Afford Anything - Erin Lowry on Raising Children Who Are Enabled, Not Entitled

Episode Date: March 27, 2017

#70: Erin Lowry, author of Broke Millennial, talks about the early childhood scripts that we learn about money. Why is this topic important? Well, if you're a parent, you want to set a good financial example for your child to follow. Giving them the right tools and information about money at an early age, as Erin's parents did, can easily set them on the right path in life. And as 'grown-ups,' many of us have negative scripts around money that we want to unearth and unlearn. Regardless of your specific situation, one thing is true: we often inherit our money mindset from our parents. For better or worse, we unconsciously internalize their actions and thoughts around money, and it shapes how we view and interact with money today. Erin shares the lessons her parents taught her about money in this episode, and discusses the impact it's had on her spending and saving. (Hint: She's always been debt-free and has set the awesome goal of being a millionaire by age 35.) For example, Erin is a natural saver and became frugal at a very young age thanks to her parents being savers. While that sounds great, she often prioritized earning money to the detriment of her social life. She shares a specific instance where she passed up what turned out to be a night to remember among friends for a babysitting gig that paid $100. These days, she allows for more balance in her budget. We also discuss: Specific financial lessons Erin's parents taught her and her sister at an early age Erin's first memories surrounding money, and how those shaped the person she is today Erin's thoughts on financial independence and retiring early How our views on real estate investing differ because of the lens with which we view it Erin's decision to become a freelancer just six months ago A personal example of when being frugal crosses the line and more! Enjoy! Find more resources at http://affordanything.com/episode70
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You can afford anything but not everything. And that's true, not just for your money, but also your time, energy, focus, attention, any scarce or limited resource in your life. And so the question becomes, number one, what decisions are you going to make? What are your priorities? What do you value? And number two, how do you align your day-to-day actions with those decisions? This is the Afford Anything podcast, and I am your host, Paula Pant. Today, I interview Aaron Lowry, the author of Broke Millennial, and a good friend of mine, somebody that I've known through the general FinCon finance blogging circles for several years now.

Erin lives in New York and she specializes in speaking to an audience of millennials about money management. And I invited her on to the show today so that she could talk about early childhood scripts that we learn around money. And I've tried to direct this interview in two different ways. Number one, I've tried to direct it in a way that serves parents who are trying to figure out how to model good financial behavior for their kids. But number two, I'm also trying to aim this interview, make it relevant towards grownups, you and me, we're ostensibly grownups, who are trying to unlearn some of the negative scripts around money that we learned when we were kids. So without any further delay, here's Aaron on raising children. who are empowered rather than entitled. Hey, Aaron.

Hi, thanks for having me. I'm glad to have you on because you and I have known each other for a few years now. Probably three because I didn't get to go to the first eligible FinCon. And I think I met you the first time at FinCon in New Orleans. Oh, you know, it's always bad when someone has met me for the first time in New Orleans. I have nothing but fond memories. Oh, excellent. I suppose I only just fall apart on the inside.

Excellent. I mean, as long as the outsides rock in, who cares? So you just wrote a book. You talk in the book about hangups that you have around money based largely on the mindset that you got from your parents and from your upbringing. So I'd love to talk about that and then kind of zoom out into just other hangups and mentality, money mentality things that people generally deal with. Sure. Yeah, I should start by giving a little bit of background about my relationship and my parents' relationship to money. I overall feel very fortunate. And I think that that is a key component. My parents raised me in a very financially literate household. They were talking about

money from the time I was a very young kid. And there was no taboo about it, no hangups about it, almost to a point where I think it makes other people uncomfortable how cavalier we are when talking about money. And I don't think I actually mentioned, oh, go ahead. I'm going to pause you. Can you give me some examples? Yeah, I don't think I actually mentioned this particular instance in the book. But we have a game in my family, I would call it the percentage game for lack of a better term, where my dad will tell us what percentage of the inheritance we're getting based on certain behaviors we're doing at that time. Are you serious?

Yeah. I have never heard of this. Hopefully it's a joke because I'm definitely losing right now if it's not. But it'll just be things as flippant as I can remember I was in high school. And for context, I spent most of my childhood living in Asia. And my little sister, I was 10 when we moved. My sister was 7. So from 7 to 18, my sister only lived in Asia.

And we were watching the movie Friday Night Lights. I was probably a junior in high school. so my sister would have been an eighth grader. And midway through the movie, all of a sudden my sister goes, oh, I get it. It's like rugby. And my dad's face just fell. And he first goes, I failed you as an American parent. And then he said, you just lost 75%.

So it's little jokey things like that. And I think that also the fact that we can talk about death and money has like a very nonchalant, non-taboo topic. My family's a little bit weird like that. But because I grew up in that sort of an environment, money was never a stressful topic. But I still was getting what I call financial blueprints from my parents. And for me, a big one was that they, even before I was born, they were spending money, like ruthlessly prioritizing spending money on what they valued. And for them, travel was really important.

And so my parents got married when they were 28. They waited five years to have me. And in that time period, almost every year, they would use when mom was a teacher, so she had the summers, but my dad would use all his like 10 measly vacation days he got. And they would take them all at the same time and go to Europe and explore and travel. And this is what they enjoyed doing. So when we ended up moving to Asia, every time we had a trip or a free time from school, whatever the break was, my family would travel.

