

Which kind of ramen do you get? The chicken top ramen. The the orange one. Yeah, I love that. It’s good. It’s good, it’s good.

 

00:18:30.230 — 00:18:32.630 · Grace

And I’ve mastered it in a microwave, so.

 

00:18:32.710 — 00:18:33.790 · Ramit

Oh, okay. Wow.

 

00:18:33.830 — 00:18:36.590 · Grace

Um, but no, it’s it’s not ideal.

 

00:18:36.670 — 00:18:40.150 · Ramit

Um, is your money joint or is it separate?

 

00:18:40.150 — 00:18:46.190 · Grace

So it comes in separate? Obviously. But then he just transfers over to me and I disperse it between our accounts. Okay.

 

00:18:46.230 — 00:18:48.630 · Ramit

So do you have any joint accounts?

 

00:18:48.670 — 00:19:01.070 · Grace

Yes. It’s been on a hiatus for a little bit, so we have not been able to put anything in it for a while. But that’s usually like, hey, I’m, you know, let’s put this much in and he’ll send it. We both have access to it so we can like, send the money into it.

 

00:19:01.110 — 00:19:08.910 · Ramit

Okay. I noticed that when I’m asking about the account flows. Grace. You’re talking. Chris has been silent for quite a while. Chris. What’s going on with you?

 

00:19:08.990 — 00:19:17.350 · Chris

I think just because she’s just more knowledgeable and that I just. I don’t really know what I’m doing. So for the most part.

 

00:19:17.630 — 00:19:20.950 · Ramit

Okay. What do you notice about these roles that each of you are playing?

 

00:19:20.950 — 00:19:28.400 · Chris

It sounds very individual to me. Not. There’s like no teamwork. It’s like, oh, hey, I’m going to do this, okay.

 

00:19:28.440 — 00:19:29.720 · Grace

They’re very passive.

 

00:19:29.760 — 00:19:30.320 · Ramit

Yeah.

 

00:19:30.360 — 00:19:33.560 · Grace

There’s not much actual interaction.

 

00:19:33.640 — 00:19:34.200 · Ramit

Why?

 

00:19:34.400 — 00:19:34.960 · Chris

I don’t know.

 

00:19:35.000 — 00:19:35.720 · Grace

Avoidance.

 

00:19:35.760 — 00:19:36.360 · Chris

Yeah.

 

00:19:36.400 — 00:19:39.760 · Grace

Avoiding argument. Avoiding disagreement.

 

00:19:40.040 — 00:19:42.720 · Ramit

Yeah. What realizations are you having right now?

 

00:19:42.760 — 00:20:00.120 · Grace

I thought I had a handle on it more than I even did. And now, talking through this, I realized I’m much more passive than I thought I was. I try to be the planner. I try to be the executor and engage others. But the follow through isn’t great. It’s kind of just in the clouds. Yeah. Hoping that it works out.

 

00:20:00.160 — 00:20:01.320 · Ramit

Mhm. Chris.

 

00:20:01.720 — 00:20:04.040 · Chris

Well I have no idea what I’m doing.

 

00:20:04.440 — 00:20:16.920 · Ramit

Okay. All right. So there’s work to be done. Yeah. Let’s put it that way. Mhm. Okay. I’m going to put the conscious spending plan up on screen before we look at the numbers. What was it like to do the CSP together.

 

00:20:17.080 — 00:20:18.119 · Chris

I kind of

 

00:20:19.160 — 00:20:21.930 · Chris

took a backseat a little bit, and she kind of.

 

00:20:22.410 — 00:20:23.490 · Ramit

She filled out the numbers.

 

00:20:23.530 — 00:20:25.290 · Chris

As usual, you know, she.

 

00:20:25.370 — 00:20:56.250 · Ramit

Did you pull out the computer, Grace, and start putting the numbers in? Yes. Aha. And did you ask him for input? No. Let me tell you what I think you interpreted the assignment to be. Even though it’s spelled out grace you interpreted the assignment to be. We got to fill out these numbers. I know the numbers, so I’m going to fill it out.

 

Hey, Chris, come sit down and watch. But I’m going to fill it out. And Chris, you interpret it as, oh there’s some money thing that has to be done. And so like yeah like yeah she’s got it. She’ll figure it out. And yeah I’m here. Okay.

 

00:20:56.290 — 00:20:57.530 · Grace

We misunderstood the assignment.

 

00:20:57.570 — 00:20:59.170 · Ramit

What is the actual assignment?

 

00:20:59.210 — 00:21:07.410 · Grace

To sit down and do this together and really look at these numbers, ask each other questions about things you don’t understand or something that might not make sense. Communicate.

 

00:21:07.450 — 00:21:08.010 · Ramit

Next.

 

00:21:08.050 — 00:21:09.610 · Grace

Yeah, yeah.

 

00:21:09.650 — 00:21:43.700 · Ramit

Communicate. I don’t care if one of the numbers is 50% wrong. We could fix the math. But you did not talk about it at all. Know, and I think this is true of different parts of your financial life. So this is something that we have to work towards okay. And the CSP is just easy black and white math. But it provides a very powerful instruction on how couples complete it.

 

Okay. Let’s take a look at the numbers. Grace, can you read off the words in bold and then the numbers next to it for this entire box, please?

 

00:21:43.740 — 00:21:59.780 · Grace

Um, assets 390,000. Investments 119,500. Savings 7350. Debt 22,483. Total net worth 494,367.

 

00:21:59.820 — 00:22:01.540 · Ramit

Okay. What do you think about the numbers?

 

00:22:01.820 — 00:22:05.220 · Grace

Fine, I think so. The assets, a lot of that is our home.

 

00:22:05.220 — 00:22:07.300 · Ramit

Do you feel anything looking at these numbers?

 

00:22:07.300 — 00:22:09.300 · Grace

I’m disappointed that my debt is that high.

 

00:22:09.380 — 00:22:12.340 · Ramit

Okay, Chris, what do you think about these numbers?

 

00:22:12.380 — 00:22:12.940 · Chris

I like.

 

00:22:12.980 — 00:22:13.460 · Ramit

The.

 

00:22:14.060 — 00:22:27.110 · Chris

The investment number. Savings is just low because we don’t bring in enough monthly to save. But the debt, the debt’s kind of a big one there.

 

00:22:27.390 — 00:22:35.150 · Ramit

Okay, let’s go down to the income this time. Chris, can you read off your combined gross monthly income?

 

00:22:35.630 — 00:22:38.590 · Chris

Uh, 9377. Okay, cool.

 

00:22:38.590 — 00:22:48.310 · Ramit

So that means the two of you combined make about $112,000 per year. What is a couple who makes $112,000 due with their money living in the area that you live?

 

00:22:48.550 — 00:22:54.630 · Grace

The median income. We are on the low side even with that 112 for the area that we live in.

 

00:22:54.990 — 00:23:02.910 · Ramit

Um, can I ask you to guess what the median income in your neighborhood is?

 

00:23:03.350 — 00:23:08.830 · Grace

I feel like it’s around 175 to 180. Okay. Like per household. Right. Are you talking per individual?

 

00:23:08.870 — 00:23:09.510 · Ramit

Per household?

 

00:23:09.550 — 00:23:11.110 · Grace

Yeah. 175, 180.

 

00:23:11.150 — 00:23:11.510 · Ramit

Okay.

 

00:23:11.550 — 00:23:14.190 · Chris

I think about like 150, 150.

 

00:23:14.240 — 00:23:15.520 · Ramit

You know the real number.

 

00:23:15.640 — 00:23:17.080 · Grace

I’m going to be really embarrassed.

 

00:23:17.080 — 00:23:18.840 · Ramit

Probably 113,000.

 

00:23:18.880 — 00:23:19.680 · Grace

You’re lying.

 

00:23:19.720 — 00:23:20.200 · Ramit

No.

 

00:23:20.280 — 00:23:21.320 · Grace

Oh, wow. Wow.

 

00:23:21.480 — 00:23:22.480 · Ramit

What does that tell you? Chris?

 

00:23:22.480 — 00:23:23.440 · Grace

I’m stunned.

 

00:23:23.520 — 00:23:27.080 · Chris

Sounds like we’re not good with our money choices.

 

00:23:28.040 — 00:23:30.280 · Ramit

How? Connect the dots for me. How did you come to that?

 

00:23:30.320 — 00:23:38.040 · Chris

The. What did you call it? The average. Median? The median is kind of right on par with what ours is.

 

00:23:38.080 — 00:23:38.680 · Ramit

Mhm.

 

00:23:38.720 — 00:23:42.920 · Chris

And so but yet we’re struggling. Yes. This much.

 

00:23:42.960 — 00:23:45.560 · Ramit

Yes. No kids. Yeah.

 

00:23:45.600 — 00:23:46.040 · Grace

Yeah.

 

00:23:46.080 — 00:23:50.760 · Ramit

And we’re going to go into some of your other numbers as well. Grace what is occurring to you?

 

00:23:51.080 — 00:23:52.320 · Grace

I’m just shocked.

 

00:23:52.600 — 00:23:53.080 · Ramit

Why?

 

00:23:53.120 — 00:24:07.120 · Grace

Because it feels impossible to live where we live and make ends meet with our income. But clearly, everyone else can seem to do it. So there must be patterns and behaviors and choices that we’re making that are not helping that.

 

00:24:07.440 — 00:24:11.280 · Ramit

Let’s keep going down the list. Fix. Whoa! What’s that number? Grace.

 

00:24:11.970 — 00:24:13.370 · Grace

Way do I? What is it?

 

00:24:13.530 — 00:24:16.130 · Ramit

Weight 108%. What does that tell you?

 

00:24:16.530 — 00:24:19.050 · Grace

That we spend more a month than we make.

 

00:24:19.090 — 00:24:20.410 · Ramit

On just fixed costs.

 

00:24:20.810 — 00:24:21.970 · Grace

Yeah, it’s not great.

 

00:24:22.010 — 00:24:37.010 · Ramit

You spend more than you make every single month. It is simply a matter of time until you are broke beyond broke, until you lose it all. When you walked in here, what did you think the severity of the situation was? Chris? Did you know?

 

00:24:37.130 — 00:24:38.690 · Chris

I knew it was bad.

 

00:24:38.730 — 00:24:39.970 · Ramit

Did you know what that meant?

 

00:24:40.010 — 00:24:44.050 · Chris

Enough, I knew enough what it meant. Oh, I think so.

 

00:24:44.090 — 00:24:52.090 · Ramit

Then did you then accordingly say to grace, we have to change everything. We have to light a fire. We have to red alert. We have to stop everything we’re doing.

 

00:24:52.130 — 00:24:55.170 · Chris

No, I guess I didn’t fully understand that then.

 

00:24:55.290 — 00:25:01.490 · Ramit

I feel like that’s kind of a pattern here. And, Grace, did you understand what 108% meant?

 

00:25:01.530 — 00:25:02.170 · Grace

Yes,

 

00:25:03.290 — 00:25:09.650 · Grace

I understood it in the way of. I know what it meant, but did not know how to take action. I don’t I don’t know how to fix that.

 

00:25:09.650 — 00:25:18.380 · Ramit

But you didn’t say to Chris. Red alert. We’re not doing this anymore. We’re not going to spend this. Here’s what’s going to happen. This is what’s going to happen. I am becoming coach of this team now.

 

00:25:18.740 — 00:25:24.940 · Grace

I think I try, but maybe not hard enough or not as intense because I avoid conflict or disagreement.

 

00:25:24.940 — 00:25:27.340 · Ramit

You two are skating on very thin ice.

 

00:25:28.700 — 00:25:45.260 · Ramit

You’re close to losing a lot. You have one months worth of savings here, but that’s still has not made you have honest conversations about money. You are still tiptoeing around each other and you’re married and talking about starting a family.

 

00:25:45.300 — 00:25:45.940 · Grace

Yeah.

 

00:25:46.660 — 00:26:49.230 · Ramit

You might notice that I am pushing them. I’m doing this for a very specific reason. They are oblivious to the severity of the situation and they are used to dealing in comfort. People will fill out applications. They will go through months of screening, they will fly here to meet me. And then suddenly, when presented with the reality of the situation, they will often revert back to the way they were.

 

They will start to minimize. Oh, it’s actually not that bad. We’re actually fine. We just need a budget. I don’t let that happen because if you went out of your way, you applied. It takes a lot of courage. I’m not going to let you go home just so that you feel comfortable. My invisible script is not. Comfort is awesome all the time.

 

My invisible script is sometimes uncomfortable. Conversations are amazing. That is why I am pushing them to see what’s really going on here. And I’m warning you right now, I’m going to keep pushing. In fact, I’m going to push harder and it’s going to happen. For this entire episode. How do you own a home at this young of an age?

 

00:26:49.630 — 00:26:56.830 · Grace

Um, I’m very fortunate. My grandma and I buy property together, and so she and I own our home together. So we bought it in cash.

 

00:26:57.070 — 00:27:14.440 · Ramit

Oh, you bought the house that you live in now? In cash, correct. All right, so your property taxes are $1,067 a month. Wow. That’s low, which means your housing costs are 11.3% of your gross income. That’s amazing. Super low. Yeah. Which then raises the question.

 

00:27:14.520 — 00:27:15.520 · Grace

Why is this happening?

 

00:27:15.560 — 00:27:24.440 · Ramit

Let’s take a look at the rest. Utilities are 412. Insurance is 922. That’s pretty high.

 

00:27:24.520 — 00:27:43.200 · Grace

Yeah. So what what had happened was he had a subsidy that was given to him. And we, being naive and understanding how marriage works, didn’t realize that as soon as we got married we would have to back pay any of the subsidy. And then the the premium was skyrocketed. So but now we’re locked into a premium that we didn’t realize what skyrocketed, if that makes sense, until the end of the year.

 

00:27:43.200 — 00:27:44.520 · Ramit

And then what’s going to happen?

 

00:27:44.840 — 00:27:50.240 · Chris

Yeah, I’m just kind of hoping to find a new land, a new job that has insurance.

 

00:27:50.280 — 00:27:54.240 · Ramit

Okay. Car payments 502. Yep. That’s includes gas.

 

00:27:54.320 — 00:27:55.080 · Grace

Uh, no.

 

00:27:55.200 — 00:27:56.440 · Ramit

Uh, where’s the gas?

 

00:27:57.200 — 00:28:11.770 · Grace

The gas is in our grocery and gas amount, and it’s 600. And we do not have an exact amount of what we pay for gas versus groceries? I just put 600 in that account. That’s just, I guess, something I’ve never calculated how much I spend in gas and how often I feel okay.

 

00:28:11.930 — 00:28:33.010 · Ramit

I think it’s probably higher than that. I always estimate higher because I want to be conservative in my planning. I never want to get to the end of a month or a year and oh, money. Never. If anything, I want to have extra money. So I always am conservative in my estimates. So if this says 600, what do you think it realistically is?

 

00:28:33.250 — 00:28:34.570 · Grace

Um, 800.

 

00:28:34.610 — 00:28:35.250 · Ramit

Yeah.

 

00:28:35.290 — 00:28:38.610 · Grace

Yeah, maybe 800 plus gas. Right now where we live is insane.

 

00:28:39.090 — 00:28:43.930 · Ramit

I think it’s 900 at least. Okay. I think it’s probably higher, but I’m going to go there. You spend it on a credit card?

 

00:28:43.970 — 00:28:51.810 · Grace

Uh, no. A debit card we don’t use. We don’t. The debt we have is from credit card debt. So we have ceased all credit card use. So we are not.

 

00:28:51.850 — 00:29:00.090 · Ramit

People in credit card debt use debit cards. Okay. All right. We were going to get their debt payments at $1,218 a month. How much credit card debt do you have?

 

00:29:00.130 — 00:29:01.410 · Grace

It’s all a credit card debt.

 

00:29:01.650 — 00:29:03.780 · Ramit

That 22 credit card debt.

 

00:29:03.820 — 00:29:04.260 · Grace

Correct.

 

00:29:04.300 — 00:29:05.500 · Ramit

What’d you spend it on?

 

00:29:05.500 — 00:29:32.940 · Grace

Our house. Getting married. Um, fixes to the house. Like when we moved in, we had a pipe burst. Then we had an HVAC issue. Then we had a bathroom flood. So we spent that on the having to remodel the bathroom so that. That’s kind of old debt. I mean, it’s been there a while. So what I’ve done is I’ve moved it to cards that have like a 0% for X amount of months.

 

And I’m trying that that debt number payoff plan is to try and get that debt paid off within that increment. So I’m not being charged the interest.

 

00:29:33.020 — 00:29:34.100 · Ramit

Is it going to happen?

 

00:29:34.260 — 00:29:36.580 · Grace

Um, if we can stick with that 112. Yes.

 

00:29:36.620 — 00:29:40.180 · Ramit

Okay. That’s a good answer. How much is left on the car?

 

00:29:40.820 — 00:29:47.660 · Grace

Um, his car is paid off. The 502 is my car. Um, it’s a newer car. We got it within the last six months.

 

00:29:47.700 — 00:29:48.660 · Ramit

What’d you get?

 

00:29:48.900 — 00:29:50.820 · Grace

A Ford Bronco sport.

 

00:29:50.860 — 00:29:53.340 · Ramit

Ford Bronco sport. Like an SUV?

 

00:29:53.380 — 00:29:54.580 · Grace

Yeah, like a little.

 

00:29:55.140 — 00:29:55.940 · Ramit

How much did that cost?

 

00:29:55.980 — 00:30:00.910 · Grace

Love that car. 30. 30,000. 30, 2000.

 

00:30:00.950 — 00:30:04.510 · Ramit

What’s the real number? The way you say it made me question that.

 

00:30:04.630 — 00:30:12.390 · Grace

I’m not really sure. I know, I know that that’s my monthly payment, and I’m on, like a 72 month or something or other.

 

00:30:12.590 — 00:30:13.790 · Ramit

Why’d you do that?

 

00:30:14.310 — 00:30:17.910 · Grace

Lack of knowledge sounded good to me at the time.

 

00:30:18.110 — 00:30:23.430 · Ramit

Uh, I note that the car payment is not included in your debt.

 

00:30:23.470 — 00:30:26.070 · Grace

Oh, that would just be a misstep on not realizing that.

 

00:30:26.110 — 00:30:30.990 · Ramit

Okay, let’s fix it right now. So if it’s 22 plus roughly $30,000.

 

00:30:31.030 — 00:30:32.030 · Grace

Yeah. Roughly 30.

 

00:30:32.070 — 00:30:36.150 · Ramit

Let’s make it 52. Okay, pets. What is this number?

 

00:30:37.030 — 00:30:41.310 · Grace

It’s a lot of different things. Um, I can parse it all out for you, but it’s a lot.

 

00:30:41.350 — 00:30:43.350 · Ramit

$735 a month on pets.

 

00:30:43.390 — 00:30:57.830 · Grace

Yes, we have the cutest little dachshunds in the world, but one of them has chronic two. Okay, chronic pancreatitis. And so he has a very special diet and probiotic and medicine that he has to take in order to be okay.

 

00:30:57.870 — 00:31:07.400 · Ramit

All right. Subscriptions are at 167, which include I like that you listed these off Spotify streaming fitness iCloud Coopers. What’s Cooper’s.

 

00:31:07.440 — 00:31:08.520 · Grace

Cooper talk.

 

00:31:08.880 — 00:31:09.320 · Ramit

Huh.

 

00:31:09.360 — 00:31:13.640 · Grace

It’s a winery. It’s $20 a month. Okay. But it’s. Yeah.

 

00:31:13.680 — 00:31:19.320 · Ramit

All right. You’re in for a quite a bit of changes under my guidance. Hey, buddy. What’s that?

 

00:31:19.360 — 00:31:22.720 · Grace

That’s our dog. Like, if your dog gets lost, it’s their little tracker.

 

00:31:22.760 — 00:31:32.200 · Ramit

Okay. Ring camera, Amazon Prime. Fine. Um, grace wellness, which includes a GLP one and hair extensions. Yeah. Okay. And that’s 662 per month.

 

00:31:32.240 — 00:31:32.680 · Grace

Yeah.

 

00:31:32.720 — 00:32:05.570 · Ramit

Cleaning service and therapy is 280 a month. And then miscellaneous, which CSP automatically adds 15% is 903. I actually think that is completely accurate and potentially even under, because of all the things you mentioned that you are not currently counting. All right. So you all are at $7,868 per month.

 

And just to reflect, you have less than one month’s worth of savings as a couple with no kids. Very low housing costs who make $112,000 gross per year. Chris, what are you hearing right now.

 

00:32:05.890 — 00:32:09.330 · Chris

That we both might have a little bit of a lack of knowledge? Yes.

 

00:32:09.370 — 00:32:16.370 · Ramit

Um, because you’ve said multiple times today. Well, she’s really smart at this stuff. She knows these numbers. Does this sound like that?

 

00:32:16.490 — 00:32:17.170 · Chris

No.

 

00:32:17.490 — 00:32:19.250 · Grace

This is blind leading the blind here.

 

00:32:19.290 — 00:32:22.450 · Ramit

I think that’s a really apt way. Yeah, not to be insulting.

 

00:32:22.490 — 00:32:23.970 · Grace

No, I feel that way.

 

00:32:24.010 — 00:32:41.050 · Ramit

Yeah. Avoiders do this. They use a series of conscious and unconscious techniques to avoid engaging with money. And one of them is they say, well, my partner’s just good at this. They’re smart. I’m not so good with numbers. You are using that phrase to perpetuate this dynamic.

 

00:32:41.170 — 00:32:41.850 · Chris

Yeah.

 

00:32:42.290 — 00:33:05.260 · Ramit

Now, at the same time, grace, the fact that you’ve been unable to say, I don’t know what I’m doing to actually even acknowledge that, like what I’m doing. I’m moving money around 0% transfers 72 months for a car loan. But even acknowledging that activity is not the same as results. But you’ve got to be able to acknowledge it and then ask for help.

 

00:33:05.300 — 00:33:16.660 · Grace

I’ve tried and it’s usually met with, I know I just need to get a different job and then the conversation goes nowhere. So that’s why I’m here. I’m like, I don’t know. I don’t know what else to do anymore. I don’t know how to ask for help. I don’t.

 

00:33:16.700 — 00:33:36.980 · Ramit

I’m glad you’re here. I’m going to try to help unravel some of this, but I just want to point out the language you’re even using. I’ve tried to have the conversation for something as important as we are going broke. I don’t try anything. I make it happen. Chris, are you hearing this? What’s going through your head right now.

 

00:33:37.380 — 00:33:57.790 · Chris

That I need to stop shoving it all on her and start. And I need to start taking responsibility. How would you do it? But instead of just sitting behind her, maybe saying, oh, I let me at least try and handle this myself, or let me do it with you instead of just sitting there and watching.

 

00:33:57.830 — 00:33:59.790 · Ramit

What about actually doing it?

 

00:33:59.830 — 00:34:02.510 · Chris

Yeah, give it a try. See how it goes.

 

00:34:02.670 — 00:34:55.760 · Ramit

You all mentioned you want to have kids, right? Yeah. When you’re a kid, um, tries to, you know, read. Are they going to be good at reading? No, they’re going to be horrible. They can’t read a single letter. They don’t know anything. So are you going to say, ah. Uh, mommy’s better at reading, so let her do it.

