BiggerPockets Money Podcast - 159: How to Financially Thrive in Marriage (Even if You or Your Partner is In Debt!) with Talaat and Tai from His and Her Money

Episode Date: January 4, 2021

What happens when you get married and find out your partner has debt? A lot of debt...That’s a question many young couples have, shortly after finding out their significant other’s full financial picture. While it may seem scary at first, working together to solve financial problems and gravitating towards financial freedom can bring you closer together. That’s exactly what happened to Talaat and Tai McNeely from His and Her Money. Both were raised in frugal houses, but like many frugally-raised people, they split in financial directions. Tai was busy putting herself through college, debt free! On the other hand, Talaat went into the military and started spending his pay on consumer goods. The cars, the clothes, and everything in between. Tai later learned that Talaat had around $30,000 in consumer debt! So what did she do, walk away from him? Of course not! She worked with Talaat and put together a plan where they both could work hard to get out of debt. Shortly after, Talaat was debt free, so what did they do next? They bought their house, and came up with a plan to completely pay it off in 5 years (Yes, 5). Now Talaat and Tai run His and Her Money, helping other couples work together to reach their financial goals. Talaat and Tai have 7 key tips to staying happy and secure in a marriage where the finances are shared, and how to stray away from the “2-Income Trap”. In This Episode We Cover Why you should go over finances before getting married  The importance of inspiring your partner to have the right finance mentality  The importance of introspection when dealing with a partner’s money situations How to stray away from the “2-Income Trap” Whether or not you should combine finances in a marriage The pros/cons of paying off your home quickly The 7 key tips to creating a financially harmonious relationship And So Much More! Links from the Show BiggerPockets Money Facebook Group BiggerPockets Forums BiggerPockets Money Podcast 73 with Ramit BiggerPockets Money Podcast 127 with Ramit Check the full show notes here: https://www.biggerpockets.com/moneyshow159 Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the Bigger Pockets Money podcast, show number 159, where we interview Ty and Talit McNeely and talk about how to get your spouse on the same financial page. Not to live on two incomes. Like we tell everybody that whatever you do, do not over leverage yourself based off of the two incomes that's coming in the household because life will change. You may not change right now or right away, but it will eventually change. So live off one, use the other to save, invest, build wealth, start a business. do some fun things, take some risk.

Hello, hello, hello. My name is Mindy Jensen. And with me, as always, is my down-to-earth co-host, Scott Trench. Thanks for grounding me today, Mindy. Great to be here. Scott and I are here to make financial independence less scary, less just for somebody else.

We're here to introduce you to every money story because we truly believe financial freedom is attainable for everyone, no matter where or when you're starting. That's right. Whether you want retire early and travel the world, go on to make big-time investments in assets like real estate, start your own business, or confess your messy debts to your spouse for the first time. We'll help you reach your financial goals and get money out of the way so you can launch yourself towards those dreams.

Scott, today we have the Talat Entai McNeeley from his and her money. Talentai are financial educators that are on a mission to get couples on the same page financially so that they can experience the joys of financial freedom. This episode was so much fun to record, Scott, and it is just going to be killer. If you are at a different place in your finances than your spouse, maybe a different mindset, this is an episode that you are going to want to listen to with your spouse because Ty and Talit have some killer advice for how to connect with your spouse financially and get on the same page.

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If you're looking to turn everyday moments into real progress, Audible has been indispensable for me over over 10 years. Kickstart your well-being journey with your first audiobook free when you sign up for a free 30-day trial at audible.com slash BP Money. Talent and Ty McNeely from his and her money. Welcome to the Bigger Pockets Money podcast. I'm so excited to have you guys today. Well, hello.

Hey, Mindy. Hey, Scott. We are just as excited to be here. Love the work that you guys are doing here with Bigger Pockets Money. And we are happy to be able to contribute. Well, that's awesome. Let's start off first with a bit of your background. Where does your journey with money begin?

And then I want to jump into kind of your area of expertise is getting your spouse on the same financial page so that you can live your most beautiful financial life. together. I think our story started with a 13-year-old tie. Isn't that right? Well, sort of. Our story, we pretty much grew up in similar homes, middle class, income families, and both our parents were, I don't like to use word frugal, but I just feel like they were very money conscious. Yeah, he says cheap. And I think that's why he went like down the wrong direction. I went in the opposite direction. And so at the age of 13, I remember having the thought that I knew I wanted to go to college that was non-negotiable, but I wanted to do it completely debt-free. I was thinking about this at 13.

I knew that the weight burden of having to figure out college, you couldn't get around that, whether you get a student loan or you have to either cash flow it yourself as well, too. But I knew that one day I wanted to get married, I wanted to have a family, and I did not want the burden of my financial habits to actually be a burden on my future spouse. And so I met this guy here in high school. and yeah. It's a good thing that she was thinking that way at 13 because it gave me so much room to mess up. So what happened was, like Ty said,

I had a similar upbringing, but to me, all the couponing and the discount shopping was a turnoff. And so when I graduated high school at 17, I immediately went into the military and a thousand miles away from home and have my own income. And so now that I had my money and my parents never got me anything named brand growing up,

I decided that everything that I was going to buy was going to be named brand. And so I kept spending money until I didn't have any money anymore. And then I kept spending more money on credit cards and loans and all that. And I wound up in a mountain of debt. Nothing good to show for, nothing like you guys talk about, like real estate or an education. It was just stuff. It was just a bunch of stuff that had payments attached to a car, furniture, the sound system in the car, everything on the credit card, clothes.

And so I was in a mess. And I got frustrated. And I kept trying to dig my way out, kept messing up. Eventually, I started reading books and starting to get a little bit smarter. And that's at the point where we got engaged. But now the problem was I was engaged to a financial rock star, in my opinion. She had put herself through college completely debt-free by working jobs here and there and everywhere. And she got a degree in finance.

She was working in the financial industry, had a perfect credit score. And here I was with a terrible credit score, a mountain of debt. and bad spending habits. And so what do we do, Scott? How old were you when you were in this situation? And what year is this? Around what year is this? So my started military 17, we got engaged. I was 24. Okay. So 24, you're describing your kind of peak financial mess. Financial mess at 24 when you guys meet. Is that right? I really stunk up the joint. We met in high school, but now we're at the point of engagement at 24 years old.

and I would pretend it like I had my stuff together because I had my stuff together in other areas of life, but I couldn't get this together. And so I pretended that I did. And what happened was I lied. I lied to her. I didn't tell her how messed up my financial path was because I tried to create a plan of my own

where I could clean up the mess before we got married. But that didn't work out. God didn't let that happen. And due to the fact that my wife, soon-to-be wife, was super knowledgeable about money. So you guys started asking questions on top of questions, and my lies caught up with me. And I had to confess, we almost did not get married because of my lies. Not so much because of the money, the debt, but the trust that I had broken over this financial

situation almost caused us to not get married. Could you describe the reality of your situation? Like what were the numbers behind the mess you just described? Yeah, something over $30,000 of debt. And like I said, just stuff. no real estate. Nothing to do with college. I was in the military.

It was just all consumerism out of control. I had loans to pay off other loans. I had payday loans. I had fresh start loans. I had car loans. I had furniture loans. I had credit card debt. All just dumbness.

Rapper, you called yourself dumb. So what I'm hearing is, first of all, you married up. Second of all, what I'm hearing is kind of the two, responses to growing up in a life of frugleness or even cheapness is I'm going to continue the path or I am going to break free and have everything that was denied for me. And it's funny that the two of you met and fell in love and got married from these different positions. Also, what I'm hearing is that she will always find out. So never lie to your spouse. And I'm not talking to Talit. I'm talking to everybody who is listening. She will always find out because that's how it goes.

nodding along with me because they know I'm right. Max. True. To Ruth. So what happened? I'm really curious. What happened when she finally was like, you are lying to me. I want to know all of your financial situation.

How did that conversation look? Because that's a really, really difficult conversation to have from either side. Like, she's so perfect in every single possible way. And then you are slightly less so. Jacked up. Jacked up. So she is thinking you're great and then wait, what? And you are like, oh, she'll never find out.