And that's what my parents spent money on. And that's what I grew up seeing as a valuable thing. So not only do I value travel, but I got this idea that it was better to spend on experiences than on stuff. My parents are not shoppers. Oh, go ahead. Oh, just where in Asia were you living? So we live first in Kobe, Japan, and then we lived in Shanghai, China. Okay, cool. Just curious. Go on. Yeah, my parents had a full stint of about 11 years. I was there from 2000 to 2007 because I graduated high school then, but I would go back summers and Christmas to Japan, well, at that point, China. But, you know, we grew up with this seeing that, you know, my mom didn't buy much and neither did my dad. We didn't have the latest in like tech gadgets or clothing. And those just weren't things that they valued. I joke that they have a leather couch in their house that's older than I am, and it's still like a prominent thing that's in the living room. And so they just don't care to spend money where they don't truly see value. And getting that message, a little bit of nature. I'm by nature a saver. It just seems to be hardwired into my DNA, but then a lot of nurture, I became relatively frugal very early on

in my life. Now, it's primarily a positive, but I will say, at times, it has been a little bit of an issue for me. And I write about this in the book where when I moved to New York City, I moved here three weeks after I graduated college. I was not earning very much money from the job that I had, which was working as a page for the late show with David Letterman. So I picked up a barista gig at Starbucks and I also started babysitting. Now, if I needed help, my parents could have supported me. A lot of my friends who were doing those jobs were on what I call parental welfare. But I thought that it would show a lot of respect to my parents and show them that they raised me

well by making sure that I was hustling and doing it on my own. I also started, I didn't want to dip into my savings. So I started taking every possible job I could and I said no to almost everything my friends invited me to. which reflecting back now, I do regret a little bit. I wish that I had been a little less focused on money and that some of the times when people invited me to do things on Friday, I would have thought, yeah, I can stand financially afford to not babysit tonight. I should go out with my friends every once in a while because I rarely did it.

And one thing I say in the book is if people ask you enough times and you say no enough times, they stop inviting you. Yeah. So that's the other thing to think about. Actually, I want to go deeper into that. So why do you regret it? Is it like the missed experience? Tell me about that. Yeah. I think that's a big part of it is that because it is experiences that I value. And there's one moment that I can think of very clearly where four of my friends were going to, one of the four live, was originally from Long Island. And he was like, oh, I want to have everybody out to my parents' house and lived in a nice house. And there was stuff to do in the area.

And they're like, we're all going to go out this one Friday night. Like, well, I got a babysitting gig that night. So I knew I was going to be earning like at least 100 bucks, if not more. So I was like, well, is it worth $100 to me to go to Adam's house? I guess not. They still talk about that night to this day. That is one thing that they talk about is one of the first. of their favorite memories and one of their favorite nights in early times in New York.

And so it was just a lot of those type of moments that I passed up on because I was so focused on money. And money is not everything. And so it is figuring out how to find that balance. And I do think it took me quite a little bit to find that balance. Do you now, at this point in your life. Does it ever like pain you when, you know, like sometimes we all make financial mistakes and we end up losing $100 or, you know, and it could be something obvious like a speeding ticket or it could, you know, where the cost is clear. Or it could just be something like you shop around for cheaper car insurance, you find something that's 15 bucks a month cheaper. you do the math in your head 15 times 12 and then you kick yourself for not having done this,

you know, three years ago. Like when that happens today, do you mentally link that back to those early frugal days with the sacrifices and does that compound the pain? I'm asking because it does for me. I don't think I've fixate on it quite as much now because I've tried to train myself out of it. It's been something I've been working on for like six years now, but I will say what I do fixate on, almost instead of the smaller things, it's the lack of negotiating early on in my career that I look back and like, oh, what are you doing? Because that adds up to like tens of thousands of dollars. So those kind of of moments I will sometimes reflect back on and be like, yikes, you screwed up there, my friend. You could be X amount richer.

Yeah. And every so often, cutting rent checks in New York City, every once in a while, I will crush myself by getting on Zillow and looking at what I could afford in other cities around this country. And I could be living like a queen in many places that I cannot live that lifestyle here in New York. So tell me then about, it sounds like you locked into some very strong. wrong financial priorities and mentalities from the beginning. From early childhood, you learned to focus on your priorities, spend on things that were important to you, and save money, pay attention to your finances, talk openly about your finances. Like, you're checking all the boxes. It sounds like you're doing everything right. For the most part, I kind of look at myself as a case study of

if your parents are comfortable talking to you about money and if they have a healthy understanding of how finances work, it reduces a lot of pain for the child because they can get set up on the right path from a very early age. Because ultimately, I think that not to throw anyone's parents under the bus, but the primary way that we learn about money and begin to have our sort of imprints on finances is directly by whomever raised us. So if that's your parents, your grandparents, and aunt and uncle, that's where you're really getting your big messages about finance. You can get it a little bit from friends, but it's through the people that you're around the most and how they relate to money that's really going to sit back in your brain and come out

eventually in your relationships towards finances. So I understand why. I understand why. I understand why, that's a valuable message for the people who are listening, who are parents. What about the people who are listening who are thinking, well, geez, my parents weren't like that with me. Am I screwed? Definitely not. I would say most of my friends and my boyfriend's parents are not like that. And to this day, that's an interesting kind of battle, especially with like my boyfriend is obviously my closest case study. We live together. We handle money together to a degree. And his relationship to money as well as his parents' relationship with money are things that I have vested interests in. And they're certainly very different than my own. One thing that I think is

important, first and foremost, is start to identify your blocks and know why they're there. And it takes a little bit of time and it certainly takes some self-reflection. But, you know, If you are willing to go through that process, then you can start to figure out how to overcome if you need to or pivot, if that's a better term. And the other thing is, once you know, like, if you know about yourself, I am a spender. End of the day, I'm never going to change this behavior. I'm always going to be a spender. At least you know that about yourself.

