Money For Couples with Ramit Sethi - 111. “We rushed into buying a $730K house. Now I can’t sleep at night”

Episode Date: July 4, 2023

Jonathan and Shalom are young, 31 and 27, married for 5 years and getting used to a big addition to their lives—a rushed home purchase in the Pacific Northwest that tints their relationship with conflict. Jonathan buries himself in the numbers. Shalom buries her head in the sand. This episode is brought to you by: Facet | Get affordable, accessible financial planning with a flat fee membership. For a limited time, the $250 enrollment fee will be waived when you sign up at https://facet.com/ramit. DeleteMe | If you want to get your personal information removed from the web, go to https://joindeleteme.com/ramit for 20% off. Methodology | Visit https://gomethodology.com/ramit and use code RAMIT for 10% off your first order of Methodology. Long Angle | If you've made a lot of money and you're looking for a community of peers to turn to for advice, go to https://www.longangle.com/ to learn more. Links mentioned in this episode • Should I Buy a House Now? (5 Guidelines & Perfect Timing Tips) Connect with Ramit • Get the Podcast Newsletter and exclusive Q&A about the show • Get Money Coaching with Ramit  • Download the Conscious Spending Plan • Get my New York Times best-selling book • Get my no-numbers journal • Other episodes • Instagram • Twitter • YouTube • Submit a question for the newsletter iwt.com/askramit  If you and your partner have a money issue and you want my help, I occasionally select a couple to work with, free of charge. Apply for my help here. Produced by Crate Media.

If you or your partner has fallen for a scam, I want to help, especially if you've recently fallen for an email or text scam, or you've gotten bad financial advice from someone who did not keep their promises, or maybe you just have not even told your partner because you are embarrassed. If this is you, I want to talk. Apply for free coaching with me by being on my podcast. Apply today at IWT.com slash apply. That's IWT.com slash apply. Let me share some of the coolest ways that my community has recently used money to live a rich life. One member did a month-long honeymoon in Europe after deciding she didn't want a big wedding. Another member bought a VW SUV that was their dream car that they've wanted for years.

And another member made a rule that any time she buys a ticket for an event, she always buys a second so that she can bring a friend. These are just a few examples of how my money coaching members have built systems to use their money. Notice that there's no more anxiety, that they have a smooth running system. They know when their debt's going to be paid off. They can feel comfortable spending on the things they love. They can actually spend less time on their finances while living an amazing life. In my money coaching program, members also get access to live events every month, including topics like money with aging parents and how to create

amazing vacations. That was one of my favorites where I shared how I spend my money on travel, plus Q&A directly from me. If you want to start building your rich life today, join us and get instant access to our back catalog of years of live calls. Check out IWT.com slash money coaching to join now. That's IWT.com slash money coaching to join the program right now. We put the offer down in the house and Louie, I woke up the next day and actually her the two weeks before closing, I almost every night I had like panic attacks. So just, yeah, like crazy level of anxiety. I think the psychological like burden of death for me, I, I know I felt like in my

body like in a very very real way. We weren't at the healthiest place. On the other hand, like he had to make a decision, financial decision. So a lot of the conversation we had was, I'm doing this for you, but do you want it? What was your monthly payment on the place you were renting right before this? We're paying by 1800 per month for rent. And now what are you paying? We're paying 4,150. When I put my head down my pillow at night, it's like, okay, so even if all the numbers were fine,

it just seems like there's this huge kind of liability at the house paying over my head. I kind of have like this big picture of like, oh, it's fine. Like, we'll be fine. And the stress is on him because he does everything for planning. and finance and all of that stuff, and I don't. So I live with peace and he lives his sleep. Meet Jonathan and Shalom. Jonathan is 31.

Shalom is 27, and they've been married for five years. He works in tech as a program manager, and she is a nurse having recently finished her second degree. What we're going to talk about today is how they have started to disagree about money when it comes to their house. They recently bought a house, and I want you to hear the way they talk about money and about things like getting a couch

because so many of us will have the exact same conversations at some point in our lives. As always, remember that you can watch this full episode on YouTube, which is quite entertaining to see the facial expressions and body language. All right, let's get to it. Why did you guys buy this house, by the way? Oh, that's a, I can't wait for this. They're just laughing.

You love you talk? Yeah. What made us make the leave. Yeah. Yeah. So I think... Wow, there's a lot of smiles going on right now. What in the hell is happening?

Everybody's, like, looking down. I was originally super against buying a house. I agree. Let's at least see what's out there. Kind of open-minded. Like, we were, when we first start looking for a house, we did it as a date thing. Okay. Like Sunday date?

Let's just go see what's around. Saturday. you know, like, why don't we do open house and see what's like on the market and how much it is and what the process is? Because I don't know how buying a house. My parents don't own a place or a house of property in the U.S. So we started attending like open houses and that it just went really fast. And we saw this place and then we had to buy it a week after. The two of you were like, oh, like let's go on date night today.

What do you want to do? I want to go to ice cream. I want to go to an open. house and then you blink your eyes and you tripped and you fell and you handed over $500,000. Yes, almost fell. Like, just the most expensive fucking date night in history. And I think when we had the conversation, and this is like housing is so expensive in Seattle and this was like on the lower house market.

And if we ever buy a place and this might be like the lowest price. we would get for the place where, like, for the area we're in. And that was the rational I had if we end up having kids that we're going to need a place that's bigger than like just an apartment for a freedom too. Like we both grew up before, I think, to the U.S. or Jonathan also grew up, who was a big backyard. And like we had a very good memory just playing outside and running around. For me, I want to be able to do that for the kids we're going to have.