Oh, crap, she found out. Like, I can see, you know, love conquers all, but sometimes love doesn't conquer all it did in this case. And that's great. But what does that conversation look like? Like, how do you start that conversation, Ty, and how do you finally come clean? Yeah.

Well, I'd like to note that this was after premarital counseling. So we had all the right conversations with our pastor during our counseling sessions. I knew to pull credit reports and we discussed it. I highlighted things. I penciled things in, but things just wasn't adding up. And so because I believe probably because of my financial background, I knew that what he was saying was a lie. So he had to come clean. And he probably eventually had to come clean anyway because when we got married, what was now he is became mine.

and there was no way to really hide that after marriage. So, yeah, hit the fan. It really hit the fan. It wasn't because of the debt. I tell people, people always ask, how in talent? Should I marry somebody that's in debt that has debt? Sure. The issue is how do they handle it?

Do you see them wanting to do different? Do you see them changing their mindset? And I really took a step back and I saw those things in him. I didn't know that's what he was doing. I saw him with the second job. I just thought, you know, he was just saving more money. maybe for our future. And I saw him saying no and denying himself from certain things. And so once I was really to take a step back and I saw, okay, he already had the mindset change. He already

knew that he wanted to do different. And it wasn't necessarily because I was this rock star per se. He made the decision that this is not how he wanted to live for the rest of his life. So I was able to work with somebody like that. But it also had me reflect upon myself, what was it about me that would not allow my soon-to-be husband to be honest and transparent with me? So I start to do a lot of souls searching in myself, within myself, like character development and things like that. Did I make it appear that I had it all together? I sure didn't think I did. Or was it just that my life made him uncomfortable? Because he saw the way that I was moving and the way that I lived my life. And so, yeah, we had a lot of conversations, a lot of communication. At that point, it wasn't about

the wetting day for me. It was about my future. Can I trust this person to actually trust him with my life, my future? Was he hiding something else for me? So we were having to deal with all of those conversations. So a lot of prayer, a lot of talking, a lot of communication, but also coming up with a claimant. We knew we were not going to handle debt the same way that he handled debt within his singleness when we got married. And so we had to discuss what would that look like within marriage, who would handle the budget, what we would do with our income, what we share accounts, like things like this, we start to have more in-depth conversations that I believe was deeper than our premarital counseling. Spoiler alert, we did get married. We did get married.

What was your position entering the marriage? Mine? Yes. I was completely deaf free. Completely deaf free. I put myself through college, completely deafly. I had to do it in five years, so I couldn't have it. Did you have assets as well on top of that, though? Well, I had a paid off vehicle. I purchased my own $13,000 car at the age of 19, paid that off in like 11 months. So I had a vehicle at the time and a paid for, paid off degree. And at the time, I had just started my career within the financial industry. So I was building as well, but I had a little bit of a head start because I didn't have to carry student loan debt with me. Got it. Okay. So it sounds like you had a really healthy, needed discussion

here. And what was it that enabled you to move past that? And then how did you begin handling your money going forward as a couple? I think it was just like we did a whole lot of praying and a whole lot of just me confessing everything and me putting everything out there, not laying anything and stay in my back pocket. And then it was, like Ty said, a reflection of this was a part of me, but this wasn't the totality of who I was. There were some good things about me, too. This was a mess up that I shouldn't have done, but this can be overcome.

And so through a whole lot of dialogue, we decided to move forward. And what was magnificent, you know, in my eyes, was Ty's approach to, she could have said, you know, this is your mess. You go clean it up. You let me know when you're done. And then we could proceed. But she took the stance that, you know, this is now our situation. And we are going to figure this out together. And so we took all the information that I now shared, all the details in any gritty. And we used that to make a plan of attack to move forward. and paying off the debt, and we ended up getting rid of all that debt within the first year of our marriage. Yeah, we were committed. We were, we had perseverance. Like, we didn't give up. And most couples in their newlywed stage, such as maybe Scott, maybe like you're going out every weekend, you're really just enjoying life. Like, we didn't have children at the time.

We wasn't enjoying a lot of that. We were sitting at home eating, like, watching our favorite television shows while we saved our money and we paid. paid down this day. Taking our lunch to work, getting laughed at. Yep. That was a sacrifice, but it was one that was not drudgery, did not feel like drudgery for us, because we knew that we were building a lifetime together. This was a temporary, you know, adjustment in order to have, you know, such a beautiful life afterwards in the area of our money. I want to point out that you said when you were telling, you know, from your point of you, I had to look to me and see what was it about me that made him think that I was perfect.

I love that you did not say, oh, well, you're a big mess. I'm leaving. Or, you know what, you're a big mess. This is yours to deal with. And I think that sometimes being the better with money spouse can feel like, you know, oh, why can't you do it right? Why am I the one that has to do everything right? This is 100% your fault.

And, you know, it can be, oh, I present this perfect image. But I love that you were willing to work together. I love that you sat down and, okay, let's look at everything. Let's lay it all bare and let's work together. It's not just Talit who is having a hard time with the repayment because he has to take his lunch, but you get to go out. And he has to stay home all the time, but you can go out with the girls. And, you know, I just, I think it's fantastic.

And I can't remember who said it, but one of the guests before previously on our show said, it isn't me against him. It is us against the world. And I think that's so powerful when you're looking at how to tackle this. Yes, he racked up the debt, but he also changed his mindset, which is huge. I mean, changing the way that you look at money and being conscious that this way is not the right way to go is a huge hurdle. What advice do you have for people who haven't gotten to that hurdle yet? Be willing to, at least... least be introspective. Be willing to say that maybe I need to look at this differently. Be willing to have enough gumption to say that maybe there's something else that I haven't thought about.

Because likely thought, you know, there's been conversations within our head where we've formulated this narrative about what the situation is and who this other person is. But maybe it's been a one-sided narrative that we've been telling ourselves. We haven't allowed ourselves to think a little more deeply and a little, and we haven't allowed ourselves to zoom out from the situation to see, again, is this the person or was this a part of the person, an error the person made? Maybe it's not the totality of the person. Or maybe there's some signs of momentum change that I haven't allowed myself to see

because I'm so frustrated and focused on this one thing about them. And I think that if we are intentional with our ability to zoom out and take an objective view at the totality of the situation, we'll find some pieces to the puzzle that we didn't see. Because the truth is, before this, whatever this is, you loved that person. You were committed to this person. You saw a future with this person. So you have to take some time to put all that into the. What was the things that allowed you to fall in love with this person? What was it that made you see a future with this person and put that into the equation?

along with some of the challenges that they have currently. I love that. I love that so much. Oh, my goodness. Okay, if you're listening to this show right now and you want to get your finances in order, go to his and her money, go listen to their podcast. This is all that they do is talk about getting your spouse on board.

And, I mean, how much happier are you now that you don't have to lie to tie? How much happier are you now that, I mean, even like 14 years ago? How much happier was it? How much easier was it to have a conversation with her when she knew all the bad things? Yeah, it was a game changer because, again, the self-created narratives go on both sides of the equation. Because I created a self-narrative that said, if I told her all this, it would push her away. I would lose her. And so then I told myself, I can't tell her.

But when I did tell her, when she did have all the information, she came closer. She said, all right, well, we're going to figure this. That was the total opposite of what I told myself with that outcome. And so when she took that approach, it was a weight that just lifted off my shoulders because I had a teammate now. I had somebody who knew all the bad stuff and still loved me despite the bad stuff. It's one level when you feel like somebody loves you because when anybody's dating, you know, you always want to present your best parts of you.

You always want to put your best foot forward to be impressive. But it's another level, it's another deptness of your love when they can see your flaws and still love you through it. When they can see mistakes that you've made and still love you past it, that's a whole, whole other level of love. And when you feel that, you feel like you can take on anything. Awesome. Going back to this first year, you get married and you begin paying off the debt.