 

No, no, that’d be absurd. Yeah, yeah, we do it all the time as adults with money. We are bad at money when we start doing it. Of course we are. Like anything else. Playing basketball, cooking any of it. Now, cooking. You might be able to get away with it because you’re just like, ah, we don’t care, Ramon. Whatever.

 

Okay, fine. But money is unlike that. Money isn’t like we’re going to have to eat ramen noodles. Money is. We can’t afford to have children, or we might become homeless even though we own our house.

 

00:34:56.919 — 00:34:59.960 · Ramit

That’s why I think it’s different. What’s your assessment?

 

00:35:00.000 — 00:35:02.080 · Chris

I need to make make some changes.

 

00:35:02.280 — 00:35:03.880 · Grace

Yeah, this is pretty dire.

 

00:35:07.160 — 00:35:08.560 · Ramit

Investments are at zero.

 

00:35:09.080 — 00:35:12.840 · Grace

Which zero added to the ones that are there. Sorry.

 

00:35:12.880 — 00:35:18.000 · Ramit

Yeah. You do contribute $136 a month to a 401 K.

 

00:35:18.040 — 00:35:26.480 · Grace

Yes. And then we have maxed out his Roth IRAs for this year. So we put in 7500 for that. So we’re.

 

00:35:26.480 — 00:35:27.160 · Ramit

Not. The money come.

 

00:35:27.160 — 00:35:33.880 · Grace

From the passing of my grandmother. I inherited some things until that’s what a lot of our investments are, is o money.

 

00:35:34.000 — 00:35:36.960 · Ramit

I was wondering, okay, so how much did you inherit?

 

00:35:37.000 — 00:35:38.800 · Grace

I think it was like 80.

 

00:35:38.840 — 00:35:41.520 · Ramit

And you put some of it into investments.

 

00:35:41.880 — 00:35:45.760 · Grace

Okay. And then started a retirement because he doesn’t have any. Through his career, I see.

 

00:35:45.840 — 00:35:47.120 · Ramit

And the house.

 

00:35:47.920 — 00:35:50.050 · Grace

Uh, we own joint tenancy. So it’s.

 

00:35:50.250 — 00:35:50.850 · Ramit

So false to.

 

00:35:50.850 — 00:35:51.570 · Grace

You. Yeah. False.

 

00:35:51.930 — 00:35:56.770 · Ramit

Okay. So you had 80. Where did the rest of this investments of 119 come from?

 

00:35:56.810 — 00:36:01.410 · Grace

Um, that’s including my retirement that I already have and then his retirement that we put in.

 

00:36:01.410 — 00:36:06.770 · Ramit

So a lot of the investments. Well, it’s real money. And it’s your money. It came from an inheritance.

 

00:36:06.810 — 00:36:07.450 · Grace

Correct.

 

00:36:07.490 — 00:36:08.650 · Ramit

What does that tell you?

 

00:36:09.890 — 00:36:33.370 · Ramit

You’re not properly investing? No, not for your income at $112,000. And we can see that because you’re contributing zero per month post-tax going on to savings at zero as well. And then finally guilt free spending at -13%, which we know is not true because you all are spending guilt free spending, including ball games.

 

What else do you spend money on?

 

00:36:33.370 — 00:36:34.210 · Chris

Dinners?

 

00:36:34.250 — 00:36:41.770 · Grace

Yeah, his family’s very social. So we go to a lot of events, like we just spend a lot of time with his family and they like to do things. So we go here.

 

00:36:41.970 — 00:36:43.410 · Ramit

Ball game, eat out. What else?

 

00:36:43.450 — 00:36:44.450 · Grace

Wine walks.

 

00:36:44.570 — 00:36:46.730 · Ramit

What’s that? What’s a wine walk?

 

00:36:46.770 — 00:36:47.380 · Chris

It’s like.

 

00:36:48.100 — 00:36:49.500 · Grace

Really fun. They don’t have them here.

 

00:36:49.540 — 00:36:49.940 · Ramit

No.

 

00:36:49.980 — 00:36:59.500 · Grace

Like they’re so cool towns. You literally get a lanyard with a wine, like a wine glass around your neck, and you get to go between shops and they give you a little taste of wine, and it’s really coolest thing.

 

00:36:59.540 — 00:37:01.580 · Ramit

And does it cost to get in or do you pay?

 

00:37:01.620 — 00:37:02.860 · Grace

Yeah. It’s like 50 bucks.

 

00:37:02.900 — 00:37:06.660 · Ramit

All right. Y’all are 29 and 30. I wouldn’t blame you for going out and having fun.

 

00:37:06.700 — 00:37:07.700 · Grace

We enjoy them.

 

00:37:07.820 — 00:37:09.420 · Chris

All right, I have fun.

 

00:37:09.820 — 00:37:13.460 · Ramit

Okay. What else um, do you spend money on?

 

00:37:13.460 — 00:37:20.940 · Grace

I will be transparent. I spend a lot of money on clothes. Lately, my body has changed a lot. I’ve lost a lot of weight recently, so I’ve had to buy a lot of clothes lately.

 

00:37:20.980 — 00:37:23.940 · Ramit

What are some of the shops that you shop at or places online?

 

00:37:23.980 — 00:37:25.220 · Grace

I love Amazon.

 

00:37:26.180 — 00:37:28.340 · Ramit

And how many clothes are we talking about?

 

00:37:28.380 — 00:37:31.700 · Grace

Probably more than I could ever imagine because I don’t really keep track of it.

 

00:37:31.700 — 00:37:37.100 · Ramit

Chris, you mentioned Amazon boxes earlier. Yeah. How many of those boxes are coming in the house?

 

00:37:37.260 — 00:37:38.820 · Chris

Like multiple

 

00:37:40.260 — 00:37:47.710 · Chris

weekly? When we left to come here, I opened the door and there was like three things on the front step. Okay.

 

00:37:47.790 — 00:38:01.550 · Ramit

What I want to know is eating out. Yeah, I just want a quick number off the top of your head. No calculation needed. Eating out, including coffee, lunch, dinner, breakfast, any of it. How many times a week do you think that the two of you eat out?

 

00:38:01.590 — 00:38:02.510 · Grace

Uh, twice.

 

00:38:02.510 — 00:39:19.280 · Ramit

Twice. Okay, Chris. Quick number like, three, three times. Okay, great. Welcome to another episode of Raw Meat City’s lore of eating out, where people tell me that they think they only ate out three times a week. And the answer turns out to be at least three times higher than whatever they told me. You’ve heard me do this on the podcast before, and I love this.

 

I ran Grace and Chris through my little audit. What did you all eat for Sunday breakfast? What about for dinner? What about for coffee? And the number we landed on was not to like Grace guest. It was not three. Like Chris suggested. It wasn’t five, 10 or 12. It was 15. What the hell is wrong with you, America?

 

I don’t mind if you eat out a lot. Fine. If you can afford it. And you love it, God bless. But can we stop lying to ourselves? Can we stop saying, oh, I only eat all three times a week, and then by Tuesday, you’ve already eaten out six times a week. Come on, let’s get realistic. I want you to try this exercise yourself.

 

Leave me a comment today on how many times you thought you ate out every week, including coffee, lunch, dinner, breakfast, a snack, brunch, any of it. And then tell me what the total tally is for the week. I bet you’re going to be surprised 15 times per week.

 

00:39:20.440 — 00:39:21.880 · Ramit

What do you make of that?

 

00:39:22.120 — 00:39:22.920 · Grace

Too much?

 

00:39:23.520 — 00:39:30.760 · Chris

Yeah, it’s ridiculous because we’re drowning and we should be making food at home and going to the grocery store.

 

00:39:30.760 — 00:39:34.880 · Ramit

And anybody surprised by the fact that you thought it was twice a week and it’s actually 15?

 

00:39:34.920 — 00:39:38.480 · Grace

Uh, not surprised. No. I had a feeling that I was not a good estimate.

 

00:39:38.520 — 00:39:40.240 · Ramit

What? What do you make of this?

 

00:39:40.240 — 00:39:43.610 · Chris

That it’s probably more than that, too, because I, I get lunch.

 

00:39:43.690 — 00:39:48.450 · Ramit

You all have concocted a reality that is not real.

 

00:39:48.490 — 00:39:49.010 · Grace

Mhm.

 

00:39:49.170 — 00:40:19.570 · Ramit

We are trying to get to the root of what’s going on here. You eat out 20 times. If we factor in the days you eat out and probably the stuff we didn’t even count. You said two. It’s 20. So you all are spending thousands per month on stuff that we would technically call guilt free. But it’s not. It’s just discretionary.

 

I think we can make some big changes. Please, would you be open to it?

 

00:40:19.610 — 00:40:19.970 · Grace

Very.

 

00:40:20.010 — 00:40:20.970 · Ramit

Yeah. Both.

 

00:40:21.010 — 00:40:22.210 · Grace

Yes, please.

 

00:40:22.330 — 00:40:22.810 · Ramit

I like.

 

00:40:22.810 — 00:40:23.050 · Grace

That.

 

00:40:23.090 — 00:40:34.370 · Ramit

Yeah, I like that energy. Okay. I need to understand how you got here. Chris, what do you remember your family saying about money when you were younger?

 

00:40:34.370 — 00:41:19.860 · Chris

There wasn’t, like, a whole lot of talk about it. We were. I was pretty fortunate growing up. my my dad had a good job. My mom had a good job. We lived in a in a pretty decent size home. How big? Um. 3000. Okay. Ish. Keep going. Square feet. Um. It was my sister. Uh, me and my brother. Um, you know, I, I was able to, you know, play sports, play on the travel teams where, you know, you had to spend a little bit more money to be, you know, to play.

 

And I always got the glove and the baseball bat and the nice basketball shoes. And it was very steady for us. And I really had no, no problems growing up.

 

00:41:19.900 — 00:41:25.780 · Ramit

What money messages do you think you grew up with that you are now bringing to this relationship?

 

00:41:25.820 — 00:41:30.979 · Chris

I didn’t have to worry about it. So I, I guess

 

00:41:32.500 — 00:41:38.350 · Chris

growing up now, I am kind of chill about it and chill.

 

00:41:38.390 — 00:41:38.630 · Ramit

What does.

 

00:41:38.630 — 00:41:48.190 · Chris

That mean? Yeah, I just didn’t have to worry about that growing up. And I feel like that’s a bad trait that I’ve taken as a kid, and it’s.

 

00:41:48.230 — 00:42:11.590 · Ramit

But it’s interesting because the way you describe it is you said it in the first two sentences. You said, I grew up very fortunate. Yes. My parents never talked about money to us. And here you are today, 25 years later, not talking about money, in fact, highly avoidant with money, you’re still not paying attention, just as you didn’t pay attention to money when you were a kid.

 

What’s the problem?

 

00:42:11.910 — 00:42:14.870 · Chris

Well, when we say like that, it sounds like there is no problem.

 

00:42:14.950 — 00:42:16.630 · Ramit

There’s no problem for you.

 

00:42:16.670 — 00:42:17.350 · Chris

Yeah.

 

00:42:17.590 — 00:42:19.830 · Ramit

Who has the problem?

 

00:42:19.950 — 00:42:20.790 · Chris

My wife.

 

00:42:20.950 — 00:42:25.470 · Ramit

Yes. And if your wife has a problem, then who else has a problem?

 

00:42:25.630 — 00:42:26.430 · Chris

Us together?

 

00:42:26.470 — 00:42:26.950 · Ramit

Yes.

 

00:42:26.990 — 00:42:29.670 · Chris

So then I have the problem? Yes as well.

 

00:42:29.710 — 00:44:31.790 · Ramit

Yes. If I were you, I might reinterpret the way I was raised. Which is? Look, my parents were awesome. They did the best they could. They gave us a great childhood. However, they never talked about money and that has actually really cost me a lot. I never had to pay attention. I never even knew it was a thing.

 

And now, as an adult, I’m struggling to actually care about money, to talk about money. My wife is telling me she feels like she’s on a sinking ship. And I think back, I wish my parents had talked about it, and I wish I had taken a little bit more interest in it. Do you see how reinterpreting your narrative, whether it’s your childhood or adult life, can dramatically change the way that you look at today?

 

Yeah, yeah, I thought it was really interesting when Chris said I was really fortunate. Growing up, my parents never talked about money, as if the two go hand in hand, as if talking about money is a bad thing, because the only way to talk about money is if you are worried about it. Look at my face. Do I look like I’m worried about money?

 

No. I get the opportunity to talk about it. Money means, oh, I can buy a new phone. Money means I can take a trip or buy some Doritos. Money is not simply a source of stress and overwhelming guilt, but that is the invisible script going on here. Now, not surprisingly, Chris did not talk about money, fortunately.

 

And guess what? He doesn’t talk about money today because just like his childhood, somebody else manages it. Both of them have been subsidized in one way or another. There’s inheritance. There’s a home. There’s somebody taking care of the money. And when you are subsidized, it becomes very difficult for you to live in reality and to understand what it would be like to have to do things on your very own.

 

That’s why this conversation is proving so challenging right now. Grace, what do you remember your family saying about money when you were young.

 

00:44:32.150 — 00:45:09.030 · Grace

Um, there wasn’t much talk of it when I was young. We didn’t have a lot of it. My. I grew up with a single mom. Um, there were times in my life where feeding or, you know, paying our our babysitter with food out of our fridge. Like, it was pretty, um, dire in different ways. I was a student that was provided free lunch at school because I, you know, we didn’t have the money.

 

My mom worked her tail off three jobs. Single mom. Um, so money was not prevalent. She say she really didn’t talk about it much. I think she really tried to be a protector of keeping adult problems and adult problem and not talking about it with a little kid.

 

00:45:09.030 — 00:45:10.110 · Ramit

You grew up in the Midwest?

 

00:45:10.150 — 00:45:11.950 · Grace

Yeah. Um, um.

 

00:45:12.750 — 00:45:14.950 · Ramit

How many siblings I have?

 

00:45:14.990 — 00:45:23.390 · Grace

Well, so growing up at that time. So my mom got remarried and then that kind of shifted. Also my financial experience, too. Um, but when I was little, I just have one full sibling.

 

00:45:23.390 — 00:45:28.950 · Ramit

One sibling. And then you mentioned your mom got remarried. What age were you when she got remarried?

 

00:45:28.990 — 00:45:37.520 · Grace

I was ten and my wonderful stepfather, he has a great job and he moved us, you know, to a nice home, a nice area and.

 

00:45:37.920 — 00:45:54.360 · Ramit

Then take me through that moment. So you were financially struggling until the age of ten, and then suddenly your stepdad has a stable job, etc.. What was that experience like for you?

 

00:45:54.440 — 00:46:06.360 · Grace

Like total 180, it was like, oh, I can I can play sports. I can be I can afford to be a cheerleader and take these gymnastics classes and I, I can buy clothes and I don’t have to take hand-me-downs from people. And what did it feel like?

 

00:46:07.560 — 00:46:11.080 · Grace

Exciting. Um. Like secure.

 

00:46:11.680 — 00:46:12.120 · Ramit

What does that.

 

00:46:12.120 — 00:46:17.600 · Grace

Mean? Um, just that I wasn’t stressed or worried about that my needs to be met.

 

00:46:18.000 — 00:46:18.440 · Ramit

Were you?

 

00:46:18.440 — 00:46:34.210 · Grace

Before I knew she was gone a lot, I you could, you know, you could kind of read between the lines. You’re intuitive. And I think I knew that, you know, you’re like, why is my mom have so many jobs? And why is she gone all the time? And why does someone have to watch me? So, you know, you kind of make your own narrative of maybe what’s going on.

 

00:46:34.250 — 00:46:34.610 · Ramit

What was the.

 

00:46:34.610 — 00:46:39.970 · Grace

Narrative? Um, just that life was hard, and my mom needed to work a lot to make ends meet.

 

00:46:40.290 — 00:46:49.890 · Ramit

So when your mom remarries, you feel more secure. You’re able to participate in school activities. What happens in your teenage years with money?

 

00:46:50.050 — 00:47:02.610 · Grace

You know, my parents are divorced, and so I never lived with my dad, so I’m not sure. Like, I know their financial aspect is a little different. But in the household I grew up, I never I never really wanted for anything. I never felt deprived of something that I needed.

 

00:47:03.010 — 00:47:09.250 · Ramit

Um, is your mom and stepdad still together or are they separated? They are. Okay. How are they doing with money?

 

00:47:09.330 — 00:47:10.889 · Grace

I don’t know, we don’t talk about it

 

00:47:11.930 — 00:47:14.210 · Grace

at all. Not really. Okay. No.

 

00:47:14.330 — 00:47:18.210 · Ramit

Okay. Got it. Did you go to college? Yes. How did you pay for that?

 

00:47:18.250 — 00:47:27.340 · Grace

Um. I was very fortunate. My grandfather and my grandmother, um, had an inheritance for or like, a college fund for each of the cousins. Oh, yeah. We were.

 

00:47:27.500 — 00:47:29.860 · Ramit

What did they do to have all this inheritance? Quite impressive.

 

00:47:30.300 — 00:47:33.580 · Grace

Um, my grandfather was a fantastic architect. Wow. Yeah.

 

00:47:33.620 — 00:47:38.900 · Ramit

And he and your grandmother. Seems like they saved and invested a whole bunch to be created.

 

00:47:39.260 — 00:47:41.460 · Grace

Trusts? Yes. Wow. Yeah.

 

00:47:41.500 — 00:47:45.780 · Ramit

Um, so they paid for your college. Do you know how much approximately that cost?

 

00:47:45.820 — 00:47:52.140 · Grace

Um, well, my undergrad and my grad school in total was probably about $230,000.

 

00:47:52.180 — 00:47:55.140 · Ramit

Whoa. Yeah, that’s a quite a gift.

 

00:47:55.180 — 00:48:03.060 · Grace

Uh, and I don’t even have words to explain the gift. Yeah. Okay. Like, I am beyond lucky to have had that privilege. Yeah.

 

00:48:03.500 — 00:48:13.540 · Ramit

Do you take anything away from the example that your grandparents set by being able to give this money? Multiple generations later?

 

00:48:13.580 — 00:48:29.350 · Grace

I would love to do that. I have no idea how they managed it. Yeah. They seem to have had it really well figured out. My grandfather and my grandmother were very, um, smart with their finances. And I wish prior to their passing, I had taken more time to understand that.

 

00:48:29.390 — 00:48:31.910 · Ramit

Are you having those conversations in this relationship?

 

00:48:31.950 — 00:48:36.190 · Grace

No. I would like to be, but I don’t know how to start them.

 

00:48:36.510 — 00:48:40.150 · Ramit

Grace, what messages do you bring from childhood to this relationship?

 

00:48:40.350 — 00:48:43.070 · Grace

I think it was. It’ll all work itself out.

 

00:48:43.110 — 00:48:43.550 · Ramit

Mhm.

 

00:48:44.230 — 00:48:46.790 · Grace

Um, so it’ll all be fine. You know, it.

 

00:48:46.950 — 00:48:49.670 · Ramit

It is fine when Mom and Dad are the ones doing it.

 

00:48:49.790 — 00:48:50.470 · Grace

Yeah.

 

00:48:50.510 — 00:48:54.270 · Ramit

And you mentioned your mom was the protector when it comes to money.

 

00:48:54.310 — 00:49:03.230 · Grace

Yeah. I think she just. She put her head down and worked her tail off and was like, I don’t want my kids to see me struggle, and I’m going to make happen what I need to make happen for them.

 

00:49:03.270 — 00:49:05.790 · Ramit

Who’s the protector in this relationship when it comes to money?

 

00:49:06.070 — 00:49:06.749 · Grace

Me

 

00:49:08.110 — 00:49:09.390 · Grace

maybe I don’t know.

 

00:49:09.430 — 00:49:09.990 · Ramit

Yes.

 

00:49:09.990 — 00:49:13.390 · Grace

I think I’m shielding him from having to know the struggle of it.

 

00:49:13.430 — 00:49:14.110 · Ramit

Yes.

 

00:49:15.230 — 00:49:16.710 · Grace

God, you’re good at that.

 

00:49:18.310 — 00:49:19.950 · Grace

Yeah. No, that makes sense.

 

00:49:19.990 — 00:49:25.320 · Ramit

And when your mom protected you from money? What was she doing in the moment?

 

00:49:25.360 — 00:49:27.040 · Grace

I think the intention was good.

 

00:49:27.080 — 00:49:28.000 · Ramit

Which was.

 

00:49:28.280 — 00:49:34.720 · Grace

To not feel the stress or the pain of, you know, struggling.

 

00:49:35.000 — 00:49:37.920 · Ramit

Because she doesn’t like to see people she loves struggle.

 

00:49:37.960 — 00:49:40.400 · Grace

Or be uncomfortable, which is what I don’t like.

 

00:49:40.680 — 00:49:41.120 · Ramit

Hmm.

 

00:49:41.160 — 00:49:44.040 · Grace

And I don’t want him to struggle or be uncomfortable.

 

00:49:44.120 — 00:49:54.080 · Ramit

Maybe I’ll can do this with your kids, huh? Not see them struggle and not see them be uncomfortable. And then when they grow up, they can do it to their partners. And then for five generations, we can just carry this.

 

00:49:54.080 — 00:49:55.720 · Grace

No no no no no. Huh?

 

00:49:55.760 — 00:49:56.960 · Ramit

No no no no

 

00:49:58.160 — 00:50:07.600 · Ramit

1. Wow. Chris, what was that? That was like a real gangster attitude right there. No. Thanks. Motherfucker. Where did that come out of?

 

00:50:08.480 — 00:50:12.080 · Chris

We just gotta. We gotta break the cycle. Yeah, gotta break the cycle.

 

00:50:12.120 — 00:50:12.560 · Ramit

What cycle?

 

00:50:12.560 — 00:50:20.370 · Chris

Though? The talking about money. Talking about uncomfortable things. Being okay with being uncomfortable. I hate being uncomfortable.

 

00:50:20.370 — 00:50:56.770 · Ramit

So you’re willing to do it? Yeah, well, you are being uncomfortable by being here right now, I could tell. Yeah, 100%. And I appreciate that. This is not easy for anybody. So you are ready to change the cycle. Like that. Really that power you had when you said no, that spoke to me for the first time. It’s amazing, Chris, that you are willing to kind of let this dynamic persist, the one where you don’t talk about money, etc. but when it comes to a future child that’s not even born yet, you are fierce about it.

 

Not continuing.

 

00:50:56.770 — 00:50:59.250 · Grace

That is a conversation that we’ve had. Yeah.

 

00:50:59.290 — 00:51:01.010 · Ramit

Yes, you have had it with him.

 

00:51:01.010 — 00:51:12.410 · Grace

Yes. Because that’s my thing, is this is the only other thing we dispute about is like, why are you ready to make the changes when a child is here? But why can we not make them ahead of time to set ourselves up for that?

 

00:51:12.450 — 00:51:16.650 · Ramit

Okay. And have you said this is what I need before we have kids?

 

00:51:17.090 — 00:51:26.500 · Grace

I don’t know what I need. I don’t know. And I think that’s part of it too, is why we’re here. I need to figure out what I need for that to. For that to feel okay and ready.

 

00:51:26.540 — 00:51:27.500 · Ramit

You want to do it right now?

 

00:51:27.540 — 00:51:28.140 · Grace

Sure.

 

00:51:28.980 — 00:51:30.060 · Ramit

Yeah. Time like the present?

 

00:51:30.100 — 00:51:30.660 · Grace

Yeah. Yeah.