And I don't want to like raise kids in a very like apartment, very tight area. and that's with that emotion though like I think we rushed into hey like we need to get the house and whatever the house like whatever we can with the budget or with the price that you know we can buy it now and then I think things things go very very fast like you start looking at houses and then you kind of get in negotiations and then things go like very very fast so the house we're looking at someone else had an offer down. So I think it kind of gotten like how can we, you know, win the house. And then the issue is once you put your money down, but big earnest payment. What was your first bid for the house? So a first bid was about, you're originally

going for like 700. And what did you end up getting it at? So we, it didn't, we had to counter with the full, the full price. Full was what? 7.30. I don't think realize just financially and emotionally, just everything that goes to buy what do you mean? It's just, you know, you look at the internet and everybody says you buy a house and then it prints money and then if you don't like it, you just rent it out and that's how you create generational wealth. What are you telling me they're not telling you the full story, Jonathan? No. And you know, I did I did run the numbers as it were. But yeah, I would just say there's things that you'll look at a spreadsheet and it works out.

The numbers may work, but just kind of the psychological element of being in that much debt and then how there's like fixed costs are not the same thing as, you know, your other money. It's required for you every single month. All of this is hilarious and I really like Jonathan and Shalom. So we're all having fun. One thing I do want to point out is that offhand comment she made about if we have kids, we're going to need a bigger place. And we grew up with a lawn and it has so many good memories.

It is no accident that when people go through life changes in America, they all say the same thing. I'd rather have a small wedding and put a down payment on a house. Or we're having kids so we need a bigger car and a house with a yard. Do you find that interesting? Do you think that every one of us just independently came up with the exact same phrases? do you think that other people in other countries say the same things? Or do you think there might be a series of organizations who stand to profit from you believing you need to spend hundreds of thousands of dollars at a very specific time in your life?

Just remember, these peculiar beliefs about money pop up in very specific circumstances over and over again. If you decide you want a house with a lawn or a certain type of car, fantastic. If you can afford it, you run the numbers and it's joyful to you, great. But do not simply slide into someone else's idea of a rich life. Just guess the average wait time to see a doctor in the United States. I'm not talking about a specialist, just a regular standard family doctor. You think it's a week, two weeks? Nope, it's over 30 days.

So a lot of times whatever symptoms you have are going to be gone or maybe worse by the time you get to that appointment. I don't want you to have to wait weeks to see a doctor. I want you to get seen faster by an in-network doctor using Zocdoc. Zocdog is a free app and website that helps you find and book high-quality in-network doctors so you can find someone you love. They have over 150,000 doctors across all 50 states in 200-plus specialties, including mental health, dental, primary care, whatever you need. Just filter for doctors.

based on insurance, location, ratings, even virtual care options, and Zoc Doc appointments happen fast, usually within 24 to 72 hours. You can look through your options, book an appointment, and you are done. If I needed to find a new doctor today, Zock Doc is what I would use. Stop putting off those doctors appointments and go to Zocdoc.com slash remit to find and instantly book a doctor you love today. That's Z-O-C-D-O-C dot com slash Rameet. Zok-D-C-com slash Rameh.

And I want to thank Zok-Dak-D-K for sponsoring this message. There's a pretty cool TikTok trend going around right now that I really love. It's called admin nights. Basically, you get your friends together, you get some snacks, maybe some drinks, and you do all the infrastructure stuff in life that most of us skip over. If you're going to set up an admin night, here's my suggestion for you. Use Zoc-Doc to book your health appointments, and you will be. done fast.

Zocdog is a free app and website that helps you find and book high quality in network doctors so you can find someone you love. They have over 150,000 doctors across all 50 states in 200 plus specialties, including mental health, dental, primary care, whatever you need. Just filter for doctors based on insurance, location, ratings, even virtual care options. And Zocdoc appointments happen fast. usually within 24 to 72 hours. You can look through your options, book an appointment, and you are done.

If I needed to find a new doctor today, Zok-Doc is what I would use. Stop putting off those doctor's appointments and go to Zoc-D-com slash Rameet to find and instantly book a doctor you love today. That's Z-O-C-D-O-C dot com slash Rameet. Zok-D-D-com slash Rameh. And I want to thank Zok-D-D-K-D-Fons for sponsoring this message. What was your monthly payment on the place you were renting right before this? Yeah, that was part of the thing that was really stressful.

So we were paying about $1,800 per month for rent. So $1,800. And now what are you paying? We're paying $4,150, which I didn't put on the plan, but next year, it's going to be going up $500. And then the year after that, it's going up $500. No, no, that can't be because everybody tells me that real estate, allows you to lock in your price and you never pay more. That's what the internet told me.

And by the way, your utilities cost $400 a month, right? Let's not forget that. All right. That's kind of a considerable jump, right? You went from $1,800 a month in rent, which was all in. That's how much you paid. That was it. To now $4,500 plus assorted phantom costs that haven't even really been added.

Let's just say, I don't know, $4,500 extra a month ballpark. that's a huge jump more than double when i put my head down my pillow at night it's like okay so even if all the numbers work fine this seems like there's this huge kind of liability at the house hanging over my head it's it's just like those things like you know flood there's mold i mean there could be a tornado hits the house i mean and it's kind of all those things where um yeah i just i feel that feel that weight shalom what happens when your head hits the pillow you are you thinking about the spreadsheet? I fall asleep.

Oh. No. So interesting. I kind of have like this big picture of like, oh, it's fine. Like we'll be fine. And the stress is on him because he does everything for planning and finance and all of that stuff and I don't. So I live with peace and he was.