You pay off $30,000 in the first year. Can you describe what you're spending? was and how you were able to do that on a more tactical level? Like what was the, what was your housing expense? How are you, how are you able to, how much were you paying for food? You know, can we get, you know, an idea of how, what percentage of your income you were saving to get to that level. Yeah. We can definitely talk about the income side of it, to be honest, 14 years ago, I don't remember what our grocery budget and things like that was, but we did adopt the principle of not falling for the two income trap. And so it's something that we teach now as well too.

Most times when couples get married, they're leveraging their entire. They're leveraging their entire lives on both incomes. That means the house that they buy. That means the vehicles they buy. That means the way they spend money, the vacations of the trips. And so we knew in order to kind of get a hold of this thing and get a hold of it so fast in which we did within the first year of marriage, we have to live off one income and then use the other income to pay down debt and to also save for our future. And so that's what we did. So we had to literally fit everything into the income, the one particular income at the time. And if it wasn't in the budget, if that income could not carry it, we couldn't do it.

And so that allowed us to take the other person's income and to throw it at their debt aggressively, to throw it at savings such as, because at the same time, we were also building our emergency fund at the same time. We were just brand new, newly married, coming together, combining our finances. So we had to build an emergency fund. At the same time, we had to get out of debt. And at the same time, we had to figure out money and marriage. What does that look like? Who gets to have this say, who gets to do the budget? We messed up with that one. Yeah, exactly. And so we had to kind of like figure things out. out at the same time while we were paying off debt. And what were your friends and colleagues doing at the same time in contrast, if there was a contrast? The exact opposite. It's a blur to me, honestly, because I felt like I had tunnel vision. Like, I didn't care when anybody outside of our house was doing or I don't even remember.

It was just like the McNeely House told, what were we doing inside of the house and how we were we? I remember because I use people's doubt. Yeah, your guys. I use people's jokes as fuel, as motivation. And so at work, you know, everybody went out for lunch. And I had the hot pockets that I was warming up in the microwave, you know. And people had stuff to say about that. And even family, even close people like, man, it doesn't take all that.

You know, when after church, everybody's going out, well, we can't go out this time. You know what I mean? We had to make those conscious decisions. We went out, we were pulling out cash and they were like, is it that serious? What are you doing? Why are you counting cash? I got out of his envelope. Yeah.

And so we were willing to do that because we were future minded. We had a goal. And we just, we didn't really care. That goes back to what you were saying. and we adopted that principle as against everybody else. Everybody can laugh, everybody can show, everybody can have comments, but we're still going to do our thing. You know what I mean? We had thick skin, like none of it got to us.

But for me, you know, I've always in situations like that and use it as motivation, like, okay, keep watching. And I think you bring up a good point, especially for me, and that was probably an eagle thing for you having to deal with that with maybe your colleagues. For me, my colleagues saw me bringing my lunch bag to work and I didn't care what they thought. They didn't care what I was doing, you know? And I think it was just, I think for me, it was something that they always saw me doing. For you, you had to now change the way that you were doing things. Because now you were married and you want to better your financial life. So they probably like, oh, wait a minute, you can't go out now.

Like, what's going on? Oh, she wearing the pants. Yeah, for me, I was consistent. I was consistent. And so nothing really changed from their point in view. Yeah, well, I think that's, this is something that I think people struggle with is because in many relationships, is just going to be one person who at least comes in or begins with a more, a heavier bias one way or the other around how we're going to handle money.

And the distinction between you guys, I think, was very extreme in this. But everyone deals with that in their relationships, right? At least some dichotomy there, some differences. And I think what's powerful here is, I think it would have been really hard for you to change your mentality around money and make this changes, perhaps, if it hadn't been, for Ty, you embracing his problems or his mess, as what we just called it earlier, as your own, and going in there all in and doing the same thing in conjunction. And I think that that's, you know, like for example, do you think, I don't know,

but do you think that there would have been a difference in your ability to change your approach with money if she had kind of left you more on your own or you had differentiated finances during this period in the first year? Yeah, I think it was a game changer. because I felt the responsibility of being somebody's husband. And I knew that this new season that I was going into would require me to be different. I couldn't be the same way that I was

because at that point in my life, even though I didn't have the game plan figured out, I knew that the results that I was getting was not the results that I wanted. And so if I wanted some different results, I was going to have to take some different actions, plus the fact that I was going to be a husband. Plus, it's not just about me anymore.

and I'm trying to build a future. One day we want to have kids, that's for sure. And so again, all these things, I always look to the future, even to this day, fueled what I was willing to do in my present tense. And so that new level of responsibility was a huge factor in my progression on a personal level with my understanding of money and my interactions with money. I think that if I wasn't in that season of about to get married, my progress would have been much slower if there would have been much progress at that. It might have took me a little longer to be willing to buckle down and do the work necessary. So me becoming a husband was a big, big part in my advanced progression. Okay.

So, Ty, you said that we were getting ready to combine finances. Do you recommend that couples combine their finances when they get married or if they haven't combined them and they're already married and they want to change their financial picture? do you recommend that they start to combine them? Yeah, so this is like one of the number one questions we get. About to get you all in trouble, Mindy. That's okay. People ask this question because it's like they already, you know, they kind of want to see like, what do you think?

What do you think? So yes, we believe that couples should combine finances. We don't believe in just making decisions to have children, making decisions to build a lifetime together. My children are worth much more than my money. And if I can trust this man to be the father of my children, I can definitely clearly trust him to handle the money. share DNA. You can share money. That's how I look at it. Now, again, we're not talking about those cases,

unusual cases, right? So, yes, if you have a spouse that clearly the signs are on the wall or clearly they're being dishonest in a way where you have to now fit for yourself, protect yourself, you and your children, that's a whole different story. We're not talking about that. We're talking about the average couple who maybe things are going well, like no issues whatsoever, but things could be a little bit better. We tell people don't knock it unless you try it. And for us, it taught us to grow more trust with each other. Like if you can trust this person with your money, like that's like one of the world's biggest exercises.

You know what I mean? Like to be able to trust them with your money. And we always feel like when two are focused in a thing together, you can gain whatever it is that you're trying to gain a whole lot quicker. And so for us, yes, we believe there's no I in marriage. It's we. It's us. And we make that decision. we've made the decision now within our money, of course we have individuality, right?

That's where a budget comes in, you know, where he gets his own spending money. I get my own spending money. He could do whatever he wants. He doesn't have to be accountable. I can do whatever I want. I don't have to be accountable. So you could still interweave some individualness, some independency within having combined finances. Yeah, but the overall plan was crafted together to include the individual spending money that we get to do what we want with.

I think that we all know, like we've heard countless. amounts of research to say one of the number one marriage killers is financial issues. So if we know that that's one of the number one ways that marriage is in, why would we put division in it? Why would we proactively put division in an area that is known to divide marriages permanently? And so I just think it's a dangerous proposition for you to allow that to be, because then that just leaves so much wiggle room for you to build up this wall of independency that prohibits you from joining in other areas of your life because you see yourself as this independent person.

And what tends to happen is your marriage becomes more contractual than covenantal. And you all are almost like business partners and roommates. I used to have roommates. And I remember on the first of the month, we each put our check on the dresser. You know, it was three of us total, one third of rent, one third of electric, one third of gas. You know what I mean? It feels more like a roommate situation than this is who I'm. I'm spending the rest of the life.

And I felt like it just adds more work, having individual things where it's like, okay, who's going to cover the mortgage? Okay, we go out to eat. Who's picking up the tab? Like, I'm married to this person. I don't want to have to figure out. I paid for the steak last time. Wait, I didn't have advertising.

You better advertise. Yeah, to me, like, I don't want to keep notes and keep tally and keep check on how we're spending our money. Have you spent your fair share? You know, and because things change within a marriage, right? I started out working in the beginning prior to us having children, and I was bringing in more of the income, but it was our income in the house. And then there was one day we had children and I decided to be a stay-at-home mom.

