Money For Couples with Ramit Sethi - 251. "We own a $1M house but can’t pay for groceries"

Episode Date: March 10, 2026

Ramit Sethi of I Will Teach You To Be Rich talks to John and Victoria in a follow-up episode. This couple, in their thirties with three children and a home in suburban New York, is facing severe financial challenges with 97% fixed costs and over $100K in non-mortgage debt. In their last session, Ramit highlighted the urgency of their situation, presenting them with two stark choices: sell their house and clear debt, or double down on income and aggressive cuts. They chose to keep their house, which required Victoria to return to work, both of them to significantly increase their earnings, and drastically cut spending. Ramit challenged them to implement these changes within two months. This episode reveals how John and Victoria fared in those crucial eight weeks. Did they truly embrace change, or did old habits resurface? In this episode we uncover: • Their initial feelings after the first money coaching session • The surprising reason for Victoria's job loss • How they managed to cut $500 from their grocery bill • Why John thinks dry cleaning is a necessity • Ramit's radical advice on debt repayment versus savings • The true meaning of "rich life" for John and Victoria • How their childhood money beliefs impact their present • The hidden challenge of Victoria's student loans • Their struggle with an external vs. internal locus of control • The danger of a financial plan that requires 100% perfection Chapters: (00:00:00) The desperation that led to an application to Ramit (00:03:00) How a hotel bill leads to a missed mortgage payment (00:05:25) The once-a-year money conversation (00:10:47) The devastating results of Victoria’s annual money spreadsheet (00:19:18) Justifying thousands in Amazon purchases with high debt (00:28:15) Understanding their $600K net worth and zero liquidity (00:35:10) The crushing reality of 97% fixed costs (01:10:46) Victoria’s inherited money trauma fuels her avoidance (01:19:40) The importance of taking decisive action (01:21:05) The couple’s future plans This episode is brought to you by: Facet | As of the date of this recording, Facet is waiving the enrollment fee for new annual members, and for my audience, Facet is offering $300 into your brokerage account if you invest and maintain $5,000 within your first 90 days. Head to facet.com/ramit to learn more about which membership option is best for you. Offer expires March 31, 2026. #FacetAd MasterClass | For unlimited access to every class and an additional 15% off any annual membership, go to https://masterclass.com/ramit Fabric by Gerber Life | Join the thousands of parents who trust Fabric to protect their family. Apply today in just minutes at https://meetfabric.com/ramit Netsuite | Get the free guide “Demystifying AI” at https://netsuite.com/ramit Connect with Ramit • Get my new book, Money For Couples • Get Money Coaching with Ramit  • Download the Conscious Spending Plan • Listen to my book—now on Audible • Get my New York Times best-selling book • Get my no-numbers journal • Other episodes • Instagram • Twitter • YouTube If you or your partner get stressed spending $150 on dinner, or are covering up spending, I’d like to help. Apply to be coached for free on this podcast at iwt.com/apply

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. Previously on money for couples, you will probably lose your house. You're spending more than you make. You're running out of savings. We need to make better decisions on how we're spending.

Anything that doesn't get directly applied to our debt doesn't keep us in this house, basically. You're spending 97% of take-home pay on fixed costs alone. You are broke. Yeah, we are. Severe danger. Red flag. Stop everything. What do you want to do? Last week, I spoke with John and Victoria, a couple in their 30s with three kids and a home in suburban New York that they are desperately trying to keep. On paper, they have a net worth of over $600,000, but almost all of it is trapped in their house. And here's the reality, 97% fixed costs, which means they are spending more than they make every single month. Their

savings is just $1,155. That's less than one weeks of expenses. If you're a lot of expenses, if if John loses his job. And they're carrying roughly $100,000 in non-mortgage debt, including $55,000 in high-interest credit cards. I told them the truth. They cannot afford their house. And I gave them two options. Option one, sell the house, pay off the debt, and start over.

Or option two, keep the house. But that means Victoria goes back to work. They both earn significantly more. They cut spending aggressively, and they grind for years with no margin for, error. The decision that they make right now will determine their entire financial future. Please remember, they have children. So today, we're going to see what they choose, and then I'm going to check back with them two months later to see if they actually follow through.

Remember, a lot of people claim they want to change, but very few people do. So let's see what they chose. So another option is take the housing costs, sell, your house, you actually have equity, you might actually do pretty well on it. Take that money, pay off your debt, start fresh, downsize dramatically, radically change your relationship with money. It will be the hardest thing you ever did. It'll be incredibly difficult. The two of you will have to change the way you talk about money. You'll have to involve your kids. You'll have to make this something that you openly talk about and that will feel incredibly uncomfortable. You'll feel like you're failing as parents, but it also gives you the chance to reset.

Now, I'm not telling you to do it. I'm simply painting a picture. If on the other hand, you say, nope, we appreciate the idea, but we want to keep the house, then the conclusion is you both got to work, you still got to cut almost all discretionary costs down. There's no room for error. Anything on that list has got to go. there is no more house renovation work being done at all because it's too expensive.

Babe, how would you like to approach our situation? I don't think we have choice anymore. We can maybe worry about that in a few years, but I think now we got to really... We don't have a few years. I don't even know if we have a few weeks. Okay, how would you tackle it? The way I tackle everything, just try harder. Just try harder.