It's so interesting. I wonder if there are any patterns here. The person who just kind of lapsed into taking care of the money is the one who's consumed with worrying about it. And the one who, you know, goes to work and says like, oh, I trust him. She's fallen asleep within two seconds. Any patterns here, anybody? You'll see the pattern?

Yeah, I can see the pattern. I think mainly in the probably a fear side of things. So we put the offer down in the house and Lula, I woke up the next day. And actually, for the two weeks before closing, I'd, Almost every night I had like panic attacks. So just, yeah, like crazy level of anxiety. I think it started to kind of the psychological like burden of death for me. I felt it like in my body like in a very very real way.

We weren't at the healthiest place, both of us. Me, I got attached to the house because we toured so many houses. And this felt like it was the house. And for Jonathan, one hand, when he says, no, he felt like he was not doing the right thing for me. On the other hand, like he had to make a decision, financial decision. So a lot of the conversation we had was, I'm doing this for you, but do you want it? This is the most American story I've ever heard in my life. Two people are just going out for coffee, having a nice walk.

They stumble into a Saturday open house. And then they go, you know what, we should do this every Saturday. They do it for months. They get so tired. In their ears, meanwhile, people are chirping saying, you need to buy a house. You're just throwing money away on rent. Meanwhile, they're looking at prices going, how are we ever going to afford something like this? Then one of them starts going, well, what about kids?

Well, we don't have kids yet. Well, one day we're going to have kids, and then we need to have a yard and a lawn for them. Then the other one starts having panic attacks. Then they start arguing, what about me? What about you? And finally, they go, screw it. Let's just write a check. I'm done with this.

And then seven months later, they end up looking back and going, we're paying more than double what we paid in rent. Okay, look, buying money. end up being a good decision for them, but the way they made this decision is fascinating to me. It is exactly what the real estate industry wants people to do. I never had to live by myself after, so we got married right after graduation. So I never had to experience even after getting a job, what it means to plan or like actually like budget.

A lot of it has been done by Jonathan. Even if our income, like our incomes combined, but a lot of it is done. by him, how we budget our life and what we do. Early on our relationship, I was kind of the one who just had a little bit more fluency around money, a little more background around money. I probably didn't begin a relationship, just kind of I handled things. I wouldn't say I was overly controlling, but just that's kind of the default rules we fell into.

So what is an example of something that you previously were totally aligned on financially speaking? Traveling. Where did you go? Where'd you go? We've been to a lot of trouble. We went to a lot of different places, Italy, Mexico, Ethiopia. Sweden. Yeah, we travel quite a bit.

So in those areas, we tend to agree on how much we spent and the amount of money we were allocated to learn those things. What would be perhaps the most expensive trip that you have taken together? Europe, Italy, and England. So how did you decide how much to spend? Was that decided ahead of time? or was it after the fact? Talk to me about that. I'd say we kind of went in with the budget.

I think we did end up exceeding it a little bit. But yeah, we were pretty careful on how we went forward with spending and so forth. Who came up with the budget? Jonathan did. That was me. I'm going to guess that's a trend, right? Yes, and it's a reflection I'm actually thinking about right now.

We do travel a lot together, but a lot of the budgeting is put by Jonathan. And I don't even have to worry about like how much we're planning because he does a lot of the planning. And I kind of like trust he's planning. And I trust whatever happens afterwards. So I have a question for you. You said, I don't have to worry. I notice you use that word worry.

Is thinking about money the same as worrying about it? Yeah, sometimes. Since we moved in, there's a couple of things that needed to get done. Paining the house and like fixing floors and that kind of stuff. And now for me, it's like, let me furnish the house. But Johnson has been kind of like putting a pause on those things and saying, like, we don't have the budget for that now. And we can do those things.

And in my head, the house is empty. So we need to go and like actually like make it feel like a home. Is it empty? Like literally empty? Not literally, but there are things that are that should be there. They're not there. Can I see? The living room.

Okay. All right. Let's get a look here. House tour. So this is, how new is this house? We moved in completely like last week. Oh, wow. Okay, pretty new.

And you just bought it. Is that correct? Yes. All right. So it's a little messy, but this is what it looks like right now. All right. Hold it right there. Don't move.

So we're looking at, what is this, your family room? Yes. Beautiful living room. And show us what else are we? So you think that's missing like a couch? Yeah. So having a couch would be better to have a couch, but we have another couch that's by the entrance, which is right there. So there's all the paper on the floor.

So excuse me for that. Don't worry. Jonathan wants that couch to move on that side and we don't need another couch. And is that a source of disagreement with the two of you? Yes. Just pan over that way towards the couch, would you? I just want to get a feel for this. All right.

Thank you. I'm sure there's more. but I think we get the idea. Yes. That's cool. I like that we just got the home tour. Thank you. This might be the first,

are we the first people who have ever seen your house? Yeah. I think we haven't had people over yet. So we're planning a housewoman party in a week or so. Love it. All right.

It's cool. All right, please. Me and just a few million other people who are going to see this. This is great. All right. So you move in about a week ago and you've been talking about getting new stuff, furnishing it.

I say we should probably get a couch for the living groom. And Jonathan responds. You can go ahead and respond. Yeah, I usually kind of couch it in terms of like, you know, trying to create a budget for it and then planning for it and distributing that amount we put every month to getting it. So usually I kind of hurt. I don't get upset right away, but I try to have.

have like rationales getting like I tried to get irrational out of him so yes budgeting makes sense but at the same time we just moved to a new house and like after we do the basics then we can save like getting a couch and then we can put money if we need to do anything else on the house so how long do you want to go before you get a couch jonathan it's a good question probably probably a good year so um I guess I have pretty simple requirements. That noise was Shalom bursting into laughter. Why are you laughing? I'm laughing because it's funny to me.