Like, we get emails and questions from people, especially single mom, not single moms, but stay-at-home moms where they feel burden like, oh, gosh, I feel like I have to help my husband. Like they have so much pressure. Here it is. They're taking care of children, which is one of the greatest jobs in the world. And most challenging. Right. And at the same time, you're trying to figure out, you're trying to figure out, oh, I don't want him to feel like I'm not doing my fair share.

like, what? Like, to me, it's just backwards. It's backwards. So, no, we highly recommend. And that's something that we stand on that we don't waver on unless, of course, there are extreme situations where you need to have your own. So please send all your comments and questions to Mindy at BiggerPockets.com. That's right.

Yes, please, because I 100% agree with everything that you're saying. I, this is my, I almost said this is my first marriage. It's my only marriage, too. How long have you been married? I am not going to be dating anybody ever again. I've been married for 19 years. Oh, nice. Congratulations.

Thank you. Yeah. I've been married for 19 days. Yeah. Let's get you, Scott. Hey. Welcome to the club, brother. I think it literally is 19, yeah, about 19 days.

That's awesome. That's hilarious. But when we got together, we had basically nothing, both of us brought nothing into the marriage. And he brought up the idea. the idea of a pre-nep, and I'm like, no. 21 days. Oh, 21 days. Okay.

Your golden anniversary, you got married on the 21st. Yep. So we were both bringing in nothing to the relationship. So it's not like, you know, we had anything to protect. I think I had a condo and he had a house and they were worth about the same. So maybe his house is worth more, but not much. So we combined our finances. We took all of my money and put it into his bank accounts because he's a computer

guy, and this was 20 years ago, 19 years ago, and he had already automatic debits coming out of his bank account. So he just put my name on his account, all my money in his account, and then continued on. Because I don't know if you know how to, if you've ever had to change your automatic withdrawals, but it is a nightmare and a half. So we just did all that. That was great. And that was 19 years ago. I can't even imagine now. We've had the same bank because it's such a disaster. But we have always combined finances. And when I was not a mother, I had a job. And then when I became a mom, I was a stay-at-home mom. He made about four times what I made.

So it was a no-brainer for me to stay home because seriously, my paycheck would have covered the entire amount of daycare. Like I would not bring anything home. And I wanted to be a stay-at-home mom. And this is not judgment on anybody who doesn't want to be a stay-at-home mom or can't. This is just my situation. And when I was, you know, home, I would go to the grocery store and I never felt like I had to ask him if it was okay.

Because this is our money. But then when I was going out to buy a purse that I did not need because I already had three at home, I would reach out to him. Hey, do you care if I, you know, there's this purse and it's $20, but it's really cute. He's like, I don't care. I'm not buying $500 purses because then he would care. Talat, you think your parents are cheap. Let me introduce you to my husband. I'm working on him.

But, you know, I grew up cheap too. I grew up like super frugal. But I think it's so much, it's so important to combine finances and what you see. said exactly what you said is like perfect. I want to cut that part out of the video and make it a standalone video. Should I combine finances with my spouse? Yes, here's why. Mindy at biggerpockets.com send me and I will forward them on to tie talent. No, no, it's funny because we're talking about this right now, Virginia and I and those types of things. And really, we've agreed, I think, to combine finances. It's just a matter of mechanically making that work. So thank you. I think we're

going to probably do, you know, I'll be to suggest what you just described, Mindy, for Virginia, just adding that into the one that I'm using because, you know, we'll see. But we have to just work out the mechanics, basically, but that's the mentality that we want to have is what you guys just described around money. I think that's really healthy one, the one that we're in the process of adopting. Yeah, and let me tell you, we receive feedback, emails, updates from people that say, at first when you said it, I thought you all were crazy, but one, we tried it. I didn't think that I could be even closer to my husband. that I am now.

I didn't even think that we could pay off our debt a whole lot sooner than we are now. I felt like our visions are more aligned because there's oneness. And so that's why I tell people, don't knock it unless you try it. But it's definitely something that has worked well for us and it's something that we highly recommend anybody do. It's countercultural, unfortunately, to have this type of mentality because, you know, even people like literally gave us advice individually separately that we should have some money

on the side just in case. It's almost like you're preparing yourself for a disaster. for disaster ahead of time. And just we're not with that. You know, we're believing and we're putting in the work to make this a lifetime situation. This is who I said I want to spend my life with. So I want to do everything in my power that I do have control over to make that happen. And so, again, if this is an area that destroys most marriages, we need to put a whole lot of

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So let's go back to your story though real quick. You guys just paid off $30,000 in your first year of marriage, which was, I believe you said 14 years ago. Yeah. Yeah. What happens in the second year? What do you guys begin doing once you get back to zero and how do you begin approaching your philosophy around money at that point? Yeah, the dope part about getting out of debt is your ability to take some risk. And so we tried some things entrepreneurally. We tried some things investment wise. You know, we took our first foray into investing in real estate. We bought the house, rehab the house, put it on the market just in time for the great recession

to take place. And it just, it didn't work out at all, right? But because, we have positioned ourselves to be out of debt to have an emergency fund in place. We were able to take risk. So even the losses that we took, one, we took them together because we tried all these different things together, several different business ideas that we tried. It was fun. Can I ask a couple questions here? You were able to have $30,000 in debt the first year.

Were you able to kind of accumulate wealth at that rate or greater in the following years just from your cat, like your personal home cash flow situation, or did that change? Did you ease off a little bit, for example, after you paid off the debt? Well, at that time, we had started saving money to put money down on our first real estate, our first rental property that we did not end up running out. So we were able to then beef up our emergency fund a little bit more. But at the same time, we were able to try different entrepreneur ventures. And we were doing, you know, the 401K game and all that type stuff. Right. And we started traveling more. So we started to really like enjoy

what should have been probably our first year of marriage. We started enjoying it, our second year of marriage. And so we started just disseminating our money in those ways, but for the intent to invest in real estate. Awesome. And I assume your incomes were growing as well during this period. So it sounds like you're accumulating wealth at like a $20, $25,000 rate in these first couple of years. And then you're saying you did entrepreneurship and real estate investing. I'm trying to get, I think this is really important because this is the, this is this is why once you get off paying the debt, this is the fun stuff of finance, right? So were you guys maybe doing a little less retirement account contributions at this point and more

in the context of liquidity? Or how, okay. No, we actually ramped up our investing. After we got out of debt. Yeah, we actually ramped it up. I think it was probably like 15% at the time. But something too that I don't want to forget, we also started to give more. And so we had the ability to give more. We were. That felt just as good. It felt just as good. I mean, we were doing things that people didn't know about, like paying other people's mortgages and things like that and giving trips and vacations. Like we started to find radical ways to be able to give to others. Buying toys for kids that didn't have Christmas and things like that. So it wasn't like we were hoarding this money. Honestly, we were now putting it to things that really, you know, tugged on our hurt.

And so, yeah, the giving increased, but also our investing increase into our own individual 401ks and then saving for real estate. Awesome. So with the saving for real estate and entrepreneurial ventures, one of the things I want to get around is this mindset around, how much cash do I need to feel comfortable with that? So how are you treating your emergency reserve in the context of going into real estate or entrepreneurial ventures?

Back thing in, man, I wish you would have that interview 14 years ago. Yeah. I mean, they were two different funds. We focused almost primarily on getting the emergency fund a little higher. And then once we check that box off, then the cash was going towards the investment property. You know, it was based on, oh, man, that time, you know, the prices, the going rate at that time, we knew we needed a certain amount of down payment. And we knew that we were getting a type of property that was going to need rehab.

We put 20% down that I remember. I don't know, remember how much it was, but I knew it was 20%. Yeah, and we knew that we were going to have to fix it up and things like that. And so, you know, we factored all that into it. We had carrying costs. You know, like I said, it didn't work out. We had that house a whole extra year than we thought we were. And we have to bring this part up as well, too.

In the time frame when I decided that I now wanted to stay home, because now three years into our marriage, we had our first child. So by that first year after he turned one, I ended up coming home, he also was going through a job transition to become a teacher. I was in grad school. So he then now exits the military. He's in grad school, getting his degree, and he's doing his student teaching.