 

00:51:30.700 — 00:51:34.780 · Ramit

Hey, I don’t like homework anyway. I might as well just do it now. What do you think?

 

00:51:34.820 — 00:51:35.300 · Grace

That’s all I have.

 

00:51:35.500 — 00:51:51.260 · Ramit

By the way. Sorry. Correction for America. I don’t like homework. For me, as a 43 year old man who dominated homework for the kids. You get the homework and you better do it. We’re going to find out what you both want and need. Have you ever talked about what your rich life is?

 

00:51:53.500 — 00:51:54.620 · Ramit

No. Okay.

 

00:51:54.900 — 00:51:56.020 · Grace

Well, I mean.

 

00:51:56.060 — 00:51:59.220 · Ramit

People who have talked about their rich life, they answer like that.

 

00:51:59.260 — 00:52:00.860 · Chris

Vaguely. What’s a rich life?

 

00:52:01.100 — 00:52:02.100 · Ramit

You tell me.

 

00:52:02.500 — 00:52:20.830 · Chris

Because my my rich life. I don’t want to be. I don’t need to be a millionaire. I don’t need to be a trillionaire. I just need to be able to be stable enough to have a family. Okay. Do you know? Do things when we get asked to or if we want to on the weekends with family and friends.

 

00:52:20.870 — 00:52:21.750 · Ramit

Be specific.

 

00:52:21.750 — 00:52:27.510 · Chris

I want to make enough money to just be comfortable where we are. I want to have a family.

 

00:52:27.510 — 00:52:32.790 · Ramit

I want to eat out 15 times a week. That’s fine if that’s what you want. Sure. Okay, great.

 

00:52:32.830 — 00:52:33.190 · Chris

That’d be.

 

00:52:33.190 — 00:52:33.870 · Ramit

Great. Great.

 

00:52:33.870 — 00:52:38.830 · Chris

I would love to have for my kids if they say, hey, dad, I want to play this sport great.

 

00:52:38.830 — 00:52:40.950 · Ramit

And you want to give them the same childhood you had?

 

00:52:41.030 — 00:52:41.550 · Chris

Yeah.

 

00:52:41.590 — 00:52:41.910 · Ramit

Okay.

 

00:52:41.950 — 00:52:42.750 · Chris

That would be awesome.

 

00:52:42.750 — 00:52:44.990 · Ramit

That’s it. That’s the rich life.

 

00:52:45.030 — 00:52:46.230 · Chris

That would be awesome.

 

00:52:46.550 — 00:52:54.990 · Ramit

It feels very surface level. It’s literally just a recitation of how you grew up. Like, if you don’t like travel, I’m not forcing you to travel. That’s your life.

 

00:52:54.990 — 00:52:56.550 · Chris

Not like not a big traveler.

 

00:52:56.590 — 00:53:13.389 · Ramit

Food, leisure, convenience. For me to be able to treat my family because they live close by and they like going to a ball game and I gosh, once a year I sure would like to get box seats. That would be a rich life. But what I’m hearing is I want to be able to

 

00:53:14.440 — 00:53:16.960 · Ramit

live a comfortable life. Yeah. That’s boring.

 

00:53:17.000 — 00:53:19.040 · Chris

But that’s. I’m a simple man.

 

00:53:19.080 — 00:53:30.440 · Ramit

What I’m trying to get at is, is there something deeper here? And I think if you just wanted to learn how to save a little bit of money, there’s plenty of places you could have gone. Why did you come here?

 

00:53:30.480 — 00:53:32.000 · Chris

We. We came here.

 

00:53:33.320 — 00:53:41.920 · Chris

Um, because my my wife, she’s she’s new. Who you were and knew what you were about. And her therapist,

 

00:53:43.000 — 00:53:45.520 · Chris

uh, wanted us to check you out.

 

00:53:45.560 — 00:53:52.440 · Ramit

You came here because your wife wanted to come here? Sure. I think that might be the crux of what’s going on here.

 

00:53:52.680 — 00:53:53.640 · Chris

Maybe a little.

 

00:53:53.680 — 00:54:14.970 · Ramit

The avoidance seeps into every part of your life. You’re even avoiding talking about your own rich life. I didn’t care if you came to me and said, I want to buy a $150,000 worth of shoes, I would be like, God bless. Let’s figure out how to do it. But if you can’t even do that. Your rich life. Not even her’s yours.

 

00:54:16.250 — 00:54:28.050 · Ramit

It’s going to be very difficult for you two to make progress together. I want you to think about that. Grace, I want to ask you about your rich life. Actually, before I get to that. What did you notice as I was speaking to Chris about his rich life?

 

00:54:28.130 — 00:54:33.890 · Grace

I think he wants more than he’s saying. Oh, I think he has more rich life ideas that he’s just not saying.

 

00:54:33.890 — 00:54:34.530 · Ramit

Like.

 

00:54:34.570 — 00:54:48.330 · Grace

Like we want to add onto our house and we talk about that and growing, you know, and how he wants like just in more detail. I think he could say in more detail what he wants. I know he says he’s simple, but I think in his head there’s more detail than he’s saying.

 

00:54:49.170 — 00:54:53.250 · Chris

Yeah, sometimes I’m, I, I don’t articulate

 

00:54:54.290 — 00:54:55.210 · Chris

the best.

 

00:54:55.250 — 00:54:59.370 · Ramit

Yeah. I mean, it is nerve wracking here. We got a bunch of lights and all that stuff. Fair enough.

 

00:54:59.410 — 00:55:06.330 · Grace

No, he’s just a man of few words. He has such great ideas and things that he wants. And I just don’t think maybe you describe them in the way that you want.

 

00:55:06.530 — 00:55:08.810 · Ramit

Grace, are you okay being with a man of few words?

 

00:55:09.620 — 00:55:11.180 · Grace

Um, sometimes.

 

00:55:11.180 — 00:55:56.300 · Ramit

Because I’m struggling to find out what your rich life is. And I know how to do this. What I want is change and sometimes grace. The way to do that is to set an expectation and hold the partner accountable. But because you don’t like to see people uncomfortable, you are currently unable to do that. And so you fill the void.

 

All these are just stories you tell yourself. What if you just change that? What if you flipped it? Oh, as of yesterday, I was not good at letting people that I love be uncomfortable. But starting today, I am extremely good. In fact, I love it because I know that every second of their discomfort makes them stronger.

 

Hmm. I wonder if we could just change our narrative. Grace, what’s your British life?

 

00:55:56.340 — 00:56:24.190 · Grace

Um. I love coffee shops and going and trying unique coffee shops, and I would love to go and try as many coffee shops as I want and not worry about how expensive the latte is. We want to fence in our yards, our dogs can run around and we want to put, you know, a play gym or whatever we want to put back there and have an all seasons room.

 

And we want to add on to our primary bedroom. And, you know, so I would love to add on because we do plan to stay in that house. I love, you know, we love our house.

 

00:56:24.190 — 00:56:25.790 · Ramit

Um, what about for the two of you?

 

00:56:26.150 — 00:57:00.110 · Grace

I would love for us to be able to still have date nights after having children. Nice. I would love to, like, really be intentional about intentional about time for like, connection with each other. I would love to be able to afford child care if needed or figure out how to navigate that, like with our families, because we do have families that really want to be involved, which is wonderful.

 

But also if they’re not available, you know, I want to figure that out about how you financially work all those things out. Um, I would I would love to travel. I, I don’t we don’t travel a lot. Um, but if we had the means to travel, I think we would more. Okay.

 

00:57:00.230 — 00:57:01.510 · Ramit

What about for yourself?

 

00:57:01.590 — 00:57:17.240 · Grace

There are some things that are also on our conscious spending plan that I do like that are self-care and that are important to me. So like some of the medications I take are, what I do with my hair. Like that is really important for my overall well-being in mental health. And so those I’d like to keep intact.

 

00:57:17.280 — 00:57:21.920 · Ramit

Great. Chris, what do you hear when she describes her rich life?

 

00:57:22.320 — 00:57:25.440 · Chris

I feel like hers was more like, kind of like home oriented.

 

00:57:25.520 — 00:57:25.960 · Ramit

Mhm.

 

00:57:26.160 — 00:57:31.440 · Chris

Like we we do want to put on a Three Seasons room. We do want to fence the yard. Yep.

 

00:57:31.520 — 00:58:04.650 · Ramit

Like it actually told me a bit of who she is. Yeah. You know what I heard in that was like oh she loves coffee. Okay. That’s interesting. She’s a coffee lover, and she’d like to be able to do date night with the two of you. And then there’s something about childcare and expanding that, like, oh, okay, I kind of get who she is.

 

That’s what I want to know when I ask people about their rich life. If you ask me, I would talk about hotels and travel and convenience and you’d be like, this guy is a little weird, but like, I can tell the kind of guy he is. The more that the two of you are specific about it, the more that we can rework some of your numbers.

 

00:58:04.930 — 00:58:16.290 · Grace

I would also add to love or love to add, if we could afford to have a long service. Yeah, to where they could take care of our landscaping and our Betsy. I like that one. I know that.

 

00:58:16.530 — 00:58:20.010 · Ramit

Chris just goes, yeah, get those long guys out here immediately.

 

00:58:20.050 — 00:58:24.490 · Grace

Talking about he knows it’s in his head. He just doesn’t think to say it. But Chris, we have the same.

 

00:58:24.650 — 00:58:28.130 · Ramit

Kids and lawn care. Is that your thing?

 

00:58:29.610 — 00:58:34.250 · Chris

Yeah, I mean, I, I mow the lawn once a week. I got my little push mower.

 

00:58:34.290 — 00:58:37.490 · Ramit

What age are you gonna make your own kids mow the lawn?

 

00:58:37.530 — 00:58:40.130 · Chris

Maybe, like 17, 18. That’s too.

 

00:58:40.330 — 00:58:52.850 · Ramit

Late. What are you talking about? 17 years old to mow, maybe 16. I thought you were gonna say six. I was like my man now 17 for a push mower, bro. I was out there at, like, age, what, ten, 11? Mowing that.

 

00:58:54.450 — 00:59:26.820 · Ramit

This is honestly pretty hard, especially because they have never faced actual consequences for their financial behavior. Sure, they spend more than they make, but they still have Spotify. They still buy all this cool dog food. So how am I going to get through to them? One thing that I can try to do is show them what is reasonably likely to happen if they make no changes.

 

I don’t know if it’s going to really land or not. I’m going to try my best. If nothing changes in your finances, if nothing changes in the way that you communicate, what’s going to happen?

 

00:59:26.860 — 00:59:32.820 · Chris

She’s going to keep looking away. I’m going to keep looking away. We’re not going to be on the same page.

 

00:59:32.860 — 00:59:33.300 · Ramit

And then.

 

00:59:33.300 — 00:59:37.540 · Chris

And then we’re going to be broke.

 

00:59:37.860 — 00:59:38.780 · Ramit

And then.

 

00:59:39.420 — 00:59:39.700 · Chris

That’s.

 

00:59:39.700 — 00:59:44.780 · Ramit

It. No. Keep going. It’s important that you actually understand what’s at stake here.

 

00:59:44.780 — 00:59:55.700 · Chris

And then I’ll probably have to sell the house. Yes. And then sell everything and get rid of everything until there’s nothing left. And then you have nothing. Yeah.

 

00:59:56.380 — 00:59:58.220 · Ramit

How would that affect your relationship?

 

00:59:58.780 — 01:00:06.590 · Chris

Terribly. I never. I mean, I’m not going anywhere with her, but I’m sure it would be not ideal.

 

01:00:06.710 — 01:00:24.830 · Ramit

Is it possible that the environment you grew up in was not particularly healthy for money, even though you all had a pretty nice upbringing for your entire childhood and after the age of ten? Is it possible you may have had things but you did not learn knowledge?

 

01:00:24.990 — 01:00:26.350 · Chris

100% 100%?

 

01:00:26.390 — 01:00:29.430 · Grace

I mean, I always say like, these are the things I wish they taught you in school.

 

01:00:29.430 — 01:00:35.630 · Ramit

You all are adults now. Mhm. It’s on YouTube. The freaking books are at the public library.

 

01:00:35.670 — 01:00:36.870 · Grace

It’s on my dining room table.

 

01:00:36.910 — 01:00:37.550 · Ramit

Did you read it?

 

01:00:37.590 — 01:00:46.149 · Grace

Not yet. I wanted to read it together, so I haven’t started myself because I figured if I started myself, I would do it all myself. And then

 

01:00:47.430 — 01:00:49.630 · Grace

where? It’s money for couples, not money for one.

 

01:00:49.670 — 01:00:50.950 · Ramit

So did you tell them that?

 

01:00:51.150 — 01:00:55.110 · Grace

I mean, I told them, yes, I’d like to read it, but it didn’t really go past that.

 

01:00:55.510 — 01:01:09.920 · Ramit

Okay, y’all walk around eggshells for the rest of your life, right into being, right into losing the house and the future family that you mentioned about having a child or multiple children. What will they learn about money if nothing changes?

 

01:01:10.400 — 01:01:14.320 · Grace

Not good things, not good habits, not good patterns?

 

01:01:14.480 — 01:01:15.920 · Ramit

Um, what will they learn?

 

01:01:16.920 — 01:01:21.000 · Grace

How to avoid talking about money? How to just hope it all works out?

 

01:01:21.040 — 01:01:21.720 · Ramit

Chris.

 

01:01:22.360 — 01:01:36.120 · Chris

We’re good people. I think our kids are gonna grow up and see that we’re we’re good people. But, like, if we keep going on this path, our kids for sure won’t learn anything.

 

01:01:36.320 — 01:02:06.170 · Ramit

They’ll learn watching the two of you. If nothing changes, moms are the ones who should be freaking out about money. Moms are the ones who try to convince dad to participate, but dad doesn’t want to because dad wants to buy the things he wants. And then mom is the one who figures it out. Not sure if mom’s even good at money though, But we got what we wanted.

 

We were very fortunate. They observed dads are the ones who are carefree, chill, easygoing. How does that strike you?

 

01:02:06.210 — 01:02:07.050 · Grace

Accurate?

 

01:02:07.090 — 01:02:09.170 · Chris

Yeah, very.

 

01:02:09.250 — 01:02:15.610 · Ramit

Y’all want to let your daughter grow up thinking that mom is the one who has to take on all the burden, and dad gets to do whatever he wants.

 

01:02:15.650 — 01:02:16.490 · Grace

Absolutely not.

 

01:02:16.530 — 01:02:17.530 · Ramit

And a son.

 

01:02:17.570 — 01:02:18.170 · Chris

No.

 

01:02:18.650 — 01:02:57.060 · Ramit

No. So let’s change it. We’re going to look at your numbers. Chris, I want you to take a leadership role in this. You all are on the path to losing what you’ve got and potentially having to sell the house in the future. I need you to make changes, and I’m going to give you a little suggestion. Typically, people who are spending more than the 60% I recommend for fixed costs they chip away by.

 

Let’s cut Hulu, let’s cut this, let’s cut that. That’s not going to work in your situation. You can’t. So I want you to actually start with a blank page. And I want you to tell me what do you envision the kind of lifestyle that you want right now? is it can’t be the lifestyle you have.

 

01:02:57.260 — 01:03:07.100 · Chris

I feel like the pets is pretty. Can’t. Can’t mess with that one. Phone’s pretty stable. Maybe take out the Cooper’s Hawk wine subscription.

 

01:03:07.100 — 01:03:08.380 · Ramit

That’s $20.

 

01:03:08.420 — 01:03:08.980 · Chris

Yeah.

 

01:03:09.700 — 01:03:11.420 · Ramit

You want to see what the effect of that is?

 

01:03:11.460 — 01:03:12.340 · Chris

It’s nothing.

 

01:03:12.380 — 01:03:20.340 · Ramit

I’ll just show you. So instead of 60, we’re going to make this 40 and watch this number up here. This 113%. It drops to.

 

01:03:20.820 — 01:03:21.260 · Chris

Nothing.

 

01:03:21.260 — 01:03:24.180 · Ramit

Nothing. Think bigger and move faster.

 

01:03:24.500 — 01:03:35.460 · Chris

The 662 heron GLP one. That’s a kind of a cosmetic thing, but I know it. It makes her happy. But maybe if we take that off the board, something might happen.

 

01:03:35.500 — 01:03:39.340 · Ramit

Ask her, is she willing to make that change? She’s not. Didn’t ask her. How do.

 

01:03:39.340 — 01:03:41.340 · Chris

You know? Are you willing to make that change? No, no.

 

01:03:41.380 — 01:03:41.980 · Ramit

Okay.

 

01:03:42.220 — 01:03:51.380 · Grace

Yeah. I mean, that’s like my mental well-being. Like when you have a condition where hair loss is a thing. Okay. Taking care of that is something important.

 

01:03:51.420 — 01:03:54.710 · Ramit

I was not aware of that. Thank you for clarifying. Let’s keep it.

 

01:03:54.750 — 01:03:55.710 · Grace

Can I take a second?

 

01:03:55.750 — 01:03:56.790 · Ramit

Yeah. Of course.

 

01:03:57.950 — 01:03:59.270 · Ramit

Want to join her? Sure.

 

01:04:01.430 — 01:04:45.310 · Ramit

I don’t mind that my guests sometimes cry. I don’t mind that they get. I don’t even mind that sometimes we have to take a break and they leave the room. Because these are very, very overwhelming feelings to encounter. Chris and Grace are actually discussing money in a way that they have never done before.

 

And yeah, I am pushing because I need them to see the seriousness of this situation. I totally respect and appreciate that she’s taking a second and I want to keep going with them, because discomfort is not necessarily a sign to stop, might just be a sign that things are starting to sink in. Welcome back.

 

Welcome.

 

01:04:46.550 — 01:04:54.920 · Ramit

Okay, I’m glad we got a chance to take a break. How are you both doing? Good, Yeah. Okay. All right. Thank you for letting me know I appreciate that. Was not aware.

 

01:04:54.960 — 01:04:58.880 · Grace

Yeah, because it is a cost. I mean, it is an expense and a cost, and so, like.

 

01:04:58.920 — 01:05:05.080 · Ramit

I appreciate that. Thank you. Okay. Let’s take a look at the numbers. Tell me what you would like to do next.

 

01:05:05.120 — 01:05:10.680 · Chris

Maybe take the cleaning therapy out. It’s 280.

 

01:05:10.920 — 01:05:11.640 · Ramit

Ask her.

 

01:05:12.080 — 01:05:13.200 · Chris

Are you cool to take that out?

 

01:05:13.240 — 01:05:13.800 · Grace

No.

 

01:05:13.840 — 01:05:15.360 · Ramit

Okay. What else?

 

01:05:15.920 — 01:05:18.440 · Chris

Well, the subscriptions are kind of irrelevant.

 

01:05:18.560 — 01:05:19.000 · Ramit

It’s tough.

 

01:05:19.000 — 01:05:19.800 · Chris

Right? Yeah.

 

01:05:19.840 — 01:05:20.440 · Ramit

Okay.

 

01:05:20.680 — 01:05:22.800 · Chris

What would you do? What would you like to do?

 

01:05:23.000 — 01:05:30.240 · Grace

I personally would just be like, okay, then we don’t have gas or, like, we will just take out all the food, money because everything else I don’t.

 

01:05:30.280 — 01:05:32.880 · Ramit

You’re going to take out food before.

 

01:05:32.920 — 01:05:33.400 · Grace

That’s that’s.

 

01:05:33.480 — 01:05:47.320 · Ramit

I just want to point out what you’re saying. No, I want you to hear it out loud. What you just said is we will take out food before we take out a cleaning service, before we take out fitness, Spotify, pets. We’ll take out food.

 

01:05:47.680 — 01:05:49.250 · Grace

Yeah, I’d lower it.

 

01:05:49.490 — 01:05:58.010 · Ramit

You can lower it by $100. Not going to change a thing. What are you realizing? I just gave you the opportunity to cut from 113% to 60%. And you got.

 

01:05:58.050 — 01:05:58.610 · Grace

Nowhere.

 

01:05:58.650 — 01:06:00.570 · Ramit

Nowhere? What are you realizing?

 

01:06:00.810 — 01:06:04.010 · Grace

I’m having a hard time being willing to compromise on this.

 

01:06:04.370 — 01:06:16.530 · Ramit

Flip it from now on, Chris, for the next two minutes, you are completely in charge. I give you carte blanche. Do whatever you want, and she will support you just for the next two minutes. Go ahead.

 

01:06:16.610 — 01:06:21.010 · Chris

Probably the first easy ones would probably be like Spotify streaming.

 

01:06:21.690 — 01:06:22.970 · Ramit

Just tell me the number.

 

01:06:23.330 — 01:06:25.210 · Chris

Oh, maybe, like, cut in half.

 

01:06:25.370 — 01:06:28.050 · Ramit

All right. What else?

 

01:06:28.290 — 01:06:36.970 · Chris

Maybe, like cleaning and therapy. Just scratch that. Okay. Maybe somehow cut groceries and gas in half. No, that’s not really.

 

01:06:36.970 — 01:06:38.330 · Ramit

I’ll cut it for a hundred bucks, though.

 

01:06:38.370 — 01:06:40.410 · Chris

Sure. Maybe. Pets.

 

01:06:40.530 — 01:06:42.010 · Ramit

Yeah. Huh? Cheaper food?

 

01:06:42.050 — 01:06:42.490 · Chris

Yeah.

 

01:06:42.490 — 01:06:43.250 · Ramit

What else?

 

01:06:43.450 — 01:06:44.130 · Chris

That’s about it.

 

01:06:44.170 — 01:06:45.730 · Ramit

All right, so we drop it a hundred.

 

01:06:45.770 — 01:06:46.450 · Chris

Yeah.

 

01:06:46.580 — 01:06:53.020 · Ramit

Remember, you are currently you have a magic wand. You can do anything you want. You have 30 more seconds.

 

01:06:53.300 — 01:06:54.540 · Chris

That’s probably all I could do.

 

01:06:54.580 — 01:06:55.620 · Ramit

All right, so.

 

01:06:55.780 — 01:06:58.340 · Chris

I can’t do anything else. That’s it. Yeah, I can’t.

 

01:06:58.380 — 01:06:59.740 · Ramit

Not because. Why?

 

01:06:59.780 — 01:07:00.420 · Chris

Just can’t.

 

01:07:00.460 — 01:07:22.340 · Ramit

Didn’t you tell me at the beginning? Like I want to be the man of the relationship. And the man is the one who provides. ET cetera. Yeah. In that prototypical way of thinking about life doesn’t demand. Especially when somebody like me is like, you have carte blanche. You could do anything you want. Magic wand.

 

Aren’t they just, like, motherfuck these numbers and they just chop it out? Isn’t that what the man does?

 

01:07:22.500 — 01:07:23.700 · Chris

Yeah, but I can’t do that.

 

01:07:23.740 — 01:07:24.260 · Ramit

Why?

 

01:07:24.780 — 01:07:25.780 · Chris

Because I can’t.

 

01:07:25.820 — 01:07:40.180 · Ramit

Okay, the number is you went from 113 to 104%. You all are broke. That’s simply unsustainable. Yeah. I think what’s happening here is you all want me to do some magic trick for you, when you all are not even willing to make the changes yourself? Is that what’s happening?

 

01:07:40.620 — 01:07:42.260 · Grace

I could see it look like that.