Yeah. Hope for next year. trying harder is it intersects different groups of people men often just try harder brute force it go out there work harder you know kind of like derived from like go out and toil the fields for longer although most men these days are not toiling the field it also cuts across people who grew up poor it's go out and work harder grind yourself to the bone that's what you got to do so there's an intersection of these messages. You all are not poor.

You make $120,000 a year, but the way that you are behaving with money is carrying some of those messages forward. There is no foresight. There is no planning. There is simply reacting and letting the world control what happens to you. Now, if the two of you made $25,000,

we'd be having a different conversation. The fact is the world pretty much does control you if you make that much. very difficult to plan ahead. You've made some choices as well that narrow how far ahead you can look. But even if you two made triple the amount you made, you'd still be in debt. That sucks to hear. I'm not the judge of you. I'm not here to judge you. You could actually disagree with me. If you go, that's not true, Rameet. If you were to disagree with me, I'd actually love it. If, Victoria, if you said this to me, you said, remit, I actually don't believe it. You know why?

Because I have a plan for exactly how we're going to get out of our debt. I made a plan. I know our debt pay off I know that if John gets another bonus, this is where the money's going. And if and when I go back to work, here's where that additional money is going. And therefore, if we had triple, we are never going to be back in debt. I know it mathematically. Can you tell me that? No. Exactly.

I can't tell you that. I don't know our payoff date because I don't know when we can switch over the purchases from or the charges. I should say the charges because they're not all purchases. You don't know your debt payoff date because. you don't talk about money. You don't talk about money because you have an extremely unhealthy

relationship with money. You have an unhealthy relationship with money, in part because of the way you were raised, but in part because of the decisions that the two of you have individually and collectively made for years and years and years. You have now created a culture of money in your household where you don't talk about it.

You spend on discretionary items. You justify them. You avoid them. And here you are. Who feels resentful about money? money in this relationship. Maybe I do slightly. I could contribute more if I didn't stop working if there wasn't already a preconceived notion that my son's child support does not support any asset of this CSP that John and I have. Mm-hmm. You feel resentful about that. Okay. John? Now looking at it against all these little Amazon purchases, I mean, for sure. Now looking back on

myself, I feel a little bit of that in hurting us. You feel resentful of your own purchases as to how it's affected your family. Yeah, I mean, the Amazon stuff is just one thing. I've become a dreamer, like we mentioned, and I dream to utilize more of our house, so I bought insulation for the garage and so we can use it. So I feel resentful in that sense where I started something I couldn't finish. may not have been needed. Do you all recognize that you can't afford this house?

With $100,000 of debt on top of that. There is no planet where you can afford that house. Every day you're in it, not only are you losing money, but you're actually spending more money on all these random renovation projects. The way you're spending is like you make hundreds and hundreds of thousands of dollars.

like more than triple what you currently make. You don't make that kind of money. I think our bigger problem are the not talking about the whole picture. You think that's the problem? Okay. Should we fix that? Well, we can fix that by talking. Okay.

If that's the real problem, if that's the reason you're in, you know, a considerable amount of debt, $483,000 of debt, including $100,000 of $100,000 of not, mortgage debt. If the problem is you don't talk about money, I feel like there's a pretty straightforward solution. I talk to the credit card companies for decreased interest rates. Hold on, hold on. I don't care about solutions right now. You're jumping to solutions because

you want to avoid the painful process of looking in a mirror and figuring out why you've gotten into this situation. And you will keep doing that for the next 50 years of life and it will not get you what you want. That's why I'm being so honest and direct with you. Victoria, you said that you avoid conversations about money. Why is that? Because I guess I know like what I can handle in terms of like a dollar amount and anything outside of that. It's like what's the point talking about it? I can't even handle it. Can't do anything so might as well just not talk about it. Yeah. Guys I'm going to be really honest with you. I can't make you care about money. It's like a teacher in a classroom and there are kids who are, you know, they all

They care about everything. They're already like getting A's. They want to get A pluses. Teachers, not concerned with them. They're going to succeed. There's kids who have a chance at really doing well, different abilities. And then there are people who just don't care. Can't help somebody who doesn't care about it.

I can tell you what's going to happen. I can paint the picture for you more accurately than you may have thought of yourself, but I can't make you sit up straight and say, we need a plan. Here's the best I've come up with. Poke the holes in it. What should we do? What are we doing wrong?

I can't do that. What's your take? Accurate? My plan is to pay as much as we can in December and then not using cards. What is your reaction to what I said that I can't make you care? I feel like I care to a certain level.

I feel like I do care. Oh, you do? Tell me. But I can't make them both of us care together. You don't think John can. cares? I don't know if he does. Why not? You're married. You have kids to get it. How do you not know if he cares or not? Because how can he look at all the accounts and still buy certain things that we probably don't need? How can you do the same thing? When was the last time I did it? How much did that patio furniture cost? Yeah, five grand. Five grand when you have $100,000

of debt and you have almost 100% being spent on fixed costs. So how can John avoid it? How can you avoid it? John, what do you think? I think I care very much. It may not be the approach that will get us out of debt, but I know I care a lot. Can I ask, John, do you care or do you worry? What's the difference, I guess? Worrying is spinning in your head, it's feeling bad, it's not looking at the numbers, it's whenever you talk about money, it's negative, you worry. Caring is making different choices. I guess I worry. You worry.