So money wasn't coming in from that from him. And she decides she want to quit, Scott. I did. And what year are we in right now? This was three years into our marriage. So this was like 2009, 2010. Okay. So you're in the midst.

So what are the things are happening? It was just job transitions. A whole life. Scott, so much is going on. So much was going on. And you're losing money on real estate. You're transitioning jobs. You've got a one-year-old. And yet you're fine because you've had these disciplined financial habits for years in a row.

and been really smart about your money. That's exactly the discipline. The work that we put in on the front end, we were able to then reap the rewards from that in a time where we were going through major life transitions. And the rest of the world's on fire economically. Exactly, exactly.

And we weren't even like sweating in a sense. And so we were able to live off our emergency phone while he was doing a student teaching until you were able to finally do some substitute teaching. And then he finally got into, official teaching teaching. Then we got crazy, Scott. And we bought our first single family home,

and we told ourselves that we weren't going to take 30 years to pay it off. We told ourselves we were going to pay it off in five years. And five years from the date that we closed on the house, we walked into the bank with our now three kids. And we made our final mortgage payment $330,000 five years. So we are 100% debt-free. And where is this located? Illinois.

Illinois. Okay. Chicago land area, yeah. Midwestern. So we're talking about, so we have this big inflection point in 2009, it sounds like. And then we've got another inflection point five years later when we're paying down the mortgage. I just want to walk through these couple of steps here. During that period where you're paying off the mortgage, are you also investing in other assets or building wealth in other ways?

Or is it really just kind of throwing every extra dollar at the mortgage? So for us, we set our investing at a certain threshold. we automated it and then all the other dollars that we brought in that was beyond that point, the goal was for the house to be paid off. So we did some extra jobs. We got, you know, every tax return that came in went that way. When we got pay raises, we didn't up our living expenses. So we like, we would literally call the bank if I got a raise and adjust our extra payment that we were sent and automate the process. And so a lot of it was on. automation, but a lot of it was we were like looking around selling stuff and doing extra

the flipping stuff from the, from the thrift stores. Because we knew that we did it before, we knew that we can be disciplined enough to do it again. And so we created an entire series on our YouTube channel for those who are very interested in how we did it. Just go to our YouTube channel, YouTube.com, 4-slash his or her money. We have a playlist as far as how we pay it off our mortgage. And so we kind of give insight and tips the reason why we did it that would actually be longer than a 30-minute episode here. But for the most part, we made adjustments. We made a lot

of adjustments, a lot of distance because at the time, you have to realize now we have three children. And children, right, and children cost money. And at the same time, we were building his and her money. And I think we didn't get to that part, how we ended up coming to the his and her money thing. But people saw us pay off that consumer debt within our first year marriage. And people started asking us, how'd you do it? The people that was laughing. Yeah, they started asking us, how did you do it? And we were inviting people into our home. They were sitting on our couches and we were counseling them. Then we were like, wait, maybe we should take this to the world.

Like if they're at our little corner, they're asking us questions. There are probably so many other families that need the answers as well too. So that's really how his or her money was born. And then at the same time, we want to show the world through his and her money that, hey, you don't have to stop there just for your

consumer debt. You can now go on and pay off your mortgage and that's what we did. So are they now enjoying hot pockets some of these folks? Yeah, they made some changes. You know, they, they, after they saw the result, you know, action speak louder than words sometimes. And so sometimes, you know, when you're in the midst of the fight, you're saying, listen, guys, I'm getting out of debt. I'm making some progress.

And then, yeah, yeah, okay, whatever. But then when the finality happens and you have a result, an outcome, then their ears start perking up. And so. Exactly. We had somebody recently, which was interesting. We were doing a live on our YouTube channel about a week ago. And somebody back from those days literally put a comment. He jumped in on the live.

He said, he will bring his lunch to work. I remember he used to bring his lunch to work. And I was like, what? So it was like, he remembered that. And then also he was watching you really tell your story and instruct others how to live their lives financially. It's like all that stuff led to the life we live now. And this is what? This is what we had in our head.

You know what I mean? The reason this was our why to get to be able to control our life, control our days. Well, I want to get to that point because that's the fun part here. we still have parts of the story. So I'm hearing that we're sitting in 2014, 2015. Is that right when you pay off the house? No, no. That's when we started the process in 2013 and we ended the process in 2018. Great. And so we're in 2018 and we've got a position with a paid off house. What I imagine are some strong retirement account contributions that have that I've compounded over the years. And then maybe a cash cushion. Is there any other wealth to speak of at that point?

or is that mostly the, is that, I mean, it's a wonderful position. I'm just, I would honestly, I like to put, we started putting a lot of focus into our own personal brand, our own personal business. We were reinvesting back in the business. We knew that one day he was going to walk off his job. And so I wasn't working at the time. I was working in the company his and her money and taking care of our babies. So at this point, I was still to stay home, work at home mom.

And we knew that eventually he was going to walk away from this educational career. And so. But you can do because you have a. paid off house, strong emergency reserves and other investments that allow you to have flex those entrepreneurial muscle. Exactly. Exactly. So we weren't really crazy with trying so many different things like our risk levels and all that. We were really conservative simply because our main goal, we wanted to pay off this mortgage. We knew that, yeah, to some people, it may not make mathematical sense to pay off your mortgage, but for us, personal finance is personal. Nobody can

take away how this feels, especially in the middle of a pandemic. And we're working. full time in our own business while we're doing remote learning across the hall with our children. Like nobody can take that away from us how that feels where we're not stressed like, oh my gosh, we have to pay our mortgage. Because mortgage debt, mortgage payments is probably the highest payment or debt payment that anyone has in their life. So if you can knock that out, my gosh, like the options and the different things that you can do. There's so many things that don't go on a calculator.

You know, I was a few minutes behind on this interview because I had to go help my mom. I'm an only child. And so when she needs help, I can just go. I don't have to ask somebody permission to go help my mom with X, Y, and Z because we paid the price up front. Right. So now we can control our situation. And we're self-employed.

And so when others need help that we love and care about, we can just go do it. So you can't crunch that inside of a calculator. Okay. Wonderful. So let's walk through this part as well. So you're building his and her money. How is that growing during this period? and when do you

transition out of your job? And how does that work? So you transitioned out of his job, not even a year after we paid off the house. Yeah, less than a month. No, two months. No, no, no. We paid up the house in July.

You left a merch. Right. So that's more than two months. Okay, huh? I said less than a year. Less than a year. About seven months later, yeah. Exactly.

Less than a year, you walked away. Yeah. And your income. But now, now, what I think a big factor in this is, is I love the fact you paid off the house, but you still have taxes, insurance, those types of things with it. And you still have other expenses for the household. In order to feel comfortable walking away from the job, I imagine that there's an emergency reserve. That's what a lot of folks have. And enough of a perception of the upside or opportunity from your business to make that call as well. And that's what I'm trying to. Okay, no. Yes and no. Honestly, Talon was not going to walk away from his job. job at the time that he did. He was actually going to still finish out that school year because we were still in the planning phases. Like we knew it was coming, but we were still planning. We were still trying to beef up the savings and stuff like that. At that point, we beat up the emergency fund.

To 12 months. Right. But there were some things that led to, no, we think that now is the time for him to leave. And so we didn't even really have it all together, honestly. Like, this picture of perfect, ideal situation. No. And his or her money was steady and growing. So at the point when you walked away from your job, I don't even know if the company

made six figures that year. I think we had just had our first six-year figure. Just had our first six-year figure year. Yes, right, six-figure a year. So we weren't like, oh my gosh, this is really going to like work. But we knew that he and I together, because we were able to pay off our mortgage, we were able to become completely consumer debt free within our first year. We knew that there was nothing that will stop us from doing. created the margin necessary to take the risk. Exactly. So we knew that there was nothing that we could not do. And so because we didn't have the mortgage, we knew, okay, we don't have to have the stress.