Like, how can you live without a couch for a year? This is actually pretty interesting. It's funny, but I can also see both sides. Jonathan says we should save for a couch, then buy it. Shalom is like, um, how long can you live without a couch? A year? Remember this detail. Well, this is going to happen pretty soon, right?

you're having this get-together next week? Exactly. Oh, wow. The stakes are high. Wait, so what's going to happen right now? If you had people come over tonight, what would they do? Well, you please answer that, Jonathan? I mean, we do have a nice backyard, so it'd probably be kind of like a long party kind of thing.

So standing? Could be standing, yeah, or picking blankets maybe. I can see that. What does a house mean to you? As I said, we live in a community. this space provides that like home for those people too. Like family comes, the state with us,

friends like traveling, they stay with us. And having that space for me is huge versus like, oh, it's just a two of us. And yeah, basically like a little shelter.

All right. What does a house mean to you, Jonathan? Yeah, I'd say a house, Dickler High G mean like just renting a house owning a house or just house in general. Your house. My house.

Yeah, I would say that the house is not really a good investment, but I think for me also, there is an element of which when I'm kind of done living in a house, you know, I don't end up in a worst financial situation, even if I'm not getting great returns on it. When it comes to a house, he does not care. It's not, like literally we can live in, we lived in a 500 square feet apartment,

and that was his idle space to live. So he doesn't care, but you care. I care about that kind of stuff, yeah. You know, when it comes to the house, there's kind of all these different things around like remodeling the house. So furniture was kind of the first thing, but we talked about, had contractors coming into estimates.

Shum really wanted to get the kitchen done. And it turned out it was going to be about 60,000, I think was what we were looking at. For me, that was just like complete shock. I just, I reacted kind of very strongly said. There's no way, you know, we just put down. a huge amount for a house. There's no way we can, you know, we can go ahead and for more money into the house.

I'm not sure I'd ever want to spend 60k on the house. I think is kind of where I'm at. It feels like I'm putting all of my, you know, extra cash in something that for me, you know, isn't, I would say, as much part of my rich life. It's more of those things like experiences and so for and kind of one of those things that really triggered it for me or kind of brought on I brought on everything was we just celebrated our fifth year anniversary and we spent you know about a thousand dollars kind of celebrating and it was a really fun time but then I remember I'm about a you know five years ago when we got married it was about 15 grand for a wedding you know it's pretty pretty decent but first day we own the house we end up remodeling the floors and we paid the same amount

And so kind of in my mind, you pay 15K for the floors? Yeah, 15K for the floors. And so for me, kind of, you know, I pay attention to numbers quite a bit, but the amount of, you know, joy and happiness that we had kind of our wedding and how much money we spent, how much we're able to create really wonderful environment, really wonderful experience. And then the satisfaction kind of I got from wood floors, which don't go right, the great wood floors, but just kind of that, that for me helped kind of clarify, I think, think where I see myself wanting to spend money.

Sounds like you got much more enjoyment from 15,000 spent on your wedding than 15,000 spent on floors. Is that right? That's correct. All right. Shalom. What does you enjoy more? Hold on. What did you enjoy more?

Your wedding or the floor? I think, my gosh, this is so hard. The floor. I think I would choose the floor because we're going to have it for the next 30 years. All right. Wait, I don't even know what to say right now. Yes, I loved my wedding. And it is a wedding, and I cherished it.

But like the floor will last forever. Not forever. Obviously, we're not going to live here forever. But it sounds really stupid. Okay, I was 100% sure she was going to say, I loved my wedding more than the floor that I walk on with my dirty feet. And Shalom looked me straight in the eye and said, I love this goddamn flooring.

I am speechless. This is why I love my. job. Here's some of the most creative I will teach you to be rich businesses that my students have created. Nate turned his love of chess into a chess coaching and training business and started a legal strategy business for online entrepreneurs and creatives. Scott teaches yoga all over the world, including in the south of France. Now, what I love about all these, they're so different, but they started from the same question. What if I took the thing I love and turned it into a business? One of the things that entrepreneurs learn is how to keep it simple.

That is why when I'm working with new IWT students who are just first-time entrepreneurs, I recommend that they get started with Shopify. Shopify is the commerce platform behind millions of businesses around the world and 10% of all e-commerce in the U.S., including brands like Mattel and Jim Shark. They've got ready to go beautiful templates for important things like your website, landing pages. Plus, they have helpful AI tools to make. make everyday tasks easier, like generating discount codes and enhancing your product images. It's like having a full marketing team behind you. They've got easy to run email and special media

campaigns to help you connect with new customers. And everything is in one place. Tackle your inventory, payments, analytics, and more without having to jump from platform to platform. It's time to turn those what ifs into with Shopify today. Sign up for your $1 per month trial today at Shopify.com slash remit. Go to Shopify.com slash remit. That's Shopify.com slash remit. I spent over 20 years fine-tuning my core message from I will teach you to be rich of living your rich life, which is why I was so thrilled when Masterclass reached out and asked me to teach a class.

Because I've spent so many years helping people define their rich life. life. My financial wellness class is now available on Masterclass where I cover how to automate your finances so your money works for you in your sleep, how to break free from financial anxiety, and how to create a financial system to live your own true rich life. With Masterclass, you learn from the best to become your best. Plans started just $10 a month and you get unlimited access to over 200 classes taught by the world's best business leaders, writers, and now me. Plus, there's no risk. Every new membership comes with a 30-day money-back guarantee, so you can try it out before you commit. I've used Masterclass myself. I've paid for it on my own,

and I loved it. And a big part of my rich life is learning from the best. So Masterclass makes perfect sense for me, and I think it will make a lot of sense for you. Right now, our listeners get an additional 15% off any annual membership at Masterclass.com slash Ramit. That's 15% off at Masterclass. Masterclass.com slash remit, masterclass.com slash remit. Where we live, it's actually, it's more expensive mortgage than to rent. So we couldn't make the money. It's, I think it's about $3,500 to rent a similar house. So we're already paying kind of more than it would cost a rent.