So you can start to set up baby gates and systems that work to prevent you from spending all of your money. And it could be something as small and as simple as, you know, everyone talks about automating your paycheck, which, yes, is important. But what if you have your checking at one bank and your savings at another bank? So when you log into your checking, you aren't seeing your savings. Something that small could prevent you from consistently skimming off the top of your savings account and spending that money.

Yeah, absolutely. Plus, it takes a couple days to clear. So that also is another bit of a problem, if you will. Yeah, absolutely. Absolutely. If you want to amp that one up to the next level, put your savings in a bank account and then cut up the debit card to it and cut up all the checks to it and intentionally forget the password that you use to log into the online banking. So the only way that you can get to that account is by physically getting in your car and driving to the bank. Oh, man. I did that once years ago to protect some money that I was saving. And it was just the bank. It was Wells Fargo. I had some, you know, a handful of thousands there. And there's a Wells Fargo branch, like, less than a mile from my house. But the fact that I would have to physically go there to get the money out kept me from touching it. That's awesome. I would say, though, if you're going to do that, then make sure it's a bank with a physical branch and not just an internet-only bank. Oh, yeah.

Whereas you'd forget the password. It's a really big headache. But let me go back to one thing that you said earlier, where you talked about identifying your blockages. because once you identify what they are, then you can begin to work through them. First, what are some examples of those blockages? Well, I would say there's two different ways to look at this. One is to just reflect on what your childhood experiences were when it came to money. So some of the scenarios that I lay out are, did mom and dad constantly argue about money? Were you scolded for asking about money?

and it could be as simple as did you say to mom or dad, how much do you make and immediately got shut down with a, that's none of your business? And then the other thing is, did you assume everything was okay and then it wasn't? And this is something that certainly a lot of families saw happen in 2008, 2009, when they looked like they had it all, but were really living in a paycheck to paycheck cycle. And all it took was one or two months of not having income. to have everything come crumbling down. And it could also be that your parents were in that cycle. Nothing ever happened to trip them up.

But now that you are living financially independently, you can kind of see that what your parents are doing is a bit of a facade, which then you can extrapolate to be thinking, are they okay for retirement? Am I going to need to help them? What's their financial situation really like? And so some of the things that I recommend people going through just as a very basic way to think through these different scenarios, if not one of those specifically just immediately jumped out to you. Reflecting on just really basic things.

Like what's my first memory of money and how does that memory make me feel? And for me, for instance. Yeah, I was going to say, okay, what is your first memory of money? So I have two. the first thing I remember as more of a joke about money was trick or treating at Halloween. We would come back and both of my parents would go out. I have a little sister and both of our parents would come out with us. But we'd come back, dump the candy.

I want to say I was probably four the first time that this happened or at least the first time I can remember it. And my dad came over, grabbed a Snickers bar and a Skittles, like arguably premium candy. and goes, candy tax. And I was like, what? He was teaching you about taxes. Wow. Yes. And he goes, we took you. And the thing is, anytime he did something, he would explain it.

It's not like he just did it and said, like, it's a grown up thing. He said, we took you out. We took you trick or treating. You got this big haul of candy, so you owe us some. I was like, what are you talking about? Oh. But boy, did that sit me up for a real one. old paycheck. Got it. Okay. So he was taking a commissioner, a finder's fee. Interesting.

Yeah. Jeez, if you really wanted to go all out, he would have taken the commission and then taxed you on the remains. He really could have. Luckily, he was a more benevolent, you know, chaperone of tricker trading. And that was one of my first, like, very first memories, which I didn't link to money until much later in life. And then anytime you trade candy with your sister, he charges a sales tax. He really should have. I. I mean, then he could have definitely gone on. I don't see those Jimmy Kimmel things where, like, parents, like, pretend to steal all their kids. Can't even like, are you kidding me?

That was my childhood. Like, for realsies, though. They actually took the candy. It's like taking candy from a baby. My sister was a baby at that point, too. So she really got it bad. All right. And then my other big number, oh, go ahead.

Oh, no, I was just going to say, sorry, I feel like I keep interrupting you. So please go on. My other favorite. And this is one that I talk about in the book and on the blog. and I call it kind of my origin story is I was seven years old and my mom was having a yard sale and I wanted to make money because even at that age my parents had set up this rule where if my sister and I wanted something we had to pay 50 percent, talk about learning how to curb impulse purchases when you're a child.

And so I was trying to get entrepreneurial but there were very limited opportunities and my friendship bracelet making business was not taking off the way I had anticipated. So when my mom had this yard sale, I was like, oh, how about we sell something? And instead of lemonade, I asked my dad if he would go to Krispy Cream and buy a bunch of donuts and my sister and I could sell the donuts. And so we sold through all these donuts. And in the end, he came over, picked up all the quarters. I had like a teal fanny pack that I had been using to store them in.

And he picks up the fanny pack. And he dumped all the quarters out. And he's like, all right, well, and I don't remember the exact numbers, but let's say I had made $20. And he was like, well, it cost me $8 to buy the donuts. And your little sister worked for you for a little bit, so you need to pay her. So you're going to pay her $2. So your net profit is $10. What?

And he wasn't kidding. Like, he took the money. It wasn't like a, here's a lesson, but you get to keep all your money. He took what he had put in and he made me pay my little sister. And I had to keep the net profit. That's how I grew up was learning all of these small lessons throughout my life about money. So that by the time I had to handle it on my own, even when I didn't make much, it didn't feel as stressful as it probably should have. Because I just understood how to determine what I value and prioritize and spend within my means.