We don't really have to pay ourselves from the business, which we weren't. Like, we just really honestly started paying ourselves a salary from our company. And our level of expenses didn't require a whole lot. Exactly. And so, again, we put margin in place to allow us to take the risk, even like Ty said, though the situation wasn't perfect, we stacked the deck in our favor to at least try to do it.

That's exactly what I was hoping to get to. It's never perfect with those type. You guys did all the work up front to, and again, you had this emergency reserve and you had enough income to feel like it was the better move for your future to make that transition at that point. The point is most people can't take that risk

because they haven't, as you said several times now, paid the price up front with that stuff, with the years, the grind as in hot pockets. I refer to it. Yeah. Yeah. I'm saying I know you've got to get in my chain. I haven't had lunch yet, so that actually sounds really good. Today's episode is brought to you by hot pockets. Right, exactly. First off, that is the best argument that I have ever heard for paying off your house early. I have only ever heard the financial argument and money's so cheap right now.

Why wouldn't you get a loan? I have a client. I just talked to her today, and she's like, well, we want to buy this house with cash. Okay, I can make a financial argument, a money argument. Hey, that's, you know, I got a quote for 2.8% on a mortgage. That's like practically free money, but it's not free. It still comes with a monthly payment every single month. What are your expenses without the mortgage? Like, since you don't have a mortgage, let's say his and her money stops bringing in any income at all.

Right. What kind of job do you have to? go get to feed your family? To be, to be honest, and this is not to sound prideful, I don't think that we would ever go back to work a nine to five. I believe that we have adjusted our lifestyles to the point that where we are now today, that we could literally make it work and take care of our family, even if we had a side hustle. Yeah. I want to bring, I want you to talk, I wanted to talk a little bit about that point, how you said money is so cheap now, interest rates 2.8. We had a great credit score. We got our home. We had a very very

very good rate, and we still pay $25,000 in interest on our mortgage. And so we want people to see that. A lot of times you just think that you're buying your home for this dollar amount. That interest adds up, right? By the time you pay off this home in 30 years, you have probably paid for that house twice, two and a half times. And so you want to get smarter than the banks, right? I don't want to, I don't want to buy any real estate where if I have equity in our home, really that equity is no is nothing if I'm paying more in interest, right? Like it doesn't make sense. So you really have to literally do the math and figure out a way to get yourself ahead of the curve. And so for us, it was paying off our mortgage. The banks are not dumb. You think you think just because you got a

2.8 that the system is in your favor and you're sadly mistaken. Look at your amortization statement then with your 2.8%. All right. Look at what happens in the first, five to seven years of that amortization statement. Guess what? It's not an accident that you pay nearly all the interest in the first five to seven years of that loan. You know why you pay it? Because they have done their research and they understand that the average homeowner moves every five to seven years.

And so they have stacked the deck in their favor, even with that 2.8 percent to make sure that they're going to get their money. And then when you move, guess what? the clock starts over. And they get more money. They want you to refire because the clock starts over and they get their money, even at 2.8%. You still take an L.

And that's why I tell people do the math. Sometimes people look down on people that are renting. More than likely over your lifetime, you may have paid more in paying mortgage payments by the time you had interest in somebody that was actually renting an apartment. So just because you have this asset is not truly an asset.

if you don't win in the end. Mindy and I just wrote a book on first time home buying. And I ran the analysis on buying versus renting, and I have chosen to rent. I've owned house hacks or properties in the past. And yeah, I'm sitting here renting because I think it's the better move for me right now because I don't think I'm going to be in a house

that I'd buy right now for more than five to seven years, realistically. It's just me in Virginia right now. We don't have a family yet. Like, why would we need to buy before, we need it and why would we you know and I'm paying more for stuff that I don't need right now and it's a good time to be renting I think so because your home is it investment Scott where can they go find your book home is a oh yeah we should because you could plug the book it's when is it's launching um it comes out in March 11th okay yes first time home buyer it's been released March 11th and yeah well

don't worry we'll give everybody a chance to hear about the book uh in great detail we're very proud of it and Yeah, this is probably the first time we mentioned in the podcast, but it will not be the last time we mentioned in the podcast. So, Talent's point about the amateur. I just ran on Google and I just plugged in some random numbers based on the mortgage that I just got on the first payment. Yeah. $300,000 at 3.5% because that's my mortgage. The principal amount of my payment is $472. Okay. The interest is $875. More than the principal, double. I am paying twice as much interest as I am on the principal in the beginning. And then, of course, if you scroll down for 30 years, your last payment is $4 to interest and $1,343 to principal.

But that is not the beginning. And am I going to be in this house for 30 years? No, I can guarantee that. How much interest on the amortization schedule does it tell you how much you paid in interest payments? This one says my payments for interest will be $184,968. How many houses can you buy with it? With a great rate. Oh, with a great rate.

Yeah. Yeah. Well, in my area, you can't buy anything for $184,000. But it may not be your area. Maybe you can invest in a different state, right? Oh, oh, my God. I could buy like four houses. Exactly.

This is what I'm saying. And so it's like, do the math, people. Do the math. Like I've heard people say, it's dumb to. pay off your mortgage will for us. It's actually put us in a better place because now we're able to now run our company without having the stress, again, especially

in the middle of a pandemic, where a lot of people unfortunately are trying to figure out how to keep them on their head. Right. And now the whole purpose of getting out of debt, the entire purpose of paying off a mortgage is not to feel comfortable where we are right now. It's for our future. We don't know what the future

holds, right? So we want to put ourselves in the best possible position, right? Because we don't know what the future holds. Nobody knew that the entire world would be impacted at the same was at time like it has in 2020, right? This whole world of finance is just a spectrum of freedom, right? And when you started off, you weren't free because you were $30,000 in debt and you were like, we're not going to relax for one second here until we're out of that debt. Then you still didn't relax. You built up an emergency reserve and made some decisions there. And then you

invested in things that had the potential to move your position for. word, but couldn't wreck you. You invested from position of financial strength. Didn't work out, but you always had that freedom. And so when the time came in the economy tanked, you weren't struggling like a lot of other people, right? And then now you again, continue to build that freedom. And now you have total discretionary power over your day and how you spend your time, unlike the vast majority of people on this planet. Right. And so that's the power of this thing is it's not like you just start reaping the rewards all at the very end of it at the end of the day. It just keeps getting better and better and better as you build a stronger and stronger position

with, of course, the caveat you have to be disciplined throughout that. That's the price you pay. We went through all those ups and downs that you talked about. We made all the sacrifices that we've talked about. And some things like we talked about are intangible, the way that we get to be in our kids' lives in their activities, being our parents' lives, they've needed our help in situations. We've been able to just get in the car and go. But there's also been some very tangible things that have happened as us doing this, been

able to build a business together. We've been able to achieve millionaire status together, all because of the prices that we paid. It wasn't one big, massive thing. It was us doing the little things consistently over and over and over again, being willing to be different, being willing to go countercultural, having goals that we set together and then we blocked out the noise of everybody else. And we just put one foot in front of the other. And we kept going. Now you're an overnight success in just 14 years.

14 short years. Yeah. Well, and look at us. Let's go back to the 14 years ago when Ty had a job, when Talit had a job. And bring those two people to now. You both have jobs and you've got kids home from school because of a pandemic, what do you do with your kids? Like, you didn't predict, I hope you didn't predict this pandemic because I would have liked to share that with me, please. But my husband doesn't work. And he's there teaching the kids at the end of last year. Oh, my goodness, what a disaster. But I don't even know what people are doing.

My heart goes out to all these parents who have, like, no way to, I have to send my kids to school because there's nothing I could, you know, I have to be in the office. I have a job where I have to be there. Right. And just the freedoms that, like you said, you can never predict what's going to happen. So do you miss the whole brand name lifestyle and having a car with a car payment and a nice stereo? And do you miss that to tell you? I still like things. But you can go.

Let me tell you, he gets his things. Like, people think that when you have living a debt-free life, like you don't get the slurs. Just plan for it. We plan for it. This man gets stuff, I promise you, like, every single month. I'm like, okay, well, what's, what you're getting this mom? Plan for. He still loves things.