I agree. You worry, which feels productive but actually does nothing. What does it get you? Does worrying pay off your debt? No. Does worrying invest? No. Does worrying increase your income?

No. You're just spinning in place. I could see to that now how I've kind of approached everything, especially with the credit cards, where I worry about being able to get groceries, but I don't care enough to not get the credit card. And so I do get them confused. and think I'm doing the right thing, but it's actually a negative.

Yes, good insight. Victoria? How do I care? Do you care, or do you just worry? I'm in a state of worry at the moment. I'm currently using, I feel like, more of my child support to buy our groceries than I think I should be doing.

Do you care? Not enough in the moment. Yeah, that's honest. That's honest. I want to give you both kudos for that. Sometimes admitting you don't care about something that is staring you in the face and is incredibly risky, that actually takes a lot of introspection because we are natural tendency. Of course I care.

Of course, I care so much. But when we're really honest with ourselves, we go, if I cared, I'd be doing different things. I would be spending differently. I would be talking about money differently. We would be doing this together. we'd even be talking to our kids about money if we cared. I think it's pretty honest of you both to admit that. In order to get out of this financial situation,

you can't do it by just worrying. I'm being tough on John and Victoria, and I'm doing it for a reason, because every time I push them to face reality, they retreat to the surface. We'll just try harder. We'll talk more. We'll be better.

I want you to listen, especially if you've ever tried to change somebody or change yourself. when people say trying harder. It's actually meaningless jargon. It is truly just random words that people use to escape the discomfort that they are experiencing. Because if that's truly just what they needed to do, they would have already done it.

The problem is not effort. This is a structural problem. They are grasping onto the very thing that has put them into this financial mess, their house. Sometimes we need to hear the unvarnished, truth and to realize that all these words and jargon and squirming that we have done have actually avoided the key truth. We cannot afford our lifestyle. In fact, John just admitted something that most people never say out loud. He said, I worry about being able to get groceries,

but I don't care enough to not get the credit card. A lot of people, their relationship with money, is simply worrying. And if you asked them, what would you be if you were not worrying about money? they are completely confused. They have no idea. That's all they know. But candidly, worrying accomplishes nothing. It doesn't pay off debt. It doesn't cut your spending.

It doesn't change your behavior. Action does. And that's why I'm being so direct. Because those surface level solutions like, we'll try harder, that's not going to work. It's not going to save them. They need to fundamentally make different choices. Not talk about making them,

not plan to make them, actually make them. And that's what the rest of this conversation is about. Let's see if they're ready. One of the most shocking things I've learned from this podcast is that almost all of the couples who come on my show with 10 out of 10 money problems have never read a single book about personal finance. Not just my book, they never read any book about money. You'll note that when people talk about money, it is very easy to dream about what they want. And actually, I like dream. It's good. We should dream. We should come up with our rich life vision. But we don't just need

dreams. We need a plan. So you can create that. plan yourself and figure out how compounding works and when you'll be able to withdraw this money and on and on. Or if you need help building a specific plan for you, our partners at Facet can help. Facet charges a flat membership fee for financial planning, never a percentage of your portfolio. You get access to a team of CFP professionals, always a CFP, always a fiduciary, who help you create a personalized financial plan for your rich life goals. And they handle important things like investments, retirement planning, starting a family, becoming a empty nesters, estate planning, all of it. Your financial plan needs to adapt as your life changes.

Fassett makes getting professional financial advice more accessible without charging hidden exorbitant fees. As of the date of this recording, Fassett is waiving the enrollment fee for new annual members. And for my audience, Fassett is offering $300 into your brokerage account if you invest and maintain $5,000 within your first 90 days. You can head to Fassett.com Ramit to learn more about which membership option is best for you. Facet is an SEC registered investment advisor. I'm not a member of Facet, and I have an incentive to endorse Facet

as I have an ongoing fee-based contract for cash compensation based on this endorsement. All opinions are my own and not a guarantee of a similar outcome. 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. 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, chefs, 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 fifth. 15% off any annual membership at masterclass.com slash remit. That's 15% off at masterclass.com slash remit. Masterclass.com slash remit. Victoria, I'd see this is a little difficult for you to hear. Slightly, because I'm not working and I feel like me stopping working has put us in the hole. Can I ask a question? Let's just explore for a second. What if you went back to work?

It would fix a lot of problems. Just explore with me. I'm not saying you have to go back to where. It's not my place to tell you. I'm just saying let's explore. Okay, you're saying it would fix some financial problems, maybe. How many problems would it fix? I'm hoping it would fix our debt rather quickly.

Have you tested it to see what would happen to your finances? No. Are you aware that that is how people make savvy financial moves? they put in some numbers, they kind of model it out and see what would happen. Are you aware of that? No. Okay? That's an honest answer.