Can I just articulate that so everybody understands it? So you're telling me to rent a similar square foot. similar bedroom bathroom in your neighborhood, it's 3,500. Correct. Everybody listen up and listen closely. It's 3,500 to rent a similar place, and you guys are paying how much per month all in? All in. How much?

What did you say? It would be close to five. This year. Yeah, this year it's probably going to be like five, maybe five and a half. Yeah, exactly. 5,500 conservatively, yes. So just so everybody understands people go, it's always cheaper to buy. No, it's not.

So you kind of modeled it out. In your model, Jonathan, had you calculated that it would cost like $5,500 a month? No, I think I, the issues I use kind of these like ballpark numbers, but I didn't actually like get the real numbers. And so for me, I think I didn't quite internalize it. Like I looked up online, you know, how much you generally spend on things. But because I was kind of using just general numbers. I didn't really personalize it.

I think you're picking like 1% per year for me. That kind of thing, which is, which kind of explains why this couch has become a central focus. Shalom, do you see that? Yes. Yes, I do. It's not just the couch, right? It's like that, that old movie about washing dishes. And who is it, Rosie Perez?

She's like, I don't want you to wash the dishes. I want you to want to wash the dishes. I think the house has to do is like the quality of life we're living too. Right? We spend so much time in the house. whatever we buy for the house or we put into the house, we spent in it more than we spent time traveling. Yeah.

So it's not just the house. It's also our like dwelling space. Would you be willing to spend more on the house if it meant you traveled less? I think house would come first for me. Have you ever made these kind of tradeoffs before with money? No. Okay. So if that's the case and your income is sort of combined and he,

he, quote, worries about money, and it seems to work for you, then just out of curiosity, why not just let him handle the money for the house? Why is it different for the house? I think that is what's making this a little hard for us to. We both love to travel. We both try to love to try new things and stuff. I am more into doing interior stuff and house stuff, and Jonathan dislike or hate that, actually. So I think that's why we're having a lot of disagreements.

We don't have the same value when it comes to home and house. But the rest of our values, the line around comes to actually like doing stuff together or spending money for another thing. Jonathan, where'd you grow up? I grew up on Bainbridge Island. So it's like an island in the Pacific Northwest. What would you describe your socioeconomic status growing up? Probably like upper middle class.

Upper middle class. All right. what do you remember your parents was it two parents one parent yeah it was two parents uh you know my dad and our family he's the one of you kind of handles the spreadsheets he's got spreadsheet just larger than i can possibly imagine horizontal scrolls and vertical scrolls hundred columns it's he's got serious records of every penny that goes out of the house and it's kind of you know my mom you know she trusts my dad and uh you know he tends to do a pretty good job at it.

So that's kind of their roles. So they definitely influenced me. When did they talk to you about investing? What age? So investing, I've actually probably got to give you credit for that. I think even before it comes to investing aside from saving, I actually came across that idea in your book. And sophomore year in college.

So you found that on your own. You don't recall your parents talking about that? I know, I mean, I went to my parents afterwards and asked my dad a lot of questions and he helped a lot. Just kind of filling information. Do your parents pay for college for you? No, they helped, but I paid. Cool. How did you do that?

So, you know, I went into a fair bed of debt in college. And in sophomore year, I read your book. And then after graduating, I lived what is in a sense. essentially a closet for, you know, probably a few years. What was your rent? What was my rent? I paid $600. Yeah.

Cool. Okay. What do you do? So I'm a program manager in time. Cool. All right. So your parents were upper middle class. They did talk to you about finances, but not to the level of investing.

And you went to school. You sort of sought out your own education, found my book, et cetera, lived frugally and then eventually, I'm guessing, increased your income and paid off a bunch of debt, right? Correct. All right. Shalom, tell me about what you remember about money as a kid. Where did you grow up, by the way?

I moved to the U.S. when I was 14. So for that, I was in Ethiopia. Two parents and two younger siblings. Got it. Are your parents still abroad? No, they're in the U.S. They live here in Washington. Let's start back to when you were in Ethiopia.

What do you remember about money back then? Culturally, from I remember, like, people don't really talk about money. But I remember, like, my parents would try to invest in, like, real estate. So they would have, like, one home and then they would do another apartment or something to, like, invest or, like, to put money toward them, potentially rent it. but there was never a conversation with us about like how we should save or invest money. But I remember in college, my dad would tell me that like I should use money to serve me not to become a slave office. And in fact, I didn't know anything about stocks or any of that until my brother's reached, one of my,

my youngest brother reached high school and he started putting money towards stock. And I remember like coming home, you were about to. to lose a lot of your money. And he was in high school. He would work, like, part-time after school, and he would put his money towards that. And I thought it was just, like, some fraud that people hide out there. All right.

And then what happened? I mean, he's well up now in college. My parents didn't. He didn't take any loans. He paid his college. And he bought a new, brand new car for himself to commute. Yeah. He was very self-sufficient.

All right. Great. So when you graduated, how many years ago did you graduate from college? 2017. And then I went back to school again for a different degree. That's awesome. All right. Fantastic. Okay. So that's great to hear. And just so I understand correctly, you both, when you met, which was years of more than five years ago, Jonathan started taking over sort of like day-to-day what to do with the money. Is that right? Is that common? Is there a cultural thing here?