 

01:07:42.380 — 01:07:48.190 · Chris

Scroll down. Take out. You got to take out the GLP one in the hair. Okay.

 

01:07:48.230 — 01:07:48.590 · Ramit

Zero to.

 

01:07:48.630 — 01:07:57.950 · Chris

That out. Um, maybe only like a streaming thing for, like, to watch TV or something. Okay, great. I mean, yeah, I don’t really know what else to do.

 

01:07:57.990 — 01:08:00.990 · Grace

We pay for dog walking services. It’s like.

 

01:08:01.030 — 01:08:01.910 · Chris

Oh, yeah.

 

01:08:01.990 — 01:08:03.870 · Grace

360 a month. What?

 

01:08:04.350 — 01:08:07.990 · Ramit

350 bucks a month for a dog walker out of 635.

 

01:08:08.030 — 01:08:13.750 · Grace

Only three days a week. It’s crazy. Dog walking is expensive. So. So, I mean, in theory, yes. That could.

 

01:08:13.790 — 01:08:14.830 · Chris

I mean, there you go. Okay.

 

01:08:14.830 — 01:08:21.190 · Ramit

Goodbye. Dog walker. All right. You’re at 89%. It’s better. Nice, but not enough.

 

01:08:21.270 — 01:08:22.509 · Chris

What is the number need to be to.

 

01:08:22.509 — 01:08:23.549 · Ramit

Not 60.

 

01:08:23.589 — 01:08:25.830 · Chris

60. Okay.

 

01:08:26.549 — 01:10:26.010 · Ramit

I find this very peculiar phenomenon, especially in self-development, where people are obsessed with finding the perfect book, the perfect coach, the perfect program. And they almost never take a look in the mirror and ask themselves, am I coachable? And that is what I am seeing here. Are they ready to change?

 

I don’t know, but it’s pretty difficult for me to get them to see it. Now that doesn’t mean they are uncatchable forever. We all have parts of our own life right now, today that we are not coachable in, including me. But there has to be a day where if we want to make a big change, we are coachable. So how do you become coachable?

 

It’s hard. It takes practice and most of us have systematically shut that skill set down as we become adults because it’s uncomfortable. It makes us feel bad. I don’t want to do it. I’ll avoid it. Or if the situation comes, I will just lie. Here’s a different way to look at it. One deep acknowledgment that I have a problem and I need to change.

 

No minimization. No equivocation. Second, we need to make a change. Not the world, not somebody else. Not us. Me? I need to make a change. And then third, even the simplest specific tactic. From now on, I am going to ask my partner to lead our money conversations because I have been trying to do it my way and it’s not working.

 

That’s just the basic scratching the surface of how you become more coachable, which is a huge skill to develop. You have to remember you’re at 89% with effectively no mortgage. This is not acceptable. If you had a mortgage, it’s one thing. Even still, it would be unacceptable. You have no mortgage, correct?

 

So where’s the money going? Look, miscellaneous is $809. No way.

 

01:10:27.370 — 01:11:27.260 · Ramit

But no one here said anything. Because both of you fundamentally don’t believe you have control over your money. If I looked at these numbers, I go, give me a machete. I will cut this so aggressively. There’s no way on this planet that we allow $809 in miscellaneous to happen. I’m going to fix it. I’ll go.

 

Okay. Wow. Cool. You’re telling me like that. What are you going to do? We’re going to be in control of our numbers. We’re going to download it every week. We’re going to have a conversation. Oh, wow. We’re going to give ourselves only $100 a month so that this number becomes in control and suddenly we’re down to 79%.

 

Oh, that’s better. But it’s still not enough insurance that needs to be fixed. Chris, I need you to find out about this different job. I need you to find out what’s going to happen. We can afford this for a while, but we cannot afford this for more than six months. What are you going to do? What’s the plan? Give me a report on it.

 

Chris, I need you to take control because I don’t want to be looking over your shoulder. This isn’t the way the two of you talk right now. What do you say instead?

 

01:11:27.660 — 01:11:28.300 · Chris

Nothing.

 

01:11:28.340 — 01:11:33.460 · Ramit

Yeah. In a future like the one I was just describing, where I’m aggressive,

 

01:11:34.940 — 01:11:38.350 · Ramit

how would that ball game conversation have gone differently.

 

01:11:38.590 — 01:11:40.670 · Chris

We probably wouldn’t have even gone, to be honest with you.

 

01:11:40.710 — 01:11:45.470 · Ramit

Bingo. My family calls me, hey, we’re going to the ball game. It’s a special occasion. What would I have said?

 

01:11:45.710 — 01:11:47.190 · Chris

No, thanks. Yeah.

 

01:11:47.470 — 01:11:52.070 · Ramit

I wish I could. I love you guys right now. Finish the sentence for me right now.

 

01:11:52.070 — 01:11:52.990 · Chris

I can’t afford it.

 

01:11:53.030 — 01:12:04.830 · Ramit

Right now, we are prioritizing paying off our debt. Right now, we need to focus on saving money for the two of us. Hard to argue with that. Oh, come on, come on. We love you. It’s okay.

 

01:12:04.910 — 01:12:05.550 · Chris

Yeah.

 

01:12:05.910 — 01:12:06.950 · Ramit

That would have got you right.

 

01:12:06.990 — 01:12:07.670 · Chris

Oh, yeah.

 

01:12:08.550 — 01:12:25.430 · Ramit

But until you can prioritize this relationship, specifically the finances and the connection, you will simply continue sinking underwater. And isn’t that what you described this financial arrangement right now? You said it’s a sinking ship.

 

01:12:26.510 — 01:12:30.990 · Ramit

Finally, where would a expenses for a kid go?

 

01:12:31.790 — 01:12:32.870 · Grace

Great question.

 

01:12:33.310 — 01:12:46.400 · Ramit

Nowhere. There’s no money. We’re not even diapers. Couldn’t even afford that. Much less child care. And all the massive costs that come along with one kid. What’s happening right now? What are you both realizing?

 

01:12:46.440 — 01:12:47.400 · Grace

It’s terrifying.

 

01:12:47.800 — 01:12:50.840 · Chris

Good. Yes. Terrifying. Good.

 

01:12:50.880 — 01:12:51.560 · Grace

Sad?

 

01:12:51.760 — 01:13:00.680 · Ramit

Yes. Notice my reaction? Am I trying to assuage it? Am I trying to make you feel better right now because I don’t like discomfort? No, no. What am I doing?

 

01:13:00.720 — 01:13:01.760 · Grace

Letting me sit in it.

 

01:13:01.800 — 01:13:11.800 · Ramit

Yeah, you earned it. And the only way you change is you realize how close you are to the edge of disaster. I have questions, the debt payments. When are they over?

 

01:13:12.480 — 01:13:22.520 · Grace

Um, some are 12 month and some are 15 months. So some should be over by December and some should be over by March. April of 27.

 

01:13:22.520 — 01:13:56.210 · Ramit

Can we look? I’m just going to zero this out to see what happens. Yeah okay. Fast forwarding you’re down to 61% when that debt is paid off. Wow. That’s pretty amazing. That’s a stark difference, but I want to paint the picture for you at 15 months. If you were to execute this plan flawlessly, which I think is unrealistic, would we all agree?

 

Yep. It would mean that the GLP ones would stop today. Hair extensions would stop today. Eating out. There would be no eating out for 15 months. Pet food cut in half. Does this sound realistic?

 

01:13:56.850 — 01:13:57.250 · Chris

No.

 

01:13:57.250 — 01:13:58.130 · Ramit

Both saying no.

 

01:13:58.130 — 01:13:58.730 · Chris

No.

 

01:13:59.010 — 01:14:00.410 · Ramit

What’s the solution here?

 

01:14:00.650 — 01:14:01.770 · Chris

At least do something.

 

01:14:01.810 — 01:14:23.170 · Grace

We’ve been pretty. The the debt payments are something that have been consistently being paid off. So they are on track to be paid. Okay. Um, in regards to, like, my medicine, that I am almost where I will be stopping anyway. So that will be, um, about $450 a month. That will be cut out soon.

 

01:14:23.570 — 01:14:24.690 · Ramit

What about earning?

 

01:14:24.770 — 01:14:28.010 · Grace

Yeah, I mean, I get an annual increase every year.

 

01:14:28.050 — 01:14:28.730 · Ramit

How much?

 

01:14:28.930 — 01:14:31.460 · Grace

Um, it varies between 3 to 5%.

 

01:14:31.500 — 01:14:33.500 · Ramit

Okay, fine. Chris.

 

01:14:33.660 — 01:14:38.420 · Chris

Bottom line, I would probably just have to switch my eye. Job is mine.

 

01:14:38.460 — 01:14:47.820 · Grace

I didn’t even put this in here, and you’re probably gonna freak out. Um, I have a second job, but it doesn’t bring in a lot of money. It brings in about 8 to 10 grand a year.

 

01:14:47.860 — 01:14:53.340 · Ramit

Oh, wait, that’s pretty good. What? Ten grand is not a lot. That’s a lot of money.

 

01:14:53.380 — 01:15:08.580 · Grace

Well, I use it to pay off all the miscellaneous things and the the inquiries and the stuff you don’t count. So it kind of just sits in an account, and then I pull from it to, like, you know, so I don’t really disperse it anywhere because I try and hold on to it until I.

 

01:15:08.740 — 01:15:16.500 · Ramit

Grace, listen, you’re not managing money effectively. Yeah. And you are not demanding enough of your partner. What are you hearing me say?

 

01:15:16.620 — 01:15:20.380 · Grace

That I am not managing my money effectively, and I’m not demanding enough of my partner.

 

01:15:20.420 — 01:15:23.220 · Ramit

How would you do each of those in turn? Be specific.

 

01:15:23.340 — 01:15:29.670 · Grace

Well, I would start to be more direct in my conversations and in my approach and my tone and my tenacity about it.

 

01:15:29.710 — 01:15:31.230 · Ramit

Yeah. For example.

 

01:15:31.950 — 01:15:38.390 · Grace

Like, hey, we don’t even if we have this $100 left over, we aren’t we are not going to we’re not going to the game.

 

01:15:38.630 — 01:15:39.110 · Ramit

Correct.

 

01:15:39.150 — 01:15:50.070 · Grace

We’re not going to attend that. We are putting like we can go and hang out at the house when they’re done or whenever they get back, but we can’t go to that event or. Yeah, I know the wine walk is for your dad’s birthday, but we we can’t afford it right now.

 

01:15:50.110 — 01:15:54.630 · Ramit

Great. Um, I love that. Chris, how would you receive that?

 

01:15:55.110 — 01:16:03.790 · Chris

Probably not. Well, to be honest with you, but seeing this, like there just needs to be a change, or else we’re just not going to survive.

 

01:16:03.830 — 01:16:16.110 · Ramit

So, yes, I appreciate your honesty. Actually, that’s pretty cool of you to just be like, yeah, I wouldn’t take it. Well, nobody does the first few times. And let me give you a little suggestion as to how to get to the point where you do receive it. Well,

 

01:16:17.270 — 01:17:11.400 · Ramit

if the two of you continue individually, then if you try to make a change, you are each going to invisibly tug like a tug of war. and it will be impossible to change. You will go right back to the way you were. So like or like, I’ll just do this for three more months. It’ll be fine. Oh, the dogs are so cute. We can’t do that.

 

What if they don’t like the food, etc.? The beers. Oh, come on, it’s just my dad’s birthday. It’s once a year and you will resent each other. It’s horrible place to be. What the two of you need to do is to find a vision together. Where you are both like, this is what we’re doing. The outside world is not relevant to us.

 

We are the most important ones here because if we don’t do this, we’re going to be stuck in this forever, and then we’re going to pass it on to our kids. For the one to third generation and maybe more, you have to find your why. That’s why I talk about a rich life. You can get there in 15 months, maybe sooner. Thoughts?

 

01:17:11.480 — 01:17:12.680 · Grace

That sounds good to me.

 

01:17:12.720 — 01:17:15.000 · Chris

Yeah, that sounds great. We just gotta stick to it.

 

01:17:15.240 — 01:17:16.600 · Ramit

How are you gonna do that?

 

01:17:18.920 — 01:17:27.650 · Ramit

A lot of silence here. What’s happening? Remember, I’m here to support you. I’m not here to tell you to do something you don’t want to do. Grace, what’s going through your head right now?

 

01:17:27.690 — 01:17:41.690 · Grace

I’m having a hard time with the idea of cutting and thinking about the fixed costs and the thing. Like, I, I think that I’ve tried to eliminate things as much as I could thus far without making my life miserable.

 

01:17:43.050 — 01:17:51.370 · Grace

Like, those things are all to me. Things that that keep me okay in life. I think I’m overwhelmed.

 

01:17:51.410 — 01:17:58.770 · Ramit

Yeah, yeah, that’s pretty self-aware to to be able to call that. Chris, how about you?

 

01:17:58.890 — 01:18:15.890 · Chris

Yeah, it’s it’s very eye opening. I would say just not really realizing kind of what the situation was at hand. Yeah. Um, so yeah, I think it’s just very eye opening and like actually kind of diagnosing what’s actually going on.

 

01:18:15.930 — 01:18:21.250 · Ramit

Yeah. What would you say you see as the diagnosis, what is going on here.

 

01:18:21.290 — 01:18:31.140 · Chris

We have a lot of high costs at the price that we, you know, can’t really afford. Mhm. Kind of bottom line.

 

01:18:31.180 — 01:19:08.700 · Grace

I think it’s apparent that we just avoid it and we just kind of dance around the bush all the time, but never really get close to it. You know it’s like a yeah we just are like well you know it’ll be fine. It’s all, you know, touch it and it won’t hurt you, you know, and you just kind of hope that it’ll all work itself out because seemingly it has.

 

Quote unquote. Right. Like, haven’t lost our house yet. So, you know, and I have like my second job and that brings in, you know, and then that’s that kind of sits on the side. So I’m like, okay, that subsidizes whatever I can account for. So I’ll just, you know, until I, you mentally convince yourself that you’ve got it handled and you don’t have it handled.

 

01:19:08.740 — 01:19:09.140 · Ramit

Yeah.

 

01:19:09.140 — 01:19:26.750 · Grace

So I think I just realized that I thought I was more involved than it and taking care of it than I really am. Um, and this is what I’d hope to get out of it, too, that it shined light on, like my patterns and my behaviors that I think I have under control, but clearly not. And, um, bringing awareness to that.

 

01:19:26.790 — 01:20:45.800 · Ramit

I actually love realizing that I have been doing something wrong. When you’re not getting the outcomes you want and you’re like, God, what’s wrong? Is it me? Am I is there something genetic? And then somebody comes along and says, like, let’s break down exactly what you’re doing. Oh, you thought you’re eating out twice a week.

 

You’re eating out 20 times a week. You thought you were spending this much, but you actually did not include XYZ, ABC. And you go, oh, it actually all makes sense. Not that it’s good, but at least it makes sense because once something makes sense, then you can start to make changes. Mm. You might be wondering why I did not get to how much they’re going to have in retirement, or even contributing to their investments.

 

That’s intentional because we couldn’t even get fixed costs below 100% for me to talk about investments 30 years from now would be absolutely pointless. In fact, it would be an escape valve for them to focus on something else instead of the problem of their house burning right now. That’s why I didn’t talk about that stuff.

 

Sometimes you got to focus on what is in front of you and nail that before you can go to the next step and the next and the next. Based on what we’ve talked about today, what do you think you are going to do?

 

01:20:47.000 — 01:21:48.090 · Grace

Um, I think prioritizing getting that debt paid down. Um, I think figuring out where we can flex costs. So like, for example, like in maybe we flex how much the dog care is, I look into other, um, options for his food, if that’s possible, eventually taking at least the GLP one part of my wellness bracket off increasing income would be nice.

 

Like in summer, I’m off on summer, so maybe I can take on more hours at the barn. I actually do make a better hourly rate there than I do at my current job. It’s just the. The hours aren’t there, so at least in the summer the hours are available. Um, so maybe I could do that to bring in some more income. Really? Actually trying to sit down and look at, I want to, like, actually understand how much we spend on gas and what that really is a month and actually do the numbers.

 

I also would like to look more into how much we really are eating out and like what we actually are doing, because I think like we just do it and it goes into the cloud and you think it never happened.

 

01:21:48.130 — 01:21:48.810 · Chris

Chris.

 

01:21:49.130 — 01:21:50.170 · Ramit

What about you?

 

01:21:50.210 — 01:22:19.140 · Chris

I just think trying to cut down where we can. Um, I think a big one will be me with the insurance that’ll kind of cut, cut down costs for us. And I know we can’t cut it all back. That’s not, like, totally realistic. But when me and her go home, we’re definitely going to start looking at things together and, you know, trying to figure out where we can and can’t Canton trying to come up with a plan for that.

 

So. Okay.

 

01:22:19.180 — 01:22:25.620 · Grace

Is that a more regular time that we talk with each other? Would that be like a Thursday evening or something?

 

01:22:25.780 — 01:22:27.580 · Ramit

Okay. What are you going to do in this meeting?

 

01:22:27.980 — 01:22:29.660 · Grace

First, we should read your book.

 

01:22:30.020 — 01:22:30.660 · Chris

Yeah.

 

01:22:30.700 — 01:22:33.020 · Grace

Start with reading the book and follow the steps.

 

01:22:33.060 — 01:22:35.660 · Ramit

Maybe that’s part of the meeting. Yeah, yeah.

 

01:22:35.780 — 01:22:44.660 · Chris

I think we could read a chapter and then kind of reflect on it. So, like, what did you learn? What did you learn? What are any ideas from this or any ideas from there. And just I like it. Collaborate.

 

01:22:44.660 — 01:22:48.660 · Ramit

So you’re going to come to the meeting both having read chapter one. Yeah.

 

01:22:48.700 — 01:22:49.700 · Grace

Like a book club.

 

01:22:49.740 — 01:22:54.980 · Ramit

It’s a book club. But the two, you’re going to be having these meetings probably for the rest of your life.

 

01:22:55.060 — 01:22:55.740 · Grace

I hope so.

 

01:22:56.060 — 01:22:56.380 · Chris

Yeah.

 

01:22:56.420 — 01:22:56.940 · Ramit

Great.

 

01:22:56.940 — 01:22:58.540 · Grace

I would like to talk about this frequently.

 

01:22:58.540 — 01:24:17.080 · Ramit

I like your reactions, so let’s find a way to enjoy it. We might have a little freaking snack at the beginning. We have an agenda in money for couples that you can use. We always start with a compliment. It always feels good when we start our money meetings, we start with a compliment. It’s cheap, costs nothing.

 

It’s amazing. You choose which book you want to start with. It’s up to you. But you should read both of them. Yep. Okay. You may want to create a set of core values, and one of them is we make informed decisions quickly. That’s one. So something needs to be cut out. You cut it out immediately. Next another skill you’ll need to work on is creating a united front together against the rest of the world.

 

You can’t be united together unless each of you knows what you want. If each of you knows what you want, then you can be united as a team that takes work. And then being united despite what the world says to you. That’s a skill. So when family calls both sides, when friends call you to should practice and rehearse what you’re going to say.

 

And if you need help, ask your partner. And the other thing is not avoiding the hard discussions. There are a lot of tough discussions ahead of you. I don’t look at them as a bad thing. The most important things

 

01:24:18.160 — 01:24:18.960 · Ramit

are hard.

 

01:24:19.000 — 01:24:41.120 · Chris

I know that we’re willing to do that and we need to do that, but I know that we’re willing to collaborate more instead of me just taking a back seat and me thinking that she’s just handling it all. Yeah. Um, so, yeah, I, I think that we we know what we need to do from here on out. I, I think so.

 

01:24:41.160 — 01:24:41.640 · Ramit

I like.

 

01:24:41.640 — 01:24:42.880 · Chris

That. Yeah.

 

01:24:42.920 — 01:25:05.000 · Ramit

Um, earning more is the natural next step. You both are young. You have time. But I would not wait. Increasing your income will dramatically affect affordability for the two of you. Um, like the summer opportunity you mentioned to me, that is an absolute no brainer. It’s a yes. There’s no discussion about it.

 

01:25:05.040 — 01:25:06.800 · Grace

What about being a Starbucks barista?

 

01:25:06.800 — 01:25:07.200 · Ramit

Why not.

 

01:25:07.200 — 01:25:07.920 · Grace

Love coffee?

 

01:25:07.960 — 01:25:08.360 · Ramit

Why not?

 

01:25:08.400 — 01:25:09.320 · Grace

Got great benefits.

 

01:25:09.370 — 01:25:10.210 · Ramit

There you go.

 

01:25:10.570 — 01:25:12.770 · Grace

Thought about it. Might as well go do it.

 

01:25:12.810 — 01:25:23.890 · Ramit

It’s time to start taking the decisions again. We make informed decisions quickly because we have a bigger vision than the two of us are going to be comfortable. We talked about what happens if you make no changes. That’s not an option.

 

01:25:23.930 — 01:25:25.250 · Grace

Yeah, not an option.

 

01:25:25.290 — 01:25:30.770 · Ramit

You have to make changes, big changes. And they have to happen fast. Are you on board?

 

01:25:30.810 — 01:25:31.810 · Grace

Yep. On board.

 

01:25:31.850 — 01:26:32.820 · Ramit

Okay. I think it’s going to be really hard for Chris and Grace to make the changes that we discussed today, but let’s remember that before today, they had never had a single substantive conversation about money. Let’s also remember that Chris does not like to be uncomfortable, and being on this show was the definition of uncomfortable for him.

 

So they’ve already taken a big step. Will they do it? Probably not until their backs are against the wall. Most people do not make self-development changes unless they have to. I don’t want them to have 1 or 2 kids and suddenly realize, next month we can’t afford diapers. I don’t want that, but there’s only so much I can say or even do until they realize it for themselves.

 

So I want to thank Chris and Grace for coming on this show. It was not easy. This is a major opportunity for you to change your entire dynamic. I really hope you do it. And now let’s take a look at the follow ups.

 

01:26:33.340 — 01:26:55.540 · Grace

This is our reflection from our time with our meet. Our biggest surprise from the session. Mine was probably related to our different childhoods, experiences with money, and how our parents talked about money or lack of conversation around money, and how that has translated into our adulthood, and how we show up for ourselves and in our relationships in relation to money.

 

01:26:55.780 — 01:27:05.260 · Chris

And my biggest surprise was how close our income is to our to our neighbors and the the people locally here in our town.

 

01:27:06.550 — 01:27:35.110 · Grace

Um. And our biggest takeaway. My biggest takeaway probably ties into my biggest surprise. So realizing those patterns and how, you know, I want to take those patterns. And I know my husband wants to take those patterns and change those, um, for our future children and kind of alter those in a more positive way.

 

So having more positive conversations around money, um, and open conversations and being more proactive and changing the patterns that we noticed about our childhood and how we got here.

 

01:27:35.630 — 01:27:45.590 · Chris

Um, and my biggest takeaway, um, is knowing that we need to have more in-depth conversations around our rich life and how we will get there someday.

 

01:27:46.030 — 01:28:04.350 · Grace

Um, and our changes that we’d like to make. I think we both agree that we are wanting to one, you know, read the book, but to have more weekly set meetings on Thursdays at six. Um, about, you know, about our finances and, um, moving forward in a positive direction. Thank you.

 

]]>

 

Ramit unpacks whether Randy can move toward marriage while Mack brings $100,000 of debt into their future together and whether that debt could become a problem they both have to live with.