So what, where has that brought you to today? Like what are your financial concerns today? What are your goals today? Like for I guess for anybody, I'm asking, I guess for anybody who's listening who is a parent, I think what I hear when I hear you tell these stories is I hear a story of parents who really did the right thing in terms of raising their kid in a money smart manner. So how does that story end? Like, where are you today as an adult? And what are your goals? What are your concerns?

what's the result? That was a really long question. Well, I'll unpack it. I think the first thing that's interesting about it is my sister and I are both freelancers now. Oh. Yeah, I find that interesting. We work in very different industries and I stayed. I was in the traditional workforce for the first five and a half years of my career out of college. I just recently switched to full-time freelance and not flippantly. I had taken a long time to get to that decision, but I switched only about six months ago. And my little sister, she went to USC for film and immediately went and stayed in the film industry.

And quite successfully, she had a short premiere at Tribeca last year. So she's doing all right by herself. And I think it's interesting that we're both in industries with relatively volatile income potentials because I think we both understand and feel comfortable with handling that. I think that's one way it worked out. Interesting. So that's your theory is that like you became entrepreneurial because you didn't, you felt like you didn't need the security of a paycheck because you felt secure in your ability to handle finances. Is that what you're communicating? I think it's a mix. I think that's part of it. I think that financially we both feel comfortable because of that and arguably we both feel comfortable because at the end of the day, we both recognize the privilege of having parents that could support us if all else failed. And I think that that's always an important thing to point.

out is that there is something that comes with having that mental security. And I have never gone to that well. I've never asked my parents for a loan. But I think that it's unfair of me to say that that doesn't play some sort of role, even if it's unconsciously in the back of my mind, knowing that if everything blew up in my face tomorrow and I somehow magically lost all of my money overnight, I could go home. And my parents would be okay with that. And I have a relationship with my parents that that would work. Interesting. I want to pause there and go into that because I don't have that. Like I would never move back home. Basically, what you just described, I don't have that. I've discussed this on a recent episode.

sometimes it makes me uncomfortable when I hear people acknowledge that part of the story because I hear it almost as though that's a prerequisite or that's a necessity. And so then I feel a bunch of internal resistance because I'm like, well, but I don't. And I did it. So, you know, and I don't think I'm special. I don't think it's a necessity or requirement at all. I just think it's important for everyone to be open about what their situation is. truly is. And I think a lot of times, especially when we're talking about money and entrepreneurship,

people withhold a little bit of information. So I've been very transparent in my writing that I don't have debt. I never have had debt. And part of that is because I work very hard. Part of that's because I had 50% academic scholarships to college. And part of that's because my parents were able to pay for the other 50%. And not only able, but willing. I think that's a good. I think that's a good. I think that's key term because they were able to pay for 100% of it. They weren't willing to pay for 100% of it because my parents thought that my sister and I should have skin in the game when it came to paying for college. I just think it's always good to note the background that you have. And it's also important to note your risk tolerance. I think your risk tolerance is higher than mine for a lot of things.

You know, real estate stresses me out because I don't have the risk tolerance for it, but I'm more comfortable with the stock market for whatever reason. I think part of it could be just my background and my knowledge and what I know about. I don't know enough about real estate at this point to feel comfortable with it. But that's kind of why I say risk tolerance wise, I felt more comfortable jumping into the freelance life because, one, I had enough money saved. I could have gone a year without making a penny and still lived fine. and not pulled any money out of retirement accounts.

So that was one thing that made me feel fine. But the other thing was still knowing that if something horrible happened, I had this kind of parachute out. And that's from my own risk tolerance and mental security that I needed. Interesting. So it's interesting to hear you say that because I actually went into real estate, in part, because I felt like entrepreneurship was kind of risky. And I wanted to mitigate that risk by building an alternative stream of passive income. So I went into real estate to reduce my risk, if that makes any sense. Oh, it does. It's just what you have a palette for. I think you understand it.

You might not have then. Well, I didn't then. I just, I just dived into learning about it. I didn't know anything about it when I started. But zooming out a little bit, I guess where I was, where I was, where I was, going with with that comment is that it's interesting to hear you say that you observe me as somebody who has a higher risk tolerance because the whole reason that I started building passive income through real estate was because I wanted to build a safety net. I wanted to build a parachute out. I think I could have built my business, my online business, a lot faster if I hadn't been doing the real estate stuff also, because I was kind of building two businesses simultaneously, so my attention was split. But yeah, it was because I wanted to build some sort of a safety net that could catch me if I fell that I built real estate.

So I actually, yeah, I actually see that as something that I did just because I wanted the type of support that you describe yourself having when you talk about going back to live with your parents. Like when I bought my first house, when I paid cash for my first house, or the first time that I paid cash for a house, I was like, oh, okay, worst case scenario I can live here. It's a piece of crap house, but worst, worst case scenario I can live here. And that brought me a lot of relief. I think that's a great way to put it. Yeah. Like, long story short, I guess I did it just because I wanted to build a safety net. And basically I did it because I had a low risk tolerance.

and I saw this as a way of building that. What's interesting, though, is that, so you bring up the cash thing, part of my aversion to homeownership at the moment is my debt aversion. And that's like another psychological block. I have such a bad taste in my mouth about debt that even when it comes to something like having a house, the idea of being on a mortgage stresses me out. And part of it's I live in New York City. So there's nothing that I would want to live in that I could afford to buy here.