Fair enough. Look, if somebody came to me and they're like, are you aware that in order to fumigate your house, you do this and I don't even know the freaking words to use, I'd be like, no, I don't know anything about this. Can you just lay it out for me? So I'm going to do the same for you. Okay? Okay. I'm going to walk you through a simulation of what would happen if Victoria's, you know, you, you started earning a full-time income. And the reason I'm going to do this is

is going to do two things for us. Number one, it's going to show us the financial impact on your household finances. Two, it then opens up a conversation about lifestyle. Is it worth it? What about the kids? They're young and all of that. But too often, we skip the numbers and we just let our emotions guide everything. Does that sound familiar? She's saying yes. All right, let me show you. I'm going to pull up the CSP. Let's take a look. So here we are in the CSP. Lovely, perfect document. Everybody can download it. Iwt.com slash CSP. Download it right now and follow along. So here we have a beautiful little cell. It says zero. That's the potential income that Victoria would make. Victoria, what would your gross income be if you went to work full time?

Probably between 65 and 80. Okay. Let's say 65 just to be conservative. Let's move. down to net. First of all, how come you have $0 gross and $2,200 net? I put in my child support. Okay. I do clean a friend's office off the books that I make some money from here and there. And then it is the gift, the rest of it. All right, fine. You pay taxes on child support? No. Okay. All right. So 5,400, let's just say that gives us an extra $3,000. All right, look what just happened. Did you guys see this number change here, the fixed spots number?

20%. Yeah. What did you see, Victoria? Dropped a lot. To how much? 77%. What does that tell you? That I probably need to go back to work.

Nope. That's not what it tells you. I just want to know what you see on the document before you spin a bunch of conclusions. What does it tell you? That it makes things easier. Yes. It eases your fixed costs quite dramatically from basically 100% to 77%, which is a major, major, major drop in fixed costs. It's still too high,

but it gets you moving well in the right direction. Now, that does not say whether you have to go back to work or not. That's not what it says at all. It simply gives you a little bit of information to make a bigger, broader decision. Okay. I'm just going to be really direct with you. The two of you jump right to conclusions, and your conclusions are usually wrong. All right, John, what did you see when I put in an extra $3,000 a month net? A way to chip away and make, I guess, some freedom to then apply to other categories. Yeah. For me, that 20% then can be applied to debt.

Good. Before we move on, Victoria, looking at that number. The 77%. Yeah, the 77% and the ability to make between $65,000 to $8,000. 80,000. What does your gut tell you? That I have to work. Okay.

Would you be willing to? It's whether or not we can find child care at this point. Your costs would go up because child care would be substantial, right? Yeah. I mean, I don't know if my mom can do it all with two children. My mom, when I was working, was our babysitter. And now it would be her having to babysit two young children. dream. That's pretty difficult. It's a lot. She's 70. This is a really tough situation because we added

the extra income, but if you were, I mean, look, maybe you could ask your mom, but that seems like a lot to ask a 70-year-old woman to watch two kids full-time. That's not my place. If you were to pay for child care, those costs are very high. Yeah. Do you have a sense of how much it would cost for child care per month for two kids? I don't know. I mean, I think one of my friends who was paying for child care full time, I think they were spending like 28 grand a year, I think. Yeah. So essentially eating up the amount that you would make. At least if you made it at 65K. Right. At 80K, it may provide some profit, basically, we'll call it. Okay. Something to consider. I don't know the right answer here, but we're starting to

become a little bit more informed, right? We can't just say, should I do it or not, we got to get how much child care would cost and then factor that in as well. Okay. Regardless, we still have things we can do. Are you willing to, I guess, start working and accept that I may have to look for another job because we need to make more money? I don't think you need to look for another job. I think you're a really good house. insurance with your current job and that's an unseen cost that people don't take into account when thinking about bringing more take home. And I know that means I'm probably up to go back to work and it's my mom needs money too. My mom also works and that's part of the other problem is that if

if I go back to work full time and she's watching the kids full time, I'm probably going to have to pay her. She's not going to be a totally free babysitter this time around. I could perhaps do my part and see if I can do some child care from home and work remote. I know. It's just working remote. You don't get any, it's just no productivity at home with two young kids. And I wouldn't want you to do that and then potentially lose your job. We can't lose your job. I think the only answer is that I have to go back to work if we're staying in this house, if that's our desire. Can I step in for a second? Yes, please. Okay. First of all, great work. I feel like that was a really honest conversation. When was the last time you had a conversation about money like that? Probably never. Never. Yeah. I felt that the two of you were listening to each other. I felt that you were talking as a team. You're really talking specifics. It's a tough conversation. It really is. Did you feel that you made a,

decision in that conversation. Yeah, the decision is that I have to go back to work. Okay, so you go back to work. All right. And assuming you go back to work and let's even assume that instead of 65K, you make 70K, but you have to pay child care in some form. Would that solve your problem? Yeah.

It would? Well, I mean, we would be able to make substantial debt payments if I went back to work. Really? How much? I would hope that we could put 60 to 70% of what I'm making towards debt. So 65% or 70% of your take home towards debt, but what about child care? I mean, child care would be whatever. My mom says she would need to stay afloat on her end. I'd assume she would need at least 250 or 300 a week, which is a lot. We can run some numbers, but let's just stay at the conceptual level. so you'd get a job that paid, let's just say 70K.

I think you'd end up with $1,000 a month or something that you could put towards debt. That's good. That certainly helps a lot. I don't think it really gets you out of the position you're in. You would need more. What would you want to do? I think she could do better. I think she's worth more.

I don't think she should take the first offer. How much? Just be specific. I mean, someone with her knowledge in the fields, I mean, I'm assuming. she can make as much as I can in the financial industry, which she's, you know, excelled in and has knowledge in. Can I tell you how my wife and I talk about money in situations like this? Like if there's something we really want, right? We need to have it. We'll sit down. Of course, we're, you know, we always start with a compliment. We do all the stuff in money for couples.