Shalom, where like, you know, where you grew up? No. No, it's not. Okay. And my household. My mom is the one who managed the money. Okay. And she's very much, yeah, like that my dad is basically is in my position where mom

takes care of everything financially or like. Man is everything and he kind of says he knows, but he doesn't really, I don't think he has interest or I feel like we're on the same page. I am interested to the point that I know where the money is flowing, the money flows going, but not to the point like I want to know exactly what happens month to month. I know it's in a good hand and it's a safe hand in my head. Okay, with Jonathan. Okay. What does your mom say, by the way, about your money management? I used to be

known in the house for spending a lot. And now? And now I think I'm better. And actually they warned Jonathan before we got married that I was very expensive. And was that like a half joke? Like ha ha ha, she's expensive, but also

like she likes to spend money. Yeah, watch out. Both. You know, even though they have different views on money, they're both very likable. They're open with how they feel and they're young. So even if they're not totally on the same page, they still have time to get there. Let's see if we can look at the numbers. Can you read off, you know, assets and then tell us the number that's next to it, please? 730,000. What are these assets that you have? I don't know. I think it's stocks. I don't think it's that. I don't. Car property. I don't know. I think

it's the house. Okay, you don't know. That's fine. Investments. What do you see? 90,000. 90,000. All right. Savings, what do you see? 60,000. Uh-huh. And debt? 650,000. What's that total net worth that you have? 225,000.

All right. Have you ever seen these numbers before? Not this part. All right. That patterns always show up. It takes me a little while, but the patterns always show up, don't they? All right. So I love putting Shalom on the spot when she's never seen these numbers in her life. What do you think about this number, $225,000 as your total net worth? Is it good? Is it bad? What do you think? I mean, it's good. It's a positive number. Okay. All right. That's what she's got to say. All right. Positive numbers are good.

225,000. The two of you are pretty young. That seems great to me. And then what's this generosity number? So generosity, so that's kind of a lump fund that we'd like to keep. So it could be generosity just with like, let's say, we know someone who's in need, also kind of tithing for church and that sort of thing. Just the whatever causes are important to us. Your savings is 16%. That's pretty aggressive. Why is your saving so high?

So in general, I hear people say the rule for how much you should. budget like monthly for house is like at least one percent. This really shows you that when you buy a house, not only do you have to pay those expenses up in the fixed cost, but you actually have to start putting a lot of money for future stuff. Yes. Maybe future stuff that you know about, like we want to do the backyard landscaping,

or it may be future stuff that hasn't broken yet, but it will break. Oh, he's looking down and he's putting his head in his hands. What's going on? You mentioned the landscaping. So that's a whole other, whole other topic. Oh, well, why don't we just get into it right now? You know, I live for this.

Sure. So it was the first day after we put the offer down. I was at kind of a family gathering and, you know, of course, the house comes up as, you know, sometimes does. And we mentioned we put an offer down and I showed pictures, right? Like, that's the thing you do. After you say you bought a house, people want to see pictures. And so I go around with like redfin on my phone just. kind of show people pictures.

And my brother-in-law, who actually does, you know, does a pair of gardening. He used to do landscaping back in the day. He looks at the like the landscaping. He's like, wow, that's gorgeous landscaping. I hope you like landscaping. And just kind of give me some background. I'm like, somebody who loves books. I don't do anything really other than almost a lot.

So, but just when it comes, to maintenance that kind of thing. I didn't realize it until that conversation. Wait, hold on. Do you like Home Depot? I absolutely hate Home Depot. So, like, I have a bit of trauma, I think, just childhood trauma. My parents can spend, like, hours trying to find, like, a light fix.

Wait, me too. Yeah, I hate this place. Yeah. And there's, like, something, like, that smell of, like, wood chips and chemicals. Wood chips and despair. So your brother-in-law mentions this to you. And then? Yep.

Yeah. So my brother-in-law mentions landscaping and he's like, expected the frubs. Like, you're going to have to, like, hire a pro to do it. You're going to have to really, you know,

go on YouTube and watch videos. And that's what people say. I would have taken a saw. I would have hired somebody off like upwork immediately. Well, it's not even upwork. I don't even know where you hire people to come to your house. But I would have been like bring a chainsaw and bring a garbage bag.

That's exactly what you said. Oh, there's 20 bucks. Someone's batting me out. Be gone in 10 minutes. I don't care how you do it. Did you say that? I actually, so what I, this is probably one of our biggest fights actually with the house.

We've had some disagreements, but, um, Shulma was in the background and I just pulled my brother along like, oh, well, I can just, I can, you know, give it a, give the, uh, the shrubbery a trim. It won't need another one. And yeah, we'll be gone. Done. Functional. Very utilitarian.

Shulm heard like chainsaw and, uh, you know, the shrubs. And she got, let's just say she had a reaction. Wait, what was your reaction? I'm asking very intently because one day this might happen to me and I need to know. Well, it was just, it sounded very ignorant. He was telling people around the party that he's going to just literally take that thing out when he goes back. And then I'm just hearing that she's like the lady who was here, she put a lot of work to it and they're not cheap shrubs. Like you call them whatever you want, but they're not cheap trees.

Listen, keep going. This is so funny. Yes, so that's what it happened. Like, he wasn't even kidding. He was serious. I'm going to just. He was going around saying that. This is amazing.

All right. So are the shrubs still there? Yes, they are. And who takes care of these beautiful things? We're trying to figure that out right now. Yeah. I don't want to put my generosity money for the shrubs. I don't know.