Not that I couldn't afford anything, but nothing that I want to live in that I could afford. And so if I could pay for something outright in cash, I would probably have a different relationship to it, but the idea of owning something, especially something that I didn't live in that someone else lived in, it's like a very control freak thing that I work up in my head, that that all feels like so out of my control and I don't like it. and I don't understand it and my risk for it is not there. And so I think that that's why I perceive you as being more risk-tolerant. Wow. This is really interesting. Like, we've got the same set of facts.

And I think you and I are probably not too dissimilar when it comes to our risk tolerances, but we view the same set of facts from these completely different paradigms. And that influences the way that we interact with it. That's so interesting. This is why I find money fascinating. Yeah. Same. And I always am so enamored by people who build the real estate.

I say what you have as an empire. It's actually talking about you to a friend who wants to get into real estate recently. I was like, I know a woman who basically has an empire. Her name is Martha Stewart. And so I find it fascinating when people are able to do that and when they're able to successfully put together a team and have that support system in place and the fact that you also now don't live near a lot of your properties to me is just astounding part of why i for a very brief moment kind of looked into trying to buy something and i knew it would have to be outside of new york so i looked

at a couple places in the south but in the end i was like uh i just can't pull the trigger it makes me too nervous to not at least be in driving distance to it for my first one to be able to figure out contractors and hiring people and building a team. So I chickened out. Have you checked out Philadelphia? I have not. And that would be close enough that I could get to it. Hey, hey, we'll be back to the show in a second. But first, I want to give a shout out to Fresh Books. They have signed on as one of our main sponsors in 2017. And they have an awesome product. It's meant for freelancers, solopreneurs, small business owners. If you have a side hustle or if you're self-employed and you need to send out invoices to your clients. Yeah, it's necessary. You've got to send invoices to get paid, but it's also annoying and it's time consuming and nobody really likes doing it. It's just one of those costs of doing the job. Inter fresh books. They automate the invoicing system. You type in some basic information and their system handles the rest. It automatically sends follow-ups to invoices that haven't gotten paid. It lets you know whether or not your client has even opened your invoice or not. Basically, they take the suckiness out of it. They take the suckiness out of it. It's not. It automatically sends follow-ups out of it. It's a lot. It lets you know whether or not

of invoicing. Give him a try for free for 30 days at FreshBooks.com slash Paula. That's freshbooks.com slash P-A-U-L-A. I don't remember what we were talking about before we kind of got on this tangent, but I'm really glad that we got on this tangent. I feel like that was one of the most real parts so far. Where were we? Well, I was talking about the financial roadblocks. And I actually, I have stuff that's in the book up in front of me. So we talked about the, what is my first memory of money. And that's what took us down the path. And the next one is also, how did I get money to spend growing up? And I always find that an interesting question to ask people because I'm always curious if people were handed money or if they had to earn money. Because I do think that that plays a

difference with how people react to money today, which for any parents that are listening, it's interesting to me how much of a you could start award a dinner party of a bunch of parents by asking about allowance. I feel like claws come out when you are asking parents how they hand off money or don't hand off money to their children. And some families don't even believe in it at all. And then also when I did have money to spend, what did I buy? And what are my financial concerns today, which you actually kind of brought up about me earlier and kind of what my big goals are, Yeah. Oh, yes. What are they? I'll go down.

Yeah. So first of all, my boyfriend student loan debt is one of my biggest financial concerns. And we've been together for closing in on seven years now. Congratulations. Well, thanks. I will not. And I always say that for context because we're close enough that marriage is a conversation. We think we'll probably get there. That's just something he does really value. And I will not combine our money. unless we are married. It's just a personal, it's a risk tolerance, personal preference that I have, but I also won't help pay off his debt until we are legally signed on a marriage license.

So I know that I could just wave a wand and take care of it right after we are married. And by wand, I mean write a check or use my bank account. Wave a pen. Wave a pen. But it's important to him, and he's expressed this on the numerous times we've about it, that he wants to have some ownership over it. He feels that he got himself into it, and it's, quote, not my responsibility. I argue that if we're married, it's a team mentality. It is my problem. Therefore, is partially my responsibility. And I, again, going back to the debt tolerance, I have no tolerance for that hanging over our heads. So I want it gone fast.

Like, to the point that we'll be one of those catchy clickable, we paid off, blank amount of student loan debt in two years kind of thing. And I was like, I've always wanted one of those stories. So that's certainly something that I wouldn't say keeps me up at night, but it's something that I think about. It's a concern that I have because I will acquire debt in a marriage. And I guess I always think about having enough to fund the lifestyles that I want. And I am very intrigued by the whole fire movement and the financial independence, retire early movement, just in terms of how much different couples and individuals feel is enough money, especially if they're opting out, people that just completely, I don't think it's common

in blogging that people leave their workforce and don't at least have some other way to earn, whether that's writing or some sort of thing that they make. But I have spoken to a few people who are not necessarily in the personal finance blogging community who do at 38 just opt out and they're done. And they don't have, other than their investments, don't have another way to be earning income, which I always find interesting. That to me is a very high risk tolerance where I don't think I could necessarily do that. Is that something that you want eventually, early retirement? I think that it's more, I call it lifestyle design, more than early retirement.

Partially because I don't know, it would take a lot to get my boyfriend on board with early retirement, which is an interesting conversation that we keep coming back to. I do definitely want to have the option to not have to make any more money if I choose, which is basically the definition of early retirement. But I don't have right now an age in mind, nor do I have an amount in mind, because there are so many other factors at play that haven't kind of resolved themselves, such as do we want kids? If so, how many are we going to have?

Where do we want to live? And I think once that crystallizes a bit in my life, then I'll be able to make a better judgment on how much I feel we would need. And from what I know about you, it sounds like you generally, you live a very financially healthy lifestyle. Having financial independence, which is the ability to retire early, whether or not you actually retire early, like just having the option to do so, that often is a natural organic consequence of living a healthy financial lifestyle.