And when we get down to the numbers, we talk numbers. We go, look, if this is what we want, then you need to be earning this much. And I need to be earning this much. Like point blank. Do you see the difference? What is the difference in how we talk about it versus how you're talking about. Very vague right now? Yeah. Being vague is allowing yourselves the ability to escape from reality. If you both are in this together and you have said, we want to keep this house no matter what. Now is the time to get specific, with each other. She needs to be looking for something and, you know, fight for something around 100,000? I just think from experience and looking at

jobs and listings and stuff, I just don't know if I can make more than 80. I think 80. 80 is probably like a high, I mean, maybe 85 would be the highest that I could see myself bringing home. Victoria,

I say you make 80K, as you said. Maybe you can make 80. Does that solve your problems? We have to run the numbers and discuss it. No time like now. You could tell me the numbers you want me to plug in, I'll do it for you. Here we go. You want to say 80,000? I was going to plug in 82. So that's 6833 per month. How much is the net going to be on that with everything? 3,700. Yeah, cool. Take a look. All right, your fixed cost number is down to 69%.

And our mortgage. Your mortgage is down to 23.5%. That's good. I think this looks pretty good. I do want to point out that this only works if you two are making a combined income of $205,000. That's a lot of money. Yeah, it is. Here's what I want to do. I want to give you some homework. I'd like to speak to you again. I don't do this that often, but I think that there are some major changes that you both recognize have to happen and they have to happen now. You cannot wait. Here's what I would like for you to do before we talk again. I would like for you to redo your conscious spending plan. Taking a look at all the changes we made, I'd like for you to make them on your own and any additional changes that we haven't considered. Those would be things like how much would child care cost? I think it's probably time to have

a conversation with your mom. Taking a look at the bookkeeper positions or the other jobs that you would apply, how much are they going for? What could you realistically get? Starting to put the feelers out on that. Don't wait. Get those job right now. Double-checking your debt payoff calculations. and knowing exactly how much you're going to put, when you're going to be debt-free, put that up on your fridge. Okay, there's a lot. I know that.

I know there's a lot. I would like to talk to you both again after you make some major changes. All the things we talked about, Victoria, I want to talk to you when you get another job. Okay. And I want it to happen soon.

I know this is so crazy. It's like, oh my God, we're completely changing our entire life. If you both adopt the frame that we want this to happen, We want to keep our house, so we are going to aggressively make changes, then you're going to want to do it as quickly as possible. What's your deadline you think is realistic? Two months.

Okay. I like it. Let's go with eight weeks. I think that sounds totally reasonable. Eight weeks to change your life is a very powerful concept. Gosh, once you really got clear on you wanting to keep a house, like it really started to move quickly after that. Did you notice that? Yeah.

I was like, once you made this one big decision, other things became easy. That's the feeling I want for you to feel easy, to feel like we can move and be decisive, not be stuck like this. Sounds like a plan. I'm excited to see what happens within eight weeks, and please be in touch. My team will be in touch. I can't wait to talk again. Me as well.

Look forward to it. All right. Big help. Thank you so much. Something kind of shifted in that conversation. For the first time, John and Victoria were actually listening to each other. They got specific about numbers. They negotiated honestly.

John said Victoria could make 100K. Victoria pushed back with 80K. I think the old John and Victoria would have just agreed to whatever sounded good and then figured it out later. But right now, these two were actually being honest about what's truly possible. And they made a decision. Victoria goes back to work so they can keep the house. Okay.

If that's their decision, I understand. So I gave them two months, which is long enough to see how they will handle the inevitable obstacles that will come up. Will they go back to the way they were or are they ready for change no matter what it takes? You know, in my experience, most people can change for a week, maybe two. Very few people can sustain true change for eight weeks and then turn those changes into a new way of living. So let me just detail what has to happen.

Victoria needs to get a new job. They need to redo their CSP with real numbers, including child care costs, debt payoff dates, everything. And they need to start talking about money regularly, not once a year in December. So when I check back in, I'm going to know, are they actually different or were they just talking about change? Guess what?

We're going to find out right now because it's been two months. I talk a lot about the $3 versus $30,000. questions that so many of us are obsessed with. And that same principle applies to kids, too. It's really easy to get caught up in the small stuff. Did I remember to buy cheez-its? Do they need new socks? But the bigger things, like will they be protected if I get hit by a bus tomorrow? Those things often get pushed to the wayside. Not anymore. This year, start by asking the big questions and protect your family by getting term life insurance from this episode sponsor, Fabric by Gerber Life. Fabric by Gerber Life is term life insurance you can get done today.