Randy and Mack are in their early 30s, and are talking seriously about marriage. But their financial lives look completely different. Randy has a net worth of around $102,000, while Mack is at roughly negative $56,000, largely because of $100,000 of debt. Randy feels increasingly “handcuffed” by what that debt means for their future, while Mack worries that he has gone from being supported to becoming a problem to solve.

Ramit quickly discovers that the real issue is not simply the debt. Mack already has an aggressive payoff plan that could make him debt-free in under four years. The deeper problem is trust, avoidance, and the way they manage money as a couple. Ramit helps them rethink their 50/50 split, build a more equitable system, and create a plan where Mack takes ownership of his debt while they start making financial decisions as a team.

In this episode we uncover:

• Why Randy feels “handcuffed” by Mack’s financial situation as they discuss marriage
• How a couple earning $309,000 ended up with radically different financial lives
• How Mack accumulated $100,000 of debt
• Why Randy’s fixed costs are 47% while Mack’s are 87%
• Why Mack avoids money even though he manages large budgets professionally
• How Mack’s debt went from his problem to their problem
• Why Ramit thinks Mack’s debt payoff plan is actually a strong one
• The hidden trust issue underneath their arguments about money
• Why splitting their shared expenses 50/50 no longer works
• How they can become debt-free in under four years while still saving, investing, and enjoying life

Chapters:

(00:00:00) Introduction

(00:02:53) Randy feels “handcuffed” by Mack’s debt

(00:23:20) Their numbers reveal a huge financial divide

(00:34:47) How Mack accumulated $100K of debt

(00:43:08) Mack’s debt payoff plan surprises Ramit

(00:53:35) How their childhoods shaped their money beliefs

(01:06:43) The real issue underneath the debt: trust

(01:10:43) Building their shared Rich Life

(01:15:58) Why splitting everything 50/50 no longer works

(01:31:32) Follow-ups: what changed after the conversation

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Transcript:

00:00:00.000 — 00:00:17.520 · Mack / Randy
I have $100,000 in debt as we're talking about eventually getting married. I just had this feeling that this was going to become a much bigger problem. It became an emotional toll on me. It's a net negative. It's not building towards something. It's actually just an anchor. I was like, how fast can we pay this off?
00:00:17.520 — 00:00:19.720 · Ramit
Pay this off? Did you become part of the debt payoff?
00:00:19.760 — 00:00:20.680 · Randy
No I didn't.
00:00:20.720 — 00:00:22.280 · Ramit
It's a bit of a mixed message.
00:00:22.480 — 00:00:40.840 · Mack / Randy
There's a little bit of whiplash, of feeling supported and understood to suddenly being, like, judged. I've become a problem to solve. Our money conversations tend to end with us going our separate ways. Emotionally, you get very charged up about it. I even feel it right now. It's just like, this is too much.
I really don't want to do it.
00:00:40.840 — 00:00:52.160 · Ramit
The way you've constructed your world is that I need to feel horrible about money. And when people feel horrible about something, they don't engage in it. Neither of you have recalibrated your relationship. What's going on there?
00:00:52.160 — 00:01:00.870 · Randy
I just don't trust that it's not going to continue to snowball in a way that's uncontrollable. If we're going to have a future together, there's an element of like. It's not possible.
00:01:02.430 — 00:02:53.710 · Ramit
Today I'm speaking with Randy and Mack, 31 and 33 years old. They are in a relationship and they are talking about getting married soon. Randy is the one who applied. Here's what he wrote. We're not married yet, but plan to combine finances when we are. A meaningful chunk of my income ends up going towards his debt and our shared fun, and I feel handcuffed into funding his rich life with my wallet.
The deeper roadblock is we haven't aligned on what we're actually building. That's a pretty perceptive comment. The idea that the mechanics may be working functionally, but the dynamic underneath is not. I'm going to pull up their conscious spending plan. Let's take a look. We have a total net worth of $45,000, but it's quite different.
Randy has a net worth of 102,000. Mac has a net worth of -56,000. Debt is where things really become different. Randy has $12,000 of debt. Mack has $100,000 of debt. Wow. Combined monthly income $25,833 for a couple in their early 30s. That's a lot of money. We have Randy making 15KA month gross. Mac is making 10-K a month gross.
That's great. Fixed costs at 63%. But if you break it down individually, Randy's at 47% and Mac is at 87%. I got to say, I'm really glad that I get to talk to Randy and Mac before they get married. Doing things preventative with your money can make all the difference. The question I have is, do they have a compatible vision of a rich life?
Let's find out. Let's meet Randy and Mac. I took a look at the application. You filled it out, right, Randy? Okay, you wrote in there. Quote. I feel handcuffed into funding his rich life with my wallet. Tell me about that.
00:02:53.750 — 00:03:08.020 · Randy
I do make more than Mac right at the moment, and I do think that there's an element of like, without me, it's not possible. And it feels a little bit like everything is kind of reliant on me to be successful and not necessarily us to be successful.
00:03:08.060 — 00:03:10.780 · Ramit
You use the word handcuffed. What does that mean?
00:03:10.820 — 00:03:25.660 · Randy
The feeling, ultimately, is that if I were to leave, the problem becomes his. But that also puts him in a bad spot. And I don't want to do that. So handcuffed in the sense that we're in this together. But you kind of are the only one carrying the load as far.
00:03:25.660 — 00:03:26.780 · Ramit
As you're the only one.
00:03:27.060 — 00:03:29.260 · Randy
As far as the fun parts of life. Yes.
00:03:29.660 — 00:03:30.980 · Ramit
What's your take on it, Mac?
00:03:31.100 — 00:03:38.580 · Mack
Uh, when I first read that line, I was pretty offended by it. Um. Why? It feels very much like.
00:03:40.500 — 00:04:05.970 · Mack
Like the whole of me is at net burden, and that's kind of how I felt. But now that we've had, like, more chances to talk about that, I understand. And there is an element of truth to that so that both feels good. And then it's like, okay. Yeah, that was a good point. We need to figure that out, but also feels bad because then it's hard for me to not internalize that even more of like, wow, like I really am a problem.
00:04:06.810 — 00:04:09.690 · Ramit
And do you think that you are a financial problem?
00:04:09.730 — 00:04:11.770 · Mack
I'm certainly financially complicated.
00:04:11.970 — 00:04:12.250 · Ramit
Huh?
00:04:12.410 — 00:04:26.010 · Mack
Huh. Yeah. I mean, I think we both are in a spot where the amount of debt that I have, I don't particularly want it to be Randy's problem. Got it. But it's also not something that can just be fixed like that.
00:04:26.050 — 00:04:27.730 · Ramit
How long have the two of you been together?
00:04:27.890 — 00:04:29.010 · Mack
Going on? For years.
00:04:29.010 — 00:04:33.690 · Ramit
Four years. Okay. And is there a plan to be married one day?
00:04:33.690 — 00:04:34.610 · Mack
I would like to.
00:04:34.650 — 00:04:40.010 · Ramit
Yeah, yeah. Has there been a discussion that you have to pay your debt off before you get married?
00:04:40.130 — 00:04:50.690 · Randy / Mack
Maybe not in so many words, but I think originally that was your plan. Yes. My plan was to keep this my problem for as long as I could.
00:04:50.770 — 00:04:51.530 · Ramit
And
00:04:53.530 — 00:04:55.010 · Ramit
why did it get so quiet in here?
00:04:56.130 — 00:04:58.690 · Mack
I am also feeling very much like
00:05:00.410 — 00:05:49.170 · Mack
I need some help. And while that's not like your job, um, it is something where it's like, okay, everybody brings something they need help with to a relationship. Mine just happens to have numbers on it, and we can probably be getting a lot closer to what we would want to have together if we work together on it.
But it's hard to have that conversation because where I am, I can't put more than what I'm already doing. Like, the numbers don't really work for me to be like doing a rapid payoff or anything like that. So it kind of becomes this unanswered question that's just sitting in every conversation of like, I don't particularly want Randy to feel like he has to be contributing, and I don't think you want to who I don't know who would, but at the same time, it's kind of if we're going to have a life together, it's going to be something that's there in the way always.
00:05:49.240 — 00:05:50.840 · Ramit
Are your finances combined?
00:05:50.920 — 00:06:07.920 · Randy
No. I mean, at least not in the practical sense. We're aware of how much we have in each other's bank accounts, but they're not combined. Right now, we do have a joint account, which I actually am going to, like, put our money into so we can just withdraw from that. So it stops being so chaotic.
00:06:07.920 — 00:06:09.680 · Ramit
What about like, the rent? How's that paid?
00:06:09.720 — 00:06:11.800 · Randy
Right now we just split it in half. Yeah.
00:06:11.920 — 00:06:12.640 · Ramit
5050.
00:06:12.680 — 00:06:13.320 · Randy
Yeah. Yeah.
00:06:13.360 — 00:06:20.480 · Ramit
Oh, okay. And so the money goes into some account, which then pays the rent. Is that how it works?
00:06:20.520 — 00:06:33.120 · Randy
No. Currently it's Venmo, but we are moving so that the combined account is intended to be for when we do move, we're moving into more of like a corporate apartment. So there's a better system. Okay. Right now we just have a landlord.
00:06:33.120 — 00:06:35.280 · Ramit
So one person pays it, the other one Venmo us.
00:06:35.600 — 00:06:38.120 · Mack
We both Venmo our landlord. Half of it, and everyone's okay.
00:06:38.120 — 00:06:42.120 · Ramit
Got it. And what about, like, other joint expenses, groceries, eating out. How does that work?
00:06:42.160 — 00:06:47.270 · Mack
I think we just pass back and forth the same Venmo transactions. Oh ad infinitum.
00:06:47.270 — 00:06:50.630 · Ramit
How many? How many per month Venmo transactions do you have between the two?
00:06:50.670 — 00:07:04.670 · Mack
A dozen, like total things, including electricity and whatnot. Okay, yeah, sometimes it'll be a month where it's like, oh, this came up. It was about $100, like, oh, I spent $100 over here. Like, okay, cool. That like cancels out generally. It feels pretty fair.
00:07:04.950 — 00:07:11.990 · Ramit
Okay. Now, Randi, I understand that you have a financial system. I love a good system. Can you describe the financial system that you've built?
00:07:12.030 — 00:07:18.550 · Randy
Yeah. I mean, I can kind of sum it up in one sentence. Pay yourself first and then do whatever else you want to do with it. Okay.
00:07:18.590 — 00:07:21.990 · Ramit
So you have money automatically going into savings, investing that kind of thing.
00:07:22.030 — 00:07:26.350 · Randy
Yeah. For one and then Roth and then savings and then the rest kind of trickles down.
00:07:26.390 — 00:07:29.870 · Ramit
How does his finances slot into this system of yours?
00:07:29.990 — 00:07:38.149 · Randy
They don't, I think largely due to the lack of a system that's in there. I think there's also just the cumbersome nature of having
00:07:39.230 — 00:07:47.470 · Randy
like disjoint accounts that don't exactly all merge in one place and then spread out. They're Siloed off, and you have to keep track of each other's numbers and.
00:07:47.710 — 00:07:48.270 · Ramit
Irritating to.
00:07:48.270 — 00:07:49.950 · Randy
You. It's inefficient.
00:07:50.310 — 00:07:59.430 · Ramit
And that sounds like irritation. Like, I love systems. And if I had to deal with some orphan account over here, I'd be like, this sucks. I'll be irritated.
00:07:59.990 — 00:08:03.150 · Randy
Yeah, I guess. I guess irritation might be a good word for it then.
00:08:03.190 — 00:08:11.470 · Ramit
Okay. And how do you deal with it? Right now it seems like Venmo is the way. But like, do you spend a lot of time on your own financial system?
00:08:11.550 — 00:08:16.150 · Randy
No. Not anymore. No. I kind of, like, set it and forget it. Okay.
00:08:16.190 — 00:08:17.630 · Ramit
Um, what about you, Mac?
00:08:17.870 — 00:08:19.510 · Mack
Just hope and prayer.
00:08:19.550 — 00:08:20.230 · Ramit
Really?
00:08:21.350 — 00:09:01.900 · Ramit
Very little fazes me about money, but I still cannot get over how the majority of couples do not have a single substantive conversation about money, often for years at a time. And just take your own relationship. Because I'm genuinely curious. When was the first time that you had a substantive conversation about money.
Not a five minute conversation about who's paying. A substantive conversation about money. Put it in the comments. I read every single one. Randy, in your application, you mentioned something you said in the last month. I kind of demanded to have a clear picture. What does that mean?
00:09:02.140 — 00:10:04.650 · Randy / Mack
I got a new job, and I wanted to start kind of living life. And through that I wanted to know what was happening. Like, I operating in a black box about stuff doesn't work for me, especially when the mechanics of how to solve a problem are 100% going to have to be known, and you can't do it in a black box. So what did you do?
I just asked if we could, like, share an app that would allow us to add our finances and see where we're at? And we did. And it's been helpful in the sense that, like, we know where we are and it doesn't feel very manual. It doesn't feel like a task to do. It's just there. I think that's the genesis of me wanting to understand his finances.
Okay, that was where it left from being this thing that I was just trying to manage in the background and not think about too much to being like, oh wow, this is this is something I need to share with my partner. We were getting very serious at that point, and also something that I just had this feeling that this was going to become a much bigger problem once it was out in the open.
00:10:04.650 — 00:10:05.370 · Ramit
And it did.
00:10:05.410 — 00:10:05.810 · Mack
It did.
00:10:05.810 — 00:10:06.130 · Ramit
You were.
00:10:06.130 — 00:10:16.730 · Randy
Right. Yeah. And when I realized what it was and how to do it, I very much was on the team of like, how fast can we pay this off? Like let's, you know, put a fire under this and get it, get out of the way.
00:10:16.770 — 00:10:20.490 · Ramit
How fast can we pay this off? Did you become part of the debt payoff?
00:10:20.530 — 00:10:40.250 · Randy
No, I didn't, at least I emotionally did. But I didn't physically contribute to it. But it became an emotional toll on me. Why? Because debt is one of those things where it can be a utility. But the problem with it, the way it's done here, is it's a kind of net negative. It's not building towards something, it's actually just an anchor.
00:10:40.290 — 00:10:41.170 · Ramit
Okay, so.
00:10:41.170 — 00:10:41.810 · Randy
You.
00:10:42.050 — 00:10:51.730 · Ramit
Asked him, how fast can we pay it off? Even though what you. Seems to me what you meant is how fast can you pay it off? Yeah. Okay. Is that a common thing?
00:10:51.770 — 00:11:12.930 · Randy
I think so. I like through kind of some of the experiences we've had recently. I've realized that a lot of the way I approach money is this is your problem versus my problem. And I'm not necessarily all set, but I'm definitely in a spot where I'm able to flex and move a little bit better and not really concern myself with the ins and outs of like, managing it.
00:11:12.970 — 00:11:28.010 · Ramit
I'm curious about. It's a bit of a mixed message. Would you say that you've experienced mixed messages around money? For sure. Yeah. You said, how are we going to pay this debt off? Implying how are you going to pay this debt off? What was your reaction to it?
00:11:28.010 — 00:12:02.320 · Mack
I think this time it was the first time it had been talked about in a context of the logistics of us having combined finances in the past. It had been more about this is a thing that I'm dealing with as a person, and I'm so glad I have somebody here that I can talk to about it. But then it was suddenly becoming like, actually your problem in that.
So it gave me your problem. Well, my problem, it already always had been my problem. But as we're talking about the potential of eventually getting married, combining finances, it becomes his problem too. And so the feeling I have a very visceral feeling to talking about money.
00:12:02.360 — 00:12:03.320 · Ramit
Which is what.
00:12:03.840 — 00:12:14.600 · Mack
I get very hot and my heart rate goes up and typically I just end up checking out because it's like in fight or flight. I just choose flight because.
00:12:14.600 — 00:12:15.600 · Ramit
I feel that right now.
00:12:16.120 — 00:12:16.880 · Mack
Yeah, a little bit.
00:12:16.920 — 00:12:18.880 · Ramit
Okay. If you need to take a break, we take a break.
00:12:18.880 — 00:12:20.520 · Mack
But I'm all right. Okay.
00:12:20.560 — 00:12:24.640 · Ramit
Well, good to know. What did it get you when you had that app set up?
00:12:24.680 — 00:12:31.840 · Randy
It gave me some relief to know just the answers that were happening. Even if they were all wrong and everything's broken,
00:12:33.080 — 00:12:48.870 · Randy
we we at least have an answer to operate with. on or with because you can kind of backwards your way into a solution. And I'm very solution oriented. So, you know, we have debt. How do we pay it off? Avalanche snowball doesn't matter. Like what's the fastest way to get there?
00:12:49.030 — 00:12:52.790 · Ramit
Is that your role with money in this relationship solutions?
00:12:52.870 — 00:12:53.670 · Randy
Yes.
00:12:55.150 — 00:12:55.750 · Ramit
Max says.
00:12:55.750 — 00:12:56.430 · Mack
Yes.
00:12:56.750 — 00:12:58.510 · Ramit
That was a quick reaction. Why?
00:12:59.310 — 00:13:04.190 · Mack
Uh, because I don't. I have not wanted to deal with it. Oh.
00:13:04.750 — 00:13:06.030 · Ramit
What is your role with money?
00:13:06.070 — 00:13:11.070 · Randy
Um, his ideal would be for me to take it all on and tell him what he can spend.
00:13:11.390 — 00:13:14.110 · Ramit
Ah. How would you describe that in a word? Mac.
00:13:15.750 — 00:13:17.950 · Mack
Uh, probably a little dependent.
00:13:17.990 — 00:13:22.950 · Ramit
Dependent? Yeah. That's interesting. So we have solutions and dependent. What do you think?
00:13:23.030 — 00:14:10.030 · Mack
That is the way we talk about it. But even now, that's honestly how it's set up. Because everything's still separate. In an ideal world, it would be something that I don't have to think about. But As we've talked more about what I actually want out of my life, our financial picture, what it would actually feel like for me to be comfortable.
Um, it's actually kind of the opposite. Like, I would like to be involved in those discussions. Like, I want to be able to talk with my friends about strategies or whatever. Like, it's kind of fun when people just talk about those things. And right now people start talking about that. And like, I have to check out why I just if I participate in the conversation, I'm going to feel really uncomfortable and, um, like, really embarrassed.
00:14:10.310 — 00:14:11.390 · Ramit
Because you have debt.
00:14:11.710 — 00:14:49.420 · Mack
Yeah. And I can't I can't help but feel a little bit resentful of that. Not toward like, other people or you or a friends, but just like in general, I feel like the reason that I have debt in the first place was not like some of it was just that I was young and stupid, but a lot of it was because a lot of things happened that were a little bit out of my control.
And so every time we're talking about debt or finances, all that comes up is like a pretty rough period of my life where I felt really not in control. And it's like behind me and I just want it all to be behind me so I don't have to think about it anymore. But now I still pay two grand a month to keep thinking about it.
00:14:50.340 — 00:14:51.700 · Ramit
Randy, I agree.
00:14:51.780 — 00:14:56.820 · Randy
Yeah, I think one of the problems I also see is the mitigation of a problem.
00:14:57.100 — 00:14:57.980 · Ramit
For minimizing it.
00:14:58.020 — 00:15:02.140 · Randy
Yeah, it just it seems to be a common pattern
00:15:03.180 — 00:15:11.420 · Randy
that if it's not a if I don't acknowledge a problem, the problem doesn't exist. Therefore it, you know, not something I have to think about.
00:15:11.860 — 00:15:16.420 · Ramit
Do you think that the strategy you are using is working for you?
00:15:17.860 — 00:15:36.770 · Mack
I think the like soft emotional Mac is like, yeah, this is great. We've got everything set up so that in like five years it's going to be paid off and we don't have to think about it anymore, and then it's not going to be a big deal. I think the adult brain in me is like, no, this is not working because I'm not really keeping track of a lot of things.
I am just kind of
00:15:37.810 — 00:15:55.970 · Mack
going, hoping a prayer, not because I'm dumb, it's because it's just too stressful to have to think about it. So if I can spend like twice a year putting everything in place and then just never have to look at it and just kind of assume things are going to be okay, then like, I don't I'm not dealing with that anxiety on a regular basis.
00:15:56.290 — 00:16:19.970 · Ramit
I'm going to be pretty direct. I think you have this invisible script that your ultimate goal is to not have to think about money. And the fact is, if you want to get good at money, you have to pay attention to it a lot, and you actually have to find a way to enjoy it. What would that look like for you?
00:16:20.250 — 00:16:44.890 · Mack
Well, in my job, I do that a lot with like a lot of I'm a project manager, so I'm dealing with a lot of budgets all the time. And one of the things I enjoy is that I'm the person who knows all of the things that are happening at any point in time with the project, and somebody comes to me and says, I need to know what you know.
This invoice was, and I can respond immediately and say, I know exactly what that was and what it came from.
00:16:44.890 — 00:16:47.450 · Ramit
What would it look like for you to do that with your finances?
00:16:47.730 — 00:17:47.120 · Mack
And I would I think it would actually be really fun to be able to say, like, I know exactly what's in this account and where it's going. I know exactly what the target is. I know that, you know, we want to save for a vacation that we're going to take in 2027, and we're going to retire at 62 years. And this is where we are on that journey.
Like I do a lot of tracking and managing projects, and I find that fun. And I don't really do that with my own finances. Why? I think one thing that I didn't notice, and so we started talking about it a little bit more, is like I've been in some level of the finance world my whole career, often with extremely large transactions.
I think there is a little bit of a skew that I still have of like, okay, I have $100,000 in debt, but I spent $150 million last week at work. So like, I understand obviously mathematically how much that is, but I don't think it has the same impact as it does you because I am used to dealing with numbers and it's like, wow, that's a lot.
That's going to take some time to pay off. But like.
00:17:47.160 — 00:17:48.320 · Ramit
Finish the sentence.
00:17:48.680 — 00:17:49.680 · Mack
Could be worse.
00:17:49.720 — 00:17:52.520 · Ramit
Could be worse. Yeah, right.
00:17:52.720 — 00:18:10.640 · Mack
Also a little bit of, um, it's someone else's money at work, so it's a little more, uh, I don't know, esoteric. Whereas when it comes down to me, it's just like, yeah, I even feel it right now, or it's just like, this is too much. I really don't want to, like, go do it. And it's just like an overwhelm factor.
00:18:10.640 — 00:18:56.790 · Ramit
Okay? This happens every so often on this podcast. I remember speaking to somebody who was struggling with their own personal finances. And you know, what they do for a job. They teach personal finance in high school. Mack obviously has the skills to know this stuff about personal finance or learn it.
But when he comes home, he sees himself as passive with money. Also not particularly good with money and somebody who's made a lot of mistakes and he doesn't really want to pay attention to it anymore. So it's one thing from the outside to look at this person and say, look, you have the skills, obviously, but it's quite another to take those skills and transfer them to your own personal life.
I hope I can get him to connect the skills he already has to this issue with his personal finances.
00:18:58.350 — 00:19:03.670 · Ramit
I want to take a look at the numbers. What was it like to put the conscious spending plan together?
00:19:03.710 — 00:19:18.550 · Randy
I don't know that it was enlightening because we've done it. We've tried to do it so many different ways that we've, you know, flavor over the week at this point. So none of the numbers particularly surprising, but they side by side like showed a pretty stark discrepancy.
00:19:18.590 — 00:19:20.710 · Ramit
Okay. Did you know this discrepancy?
00:19:20.790 — 00:19:23.030 · Randy
Yeah, at least I did.
00:19:23.070 — 00:19:32.870 · Mack
I think intellectually we do, but like seeing it like right there, the actual numbers is like okay. Yeah, that's what I was feeling. But this is definitely different.
00:19:32.910 — 00:19:43.870 · Ramit
Yeah. All right. Let's take a look at the numbers. Randy, can you read off the word in bold and then the combined number next to each of these cells for this total box?
00:19:43.910 — 00:20:04.710 · Randy
Yeah. Assets zero. Investments 141,645. Savings 17,184. Debt 112,939. Total net worth 45,890. Okay, cool.
00:20:05.030 — 00:20:08.630 · Ramit
Just looking at those numbers, what are your reactions?
00:20:08.670 — 00:20:12.270 · Mack
I don't like the extra little symbol that's on the left side of my number.
00:20:12.310 — 00:20:13.230 · Ramit
The negative.
00:20:14.670 — 00:20:15.870 · Ramit
Okay. Good catch.
00:20:16.110 — 00:20:16.710 · Randy
Yes.
00:20:16.710 — 00:20:17.510 · Ramit
What else?
00:20:17.630 — 00:20:39.660 · Randy
I feel a little saddened by that when you combine it, because a lot of the the investment side and the things that we have going for us are eaten up by the debt. And so that number isn't representative of the work, it's representative of the trauma that you've kind of accumulated in trying to pay down.
00:20:39.700 — 00:21:12.900 · Ramit
So to clarify, we see that, Mac, you have 38 K of investments versus Randy's $102,000. It's quite a discrepancy there. $5,000 of savings for Mac versus 12,000 for Randy. And then the big difference here is the debt Mac, $100,000 of debt and $12,000 of debt for Randy. So the numbers on average look one way.
But when you dig in beneath, you see quite a difference. Okay. Did you know these numbers? Randy says yes, Mac.
00:21:12.940 — 00:21:21.610 · Mack
I will be honest. I did not realize that I had $40,000 in 41 days. So that was actually kind of a positive.
00:21:21.850 — 00:21:25.730 · Ramit
How do you think that happened? That you have 40 K. Now that's a lot of money.
00:21:25.770 — 00:21:41.130 · Mack
Well, mathematically I know exactly how it happened. Um, it's been sent around in 401 K for a while. I think it's just one of those things where I was aware of it, but I just didn't want to be looking at it. And so I wasn't paying attention to that number at all.
00:21:41.170 — 00:22:15.730 · Ramit
This invisible script. I should not have to look at money. Did you see how many different ways it affects you? It affects you on the downside, with debt, it affects you on the upside. With 401 K, it affects you in your relationship, the two of you. And a healthy relationship with money is actually like, oh, I like this.
Oh, what a gift that I get to manage my money because that is how I live my rich life. That's how we live our rich life. Okay, let's go down to the income. Um, Matt, can you read off the combined gross monthly income, please?
00:22:16.090 — 00:22:18.250 · Mack
25,833.
00:22:18.330 — 00:22:19.690 · Ramit
What do you guys think about that number?
00:22:19.730 — 00:22:20.730 · Randy
It's a lot of money.
00:22:20.770 — 00:22:21.890 · Mack
It's a pretty big number.
00:22:21.930 — 00:22:42.330 · Ramit
Yeah. And you're in your early 30s. That's a lot of money. So that's a total of $309,000 per year by a show of hands. Who knew that? Both. Oh my God. Okay, round of applause. This does not happen very often on the show. Wow. How did you know that? Because 50% of people do not even know their own household income.
00:22:42.370 — 00:22:43.610 · Randy
Because we've talked about it.
00:22:43.650 — 00:22:44.890 · Mack
Yeah, great. We have talked about that.
00:22:44.930 — 00:22:45.290 · Randy
Yeah.
00:22:45.330 — 00:22:45.890 · Mack
Wow.
00:22:46.450 — 00:22:56.330 · Ramit
What does a couple in their early 30s that makes over $300,000? What do they do? How do they behave when it comes to money?
00:22:56.370 — 00:23:15.960 · Mack
I mean, I think about a lot of our friends are in somewhat similar situations. Um, actually, a lot of our friends are pretty open about talking, not necessarily about income and stuff, but, you know, how are you doing on this kind of investing thing? Not in a it's not like the number one topic of conversation, but it's something I think everybody's interested in.
For the most part in our group.
00:23:16.000 — 00:23:17.920 · Ramit
Mhm. How they talk.
00:23:17.960 — 00:23:18.760 · Randy
Confidently.
00:23:18.800 — 00:23:19.520 · Ramit
What else.
00:23:19.960 — 00:23:21.080 · Mack
Competently.
00:23:21.120 — 00:23:21.880 · Ramit
Nice.
00:23:21.960 — 00:23:22.280 · Mack
Yeah.
00:23:22.320 — 00:23:23.920 · Ramit
Nice. Good. What else?
00:23:24.200 — 00:23:27.120 · Mack
It seems like they all have houses to fix, which I don't want to do.
00:23:27.160 — 00:23:28.640 · Ramit
Okay. Got it. Yeah.
00:23:28.800 — 00:23:31.640 · Randy
I think at that point, the way I would talk is proud.
00:23:31.680 — 00:24:09.480 · Ramit
Proudly. Yeah. Yeah. I agree, it's something that they have accomplished. Nobody trips and falls into a $309,000 household income. Yet you got to be very good at your job, both of you. That's impressive. Okay. Um, I just want to point out the differential in income here. 15,000 a month for Randy. 10,000 a month for Mac.
We have Randy taking home 10,000 a month. Mac taking home 7000 a month. So, again, like my assessment. Generally pretty similar incomes. Of course, one is like 50% higher, but they're both high incomes. Great. Let's go down to the rest of it. Fixed costs. What's that number?
00:24:09.600 — 00:24:10.600 · Mack
63%.
00:24:10.640 — 00:24:11.520 · Randy
Great.
00:24:11.910 — 00:24:17.510 · Ramit
Um, I'd like to see it below 60%, but okay. I will say, especially with a very high income,
00:24:18.550 — 00:25:01.110 · Ramit
when the number is above 60%, I'm kind of like, what's going on? And we know what's going on, because the highest number here is the debt payments 2238, of course, aside from your rent. So we'll get into that. Investments are at 4%. But that's really Randy's investments. Savings are at 3%. But that's really Randy's savings.
And then finally this one is very interesting to me. Guilt free spending. What's this number. It's 31% Randy $4,394 a month. That's a 42%. Now, I don't mind. I love seeing a high earner spend a ton of money on guilt free spending if they're hitting all their other numbers, I don't mind. What is that money going towards?
00:25:01.590 — 00:25:16.950 · Randy
I mean, kind of, you name it. It's fun buying new bike parts, helmets, stuff like that. I don't know, it goes to expensive coffee when I go out. I don't really have to think about a no situation because it just is there.
00:25:16.950 — 00:25:17.710 · Ramit
You have the money.
00:25:17.750 — 00:25:21.150 · Randy
Okay, so that this income is new for me.
00:25:21.190 — 00:25:22.550 · Ramit
Oh, as of when.
00:25:22.670 — 00:25:24.550 · Randy
I'd like a month ago. Oh.
00:25:24.950 — 00:25:27.990 · Ramit
So you're rolling in it. You're like, I got more money than I've ever had.
00:25:28.030 — 00:25:32.350 · Randy
Yeah. I mean, I have an extra 2500 dollars ish, roughly a month.
00:25:32.350 — 00:25:33.590 · Ramit
What were you making before?
00:25:33.630 — 00:25:34.910 · Randy
150.
00:25:34.950 — 00:25:35.590 · Ramit
Whoa.
00:25:36.470 — 00:25:48.510 · Randy
And then. And that was. I was only there for a year and a half. And prior to that was 113. And then prior to that was 60. And so in five years, I've gone from 65,000 to 185.
00:25:48.550 — 00:25:52.190 · Ramit
What's your advice for America? Tell them, how'd you do it?
00:25:52.230 — 00:25:56.030 · Randy
Find the next job you want and gain the skills to get there. Wow.
00:25:56.270 — 00:26:26.180 · Ramit
I like it. It's actually, um, very aligned with how high earners talk about it. It's very solutions oriented. It's very black and white. Doesn't mean it's going to happen, but that is the path to do it. Well said. All right. Um, what is your assessment of this conscious spending plan when you look at it like if you had to analyze it, what would you say you notice about the CSP.
00:26:26.500 — 00:26:40.780 · Mack
Combined is really not so bad. There's some things that can probably be polished, but it seems pretty good. Yep. Um, individual. There's one person who's doing great and there's one person who is stuck.
00:26:41.020 — 00:26:43.060 · Ramit
Stuck. Be more descriptive.
00:26:43.100 — 00:26:54.300 · Mack
I mean, my fixed costs are at 87% on an individual level. Like it's manageable, but not to be sharing a life with the person in the first column.
00:26:54.740 — 00:27:25.650 · Ramit
Yeah, they're kind of like completely different. If we look at, you know, one person, Randy, has 47% fixed costs. That's extremely low. Like, there's no stress at all at 87%, you feel like you're drowning. So there's an incongruity there. And that feels odd in a relationship, especially in a married relationship, which I know you're not.
But in an intimate relationship, when you're living together, it can feel a little weird. Does it feel like that to you?
00:27:26.250 — 00:27:28.250 · Randy
Yeah, it definitely does on my end.
00:27:28.290 — 00:27:51.210 · Ramit
Okay, here's my approach. First, I want to spend a little bit more time with Mac to understand his view of money, especially where this debt came from. But then I need to talk to Randy. I need him to start to understand how he has co-created this dynamic that they have around money, and get him to see the effect of it on Mac.
00:27:54.210 — 00:28:01.730 · Ramit
You both have debt, but I want to talk Mac, about your debt, which is $100,000. What is included in that debt?
00:28:01.770 — 00:28:14.250 · Mack
It's about 15,000 of student loans, and then the rest is like debt consolidation loans that I did over time. It's really just two big ones.
00:28:14.250 — 00:28:15.370 · Ramit
What were those?
00:28:15.530 — 00:28:20.210 · Mack
Uh, one is for 11,000, the others around 70,000.
00:28:20.250 — 00:28:21.690 · Ramit
And what were those loans for?
00:28:21.730 — 00:28:31.170 · Mack
Those were consolidating some loans that were over here and over here. I mean, I think at some point there was probably 8 or 9 different spots where money would.
00:28:31.370 — 00:28:35.690 · Ramit
Keep asking to, you tell me what those loans were, what were they for the 8 or 9 loans?
00:28:35.770 — 00:28:36.450 · Mack
Um,
00:28:37.490 — 00:28:46.090 · Mack
my trajectory has been very much the opposite of Brandeis when it comes to income. Um, I started off making a lot more money than I probably should have. Um, young.
00:28:46.130 — 00:28:46.850 · Ramit
How much?
00:28:47.090 — 00:28:55.290 · Mack
Uh, I was probably making 180, up to 200 in my 20s. But that was at a time when.
00:28:57.490 — 00:29:40.360 · Mack
Uh, mentally, I was not in a great space. I was in a career that was primarily commissions based. I did not really have any kind of education around what to do when your income comes in chunks like that, you know it would be a bank account of, you know, $1,000 and then suddenly a $50,000 check. And then I wouldn't get paid again for six months.
And so I think that whiplash for somebody who was like, just not that practiced at what that looks like. The debt came from not really planning very well when that was going. I did a lot of personal discovery toward the end of that career and realized, like, this is not something I wanted. Um, the people I was interacting with were not people that I wanted to interact with.
00:29:40.480 — 00:29:43.200 · Ramit
You hold on. Just to guess, were you an insurance broker?
00:29:43.320 — 00:29:44.600 · Mack
Uh, commercial real estate broker.
00:29:44.640 — 00:29:51.480 · Ramit
Ah. That was going to be my number three guests. Yeah. Okay. Yes. Good call. Okay. So you walked away from that industry?
00:29:51.480 — 00:30:23.030 · Mack
I did, um, and at that point I had savings. I hadn't really thought about it that hard, but I was like, oh, sure, I could live on this. and I needed a real reset, which I don't regret doing. But I took three months off, which was planned, and I had it in my head that, okay, three months off, I'll go get a job like that.
Um, and it took another 3 or 4 months after that to get a job. And so during those three months that I had planned for, I didn't make any adjustments and had pretty much burned through what I had.
00:30:23.070 — 00:30:25.590 · Ramit
How would you describe it? How do you feel about your career.
00:30:25.670 — 00:30:50.550 · Mack
Those early times when it was a lot of money coming in, real estate market was booming. I was pretty good at my job. I had a lot of opportunities really young. I was not setting that aside, really. I was, uh, pretty much hoarding cash. I think. Also, when I initially took that time off from work, I should have planned that to be, uh,