It's kind of like, oh, I just ate this really healthy food and drank a lot of water and exercised all the time and didn't smoke. And oops, now I guess I'm really healthy. You know what I mean? Like even if that wasn't like what you were intending, if you just take the right actions, that just is like the organic result of it. So I can see you accidentally becoming financially independent. I do want to reach a million by 35. I have started getting vocal about that one, but to me a million dollars is not financial independence yet, I think, just by product of living in New York at the moment. And because of my thoughts on lifestyle, which I know is going to make some of your listeners cringe, as well as pretty much everyone in the minimalism camp of personal finance really hates it when I say, I don't think I can live off of $40,000 a year, especially not with a family.

but which I ironically have been doing for the you know my entire life up until now so could I yes but I want to hit a million by 35 because my joke is that I want to beat my dad to a million that is very misleading in how it sounds my dad had a goal at around my age and about his late 20s he set a goal to be a millionaire by 42 and he hit that so I think if we adjust for inflation, 35 would have me soundly beating him to his goal. I love that you adjusted that for inflation. You have to. Otherwise, it doesn't count.

A million today is not a million then. One of my friends said that recently. He's not a money person. And I said, yeah, so I want to do it at 35. He's like, then you'll crush him. I'm like, dude, no. Because a million, if I waited until 42, those millions aren't the same amount of money. He's like, what is that?

Trust me. Oh, man, this is exactly why I love hanging out with money nerds. I totally get that. So I was like, maybe if I did 1.3 by 42, but no, the goal is a million at 35. Yes, it's easier to set benchmarks that are round numbers. Intigers that end in zero make great benchmarks. Quote of the day. It was funny to my dad, I think maybe two years ago, when I first disclosed my net worth to him, And he goes, well, if I had had that amount of money at your age, I probably would have gotten to a million much sooner. I was like, oh, Lord. All right.

Pressure's really on. Man, way to bring you down a peg. It's funny, too, because I spoke to somebody. I told a friend of mine, more like an acquaintance that goal one time. And he was in a CFP class with me. So obviously both money oriented. And he goes, man, my dad would be pissed if I did that. I went, really? I just think I would make my dad really proud. That's the only reason I'm doing it. Like, I'm very vocal about it. He knows about it. And he's never been like, well, we'll see. He's like, all right, do it. That's awesome.

Hmm. Why would your friend's dad be mad? I think, and I don't know if this is a gendered, like, male and male macho competition thing, but he felt like if he beat his dad, his dad's ego would be bruised. I was like, really? Don't parents usually want you to do better than them? Isn't that kind of the whole point? Like, you always hear about parents wanting more for the next generation. Well, you know, so what I hear when I hear that is like underlying that is a bit of a scarcity mentality. Like, it's a zero-sum game. If a given person is doing better, that means that I am doing worse, meaning the pie is fixed and one person's win comes at another person's expense. That's a good point. It could be what his crux was. I mean, that's just, I might just be smoking something. Like, who knows, you know? But that's just what I hear when, that's where my brain goes when I hear that. Well, fortunately, that is not my parents' mentality. They are all for us being. as if not more successful than they are. So it sounds to me that you have thought about money

and been very careful with money throughout your entire life. And I'm guessing that the majority of people that you encounter outside of these particular personal finance communities are, you know, don't think about money very much. Like the majority of random person that you'll meet on the street doesn't think about this stuff so much. How do you deal with that? Do you talk openly about money with the outside world? I'm very honest with my friends, especially those that aren't very, I should back up and say first. I think we as humans self-select people who are similar to us.

And one of the ways I have seen that manifest in my own life is that I have friends that are from variety of different socioeconomic backgrounds, but almost all of them today are very fiscally responsible and very focused on some form of monetary success. I think that looks different to a bunch of us in terms of what we define as success. But most of the people that I'm very close with, have some element of saving, budgeting, not overspending on luxury goods. So I don't usually feel pressure to keep up with a certain friend or I try not to let friends spend my money. I would say the exception is wedding season.

That seems to be the one time that everyone's happy doesn't get someone else's money. And it's been an interesting evolution over the years. And part of it too is just being really honest about telling friends like, okay, if you want to do that, that's cool. I personally, I don't usually word it this way, but in my head I'm thinking, I don't see value in spending $100 to go to that concert. It's not someone I'm very interested in. So I'm not going to go. If they still want to go, obviously, no harm, no foul. But I also like to, I call it countering.

And I kind of will negotiate sometimes on if a friend. wants to do something really expensive that either I don't see value in or if I've kind of hit my budget for the month and I just mentally don't feel I can afford it. Let's say, you know, I really would like to spend time with you this weekend. I really don't want to spend $50 on brunch at that particular restaurant. How about we just go get a bagel and walk in the park? We still get to spend some time together. And more often than not, people are pretty open to that kind of negotiation, especially

if they just want to hang out. But you also can't begrudge them if they still want to do the expensive thing. You just don't go, but you can't be pissed if they still go do it. Right, right, of course. Yeah, I have found a lot of times that people suggest restaurant meals, people suggest meeting for lunch or dinner because it's an easy default. Yep. I often suggest something different, not for financial reasons,

but sometimes just because I'm just tired of it and want to do something different. Which is also fair. Yeah. And people are... Because that's about value. Yeah. People are pretty open to that. If I'm like, hey, there's this cool art sculpture like a block over that way.