It's made for busy parents like you. It's all online on your schedule right from your couch. You could be covered in under 10 minutes with no health exam required. If you've got kids, especially if you're young and healthy, now is the best time to lock in rates. And even if you have life insurance through your employer, it may not be enough to protect your family, especially if you leave your job or get it.

let go. Join the thousands of parents who trust Fabric to help protect their family. You can apply today in just minutes at meetfabric.com slash remit. M-E-E-T-Fabric.com slash remit. Policies issued by Western Southern Life Assurance Company, not available in certain states, prices subject to underwriting and health questions. Entrepreneurs, let's talk about systems. This is the year you can give yourself the gift of sorting out your business systems. Tons of small businesses are held together by duct tape and 15 different platforms and tiers, but it does not have to be this way. You can simplify your business systems, save time, and streamline your workflows in 2026 with NetSuite. NetSuite is the number one AI Cloud

ERP. It's trusted by over 43,000 businesses. It simplifies your business into a single platform. That's your financials, inventory, commerce, HR, and CRM all in one place. Plus, it uses an AI built system to automate your routines, deliver actionable insights, and help you cut costs with confidence. Whether your company earns millions or even hundreds of millions, NetSuite helps you innovate and improve. If I'd had a system like this, back when I was building IWT, it would have changed everything. If your revenues are at least in the seven figures, get our free business guide

demystifying AI at netsuite.com slash remit. That's netsuite.com slash remit. All right, welcome back. How's it going? Good. How are you? Good. Good. I'm excited to talk to you again. Thank you. I have a lot of questions for you. I'm very curious what changes have been made. And I want to hear, honestly, what has changed, what has not. Let's just be an open book today. How did you feel after our last conversation. Motivated, energized, refreshed. Sometimes felt good to, you know, just discuss it and talk. And it felt like just that initial, like, elephant on the shoulders was off and felt good. Good. Victoria, how about you? I agree. I felt like it was eye-opening. In what way? So for me, that, like, we probably do have certain

areas where we both can be cutting back on spending, such as groceries for me. And then secondly, I think that I was like heard in the sense that we are overspending. Yeah, I think it was reaffirming that he realized as well. Okay. What kind of conversations did you have after we talked? I think we mostly talked about, you know, going through the finances and transactions and going through and categorizing where our lifestyle fits into those CSP categories. Do you think that the overspending and the financial situation you got yourself into was a result of purely numbers or was it a result of your relationship with money? I would say it was a relationship to money. I've survived this two months. I know just

speaking of my behalf, with kind of slim, a slim down, I guess, financial freedom. And I survived. What do you mean by that? Slim down financial freedom.

What is that? Well, like not eating out and getting lunch at work or eating what's in the house instead of going to the grocery store and bulking up again in the pantry and stuff. So just making sure I'm aware of what I really need versus what I want.

So in that sense, I mean slim down. How did it feel? It felt good. Hold on. That was the least convincing good I've ever heard. It felt good. It felt good to know that I don't need what I don't need. It's just purely wants.

So being able to be cognizant of that, It felt good. Yeah. And making that connection. And then, Victoria, how about you? One of the other homework assignments was to go back to work, correct? So I was working. I worked three weeks.

And then I was like, oh, on Friday. So it just wasn't working out to be a good fit. What's your story there? They didn't think it was a good fit. The fast-paced moving environment office, their words, and that they didn't think I was being. accurate enough with the payroll. What do you make of it now that you look back?

I do feel like that it was an unfair and very quick judgment or potentially two minor errors in my opinion. But I also am not entirely upset regarding it because literally the night prior on the way home from work, I had called John and said, I think I'm going to start applying to places again because I don't know if I'm going to last year, it was turning into the fact that I was there

until 6 o'clock almost every night, and I was not okay with that. And not being able to leave at 5. It was not encouraged for me to be leaving by 5 o'clock. There were some reasons why I didn't want to be there anymore anyway, but obviously wasn't going to quit. and, you know, with our financial situation at home. So until I had found another job, I wasn't going to quit.

But they did let me go then the very next day. How did you work childcare out while you were working there? My mom was watching them. My mom was watching the boys. And we were paying her $2.50 a week. Do you think that you'll be able to do the same thing if you go work at another job? Yeah. I mean, the deal is that, you know, if I,

go back to work, then I pay her to 50 a week because she can't do her own work. All right. Are you applying for other jobs right now? I have been looking. I looked yesterday, but I didn't see anything that I wanted to apply to. Okay. Can we take a look at your numbers? Your CSP? This was your previous conscious spending plan, if I recall. You had 97% fixed costs. And then I see that you created a bunch of tabs up here, which I'm curious about. Should I go to conscious spending? Yeah. Okay, cool. Whoa. Oh my God. What is all this? Okay, I'm excited to find out. So just to everybody listening, I'm going to describe what I see on screen. I see the typical CSP, which has some changes. I also see some, it appears to be a debt payoff plan, which is cool. I love seeing this. And I see some total amount of debt broken down, you know, PayPal, Klarna, Amex, etc. Basically, a lot of details are broken out here. Okay, I'm already excited. So here's my question for you.

At a high level, what changed in the conscious spending plan? The amount that we're going to put towards debt, I think, is the main area and then the number in the subscription box. Okay, so take me through it. Here, originally you were paying $1,836 a month toward debt. Now you are paying how much? $2,800. So like a full $1,000 a month more towards debt. Correct. Okay. I'm loving that overall. And then subscriptions in the past were $394 a month. Now they are? 236. Yeah, $238. Okay, so about $150 bucks less per month. That's great. Take it. What did you cut there? We stopped ordering the dog food. on subscription, and we're getting that from Costco now instead.

Cut out our chat GPT subscriptions. I'm pretty sure John canceled. The Amazon Prime, the Disney account, we added in the ad level, so the savings there. All right. Good work. So you cut about 150 bucks off subscriptions. How did that feel? It felt good.