You're just playing for. Well, guess what? It's, I don't know because it's, and it's probably impossible to get it to assess because how do you value a business? But I'd pick you guys as millionaires. It's probably well past that mark, right? So as having paid that price, you get to buy whatever you want. Whatever you want.

Now you can buy that, like, this guy, like people are like, oh, a billionaire. Can I get a Tesla? Yeah, you can get a Tesla. You're a billionaire. Right. We were willing, we were willing to just. not do nothing for years, right? Not get things at the level.

We still have fun. We still went on trips. We still got stuff, but not at the level. We restricted ourselves so that we could get to a place to where we wouldn't have to restrict ourselves. Do you miss the payments? No, it's not NAM payment. Not one. Yeah.

Okay, I'm going to correct all of you because you're saying we paid the price. No, you put in the work. You did the, I don't even like to call it a sacrifice because it seems. like it's going to be a sacrifice. People who are listening now, who are, you know, maybe this is the first episode they've ever listened to of the show. And they're like, oh, man, I can't have anything. You can't have anything. You can afford anything. You can't afford everything. And when you go to, to make these changes, don't cut everything out all at once. Yeah. That sucks. That really is a horrible, horrible way to live and have no fun at all ever and don't do anything.

Don't do that because you're going to fail. You're setting yourself up for failure. You're going to be like, well, see, I said I couldn't do it. And look, I can't. It was right. So look at your budget. Look, I'm always going to harp on tracking your spending. What did you spend money on last month? Look at really, really look at that. Did you need all of that?

And yes, it's January. So it was Christmas and you needed Christmas gifts and blah, blah, blah. I'm not trying to beat you up about last month. But look at where your money is going. Is that really where you want your money to go? Right. And once you see where your money's going, it's super easy to make changes. You don't have to cut everything out.

Try one thing. trying and not even cutting it out, just reduce it. You have, you spent $1,000 at Target last month. Maybe you spend $8.50 at Target this month. You still get to go to Target. You still get to spend money at Target. You're just not spending as much. And then if you were okay with $8.50, cut it back to $800 or, you know, $750.

Or, you know, try to step it back a little bit and see what you miss and what you don't. And replace the things that you miss. And if you don't miss it, then you never needed it in the first place. but you have to be conscious about your spending. So no, you didn't pay the price because that makes it sound bad. But we incorporated celebrations as well. So we tell people that. So when we paying off our mortgage, we did $10,000 increments because it was such a,

it felt like a daunting task. Like we were having to tell ourselves no a lot. And so every $10,000 increments, we would then celebrate where we would take ourselves, we have a beautiful city, beautiful downtown area. And we would get a nice hotel and go to a nice steak restaurant. and enjoy ourselves, talk about life, dream. And then we got done with that. It's like, okay, let's go back and hit the grind some more.

And so incorporate fun within this time. Like it doesn't have to feel like, yeah, it doesn't have to feel like, oh, gosh, five years. I can't sacrifice that. I cannot get five years without doing the things that I love. Well, you can still do the things you love. Just make sure that you account for that, like plan for it. Make a plan. I love that.

I love that. That's a great idea. Okay, so incorporate reward. There you go. Okay, so we've got, boy, I've been typing up these little notes and I see, number one, don't place blame on the spouse who has brought some debt into or, you know, it has a different mindset that isn't where you want to be. Number two is lay out all your debts. Get them all out there. I read a book.

Oh, I am blanking on her name, but this woman wrote a book where how she, her husband would go to work and then she would go out to the car. And then she would go out to the car and bring in all the things that she bought yesterday and put him in her closet real quick. So he didn't know that she had new clothes. And she did all the finances. And when she finally came clean to him, they had something like $40,000 in credit card debt. And he's like, what? Are you kidding me? I had no idea.

And so I didn't realize that you could lie to your spouse about money, which is, I'm so naive sometimes. But like, why would you? That's your partners. But again, like, I'm not trying to make you feel bad talent for saying that. I'm right. This is good. This is good. This credit scores a little bit better of mine now.

So, you know, if you truly are going to come clean to your spouse or lay out, lay out all the debts. Don't try to hide anything. Just get it all out there. Number three, make a clear plan of attack together. Number four, combine your finances so that you are in this together. It is you against the world. Number five is do not fall into the two-income trap. And number six is give yourself rewards at set intervals, budget for the fun.

Is there anything else you would recommend to people who are looking to change their financial picture and get their spouse on board to tackle the world? I would say to borrow from Dr. Stephen Covey, one of his habits of highly effective people, begin with the end in mind. You have to dream about what you want your life to look like. It's easy to just focus on where you're at right now and the fact that you may not be where you want to be, but take some time, some intentionality toward what you do want your life to look like. And then when you paint this picture of what you want the future to be five years from now, you use that picture, you use that information to backwards plan to get yourself,

your family from the place that you are right now to the place that you want to be. And you use that as your guiding post because there will be times where you're a little less than motivated. But if you have this picture, if you have this information of where you're trying to get to, you'll hang in there and you'll stay consistent. I would say be the change that you want to see in your spouse. So sometimes spouses, you know, they'll get frustrated if they can't get their spouse on board. And then a year will pass and they've made no traction. Like you figure out what you can do, right?

So one of the things that I knew that I can control, I can control whether I spend money out for lunch or bring my own lunch. And so what happens is your spouse will be able to take notice like, wow, I do see you making sacrifices. Like, sacrifices is not always a bad thing. I do you, I do see you telling yourself no. And it causes them to reflect and to look at themselves. And so do what you can do until your spouse comes fully on board. Yeah, I think it's going to be, for someone who's new to this, it's going to be a really tough sell to say, stop spending money on all these things. that you're spending money on. And it's going to be a lot easier for a sell to say, in three to five years, we could be sitting pretty with $50,000 in emergency fund, the option for one of us to stay home and be with the kids. And in 10 to 15 years, we could be self-employed or early retired

business owners with complete discretion over how we spend our time in every aspect of life. That's what you're selling, not stop spending money on new clothes, you know, right? I think that's where they begin with the end of mind. And painting that vision, I think, is so critical. Yeah, it's a game changer because it's not about the work that you have to do as much as it is about the destination that you're trying to get to. Ooh, that's good. That's really good.

I love that. Okay, is there anything else you want to cover before we move on to our financial scan? We would just want people to know that it's worth it. The work that's necessary, the changes that you have to make, the new habits that you have to develop, it is absolutely worth it. To be sitting on this side of that scenario, we want you to know that it is absolutely worth it. I love that. I love that so much.

Oh, you guys are so good. You should see my notes. I'm like, oh, my God, I love them. This is so great. This is going to be like killer. This is going to be such a killer episode. This is so much fun. It is time for our financial scan.

This is where we look at where you are. investing your money. I'm not looking for dollar figures. I'm just looking for percentages of your investment. A hundred percent Bitcoin? Nah. Our focus right now is on, you know, index funds like Scott teaches in his fantastic book. And right now, we are sticking cash to the side looking for the right real estate deal. Those are the two areas that our investment dollars are going towards. So, Scott, did you hear that? Kind of a boring answer. What's our best answer? Boring, right?

Boring. But and let me just say that they do get a chance to be excited with their finances because you own a business. And so I think that that's the right way to do it. Everything else it sounds like is stupid, simple, paid off house, index funds. Love it. Right. Cash.

Boom. Now we get to be exciting with our business and personal lives. Cash for real estate. Yes. Yeah. I love it. Yeah. Whenever anybody is like, oh, this is how I invest.

It's never, I'm 100% in Bitcoin. And I am always watching. my network, go like this. It's always index funds or maybe a little bit of individual stocks, real estate, some bonds. And we're reinvesting steel into our business. We're buying better equipment. We're buying better software. We're just continuing trying to make our business top-notch. Well, you guys are crushing it. So is that a YouTube award that I see behind you? It is. Yeah, we hit over 100,000 subscribers in March of 2020. Headed towards 200 now.