I just love the idea of walking into their house. Jonathan and Shalom are sitting at opposite ends of the table. Both of them looking at their phones, so angry with each other. And I'm like, hey, guys, it's Ramit Satie here. How's it going? And they totally set aside the years that it took for them to get to know each other, the unlikely journey it took for them to meet each other to get married to buy this house. And they just look up and they start cursing about these shrubs.

You know what? I have this guide I put together of questions to ask before you buy a house. You know what I'm going to do? I'm going to add an extra section on expensive shrubs that can add massive relationship fights. Go ahead. You can find that link right in the show notes. I'm not kidding. Click the link. It's in the show notes. I have this email software that I love so much. I pay for it personally. And just 20 minutes ago, I used one of its AI tools. I'm currently doing a pitch to some journalist for this story that I want to run. And I said, go through my emails for the last. last two years, identify every top-tier journalist that I've interacted with, and then sort them based on this story that I want to pitch and pull their email addresses for me. It did it in 20 seconds. You can use this software called Superhuman. Today's sponsor, Superhuman is an AI native email

and calendar for busy professionals and teams. It learns your voice so we can pre-draft email responses for you. This stuff is important because momentum is what helps you drive forward. The auto draft feature that I mentioned that drafts follow-ups for you automatically also schedules replies so nothing falls through the cracks. You can make sure that somebody responds to you if you need to check in on it. It's all automatic. And its auto archive feature can help you keep your inbox clear by letting you automatically archive entire categories of emails so they never even hit your inbox.

My favorite thing of all is how fast this software is. You can do everything from the keyboard. You can use shortcuts like you wouldn't believe. you can get through tons of emails in minutes. My team and I at IWT use Superhuman. We love it, and I think you will too. Turn your inbox into momentum. Sign up for Superhuman Mail today.

Go to superhuman.com slash remit three and try it for yourself. That's superhuman.com slash Ramith three, the number three. All right, how many of you have a parent or a loved one that clicks on every link they get in their old email inbox? I have a friend that is constantly having to go over to her parents' house, wipe out whatever random pop-up is appearing on her dad's browser because he basically just clicks whatever comes in his inbox. And the thing is, it's very easy, especially for older people to get targeted

and have their data compromised by clicking on the wrong link. Just a single button. That is why I personally use Delete Me. Delete Me is a subscription service that removes your personal data from the internet. We're talking about things like your full name, email, phone number, address, even your parents' names, all found and removed. They've been the leading expert in personal information removal for the last 15 years. They were recently named Wirecutter's number one data removal service, and I personally use

and pay for Delete Me. And I love it, and I know you will too. Start this year smarter and safer with DeleteMe. You'll get 20% off all consumer plans when you go to join DeleteMe.com slash Remete, and use promo code Rameith at checkout. That's join deleteme.com slash remit, code Rameet for 20% off. I think it kind of goes back to my principle of like putting as much money as possible

and creating experiences, everything. And just for me, you know, it is a small amount of money. I could probably compromise. I think for me it's just, I kind of feel I'm like already at kind of the top of what I feel comfortable spending. for kind of full housing expenses. What did you just hear? That he does not want to put more money into the house.

There is a part of that. I think I've heard people often say like, you know, any money you put into the house, you get it back. And like the top percent, if you're really lucky, in the right market and everything, you'll get about 80 percent back on something. Exactly. That's like best case.

And in my mind, maybe this is kind of where I focus on my phone spreadsheets, when someone says I have an investment for you and it'll return you 80% of the money you put in it. I don't, you know, I guess I have a hard time going with that. I agree. First, let's just clarify what Jonathan is saying, which is that, you know, a lot of people say, like, any money I put into the house basically turns into equity. And so if I paint or if I upgrade the kitchen or whatever for $50,000 and I'm going to be able to sell the house for $50,000 more, which is largely,

bullshit because most upgrades people make in a house is purely a cost. You're not going to recover much on it. Like, just go look at some people's ghastly kitchens or the window treatments. It's like, I'm not going to pay for your horrible taste. I couldn't care less that you spent 30 grand on that. Too bad. There are a couple renovations in a house that tend to pay a little better. These are all easily Googled. But all that said, we should also remember that you are living in a house with your partner. And this isn't purely a flip that you're designed to spend as little as possible and squeeze out as much ROI. Right? That's different. You're actually living in this house. Because truthfully, Jonathan, if you wanted to take that approach and we took it to the logical extreme,

you would have old floors, you know, like you wouldn't do any landscaping, because why, you're going to make no money on it. Obviously, you live there. You got to do something. Okay, the question is one of degree. How much money are you willing to put in? Shalom, what do you think hearing this? I think you had a fair point, and that's something I'm struggling with. I think communication is or clarity is a big thing. And I've been trying to communicate that. Like, yes, now I'm understanding like that whole idea of like it's actually not just a house. It's an investment. But at the same time, it's a place we live in. So it has to be livable for Babapest.

Shalom, what happens when Jonathan gets hit by a bus one day? That's scary. Yeah, I thought about this. And we talked about this. When I signed up for retirement, I got angsty because I didn't know what to choose and what to do with all this numbers. And I start losing it saying now, like, I wish I had this much education when I was in high school or like the kind of education high school should be giving before we actually like become adults because now I'm like late, 20th then I'm freaking out about like signing up retirement. Oh yeah. So late.

You're so late. There's no chance you can catch up now. 27. Oh, you're, that's it. It's over. You had a chance, but you didn't learn it. So. All right.