It felt good. I felt relieving. Wow. That's pleasant. We can do more, though. I disagree. I don't know if there's anything more that could be cut off that list.

Oh, not a subscription, I guess. Hold on. You don't think so? I don't know. Well, I guess I'm... I mean, we can kind of... You want me to tell you? Because I'll break it down right now. Yeah. I mean, water pitcher, filter, Apple services,

recycled sponges. I'm not even going to get into that. Delete. Price-efficient matcha? It's not that price-efficient. That's a guilt-free spending. then it shouldn't be here in subscriptions. Well, it technically is a subscription. I just cut off like 50, 70 bucks.

There you go. You're welcome. Now, I'm not saying you have to do it. I am saying sometimes it's helpful to have a third party look at what you consider essential and be like, no, do you need price efficient sponges or whatever. So you take it as you will. But I appreciate that you cut 150 bucks off. I think that's awesome. Big round of applause.

Can we look at the rest? Yeah. Okay. I'm loving it so far. I do want to point out that your fixed costs are still 91%. All right, let's just take a look at the rest of this. Investment zero. Savings are at 9%.

Huh? What's this? So I split my paycheck to go 75, I think it was 75, 25, 25 into checking and then savings. So this way we do have that extra $1,000 to put towards debt. Hold on. The extra thousand that you're talking about up here, right? Right.

You also put it here? Yeah, I might have. Okay. Hey, good news. You double counted in a way that's going to help you. You actually do not need to put it here in savings. So I'm going to take this out. Okay. That's going to drop your savings to 2%, which it realistically is. And that's going to bring us down to 7% of guilt-free spending or $931 a month. Is this accurate? No, because we're not going to actually have that left over because that guilt-free spending is what we were going to use to pay off the debt. All right, that's okay. Let's take a look at it now. So right now, you know, the numbers do add up 91% on fixed costs, 2% on savings,

and 7% on guilt-free spending. So at least they add up to 100. So then there is extra? Yeah, there's an extra $931 per month for guilt-free spending, although I'd propose, maybe you want to put that money somewhere else. You tell me, what do you think? Right into the debt? No.

I love a good disagree. I mean, we can't do it now, obviously. I mean, we can't do it anyway regardless because things come up. The bigger point is that there's unforeseen things that come in the mail. And that's always been one of my challenges in terms of keeping to a money plan, is that there was never any wiggle room. to pay the unexpected expenses. So that's why we can't take the $900 and put it all back into debt.

As nice as it would be to pay everything down faster, it's not the best plan. I think that was a very good explanation. That was outstanding. Crystal clear. Great examples. Nice firm conclusion, Victoria. Well done. Great.

That's great communication. I agree. There will be unexpected expectations. you need some liquidity. Liquidity meaning you need some cash. You cannot run skating so close to the line that you have zero dollars left over every single month. You'll be destroyed.

How long until your debt is paid off? I think it was November 26th if we keep this schedule. Guys, a year is not bad at all. What the hell? No, it's great. Okay. Wait, are we smiling or are we depressed? I can't tell.

What's happening? No, it's good. It's good. It's just now, obviously. I don't have a job that's attributing to all this paycheck decision making in the CSP. So I have to get back on it. And it's obviously contingent on me working. So it's the plan is great.

And once we start the action, it's great. But for now, I personally feel like in a limbo from Friday to today. Okay, because the layoff or the, your job laws happen on Friday. Correct. All right. John, how do you feel about about a year to pay off this debt? This is awesome. I'm ready to do whatever needs to be done if I need to keep cutting and I'm in it for the long run.

Good. Okay, okay. I like this. I'm getting excited now. Hold on. I'm excited and I'm concerned. Okay. We work through them both.

I have a lot of feelings. I need to work through them with you. Okay. I'm excited that you have a debt payoff plan, which is awesome. Let me remind you, 90% of people I talk to who are in debt, don't even know how much debt they owe. that they owe, 95 plus percent of people do not know when their debt will be paid off. You know both. In fact, I'm going to show it on screen because there's a lot of numbers here and you put a lot of work into this. It deserves to be seen by the world. You have a debt payoff plan here. You're paying off

the minimums. You're paying a little bit more aggressively. You got them broken out by Apple and Amex and PayPal and clare and all these different things. And it shows when things are going to be paid off. I love it. November 2026, fantastic. So great work. on that. What I'm concerned about, can you guess? The implementation? No. What is an example of implementation first? John, I want to hear from you. I guess just, I mean, it's a year away is a long time. No, it's not. Anything can come up, I think, like we were just discussing. So my point was, in that year, anything can come up again. So that can be very worrisome for, you know, for me, anyone. That I agree with. I'm not concerned with one year. If anything, I think one year is like

really fast, like maybe too fast. It's definitely going to happen fast. Yeah. So I'm not concerned that it's taking too long. If anything, I'm like, damn, this is like really fast. Almost to the point of a detriment to you. Yeah. I mean, like things come up, like the holidays that need to be accounted for, school stuff, all these little things. There's no holiday spending this year. That's one something we did discuss where it's going to be very slim this year. Yeah.