Yes. That's awesome. That is fabulous. Now you got one more. Thank you. Thank you so much. Okay. One last question in terms of our financial scan. In terms of annual spending, how much do you keep in cash or easily liquidatable assets?

So I would just say we have a 12-month emergency fund. Oh, love it. Yeah, simply because that's what makes me comfortable. If Tyler had his way, he would probably have a six-month. So I like to tell them I'm a mom. And as a mom, sometimes I just, that extra security just makes me feel good. So we have a 12 month emergency fund. Everything else above that is fair game. Let me ask you this. Did that, because when you have a mortgage payment, you need 12 months is a little bit more expensive because you have that mortgage. Were you able to reduce the emergency fund once you paid off the mortgage as a result of that? Well, we were actually able to now grow the emergency fund more to a 12 month because at the time when we were paying off our mortgage, we only had like a six month. Okay. Got it. Yeah. Okay, so people who know about money have a 12-month emergency fund. I just want anybody listening to hear that again.

I didn't even know that. I just thought I was the one that was just being wild and unique. So I'm happy to hear that. No, I'm saying you are the ones who know about money. And you have a 12-month emergency fund. And I would say that many of our guests, we ask them this question, all answer with that same, you know, six to 12 months. Yeah, that's good.

And a lot of the folks who have clearly crossed over the threshold of financial independence, which you guys are clearly in, a lot of them are biased more towards that higher emergency. Not all. Some folks have lower ones, but that tends to be the tendency is towards that, I think. Yeah, absolutely. Right. Yeah. And you know what?

If you decide, hey, 12 months is too much now. I can go back to six. You can always just spend that six months worth of emergency fund or invested in something. But you can't instantly grab six months. Exactly. Takes a while to grab that six months. Okay. Okay.

Let's move on to our famous four. These are the same four questions we ask of all of our guests. And you can each have your own answer. You don't have to agree on this. So what is your favorite finance book? Mine is the richest man in Babylon. I can't think of the person. Oh, is it George?

I think it's all. George S. Clayson. Yes. Okay. Yep, that's mine. That was written 100 years ago. Really? So it's 100 years. I like it. I think the basic principles. I thought it's written principles ago.

I like the basic principles of the book. For me, I'm a super practical guy. So I am a fan of I will teach you to be rich by Rameet Satie. I think that there's so many strategies, he's very transparent, like even down to like the software and the funds that he invest in. So I just think he, gives a complete gang plan to lay a firm foundation financially. We both love Rameet as well. He's been on the money show now twice. Oh, wow.

Got a chance to talk to him. What was your biggest money mistake? So for me, it was lying about, you know, the amount of debt that I had, and it almost cost me the woman of my dreams. And so not being transparent with the totality of my financial situation. Yeah, for me, we created a video on that money. mistakes, I think we wish we would have made while single. I think I probably would have wanted to start investing a lot sooner than I did. Well, I love the opportunity cost one as well. We obviously

discussed years at length on top. What is your best piece of advice for people who are just starting out? I would tell couples not to live on two incomes. Like, we tell everybody that whatever you do, do not over leverage yourself based off of the two incomes that's coming in a household, because life will change. You may not change right now or right away, but it will eventually change. So live off one, use the other to save, invest, build wealth, start a business, do some fun things, take some risk. Yeah, I think I would tell people to position themselves for a house hack. I think that it's a heck of a chess piece that if you can... That's a mistake. Wasn't that one of the money mistakes?

That was one of them. I think about it. Yeah. That was one of the money mistakes. I wish we would have done first, but I would tell people to position themselves for a house hack because it's a major chess piece and where you will end up financially five to 10 years down the road. I love it. That was when I started out, that was my, like once I realized there's a house hack component, that was just my number one thing. I'm getting into that as soon as possible because it's just like, what a powerful chess piece. Exactly. That propelled my wealth by hundreds of thousands of dollars and my savings rate and all those different types of things. I was able to house hack for seven years before moving back to renting now.

I wish we would have done that. And we didn't have children at the time, too. So it would have been more favorable for us, you know, not to say that people can't do it with children. I personally just feel like it can be a little bit more difficult when you have, let's say, three children like we do and maybe staying in a one to two bare room, you know, home and house hacking. So, yeah. All right.

What is your favorite joke to tell at parties? I'm not a joke. I'm not a joke. I'm not a joke. No, you're not. No, he says that I'm serious. He says that I'm serious. He loves to laugh at jokes, and it takes a lot to really make me laugh.

Well, what do you call a French guy being mauled by a lion? A baguette. That's what I say to my head, but that's all I know when it comes to French is a baguette, so I don't know. Claude. There I get it. Oh, okay. I don't think I'm laughing. more at your

hashtag dad jokes. Hashtag or at dad says jokes. Why do fixed interest rates smell so bad?

Because they never change. Oh, that's good. That's a good one. That's a good one. That's a good one. Okay,

tie and talent, please tell people where they can find out more about you. Sure. You all can find us over at our website at his and her money.

com. We also have a YouTube channel, a podcast, called the His and Her Money Show. We're on all outlets, yep. And social media, we're at his and her money. This has been fantastic.

We are going to link to all of those things in our show notes, which can be found at biggerpockets.com slash money show 159. And if you are serious about getting your spouse on board with finances, listen to their show, listen to this show, listen to this show with your spouse. Talk about from a non-confrontational, non-judgmental point of view. Be like Thai. Be like Thai. Everybody should be like Thai.

Everybody should be like Thai. Because you can get yourself on the same financial page. And like you said, it's so worth it to not have money fights. Like whenever, my husband and I don't fight a lot. But when we do fight, it's really just soul crushing. And I don't want anybody to be like that. I can't imagine fighting about money. That would just be so heavy and weighing.

So if that's your biggest fight, really just want to fix your finances. Tie and Talit can help you. Thank you, so much. We appreciate you having us. Keep up into the work, guys. We thank you for coming on. This is fabulous.

Okay, and we'll talk to you soon. Bye. Holy cow, Scott. That was fantastic. What did you think? I really enjoyed it. I thought they had an incredible story, and we were able to interweave a lot of really good learnings

about how couples can get on the same page financially with this stuff. and manage the finances. You know, as you know, obviously me and my wife have talked about finances to some degree. Otherwise, I'd be completely hypocritical around this. But we got married and like, guess what? We're only like a few weeks into our marriage

and we still have some things to do to, you know, dot the eyes and cross the T's as far as merging and combining our finances. So I think that it's, I think it's really powerful to hear that. And I learned a tremendous amount as a new non-batchelor, new husband. That's what the word is. Newly wed. Yeah, newly wed, yeah.

So I really enjoyed picking their brains, and then their money story was just incredible. I mean, I love it. That's the right way to do it. They have complete freedom now, and they're never going to have to worry about this rest of their lives. The snowmall may just keep growing and compounding for them, but they're never going to be in a position where they're reliant on a paycheck or outside, you know, lacking control or freedom over their time again. Yeah, I just was super excited the entire time we were recording. Scott and I share a Google Doc when we record so we can take little notes and I'm like, oh my God, I love them so much.

This is so fantastic. This is just, I learned so much and I've been married for 19 years. This is the way that they phrase things, the way that they put frames around the outlook for this is just so wonderful. I have never heard somebody make such a good argument. for paying off your mortgage. And at the end of the show, if you decide that that's not for you, great, that's your choice.

But that is what worked for them and that's why it worked for them. And I thought that was a really great way to frame that. I just loved every minute of the show and I'm so happy that we had them on. Agreed. Loved it. Should we get out of here?

Scott, this episode ran pretty long today. Let's do it. But I had a lot of fun. It was the perfect length, Mindy, today. Because we got, we used every minute of it and I got value out every minute of it, even if went a little long, longer than usual.

That's okay. Yeah, it was great. Oh, this was so fabulous. This is probably my favorite episode. Okay, from episode 159 of the Bigger Pockets Money podcast, he is Scott Trench and I am Indy Jensen, saying, got a shake, rattlesnake.