You want to check it out? Yeah, most people are very, in my experience, most people are very open to that. And enjoy the breaking out of the grind, like the social grind. Right. I also think that the other thing is important to know your financial relationship with individual friends. And what I mean by that is that there will be some people that you are friends with or related to. And it might be a very penny-pinching slash nickel and dimming situation. And I do not mean either of those in a derogatory manner.

So a friend of mine and I, we kind of joke about this. She and I, anytime we go out to eat, the bill always gets split based on what each person ordered. And you pay your share. I don't know where this originated from. We've been friends for six years. We both make around the same amount of money. But that's just what we do. And I have another friend where we always just kind of rotate picking up the tab.

So over time, it's probably going to even itself out. But I never really concerned myself with that one either. I just know that with this friend, we always split exactly as we should. And this other friend, we just alternate. And I never want to necessarily upset the apple cart by saying, to the one where we, you know, pay for exactly what we ordered and go, hey, why don't we just split the bill? Because this is the script that we've set up. It's what works. It's what makes her comfortable. It's what therefore makes me comfortable. So why change it up?

One of the themes that keeps kind of coming back up throughout this conversation is early childhood experiences with money. And I've, you know, hope I've done a decent job of directing the conversation in multiple ways so that this is valuable both to parents who are thinking about how to raise their kids in money-smart ways, as well as former kids who are listening, all of us who are listening, who are trying to overcome, you know, scripts that we learned earlier in life that are not healthy. So far, everything that I've heard you describe from your early childhood experience has been like a very good, healthy, example. Were there any things that you learned that weren't healthy, things that you had to unlearn? Yes. I'm trying to think of the best way, the best time to describe this. I think that there are moments that you can be frugal to a fault. And I know some people will disagree with me on this one, but sometimes it is worth the mental peace to just chill out. And one of my favorite

moments of this from recent memory is maybe like two Christmases ago. We were in upstate New York where both of my parents are originally from. They live in North Carolina now. And my parents had rented a little house up there and wanted to have a Christmas party. And my mom had purchased this cheap, I would call it tacky little white Christmas tree that had maybe been like 10 or 12 at Walmart. And she and my dad had flown up to New York. she could not bear it to throw this thing out, even though no one wanted it. My aunt and uncle who live in that town did not want it cluttering up their house. And my mom certainly wasn't going to get it on a plane back home.

But she was actually sort of debating whether or not to like check this thing or how to get it back or where to put it. I'm like, first of all, we've gotten $12 of value out of this already. It served as the little Christmas tree at two Christmas parties. you've definitely gotten your money's worth. Second of all, paying to check it is absolutely assinine because then you're going to spend like three times more than the thing was originally worth. And if aunt and uncle don't want it in their house,

don't put it, like don't sneak it into their house. Like that's just disrespectful. And it's just funny to me that in her mind, she'd already spent this money on this thing. She wanted to use it until there was really no more use for it. And it's almost this like semi-depression era mentality that I think she got passed down, that there are moments that she just will not get rid of stuff.

She had a pair of Nike gym shorts that she wore from like the early 90s until I think she still has them. I think she could still bust those things out. And it's not about the fashion aspect of it. It's like they just, they need to be turned into a rag at this point. Like we're just there with those shorts. And it's just funny because she won't let it go. But I see that in myself too.

there are things that I'm the exact same way with. And, you know, it's something that definitely got passed on to me. And at times, I just kind of try to combat it. Where if it's something that's in my house that I don't need and I could sell, like, just get it out of here. Like, why am I hanging onto this? Why am I so obsessed with having to, like, bring every last possible penny out of something that's ultimately just currently bringing me stress? Do you find yourself having sort of like hoarder?

I'm not calling you a hoarder, but you know, yeah. So I would say no. It's more like I'm almost an obsessive perjure of things, except for books, books I have a hard time getting rid of. So I probably have way too much of that. But I moved around enough as a kid that I see it as a pain to have a lot of stuff. And my mom also imparted this little gem when I moved to New York. She goes, for the first few years of your life, or at least until you know you're really going to settle down in some place, you should probably be able to pack up everything you own into a back of a car.

And I still kind of think that way. Like it makes me uncomfortable to have too much stuff. And I also don't want to, I don't want to spend money on cheap furniture that I'm just going to have to get rid of. I would rather start to acquire nice things that can last me decades. Yes, by buying fewer but better things. Yes. And I see a lot more value in that than, you know, my friend. friends used to make fun of me a lot that my TV would just sit on the floor because I wouldn't

buy a TV stand. I'm like, well, why do I need one? It's just going to take up space. And when I move, I'll just chuck it anyway. So I can see the TV fine. It's perfectly fine where it is. And when my boyfriend moved in, I acquiesced and got a TV stand because he wanted one and then I can hide his gaming systems in it. But it's just kind of funny to me that that was like a sticking point that people kept bringing up was my lack of a TV stand. That to me is not something I see value in. Why would I spend money on it? Yeah. Yeah. It's an example of how people try to impose their concept of normal onto your financial decisions. That's something that I write about a lot. The spending for social norms versus spending for priorities.