00:30:51.590 — 00:31:28.070 · Mack
you know, a time of some level of scarcity. I was not going to have an income. I was living in a very expensive apartment. I didn't change that. I've just kept spending like I was still had a regular income, and it didn't feel like that big of a deal for those three months because I planned for it. But then it became a much bigger deal.
So I think looking back, like there's some elements of getting here that I could control a lot that I couldn't. And so I end up in the spot where like kind of this is what I have, and I feel it feels unfair at times that this could be a thing that gets in between us.
00:31:28.070 — 00:31:35.590 · Ramit
It is unfair. Okay. So it is. Let's acknowledge that you have $100,000 of debt your partner is making.
00:31:36.630 — 00:33:14.090 · Ramit
Well, you're both making big salary. He's making a very large salary. And he's like, we're going to be in our 30s. I want to be able to ball out and we have this debt. It's unfair. Okay. Now what? You got to put yourself in max shoes for just a minute. In his early 20s, he's making a huge amount of money, but it's commission based, so it's really up and down.
Every time I talk to people who make incomes like this, they feel a lack of stability. They don't know that there's actually a way to stabilize manage their up and down income. Next, he loses that job, and then he proceeds to subsequently lose multiple other jobs through layoffs. How would you feel if this happened to you?
Probably be like, fuck, I don't even know what's happening, but I know I'm not in control. You'd probably feel a little bit incompetent, and then you might feel even worse when you see your partner who used to earn less than you start to steadily make more. You can start to understand why Mac does not have a healthy, engaged relationship with money.
Because for most of the last ten years, money has been a source of negativity, stress, overwhelm, and confusion and I hope that I can show him why this is important and then how to do it. Who is this debt a problem for? Raise your hand if this debt is a problem for you. Okay, cool. Keep your hands up, I like. They're both at the same level.
Let me ask the question again of this debt. Who does it represent a bigger problem for? By a show of your high hand going high.
00:33:16.010 — 00:33:16.810 · Ramit
It's quite interesting.
00:33:16.850 — 00:33:23.570 · Mack
I guess it's technically mine on paper, but I think my reaction to it is a lot different from yours.
00:33:23.610 — 00:33:49.770 · Randy
I mean, the teamwork side of me definitely leans into the idea that it's our problem to solve. And I see it's a scary thing to hear when somebody doesn't want to acknowledge that it's a big problem for them. And I think in this scenario, it's actually one of the ones where it's like, well, this isn't my problem if it's I'm not here.
Like it's one of those things that does pop into my head, kind of like an intrusive thought in that way where it's.
00:33:49.810 — 00:34:10.010 · Ramit
Yeah, I don't mind that, you know, you want to be cooperative. But I will say it's hard to interpret the mixed messages that you're sending. You know, it's like, I want to be a partner, I want to help, etc.. We what are we going to do? But also it's your problem. Because if I'm not here. Yeah. Good luck.
00:34:10.129 — 00:34:38.490 · Randy
I think there's two parts to it. I think one, there's like a buy in problem from, from you in this scenario where it feels like I'm taking this far more like seriously as a problem to solve and something that we should not have as a problem because I got this new job. And once you have, you know, that combined with, you know, the comfort of more money, you start to think about, like, how could we spend it?
Where could we spend it?
00:34:38.530 — 00:34:53.360 · Ramit
And you felt hamstrung. Yeah. Because like, hey, I'm now making way more than I ever thought. But yet looking at our numbers, so much of the money is going to debt. Your debt? Yeah. Okay. So what was the end of that entire paragraph?
00:34:53.639 — 00:35:06.720 · Randy
Our money conversations tend to end with us going our separate ways, because emotionally, you get very charged up about it. And I don't like to push people past where they're willing to be comfortable.
00:35:06.840 — 00:35:11.880 · Ramit
Huh? Is that why you came to me? Because I love it. Like what the hell?
00:35:12.160 — 00:35:12.440 · Randy
That's not.
00:35:12.440 — 00:35:18.600 · Ramit
Me. That's the whole point. You're supposed to push people past comfort to get where they want to go. What's that?
00:35:18.640 — 00:35:33.360 · Randy
I think the difference in this scenario is it's more of a shutdown rather than a conversation. Okay. And I know that from personal experience, just in general, if you try to push somebody past where they've already decided they're not going to go. Yeah. That's not productive.
00:35:33.400 — 00:35:54.190 · Ramit
Fair enough. We always want to be sensitive to where our limits are at the same time. This is a problem. Like both of you. At least put your hands up halfway. We know that it's a problem. So what do you both think is the solution to this. Because if one person cannot engage in the conversation, then it kind of gets shut down.
00:35:54.230 — 00:36:15.750 · Mack
It's not that I don't see this as a problem, it's that like, this is not a new problem for me. It's a new problem for you because we've only just recently been talking about it in the context of our relationship. But, I mean, this is something that's been on my back for a while. So the anxiety and processing of like how I'm going to deal with this.
I've kind of already done.
00:36:15.790 — 00:36:19.110 · Ramit
You have a debt payoff plan. Yeah. You know the date.
00:36:19.150 — 00:36:22.630 · Mack
It'll be February of 2030. Wow.
00:36:22.950 — 00:36:30.030 · Ramit
What? Really? Okay, round of applause for that. First of all, it's very rare. You say February 2030.
00:36:30.070 — 00:36:30.790 · Mack
Be four years.
00:36:30.790 — 00:36:32.110 · Ramit
From now, you're debt free.
00:36:32.190 — 00:37:09.070 · Mack
Yeah, I did a five year consolidation loan. Like I've come to terms with, like, what it is in terms of, like, I'm going to have this payment. I know when I'm going to be out of having that payment. I also know that that's the point when I'm going to be able to actually start saving again. I also know that barring large life changes, that that's putting me out from being able to be like on par with what you have saved, because during this entire time, call it seven years.
Like you were talking about, your 100,000 is going to be growing and growing and mine growing a little bit, but not
00:37:10.230 — 00:37:15.709 · Mack
I won't be able to get there. I've had to come to terms with that already. Um, but I think
00:37:16.830 — 00:37:26.310 · Mack
the emotional side of it is also like excited. Mhm. Um, it feels like something we could do together.
00:37:26.390 — 00:37:31.350 · Ramit
Nice. Can you be excited about money if you are $100,000 in debt?
00:37:31.870 — 00:37:34.190 · Mack
I mean I have not been able to.
00:37:34.630 — 00:38:07.700 · Ramit
You can't. You can. This is interesting. So if, if your entire worldview is like, oh no, you can't be excited. I don't know anyone who's done that. It just the two seemed completely at odds. Then of course, you're going to feel like about money. And the way you've constructed your world is that I need to feel horrible about money until 2030.
And guess what? When people feel horrible about something, they don't engage in it. They simply ignore it. So you're doing a very rational thing. The problem is you have the wrong view of the world.
00:38:08.780 — 00:38:55.850 · Ramit
Here's the truth Mac is not going to be successful with money unless he completely changes his worldview around it. It's not as simple as paying off the debt, he thought. All right. I created this debt payoff plan. Check the box. Good. But as you can see, even having an aggressive debt payoff plan is not solving the relationship problem.
It's actually making it worse, because Mac's worldview is. I don't want to talk about money. That is why I was so direct with him. I said, look, you're going to need to talk about money a lot, and you're going to need to find a way to enjoy it. Have you talked to Randy about the debt and about your plan and your feelings toward money?
Yeah. What have you said?
00:38:55.890 — 00:39:30.050 · Mack
I've admitted that I my relationship went from poor planning to ignoring to anxiety, to kind of just trying to manage the anxiety I have around it by planning things out and kind of having it sit. Um, I've also told you about how now that it feels like it's more a part of our relationship. You know, it went from being like a roommate that just has to be around all the time, because it's there to being right in the middle.
And that's felt like a whole new world. Different.
00:39:30.050 — 00:39:30.650 · Ramit
Bad.
00:39:30.690 — 00:39:31.130 · Mack
Yeah.
00:39:31.170 — 00:39:48.570 · Ramit
Okay. And when Randy says, like, the debt payoff plan is good, of course I would prefer if it happened faster. But from my perspective, it's a pretty solid plan. Okay. What do you think he's really saying? Is he critiquing your debt payoff plan or is there something else?
00:39:48.610 — 00:39:55.409 · Mack
I feel a lot like, um, at that moment when I first told you, like, I became a
00:39:56.490 — 00:40:12.250 · Mack
burden. And since we've talked about it more, it's felt a little bit more like the last few months. I've felt more like a net negative in our relationship because of it, because it's become more of a real conversation. When I first brought it up with you, it was a little bit more of like,
00:40:13.290 — 00:40:45.560 · Mack
hey, here's the thing you should know about me. Like, I'm figuring it out. And your response was amazing. It was like, yeah, I totally understand how that would happen. Like, I've been here with you through some of that and like, I felt really good after that because I felt really supported. But I think at that point, for both of us, this was like a mac thing and not a randy thing.
And then when it became an US thing, it feels like there's a little bit of whiplash, of feeling supported and understood to suddenly being, like, judged and like I'd become a problem to solve rather than a person to support.
00:40:45.600 — 00:40:48.440 · Ramit
Mhm. Um, have you said that before?
00:40:48.480 — 00:40:50.520 · Mack
Maybe not in so many words, but.
00:40:50.520 — 00:40:50.720 · Randy
What's.
00:40:50.720 — 00:40:51.400 · Ramit
Your reaction?
00:40:51.440 — 00:40:53.200 · Randy
I like a good problem to solve.
00:40:54.280 — 00:41:21.120 · Randy
I think is my default. I'm a little disheartened by some of that because it means I haven't been a very good partner, and it's something I can work on. Absolutely. And I'm kind of excited, too. Now, weirdly, um, as much as I don't like admitting that I have faults, when I do have something to improve upon, that is almost like a better thing than admitting you have a fault.
It's something new to get better at. Um, and I am sorry.
00:41:21.680 — 00:42:03.270 · Ramit
I appreciate that from both of you. It's nice to be able to share the way that you feel about money, and to be able to almost take a fresh look at what's happened in the last few months and saying, like, I don't want to be a net Negative. I don't want to be the problem to be solved. And, you know, remembering that it felt good to be supported when you first brought it up.
Sure would be nice to feel that way again. At the same time, when I think about what you're asking for when it comes to like as recently as a few weeks ago. Like, put the thing on the app. What's going on there? What are you really asking for more control? Mhm.
00:42:03.710 — 00:42:13.710 · Randy
There might be like an element of trust associated with it that I just don't trust that it's not going to continue to snowball in a way that's uncontrollable.
00:42:13.750 — 00:42:15.030 · Ramit
Have you told him that.
00:42:15.110 — 00:42:21.510 · Randy
No. And yes. I haven't said it in those words, but I have mentioned like, you know,
00:42:22.990 — 00:42:32.710 · Randy
we shouldn't be going and doing like pay over for different payment plans, doing if we buy something expensive, we should have the money in our pocket for it kind of situation.
00:42:32.750 — 00:43:12.230 · Ramit
Do you notice that when you say all these things like we should, we shouldn't do this, we should do this. We should set up an app. It's dancing around the core thing, which is, hey, I'm. I don't know if this is right or wrong, but I'm kind of feeling a lack of trust here. Like this debt has been here for a long time.
I don't feel the alarm from you that I would feel if I had this much debt. And we're in a relationship. We're. We're living together. We're going through life together. I don't know if I should feel this way or not, but I feel this lack of trust right now. That's the crux of this. Not can you set up an app? How does that strike you?
00:43:12.230 — 00:43:15.350 · Randy
Accurate? I think that's the core of it.
00:43:16.030 — 00:43:45.900 · Mack
I think the way that we that you specifically I talked about it when we got it was that this was going to be something to be helpful for us to, you know, figure out the path forward. And I was pretty excited about it because I saw it more as like, okay, maybe this isn't something that's going to be, you know, existential to our relationship.
And I can be into it, too, if Randy can be into it, too. I don't think I realized until now that there was an element of like, trust in there, which I can understand.
00:43:46.820 — 00:45:15.010 · Ramit
Randy is indirect. Do you notice it? He doesn't often say exactly what he's feeling, in part, I think, because he may not actually have access to it. So instead of doing the work to find out what's truly troubling him, he might suggest things like, we need to have an app, but the app doesn't really solve the real problem because nobody actually knows what the real problem is.
There's also something I want to point out to all the people who are indirect in their communication. You know that you're indirect if you are constantly monitoring how your partner feels, if you have a mental checklist of all the things that you are not allowed to say or talk about because it might hurt their feelings, you're actually not being effective in your communication.
You can be direct and you can be respectful. Notice that I am not telling you. You're never going to hurt your partner's feelings. You are. Life involves you hurting your partner's feelings. Sometimes. That's okay. We are not in a relationship to protect our delicate partners feelings. Oh, there's such a flower, petal.
Don't do anything that would damage them. No. We're here to live a rich life. And that means sometimes we need to raise uncomfortable questions. We need to be direct. We need to have these conversations. We do it lovingly. We acknowledge, hey, this can be difficult. I'm not even sure if I'm saying this the right way, but here's what's been on my mind.
And if we can have the courage to have those conversations, then we can get to a much better place. That's the path to a rich life.
00:45:17.890 — 00:45:27.850 · Ramit
Let me try to understand more about your relationship with money today. Randy. What do you remember your family saying about money when you were growing up?
00:45:27.930 — 00:45:38.410 · Randy
I grew up as an only kid with an only parent, so my mom was kind of independently successful and always taught me the value of a dollar and where it goes. But what'd.
00:45:38.410 — 00:45:38.530 · Ramit
She.
00:45:38.530 — 00:46:15.570 · Randy
Say? I mean, she always said, you know, take care of your pennies and nickels because your dollars will take care of themselves. But in the exact same breath, she also never told me to not go and experience life, which was a, you know, a great thing to have and a parent. I didn't have a lot of the normal money conversations, but she definitely taught me the value of trading time for items.
Oh, how'd she do that? I when I was a kid, I would get a $20 allowance, and if I wanted anything more, I had to figure out how to come up with that. Okay. And
00:46:17.290 — 00:46:36.600 · Randy
through that process, I obviously learned, like Gomo lawns, go clean gutters, go figure it out. And by doing that you effectively trading time for items, and that extended to my adult life where now I appreciate my time and will trade dollars for getting my time back.
00:46:36.640 — 00:46:44.120 · Ramit
Ah, okay. So you you're happy to spend money now to buy back your time. What are some examples of how you do that now?
00:46:44.280 — 00:46:48.240 · Randy
Recently we opted into having food delivery. Okay.
00:46:48.280 — 00:46:56.800 · Ramit
What else do you remember about money actually? Would you say your mom was upper middle class? Wealthy? How would you describe that?
00:46:57.280 — 00:47:08.040 · Randy
Probably upper middle class? Definitely. I mean, I also grew up in a pretty affordable area, so that made it a little bit easier to feel upper middle class.
00:47:08.080 — 00:47:11.280 · Ramit
Got it. Any vivid memories about money?
00:47:11.360 — 00:47:30.550 · Randy
I guess in my early 20s, I was very much conflicted with what I wanted to do in college and started off as like a data engineering degree. Okay, and was hoping to be a quant. So like got real accustomed to the idea of how money worked and what its levers were, and I think that's where I got my appreciation for money.
00:47:30.590 — 00:47:31.510 · Ramit
Do you like money?
00:47:31.550 — 00:47:32.790 · Randy
I like the game.
00:47:33.190 — 00:47:38.990 · Ramit
Ah, that's very helpful. Thank you. Mac, what do you remember your family saying about money when you were growing up?
00:47:39.070 — 00:48:09.030 · Mack
I mean, I also grew up. I mean, pretty middle, middle class, but we lived in a much more blue collar area, so that felt pretty upper class up through middle school. And then I went to high school and like the fancy town over, and then really bumped that up by going to the fancy private school for college. So a lot of the messages that I got from my parents was like, oh, we aren't those people.
Like, that's like very different.
00:48:09.070 — 00:48:09.990 · Ramit
What did they say?
00:48:10.030 — 00:48:22.430 · Mack
Any time I'd be hanging out with my friends in high school, it would be in like, the fancy neighborhoods. And my parents would always, like, make jokes about like, oh, yeah, well, you know, time to come home to where we live. And, um.
00:48:22.430 — 00:48:23.540 · Ramit
Implying.
00:48:23.820 — 00:48:54.900 · Mack
Implying that, like, we don't belong there, right? Kind of thing. Um, and money was like, never. We were never people who were, you know, buying things all the time. We lived in the same house my entire, uh, upbringing. But it wasn't necessarily scarcity. I would say my parents are extremely frugal. My dad could pinch the copper off a penny.
Mhm. Um. And my mom spending is entirely guilt ridden. Oh, it is anything. Yes. They're very religious. Midwestern, very religious.
00:48:55.100 — 00:48:55.700 · Ramit
Both.
00:48:55.740 — 00:48:56.140 · Mack
Yes.
00:48:56.180 — 00:48:58.580 · Ramit
Oh my God. All right. Yeah. All right.
00:48:58.620 — 00:49:00.500 · Randy
The free things, they live.
00:49:00.540 — 00:49:02.740 · Ramit
Do they do they do their own lawn work?
00:49:03.180 — 00:49:04.500 · Mack
Yes. Of course they do.
00:49:04.580 — 00:49:11.700 · Ramit
Midwesterners love love to do their own lawn work. They would never hire somebody to do it. That's.
00:49:11.740 — 00:49:12.740 · Mack
That's definitely true.
00:49:13.020 — 00:49:20.220 · Ramit
Amazing. And then you go to private school for college. What was that like from a financial perspective and looking at the world differently?
00:49:20.260 — 00:49:48.500 · Mack
I mean, that was my first time really interacting with a lot of people who had like real wealth, like not just they live in the nicer town next door, but like, you know, people whose parents were owners of corporations and, um, who, like, you could Google someone's dad or mom and you're going to find out, like, their net worth, like, that kind of thing was, uh, very different for me.
I'd never interacted with that before. Um, and I felt.
00:49:50.580 — 00:49:54.940 · Mack
Very out of place, but a need to be in place, if that makes sense.
00:49:54.940 — 00:49:56.140 · Ramit
How did it show up?
00:49:56.340 — 00:50:26.650 · Mack
Um, going into finance or the finance degree from private school and being around people who had been around a whole lot more wealth and money discussions, um, more that like early 20s was like, I have to prove that I'm supposed to be here. Um, um, which I think probably fed into a lot of like, not saving because, like, I always wanted to be living in a nice apartment.
Have a nice car. I never really wanted to talk about money, because I knew my picture was going to be different than anybody else's, because.
00:50:26.690 — 00:50:28.170 · Ramit
Would it have been embarrassing?
00:50:29.530 — 00:50:40.450 · Mack
I don't know what I thought it would be. It just maybe felt more like if everyone around me had more insight into what my background actually was, that, like, I wouldn't be accepted in the groups that I was in.
00:50:40.490 — 00:50:52.490 · Ramit
Yeah. What does it feel like now to know that your partner, who used to make a much more modest income, is now one of those people who makes a ton of money?
00:50:52.690 — 00:51:04.729 · Mack
I mean, I think I know you well enough that I've never, I don't like, see it as, oh, no, we don't belong here. But when we first started dating, I was the one making a lot more money. Um, and so
00:51:06.050 — 00:51:12.530 · Mack
I'm only a little bit older than you, but my career has been a lot longer than yours. And so it felt a little bit more like
00:51:14.050 — 00:52:09.400 · Mack
I had this idea, like I was the slightly more mature in the career, a little bit more to earn the money. Like I had more money coming in. Um, and then as you have excelled, it's been awesome to watch. And there's no jealousy or resentment for me on that side. Like it's pure pride. Um, I love bragging about the stuff that you've done.
Uh, but it does feel weird of, like, oh, I am not the one who knows what's going on. Like, just because I have more years. Like, not only is my salary gone down, which, you know, I made a career change. That's going to happen. We talked about that. It kind of is what it is. But it does feel a little bit weird like that.
That role has flipped pretty much and much more dramatically, because even when I felt like I was like the more mature one I was, I was not. And so I'm also realizing that, like, wow, we flipped and just moved further apart in terms of our knowledge and control and comfortability with finances.
00:52:09.440 — 00:52:12.480 · Ramit
That's quite insightful. Have you thought of that before today?
00:52:12.560 — 00:52:17.680 · Mack
We've always known how much each other makes so I. Yeah, I guess intellectually I was aware that like mine went down.
00:52:17.680 — 00:52:18.080 · Ramit
And that's not.
00:52:18.080 — 00:52:21.320 · Mack
What I went up. Yeah. I never really thought about it in that way.
00:52:21.600 — 00:52:25.000 · Ramit
How do you think that it shows up for you? Because that's a change in identity.
00:52:25.640 — 00:52:35.480 · Mack
I mean, before when it was other people I was interacting with, I was like, I never would want to talk about money because I didn't want there to be like, the secret's out that, like, I'm not supposed to be here.
00:52:35.680 — 00:52:49.360 · Ramit
Yeah, you're the you're the freshman in college again. Yeah, coming from the blue collar world and everybody else seems to have more money. And in fact, you used to be the person who had more money and more maturity. And now you're at the quote, bottom of the pecking order.
00:52:49.840 — 00:52:54.000 · Mack
Yeah, I had not really thought about it that way. But yeah, that is how that feels.
00:52:54.040 — 00:52:58.880 · Ramit
Mhm. Randy what's your take on this. Did you realize this.
00:52:58.920 — 00:53:11.519 · Randy
No I'm torn because on one hand I can totally understand what that feels like from the perspective of, of going to college and competing to be at a rank in your college class and all of that stuff. And
00:53:12.590 — 00:53:32.110 · Randy
I have a very different mindset on scenarios like that where, you know, it's just it's a problem of finding an optimization, which I know is an optimizer thing. Um, but I didn't know that it was that impactful to watch
00:53:33.190 — 00:53:42.830 · Randy
me do that. Do what? You watched me get a new job three separate times. You literally got laid off in the same week. I got a new job.
00:53:43.070 — 00:53:45.350 · Mack
So on even an average week.
00:53:45.990 — 00:53:50.550 · Ramit
What do you think that feels like? What do you think that causes in a relationship?
00:53:50.590 — 00:54:15.580 · Randy
Tension? Yeah for sure. Obviously an imbalance. It's been said as much. But I also think there's like an element of you're no longer allowed to be in the conversation, which is not the intent. Mhm. But after hearing what you've said, you, it sounds like you don't feel like you're privileged enough to be in the conversation and that it just happens to you rather than making it happen.
00:54:16.020 — 00:54:32.860 · Mack
I mean, the conversation of money now is a little bit more like we're looking into the future. It's like you're the one who has the bigger future. So it's kind of like, I'm not. It is kind of happening to me in a way, because we're together, but it also feels like it's not.
00:54:32.900 — 00:54:36.420 · Ramit
Listen, I see you're about to get ready to respond. Just listen to what he's saying. It's very powerful.
00:54:36.460 — 00:55:36.940 · Mack
Yeah. It's you. You have the savings now. You can see it on the CSP. I'm the one who has the negative in front, which means that I'm working to get to neutral, and then I'm still going to have work to do to be positive. So like, I haven't had the experience to be able to talk about what we do with the money. And now it feels almost pointless to be learning about it because like, what?
What am I going to do with that information now? Like, you get to make those choices. It is the money that you're earning and you do deserve to have that money. Um, and for me, I want to check out because it doesn't even really matter what I'm going to say. And and frankly, I don't know that I would have anything to say that's even better than what you have.
I mean, it's like, obvious that you're better at it than me. So it's like I'm going to get stressed out and feel really terrible. And I also don't really have much to contribute here anyway. So, like, why do I have to feel this negative and this bad when there's not even really anything for me to contribute in the first place?
00:55:37.420 — 00:55:38.580 · Ramit
What do you think, Randy?
00:55:39.420 — 00:55:45.580 · Randy
Disheartened. I feel like I'm kind of bummed you don't feel like you can come talk to me and ask me questions.
00:55:45.620 — 00:55:57.100 · Mack
I don't know if it's that. I don't feel like I can ask you questions. And it's not that I don't know how these things work. I, I do, I have a degree in it, but, um, it's like
00:55:58.340 — 00:56:12.250 · Mack
just getting to talk about it. I'm either going to be feeling not really part of it and just awful or at best, just kind of like a little disinterested because it's like it doesn't it doesn't matter. Like this is going to be a new thing.
00:56:12.450 — 00:56:13.370 · Ramit
Does it matter?
00:56:14.170 — 00:56:17.690 · Randy
Yeah. Tell them it does matter.
00:56:19.210 — 00:56:32.810 · Randy
We're solving for we. Not me. And I don't think that it's just a me problem. Especially if we're going to have a future together. And I would like it if you were a part of that conversation.
00:56:33.530 — 00:58:03.440 · Ramit
I think there's an interesting dynamic here, and I think you are both really starting to get to the core of it. So what I just heard from you, Mack, was a lot really honest, vulnerable, sharing of like, I like it doesn't really feel like this matters. It doesn't feel like anything I do is really going to change it.
And you're the one making more money. And so if we're talking about money, it's going to be about you and your ability to save. Obviously, that's hard to hear. Randy, your response was, I'm disheartened that you feel you can't come to me and ask questions. But in human nature, we do not ask people questions when we feel bad about something.
You know what we do. We hide and we try to avoid paying attention to it at all. That's the way it works. So the job of both of you is to create a healthy culture where by default you get the opportunity to talk about it, not just get it, but you are actually compelled to talk about it just the same way as like if a couple had kids.
Oh, I don't like to talk about kids. Well, we have a kid. We got to talk about kids. That's how it works, right? Money's actually the same thing. It's just a little bit more convenient to avoid it. I see how you have both co-created this dynamic, Randi. You know, I think there's some resentment here, especially as your income has steadily increased and you're looking at this debt payoff plan.
And implicit in what you're saying is like, how do you do it faster? I know you have the numbers in this plan, but like, how does it go faster? And I'm over here Like,
00:58:04.640 — 00:58:18.640 · Ramit
is speed the thing that we need to worry about here? Because for years to pay off 100 K to me is like pretty good. Maybe we can make it three and a half. I could play with some numbers with you, but like, is that really the issue?
00:58:18.800 — 00:58:19.440 · Randy
No.
00:58:19.680 — 00:58:20.640 · Ramit
What is it.
00:58:20.680 — 00:58:24.000 · Randy
The trust element that we had talked about. It's just so
00:58:25.040 — 00:58:29.479 · Randy
I guess paramount to what I'm concerned about. It feels like
00:58:30.920 — 00:58:34.000 · Randy
there is no plan around it, as you mentioned.
00:58:34.040 — 00:58:36.960 · Ramit
Plan being because you got a debt payoff plan.
00:58:37.000 — 00:58:39.960 · Randy
Well, the plan around not having it happen again.
00:58:40.360 — 00:58:41.160 · Ramit
Okay.
00:58:42.280 — 00:58:56.040 · Randy
It very much feels like it's still something that can happen again and again and again. And it's not going to change the pattern, because once you're out, you can get back in. You know how to solve the problem. Now we can go in this loop and I don't want to be stuck in the loop.
00:58:56.080 — 00:59:18.470 · Mack
I mean, I think that is fair. You were there for some of that accumulation, but most of it happened before we had even met. And so there's a little bit of like I have the understanding of how I got there. You don't and I can I can totally see how that's like if it happened once, it can absolutely happen again, especially if I'm consistently coming off as it not being a big deal.
00:59:18.590 — 00:59:18.950 · Ramit
There you.
00:59:18.950 — 00:59:33.670 · Randy
Go. I don't know. I kind of see it as a game, and I wish we could treat it as a thing to tackle and get excited about it so that once you're out of the zeros and get start going up, we can celebrate that win in a very different way.
00:59:33.870 — 00:59:35.910 · Mack
Yes, I absolutely can do that.
00:59:35.950 — 01:00:07.620 · Ramit
I think that, um, Randy is perfectly acceptable for you to ask tough questions and to say, look, we're building this relationship together and we are a high earning couple. And I understand that you've got debt, and I want to support in the way that you need to be supported. But my expectation is that you pay this off aggressively.
You follow the debt payoff plan. I think it's a great plan, and I want to know how you are going to make sure that this doesn't happen again. Go ahead, Mac.
01:00:07.820 — 01:00:22.780 · Mack
I think I've got to be transparent about, like, what I'm actually doing every month with you, even though we have all the accounts and things. It's like you're just looking. You're not looking inside my head. Um, I need to tell you more about what I'm feeling and what,
01:00:23.980 — 01:00:40.740 · Mack
where it's going and what I'm trying to do, so that you know that this is something that's on my mind. It is something that, yes, I get a little emotional about it for a lot of different reasons, but it's not something that I don't have some level of control over.
01:00:41.300 — 01:01:19.620 · Ramit
Um, you have total control over this. Don't say some control. You have complete control over this debt. You incurred it. You have a debt payoff plan. You have an income. That's all you need. You have complete control over it. Own that. And I love what you just said. I need to provide transparency literally right up your monthly transparency report.
It's not punitive. It's not like you're a child. It's actually you're a partner. It's what you do at work. Here's what's going on. Here are the numbers. Here's what the numbers mean. So I think you're totally on the right track. What is your reaction? I noticed a bit of a reaction when I say you own the debt, you have control over it.
01:01:19.820 — 01:01:27.420 · Mack
I think it was that moment. It's it dawned on me that I didn't realize how not in control I felt.
01:01:27.460 — 01:02:20.850 · Ramit
Yeah. I'm glad. I'm glad to be able to provide a little perspective, because when I see a debt payoff plan that's that aggressive, you know, many people take decades to pay off 100 K. You're not getting it out in less than four years. And I'm like, all right, that's great. But you you are able to do the math, but you have not yet transitioned your mindset to realizing, I'm doing this.
And because you're not transitioning your mindset, you're not confident Even though you are relatively competent at the debt payoff plan. That energy is rubbing off on Randi. And so Randi sees this lack of confidence, not talking about it, avoiding it, not carrying the ball openly. And he goes, I don't trust you.
What's going on? Fill out this app. Da da da da da da. And the irony is you actually have a nice plan, but neither of you have recalibrated your relationship.
01:02:22.370 — 01:02:24.610 · Ramit
Okay, cool. Let's keep going on this.
01:02:25.730 — 01:02:47.130 · Ramit
The rich life for the two of you. Would the two of you say you live like a very nice life? Yes. Okay, so you eat out, you travel, etc., etc.. Cool, I get it. I like talking to people who like to spend money on the things they love. I think that's great. High earners especially. You've often earned the ability to do that.
Great.
01:02:47.130 — 01:02:59.360 · Randy
I kind of daydream about the day we don't have any debt to think about and how we can put away each of us $1,000 for four months and go on an $8,000 trip three times a year.
01:02:59.400 — 01:03:01.320 · Ramit
Ooh, okay. Where would you go?
01:03:01.840 — 01:03:05.560 · Randy
Vancouver. Brussels? I don't know. I mean, there's a bunch of places.
01:03:05.960 — 01:03:06.320 · Mack
We got a.
01:03:06.320 — 01:03:23.080 · Randy
List for sure. Yeah. Okay, cool. I want to go on a mountain biking trip that's guided by somebody cool and Austria. Mhm. I would like to go explore Mexico and go do all the tequila tastings down there and understand culturally what they do. Yeah.
01:03:23.360 — 01:03:24.280 · Ramit
Do you travel now?
01:03:24.320 — 01:03:27.840 · Randy
I'm not as experienced as Mac, but it's something I do like to do. Yes.
01:03:27.880 — 01:03:34.280 · Ramit
What about the two of you? Do you currently travel? Yeah. And then how does the money work with that?
01:03:34.640 — 01:03:36.360 · Randy