So anyway, back to my question. What happens if he gets hit by a bus? I don't know. That's a very good question. Jonathan, do you ever think about that? Yeah, I know,

I have thought about that. And one of, kind of, one of the things that, you know, I think was really helpful. We almost never talked about money when we were first married.

And we've come a long way, but it just seems like because the house is such a big burden that, you know, it's, it's forced us to connect on that, that deeper level.

And I think we're still trying to still trying to have those kind of conversations. So, yeah. Yeah. You know, if you have like a bad habit in some part of life, when the stakes get higher, that habit emerges. It's like, I don't know, if you're bowling and you have a certain thing you do when you're bowling, it's fine when you're just playing with your buddies. But if you're playing at the professional level, that's going to get exposed really quickly. And in your case,

for the last five years, it's been fine. Your earnings were probably really good. You know, taking a trip for an extra thousand dollars, no big deal. But getting a house is the biggest purchase you ever do. And so any lack of communication, any bad financial habits, such as one partner doing everything and the other, not really participating, it gets exposed and there's a gap that becomes wider between the two of you. Does that feel like it resonates with you? Yes. Yes, for sure. Like when we had less to pay for when we first got married, again, money was not a thing we talked about. It's just, you know, he made, and I made the money.

We come together. We put some for traveling, rental, whatever, and we never kind of discussed, oh, like, we should probably, like, save this semester. It just automatically goes to things. But now because there's this big thing, cold house, and there's a lot of things I want to do with it, I feel like we have more fights when it comes to money,

more conversations that we've never had before. and yeah, that's totally right. Now, what do we get? What do we get to do with that money? You're going to set up your monthly meeting. You're going to talk about it. You're going to have a calm way of discussion. You go, oh, you know what?

I think we misallocated this. Gosh, this is how I'm feeling. And when I look at this, this is what I think. What do you think? I don't know if I agree, but like, tell me more. And you talk about it. You go, okay, I see your point. Let's go ahead and amend it.

Done. But you can't live your life playing defense with tiny little decisions like that. Okay. Ironically, for the biggest financial decision of all, the two of you both admitted that you rushed right into it. So there's a pretty fascinating dynamic going on here. I'd rather have you spend more time on the big stuff and less time on the little stuff. Okay? The other dynamic I want to point out is that. This is a good start with the CSP. It does feel a bit theoretical in this sense that you, like Shalom, you don't, talk about a CSP, you talk about a couch. So, like, this is how I would approach this conversation, Jonathan. I'd be like, okay, Shalob, I understand that you want a couch.

And what gets you excited about having a couch? Like, why do you want one? A place to sit, to host? Okay, but don't we have that little couch by the front door? Also, the aesthetic. Oh, you want our house to look good. You don't think it looks good right now? Not yet.

So, like, if we were able to get a couch, how much do you think a couch costs, like, ballpark? Let's say, let's say two grand with everything. Two grand. All right, cool. Yeah. Like, how soon are you thinking you want that couch? When do you want this couch? I was thinking, like, and maybe the next three months.

Because like, for example... I can wait a year? You can wait a year? Yeah. Okay, so that would be like, what, look at Jonathan's face right now. The guy's like, I'm impressed. Shalom's change in perspective about the couch seems small, but I think it's actually a bigger lesson that we can all apply.

Most of us go through life seeing something and saying, I want that. I want that coffee. I want that night out with friends, that car, that house. But very few of us have a system to help us decide. We basically just buy whatever we see and we use very loose logic to decide if we can afford it. And then we wonder why we're not getting ahead. This way of making decisions stays with us as we become more financially successful. That's why you hear multi-millionaires on this show who still agonize over the price of gas or blueberries.

It's not because they don't have enough money. It's because they are arbitrarily making decisions. They have no system. With Jonathan and Shalom, you see this pattern. Jonathan analyzes purchases. Shalom is much more casual about what she wants, but they haven't developed a way of making financial decisions together. The couch is really just a symptom.

It's a small thing like training wheels. But together, they're going to face thousands of decisions about money together. So from my perspective, this is a great opportunity to develop a shared vision, a shared system. And just note, about 45 minutes ago, Shalom couldn't even believe. leave waiting a year to get a couch. Now she seems much more open to it. Let's hear their follow-ups. Jonathan said,

During the call, I was absolutely shocked that my wife said she would prefer to spend $15,000 on new wood floors than our wedding if she had to pick between the two. One of the biggest takeaways was the value in financial simplicity, which can take a lot of time and effort when there are two people involved with their own dreams and perspectives. simplicity is not a starting point, but something that is reached through a lot of communication and compromise. Reflecting after the call, what surprised me most was how much time we spend

focusing and arguing about small financial decisions like whether to buy a couch or which restaurant to visit and how little time we spend on large, important, life-changing decisions like buying a house, where to live, travel, and our long-term savings goals. I'm grateful we had the opportunity to talk with Rameith. It really helped to get another perspective on our relationship. with money as well as each other. And Shalom's follow-up? Unfortunately, we never heard back from Shalom, and we tried even as recently as last week to reach her.

I'm wishing Jonathan and Shalom the very best going forward. I really enjoyed speaking with both of you. And for those of you who enjoy this podcast, I'd like to encourage you to go to IWT.com slash podcast newsletter. Every single week, I share a new insight about money psychology right there on the newsletter. This is a material you will never see publicly.

It's IWT.com slash podcast newsletter. Thanks for listening to I Will Teach You to Be Rich. I'm Rameet Seity. Please follow the show on Apple, Spotify, or wherever you listen to podcasts. If you haven't read I Will Teach You to Be Rich, my book, pick up a copy. You can get it at any bookstore or any library,

and it will show you the specific tactics for how to build the I will teach you to be rich system into your personal finances.