Weddings. I keep coming back to those because that's my phase of life. And just being in them and how much people think. It's okay to require of others to spend for what is not that individual person's special day blows my mind. Well, I know that you have to go, but I guess are there any parting words or any final pieces of advice that you would want to give to, I'm going to hold with this early childhood theme here, that you would want to give to parents who are searching for ways to raise their children in a financially savvy manner and or children. children who are, or ex-children, as we all are, who are trying to unlearn some of the negative scripts that we've learned. I'll start with the unlearning. I think first is to always assume the best. Assume your parents did the best they could with the information they had at the time. I would never begrudge someone's parents for how a person was raised, just like even anything

negative that I have. I think my parents were always just trying to do the best had with the information they were given. And when you're trying to unlearn things, just, first of all, forgive yourself. If you've kind of gotten yourself into a bit of a money pickle, like forgiveness and accepting that situation is definitely the first step. And then really reflecting and thinking through and don't be afraid to write stuff down and think about some of those early memories and try to kind of find some common grounds and some links. And then figuring out how to set up those baby gates and those systems that will keep you honest and on track to whatever your very specific and actionable financial goals are. In terms of the parents,

I would definitely say, don't be afraid of tough love. At worst, your child will write all these memories that will be published in a book for everyone to read out. At worst. My dad often jokes that he calls himself the villain. of all of my stories. And I said, well, I mean, I don't see you that way. I see how it gets construed that way. But I dedicated the book partially to him kind of saying, you know, for the self-proclaimed villain, he's the reason I'm doing this. He's the reason I'm financially savvy and comfortable. And a big part of that was that my parents had a team mentality about how they were going to behave about money. And it was their goal to raise us to be. And my

dad actually told me this recently, it was their goal to raise us to be enabled and not entitled. And I think tough love had a lot to do with that and not just handing us everything, especially when they could. And that's something that I definitely respect my parents for is that, you know, my dad worked very hard and my mom too. Not to discount my mom's contributions, but they worked very hard to put themselves in a situation. where they were quite comfortable financially, especially pretty quickly in life. And I think it's admirable that they didn't just indulge in our every whim and give us everything that we wanted. They really figured out a strategy.

And they didn't know if it was going to work. Luckily, it did. But I think that's the other thing is just come up with a plan and stick to it and be a team about it. Awesome. Well, thank you, Erin. Where can people find you? You can find me at brookmillennial.com. On Twitter, I'm at Broke Millennial, Facebook, Broke Millennial, and Instagram is Broke Millennial blog.

And then also the book is Hitting Shelds May 2nd, and it can be preordered before then. And it'll be on Amazon, Barnes & Noble, indie books. I just got a list of a bunch of other places that are carrying it. But hopefully, wherever you buy your books, there will be a copy of Broke Millennial. The full title, I should probably say it's Broke Millennial. Stop scraping by and get your financial life together. Nice. Thank you, Erin. Thanks so much for having me. I really love doing this.

Thanks to Erin for coming on to the show. So normally, I wrap up these shows by going over some of the key takeaways. But at the end of this interview, I don't really know. Like, I don't know. I'm not quite sure what the key lessons from this interview are. The big thing that stands out to me, do you remember that point when we were talking about how two people could be looking at exactly the same set of facts? But based on their framework, you know, they're interpreting those facts through a given prism. So they see that set of facts differently. Like, you know, in this interview, the specific example was that Aaron and I both looked at rental real estate. We saw the same basic set of facts about rental real estate. Person A purchases a home and rents out said home to person B. You know, like those facts are irrefutable. But because of where we were coming from, because of our relative vantage points, we interpreted those differently. I saw that as a way of creating a safety net and creating security. I saw that as a form of risk mitigation. Aaron saw that as a form of risk.

And that is the part of the interview that stands out the most to me when I think back on our conversation. because I think it highlights that even the world of finance, which is supposed to be, you know, relative to a lot of other industries, there's math in it, you know, it's analytical, it's supposedly very logical and left-brained. And yet there's still so much interpretation. There's so many different ways that people can view a given situation. And we not only do we not know what the outcome of a given situation will be, people can. can't even, I don't want to say correctly, but people can't even agree upon the classification or the orientation of a situation. I don't know if I'm saying this very, you know, I'm not saying this very well. Or at least, coming from my framework, I'm not saying this very well. I don't know what your prism says. So, so anyway, my point is just that I guess the key takeaway is

Mar? Because when we apply this to parenting, you know, either for parents who are trying to figure out how to raise financially savvy kids or for grownups who are trying to figure out how to unlearn some of the scripts they've learned, the thing is, like, it goes back to that shrugged shoulders. We don't know what the outcome of anything we do is going to be. Aaron's parents seem to raise her really well. Like from what she told me, or at least from what I heard, it sounded to me as though they did everything right. And yet, does that mean that she's perfect? No. I mean, she's human, of course. No human is perfect. But still, there's action and then there's downstream consequence. And then there's the filter of interpretation upon both the initial action and the downstream consequence. And all of that just leads to a whole lot of murky gray. And so I guess the only ultimate conclusion that I can come to is nobody really knows what we're going to. doing. I don't really know what I'm doing. I don't think anybody really knows what we're doing. We're all just trying to figure it out. And we take some actions that we interpret from the framework that we have and we hope that they maybe somehow butterfly effect into a good position down the road. Or to say that very concisely, do the best you can. I mean, is that the key takeaway from this episode? I don't really know. you know what? If you have thoughts on what the key takeaway from this episode is, tweet me on Twitter at Afford Anything.

Let me know what you think because I really enjoyed the interview, but I'm kind of scratching my head at, you know, what I feel like I'm just having a really hard time coming up with bullet points as to what the lessons are that we can carry forth from it. But I would love to hear from you. So Twitter at Afford Anything, let me know what you think. Thank you so much for tuning in. If you're a fan of this show, please head to iTunes and leave us a review. Those reviews are extremely helpful in helping us book more guests on the show and get the feedback that we need to make a better listening experience. Isn't that like a really corporatey buzzword? Listening experience. So thanks again for tuning in.

My name is Paula Pan. This is the Afford Anything podcast. I'll catch you next week.