 For the most part.

01:03:36.400 — 01:03:36.640 · Ramit
Yeah.
01:03:36.680 — 01:03:37.120 · Randy
Ah.
01:03:37.480 — 01:03:38.080 · Mack

 50.

01:03:38.120 — 01:03:49.160 · Randy

 I think that's where we just naturally landed. Because originally when our when we started dating, he made more. But I also had much more control over my finances, so it just kind of worked.

01:03:49.200 — 01:03:49.480 · Ramit
Yeah.
01:03:49.520 — 01:03:57.160 · Randy
And As the Delta has gotten further and further apart, we just have not revisited that conversation because it's.
01:03:57.200 — 01:04:08.120 · Ramit
Kind of a familiar thing, right? Yeah. Think about Mac when your income dropped, when you were laid off and you did not adjust, and what was the consequence of that.
01:04:08.200 — 01:04:09.360 · Mack
Spending more than I had.
01:04:09.400 — 01:04:45.800 · Ramit
Yeah, it was like a decade of debt. Yeah. Because of that. Do you all see that there are severe consequences for not adjusting to the reality of changing situations? It's actually so important. Almost nobody does it. They lose their job, they keep spending the same, or they make a ton more. They keep things the same.
Obviously one way is worse, but it has severe consequences. So we're going to fix that as well. Because if one person is earning way more we need to adjust things. Okay. In your rich life do you have a vision of your finances?
01:04:45.840 — 01:04:52.950 · Mack
I mean, I think you have a lot more that's involved in, uh, spending money to buy back time.
01:04:52.990 — 01:04:53.510 · Ramit
Mhm.
01:04:53.550 — 01:05:14.070 · Mack
And for me, that's a little bit less important I think, with the cooking one that often did fall to you because you work remote and I work in an office. So you really want to be able to have someone who like does the cleaning. And if we've got it all set aside, we've got someone doing laundry and someone, you know, fixing a lot of those things.
I think that's like less important to me.
01:05:14.110 — 01:05:18.510 · Ramit
How would you reconcile that? Assuming the two of you get married and you combine your money?
01:05:18.550 — 01:05:21.590 · Mack
I think I'm pretty comfortable with the idea of if we're
01:05:22.630 — 01:05:42.670 · Mack
hitting our goals on our savings, I don't really feel the need to be policing like what's there. If if it's combined and that's something that fits in and we still have room for the other stuff that's important to us, then like I might sit there and be like, I don't know why you're doing that, but like, I'm not gonna it's not that big of a problem.
01:05:42.670 — 01:05:51.060 · Ramit
Let me ask about your identities, Mac. Who do you need to become in order to live this vision of a rich life?
01:05:51.100 — 01:05:53.060 · Mack
I think I need to
01:05:54.380 — 01:06:07.940 · Mack
become a little bit more of the person I'm at work. I have to be hyper organized and on top of everything all the time. I'm pretty good at that at work. I need to be that at home, too.
01:06:07.980 — 01:06:09.540 · Ramit
Nice. What else?
01:06:09.860 — 01:06:35.180 · Mack
Uh, have to be more confident as well. I need to be communicating to you that, like, I've got this, and I need to also be showing you that I've got this and that once we're together and, like, kind of a decade past where we are now and looking back on it, it I think I need to be the person who can separate that and be like, boy, that sucked.
Glad we got through it. Super happy about where we are now.
01:06:35.780 — 01:07:06.100 · Ramit
Beautiful. That was amazing. The ability for you to, uh, future pace yourself and see what you're going to look back on and how you're going to tell that story. Like incredible. I can feel that. Because you're right. Like, oh, that sucked. I'm proud of what we did. I'm proud of what I did. You already are seeing that pride.
It just needs a little time to cook. Amazing, I love that. Randy, what about you? Who do you need to become in order to live this rich life?
01:07:06.420 — 01:07:11.340 · Randy
A champion of your successes? I think a better pillar.
01:07:11.900 — 01:07:34.660 · Ramit
Can I make a couple of suggestions? I think you need to be more direct. I think the mixed messages are killing you. So it's very clear what you need to do. And it's very clear what we need to do. Those need to be explicit. I can cheer you on, but this is your thing and here's what I expect. How does that strike you?
01:07:35.100 — 01:07:35.740 · Randy
Doable.
01:07:35.780 — 01:07:38.660 · Ramit
Great. I love that one other thing.
01:07:40.940 — 01:08:20.009 · Ramit
I want to take a look at your numbers in a second, but I suspect you may need to change some dynamics on your CSP. The 5050 thing doesn't work when one of you is earning 50% more than the other. I'm going to propose that we change that you all can discuss. Maybe at some point Randy goes, look, I really I really want us to take this trip together.
Let me cover this one. It means a lot to me. Great. You can gracefully accept. Maybe you're just like, yeah, anything below 100 bucks. Okay, fine. It's not really going to affect anything, but you've got to also be able to change the way you look at spending in your relationship. Randy you're nodding.
01:08:21.130 — 01:08:32.250 · Randy
I mean, even coming here are you I like the idea of being able to be the pair of that in some scenarios, and you just don't want me to sometimes. And you kind of.
01:08:32.529 — 01:08:35.049 · Mack
I was pretty pissed off about you buying dinner last night.
01:08:36.690 — 01:09:42.960 · Ramit
I think this is your good conversations for the two of you to have. Like, you will have to come up with a new way of treating money, because the facts of the matter are one of you earns 50% more than the other. Okay, one of you is in $100,000 of debt, is on an aggressive debt payoff plan, and you still want to enjoy life.
I'm not saying don't do anything, but you're probably going to have to adjust what you spend money on, how you spend money, and how frequently you do. So I'm going to put the CSP up, and I want to take a look at some of the numbers and let's make some adjustments. So as we can see right now, we have one partner, Randy, with 47% fixed costs and another Mac with 87% fixed cost.
That's simply not feasible. The one thing that immediately jumps out to me is your rent. It's 5050 now, y'all. You know you are not married, but you are living together. In my opinion, it makes sense for your joint Expenses to be proportional. How do you feel about that?
01:09:43.319 — 01:09:45.880 · Randy
That's a conversation that we've had.
01:09:45.920 — 01:09:47.480 · Mack
Oh what.
01:09:47.680 — 01:09:51.880 · Randy
Like it's it's it. I'm okay with that.
01:09:51.960 — 01:09:53.120 · Ramit
I what's your.
01:09:53.120 — 01:09:57.000 · Mack
Take? Yeah. I feel very uncomfortable. Why? I don't know again it's like I,
01:09:58.160 — 01:10:05.040 · Mack
it's like my thing to be dealing with. I don't really want to be cutting into what you're enjoying because of that.
01:10:05.560 — 01:10:07.960 · Ramit
What does that. What? He makes more money.
01:10:09.000 — 01:10:33.120 · Ramit
Yeah. Like, look at me. I make more money. I pay more taxes than somebody who is making, like, $35,000 a year. I should he makes more money. He should proportionately pay more of joint expenses. It actually has nothing to do with your debt. He has the ability to do it. He actually said he wants to. What's the objection?
01:10:33.160 — 01:10:35.640 · Mack
That's hard for me to believe that you actually want to.
01:10:35.680 — 01:10:53.350 · Randy
I could see why. And I know like there's obviously mixed messaging. We've talked about it. I think the realization I've come to, though, is that the proportionality is important because it makes fair feel fair versus equal.
01:10:53.510 — 01:11:16.390 · Ramit
Nice. Fair or equitable? Much more important than equal. Y'all are never going to be equal in your relationship. No couple is equal. Not with, um, stuff around the house. Not with earnings, none of it. But if we make it equitable, if we make it fair and we discuss it, that can be great.
01:11:16.430 — 01:11:25.510 · Mack
I mean, it would certainly make me feel like I have a lot more space to either be more aggressive or to be able to keep up with some of the stuff that we like doing.
01:11:25.910 — 01:12:41.100 · Ramit
I was a little surprised that Mac was resistant to doing proportionality for their joint expenses. I mean, after all, there's a disparity in their income and they live together. To me, this is a perfect recipe for proportional spending on joint expenses. But this idea that we have, which is quite unexamined of equality, everything should be equal.
Why would it be? Am I equal to freaking Michael Jordan on the basketball court? Of course not. And yet, in arbitrary parts of life, usually the most unexamined ones, we go. It's all got to be equal. How can it be equal? If one person earns 50% more? It can be fair, but it probably will not be equal. And how do we do that?
We have discussions. We talk about what are we contributing to this relationship? We never overvalue the contribution of money. Just because you can put it in a spreadsheet doesn't mean it's more valuable. There are lots of ways to be valuable in a relationship, including emotional labor, labor at home, money planning.
There's so many different ways, but we need to shine a light on these and we need to be honest about them. And we need to be open to changing those as situations change.
01:12:41.620 — 01:12:45.820 · Mack
I think the hardest part for me is like, there's always going to be a little bit of a doubt in the back of like,
01:12:46.860 — 01:12:53.260 · Mack
ah, are you actually okay with it? Like, is this actually something that like, am I just being the burden again, I guess.
01:12:53.420 — 01:13:23.660 · Randy
I think it comes back to a plan. I don't want to fund the fund money if you have debt to pay off. And like that's not like that would be a hard stop for me if that were the case where, you know, we're paying, I'm paying, let's say $1,000 extra in rent and that extra thousand dollars, rather than it going to a place that's going to get us where we want to be faster, it's going to more spending on things you want that doesn't feel fair.
01:13:23.700 — 01:13:28.940 · Ramit
Are you then willing to not go on certain vacations and restaurants for the next few years?
01:13:28.980 — 01:13:29.780 · Randy
Yeah.
01:13:30.060 — 01:13:58.010 · Ramit
Take the win. So let's make the changes in the CSP and see what it looks like. Okay, cool. Um proportional payments. We are going to have Randy paid 2282 and Mack is going to pay 1556. Notice the number dropped from 87% to 81%. That's a bit of relief. Subscriptions. What is this? What's $140 of subscriptions when you have $100,000 of debt?
01:13:58.050 — 01:14:01.570 · Mack
Uh, the largest part of that is a gym membership. But what is it?
01:14:01.610 — 01:14:03.130 · Randy
109 yeah.
01:14:03.130 — 01:14:05.730 · Ramit

 All right. What's the other 30?

01:14:05.810 — 01:14:08.170 · Mack
Spotify. Netflix.
01:14:08.730 — 01:14:21.250 · Ramit
All live in the same place. Why don't you just share it to. Sorry. Netflix, guys. I mean, it's literally the same household. What's the problem? Eliminate this. I'm gonna do it for you. I don't want to talk about this anymore. 110. Um,
01:14:22.290 — 01:15:01.640 · Ramit
miscellaneous. Oh, yeah. What, you just let this be 15%, right? You didn't change this. Okay, here's the deal. When you're making like a ton of money, then the 15% I sort of don't care because I've found a lot of people have 15% fixed cost extra. I put it in there. It's remarkably consistent. But when you are in debt, you can't allow that to happen.
You have to be dialed in. So in your case, I would say because you are now your identity has changed. Taking the ball, owning it, being meticulous the same way you are at work about your own personal finances. This 743 is not acceptable. What do you want to make it?
01:15:01.680 — 01:15:03.080 · Mack
250 bucks.
01:15:03.120 — 01:15:35.400 · Ramit
Better. Wait, you have $100,000 in debt? I'm taking that down 150. You need to be dialed in. I'm raising the bar on expectations. And actually, this is what I want you to do. Because we have a mission. And it's for me, first and foremost for Mac, but it's also for us. Take that energy and communicate that to your partner.
He wants and needs to see that as well. Okay. We have $0 in investments. I sure would like to see that number change a bit. What do you think? Randy's nodding his head furiously.
01:15:35.440 — 01:15:48.960 · Mack
I, I don't know, like the right balance of putting money into investments versus high interest debt. Like, I'd rather just get rid of the debt and then worry about investing in things later.
01:15:48.960 — 01:16:26.910 · Ramit
I like to see people, even if they're paying off debt, to have a little bit going towards savings and investing. It's kind of like keeping the factory on. It keeps the widgets moving. So even like a hundred bucks a month is actually meaningful. And it's meaning. It just sends a message to yourself. Saving is important to me.
Investing is important to me. So let's take a look here. I'm just going to arbitrarily pick a number. Okay I'm going to say $100 a month for investing. And I'm going to say $100 a month for an emergency fund. Wow. Okay. You. This is quite amazing. Look at the bottom here. What do you see?
01:16:27.590 — 01:16:32.990 · Mack
Yeah. That went on to or up to 25% went up by. What is that, $800.
01:16:32.990 — 01:16:49.910 · Ramit
It's crazy. Yeah. So I see you have 25% of net pay available to do whatever you want with. And that is $1,793 a month. That's a lot of money. Now the question is, what do you want to do with that money?
01:16:50.190 — 01:17:05.030 · Mack
I wanted to be going into something long term, whether that be increasing the investing side. I mean, I think I am in a spot where if something happened to our relationship or to you and or to me, like I would not have any kind of buffer.
01:17:05.030 — 01:17:06.310 · Ramit
So I would put some in savings then.
01:17:06.350 — 01:17:06.590 · Mack
Yeah, for.
01:17:06.590 — 01:17:08.270 · Ramit
Sure. Let's take some of that. How much?
01:17:09.430 — 01:17:15.109 · Mack
Um, I have about 6000 or so today in savings. I probably need
01:17:16.110 — 01:17:22.990 · Mack
more like 20, 25,000 to feel like that's comfortable. So call it $300.
01:17:23.110 — 01:17:24.460 · Ramit
Let's go a little higher.
01:17:24.500 — 01:17:25.260 · Mack
$500.
01:17:25.340 — 01:17:45.060 · Ramit
I think 500 is good. Plus, the 100 you already have is 600. Watch what happens to the numbers. You're now at 8% savings rate. That's pretty good. I like to see that number 5 to 10%. Maybe a little higher. Your guilt free spending. I like to see that number at 20 to 35%. But that's for somebody with no debt. If you have debt, should that number be higher or lower?
01:17:45.540 — 01:17:46.980 · Mack
That should definitely be lower for sure.
01:17:46.980 — 01:18:27.020 · Ramit
Lower. So at 18%, you're still kind of like at 20%. So what it's telling me is you got money still to reduce on guilt free spending and to allocate elsewhere. Now again, this would depend on the two of you. Because if you all are going out to freaking Masa in New York or something, that's not going to work. But that means you probably need to change the dynamic of your relationship.
Number one, you may need to reduce the frequency of how often you go to these nice places. And two, you may need to reconsider who pays for them for a while. Okay, let's take this number down. I'd like to see this number at somewhere like 12 to 15%. So we got a few hundred bucks to play with. Where do you want the money to go?
01:18:27.060 — 01:18:30.620 · Mack
Probably increasing the debt payment. Okay. It's up there. Yeah. Principal.
01:18:30.620 — 01:19:35.770 · Ramit
Why not? All right, so it's at 2038. How about we say like 2400 just to play games? 24. Whoa. We're now at 13% guilt free spending or $931 a month. If you combine that with your guilt free spending. Randy, that is $4,900 a month. Now, I understand the two of you are not married, so you may want to keep your guilt free spending separate, or you may want to combine it because you're like, hey, we do everything together.
We enjoy it. But the important part here is you both look individually and together to realize that's a load of money every month. So that means, like if Randy goes, hey, I really want to eat at this restaurant, this one is going to be on me. It's important. And Randy would have to be aware that Mac has $931 a month total for everything guilt free spending, self-care, travel, all of it.
So if you want to do other stuff, then you probably either need to pick up the tab or don't suggest it. How do you feel about that?
01:19:35.770 — 01:19:39.330 · Randy
Confident I can do that. I'm a homebody. Great.
01:19:40.010 — 01:20:11.010 · Ramit
And then? And then the times that you want to travel, you can discuss it. And that's a that's an honest discussion. So I would suggest that most of the time, um, Mac, you're going to be like, look, I of course I'd love to take this trip, but right now I'm on a mission to pay this debt out so I can't do it or, hey, I'd really like to do this right now.
I'm on a mission. Can't do it. And then, Randy, you might go. You know what? I totally understand that it's important for me that both of us do this. This one is on me, and you two can hash it out. Would that be okay?
01:20:11.210 — 01:20:11.810 · Mack
Yeah,
01:20:12.890 — 01:20:13.290 · Mack
yeah.
01:20:13.370 — 01:20:59.320 · Ramit
Might be harder a little bit. Might feel a little weird. But I don't care if it's weird, I want success. Okay. Um, we have some utilities changes. By the way, let's take a look here. 149 101. You know, you go and make the adjustments proportionally and it it starts to go into all parts of the CSP and it makes things much more equitable.
Somebody who's earning 50% more should be paying more proportionally for joint expenses. You're up to 955 a month and guilt free spending. Your savings is growing back at $600 a month. That's pretty cool. You got a 100 bucks a month going to investing, not to mention your 401. It's like. And the debt is paid off in how many years.
01:20:59.320 — 01:21:00.880 · Mack
And four years from now?
01:21:00.880 — 01:21:03.640 · Ramit
Four years actually sooner than that. Yeah. Yeah. Because we increased.
01:21:03.640 — 01:21:04.800 · Mack
It. Yeah, exactly.
01:21:04.840 — 01:21:11.680 · Ramit
I, I can't do the math off the top of my head, but it would probably be something like 3.6 years.
01:21:12.000 — 01:21:12.960 · Mack
Like it's.
01:21:12.960 — 01:21:30.400 · Ramit
Fast. By the time that ends, you will have thousands more in your savings account. You'll have thousands more in your investing account. You too will have lived a very nice life and you will be debt free. What do you think?
01:21:30.440 — 01:21:31.800 · Randy
I'm excited by it.
01:21:31.840 — 01:21:41.440 · Mack
I am also excited about that. Um, I think it's the hardest part is going to be me believing you that you're okay with it. Not that I think you're lying, but that, like.
01:21:42.000 — 01:21:43.560 · Randy
How can I show that?
01:21:43.720 — 01:22:05.200 · Mack
I think we just need to be talking about it and how we're feeling about it. Um, and I can commit to working on my reaction to talking about these things. It feels like in this mode, it feels less like something is hunting me, and almost more like I'm doing the hunting, which feels pretty good. Okay.
01:22:05.520 — 01:22:11.720 · Ramit
Yeah, I like that. I like that metaphor. Yeah. You are doing the hunting. You're in charge.
01:22:12.920 — 01:23:14.660 · Ramit
I feel really good about Randy and Mac. I think the fact that they came to ask for help before they get married is a huge sign that they take this seriously. These are not easy conversations to have. So the fact that they're doing it, going through this tough stuff in these realizations is a really positive sign for me.
My wish for them is that they start to see themselves as a unit. They can keep their finances separate. They can be more proportional on the joint expenses. They can have a plan where Mac is the one driving the debt payoff as he should. But more importantly, they start to talk together as partners about what should our money do today and tomorrow?
What do we enjoy doing? Is it more important for us to be debt free as a couple than for us to go on this trip in September? I want them to have those vivid, sometimes contentious discussions as partners. If they can do that, I feel very good about where they're going. And now let's take a look at their follow ups.
01:23:15.340 — 01:24:39.980 · Randy
Here we meet. Hey Tim, it's Randy calling in with a one week update. Uh, Mac and I have had the opportunity to really work through the homework use at home with us. I think the most surprising thing for me with that experience was that the idea of equitable and even aren't necessarily the same thing, and in our scenario, they're not.
Uh, that has turned out to be one of the very first things we implemented as a couple was to go ahead and split our all of our finances 60, 40, um, right down based on how much income we have. Uh, I think one of the biggest things that has changed in our communication, and also the way we talk about finances, actually, is largely Mac taking ownership over the process of planning, finances and really being involved from the get go and what we do, how we tackle finances and more importantly, how much ownership he feels like he has.
So it's no longer him writing along, but it's actually more of him being in charge and leading that. One of the outcomes of that is that I've gotten the freedom and kind of the mental bandwidth to stop being the bad guy, and instead we get to kind of enjoy the process of where we're at. It'll definitely be one of those things where we can look back at it, you know, a decade from now and say, that really sucked, but boy, did it put us ahead.
Um, and it gives us some excitement to kind of look forward to the future. So I appreciate the time. See you guys later.
01:24:40.540 — 01:26:25.960 · Mack
All right. Me wanting to give you a quick update from our conversation last week. It really shifted our mindset when it comes to our individual finances and what we're building together. The biggest surprise for me was realizing that my debt payoff plan is actually not that bad, and there's realistically room to put even more toward it.
But the real game changer was learning that Randy wasn't just willing to split expenses proportionally with me, but he was actually excited to do it once he knew that I was the one with his strategy. I realized that by trying so hard to keep my financial challenges to myself and not make them Randi's problems, I actually made things worse for the both of us.
It made him feel defensive of his own savings and spending, and eroded his trust that I was also working hard on my own finances too. I spent so much time worrying about how Randy felt about things, that we weren't really having honest conversations, and we lost sight of the main goal, crushing the debt and building the life that we want together.
Your analogy about who has the ball really stuck with us? Although we're big hockey fans, so we're calling it Who Has the Puck? And I've officially taken the puck in our regular money conversations. I'm not only building the agenda, but leading the topics, asking the questions, and still creating space for Randy to get his own input as well.
I've set up our refined CSP in our own savings and tracking apps so that when we do have our money conversations, it feels less like confronting the really big problems every single time, and more like solving the small and medium ones makes it much more fulfilling to be engaged, and he's here to take some of the bad emotions out of the conversation and replace them with feelings of accomplishment each time we sit down to tackle a problem.
We definitely came out of this experience with a better understanding of each other and what we want in our relationship. We even talked realistically about a timeline to get married once we're ready. Don't worry roomie, we'll be sure to send you an invite to the party.
01:26:26.640 — 01:26:58.800 · Randy
Hey team, this is Randy calling in with my four week update. Um, things have been going really good. Uh, we moved to an apartment, and actually, not even the same one that we intended to. We found a better deal that gave us three months free. Um, we set up a joint fixed cost account that allows us to put everything that we would naturally spend anyway into an account together, split the same way we planned on, which was 6040.
Uh, and it gets rid of the problem of.
01:26:58.800 — 01:28:11.470 · Randy
Venmo ING each other back and forth. Who goes who, and instead just allows the money to come out of our accounts kind of organically, which feels really good. Um, that apartment that we ended up changing over to has three months free, which kind of nets out to $10,000. So that allows us to very quickly in the next three months, build up a shared buffer for us just in case anything were to ever happen.
And then it allows both of us to individually also save up money. Um, which feels really good. It feels like we're on the right path along that. Mac and I have definitely aligned our expectations and helped each other understand what we are kind of aiming for long term. Um, one of the things I decided to do was put in the same amount of effort he is in paying debt down, and I'm going to save an equivalent amount.
Um, which feels really good. We kind of did our first version of that in the last couple of weeks and immediately texted each other individually and said how good that felt. So long term, I like things are looking up and I'm really excited for the future. Hope you guys are doing good. Um, I'll see you on the flip side.
01:28:11.870 — 01:30:57.060 · Mack
It's been about six weeks since we first met, and we definitely made some big changes. And I think it's been really great for the two of us. I think one of the biggest changes that I've seen is, um, Randy's been a lot more comfortable with being able to split all of our fixed expenses proportionally every month, and I've gotten more comfortable with that, too.
It's really given me a lot more flexibility to focus on my own debt payoff plan, but also to be able to boost my own savings, see that emergency fund grow a little bit and feel a little bit more like I'm pulling my own weight for the stuff that we're sharing. I think I've gotten a lot better about setting boundaries for certain things, whether that is, um, you know, some bigger purchase comes up and I say, you know, this is not the month for me.
Can we wait? Or maybe it's a trip or something that we decide to put off a little bit longer, and there's been a few times when it's been worth it for Randy to just go ahead and do it or pay for it, and I've had to get comfortable with that. But, um, you know, it's been a great way for us to be able to have those conversations and to feel like we're making the decisions together, which is really nice.
We have set up in various apps the way that we can see each other's accounts, obviously our shared account, but also our individuals individual savings and checking accounts. Um, it gives a lot more visibility so that we can see where everything is going. Randy can see where I'm paying to every month and can see the balances go down at the same time that I do.
But interestingly, I don't think either of us have really felt the need to police that. You know, we check in with each other every month during our monthly meetings, but we haven't felt the need to actually be tracking along and seeing how each other is doing. It's built a lot of trust for both of us and has made, uh, the, the financing discussions be once a month and, pretty fun actually, which has been great.
We just had one of the bigger stressors that any relationship can have, which is moving into a new house. Uh, it is obviously a lot, but, uh, we sat down for, for at least once every week for the month leading up to figure out what expenses we were going to have if we needed to get any new furniture or anything.
Paying for movers. All of that decided what felt fair for each of us to pay for what? Um, and it made it so that, you know, the day of the move was a little stressful, as any move can be, but we were able to make the whole process overall actually feel a lot more comfortable, collaborative. Um, even a little bit fun, which has been great.
So we're really excited to be able to have some new skills and some new comfort with how we can build our life together. Um, and we're really grateful for the chance to be able to have, uh, to be on your show and be able to talk about it. And, um, we're excited to see where it goes. Thanks.