That's okay. It's just one year. My point is, I love that you've discussed that you're going to have a smaller, shall we say, much more conservative holiday. My concern is what's going to happen for the next year, two years,

three years, because things are going to come up. Traffic tickets, kids' expenses. Things happen when you have a family. So I'm a little concerned about that. I want you to give yourself the ability to withstand life. Right now, it's really freaking tight. Like if one bad thing happens, what do you do?

Right. Can't imagine. Now, Victoria, what do you think? What's your take? What do you think I'm concerned about? Sticking to it. Sticking with the plan. Yeah.

Yeah. Like, this plan only works if everything goes 100% perfect. Right. How often has that happened? We wouldn't be here if it was higher than 50%. Yeah, exactly. So, like, the good news is you built a plan. That's great news.

The bad news is your plan is based on you being 100% perfect in a way you never have for your entire lives. We need to build a plan that's a little bit more realistic. What do you say? Okay. How do we do that? Okay, great. That's the question I was hoping for. So, first of all, we got the income issue, which is the biggest issue of all.

Let's just tackle that. Your income, Victoria, on this CSP was, what, 65? 17 a month? It was $77,000 for the year, whatever that divided out to. So that's now zero. Right. How long until you think

you can get another job? Realistically. Well, it took me three weeks to find that job. 21 days and 61 applications. Yeah, I wanted to make it clear Victoria was the beast applying for jobs.

I just want to say, what a great answer that was. You knew your numbers like that. Hey, everybody listening. That's the kind of answer you need to have when it comes to when is it when are you going to find your job? When are you going to pay off your debt? When, when, when, when? You better have your freaking numbers down.

That is a great answer. It took me three weeks, 61 applications, blah, blah, blah. Boom. Okay. So can we assume three more weeks, Victoria? Yeah, we can assume three more weeks. And in the interim, I do still have my friend's office to fall back on. So I can always bring in some something.

How much? Maybe 500. I think you should do it. You need the money. Yeah. Well, I'm going tomorrow. Perfect. Fantastic.

Here's what I'm seeing. John and Victoria did some of the work. They built a debt payoff plan. They now know exactly when they'll be debt-free, which is November, 2006. Candidly, most people in debt can't even tell me how much they owe, much less when it will be paid off. So I think that's real progress. They cut subscriptions by $150.

They're putting an extra $1,000 a month towards debt. John stopped eating out for lunch. All of those are positive. They're real change. But here's the problem. Their plan only works if everything goes perfectly. And for John and Victoria, things never go perfectly. Victoria lost her job after three weeks.

Their fixed costs are still at 91%. And when I asked if they could cut more subscriptions, they immediately started defending matcha and water filters. You see what's happening? it's that old pattern creeping back in, justifying, defending, we need this. The good news is that Victoria knows her numbers. She got a job in 21 days with 61 applications.

Tomorrow she's going to clean her friend's office to bring in $500. But if I'm being honest, I'm worried because this plan requires Victoria to get another full-time job in three weeks. It requires them to stick to aggressive debt payments for a full year, and it also requires nothing unexpected to happen. That's not realistic.

What happens when life throws them a curveball? What happens when the car breaks down or their kids need something they didn't anticipate? By the way, Victoria's student loans are yet another thing they haven't planned for. These are the ones that got her wages garnished, the one she's been avoiding for years. So listen in now as I ask about those student loans. Speaking of income and loans, Victoria, last time we talked, you mentioned your wages have been garnished for student loans. What is this balance and the plan for student loan repayment? Well, currently I am waiting.

I assume something's going to be coming in the mail that I'm giving me an option to pay it before they go against. I mean, this is what I looked. I did at Google search what happens when, um, these types of things are in place because it was our tax return that was garnished. So it wasn't like wages that have ever been garnished from me prior. So I wasn't sure the exact course of what was going to happen when I started to work. So I just, you know, did a Google search and kind of tried to look into it a little bit. And from what I saw that they initially will contact the, you know, person, so me to start a payment plan.

versus garnishing the wages. So right now, it's a waning game to get something in the mail and hopefully set up a payment plan, even if it's like $50 a month, just so we stay in good standing. Why don't you contact them yourself? I don't know who to contact at this point. I don't know how many times the loan has been sold.

I don't know who's responsible for it. I tried actually looking for this information when John and I bought the house because we were going to potentially pay it off then. But I was unsuccessful in finding. You have a bill? I don't. You don't have any bills?

I don't have anything recent, which is part of the problem that got us here. When was the last one? Pre-pandemic. Okay. You have the bill? I might have the last one, but I think it was sold that I didn't get anywhere when I called them. What did they tell you? We sold it.

I don't remember. It was when I spoke to them, this was back in 2022, so I don't remember the conversation. to be entirely honest. I just remember being not being successful in getting... Well, I know they said oh, this reference number they had didn't match with someone else's and the account numbers just

it led into nowhere, basically. Guys, I'm going to be really direct with you. You cannot wait to get somebody to message you about student loans when you've already had wages garnished. You cannot wait. You need to find it. I know you're resourceful enough, Victoria, because you got a job in three

weeks. So apply that same approach to finding out who owns your loan. Trust me, people want to answer the phone when you owe them a lot of money. I guarantee they will not make it that hard. Okay, somebody's picking up the phone when you're like, hey, I'd like to pay you money. They'll pick up. Find them, set up a payment plan proactively. Do not wait. Yes, sir. The whole principle of what I am talking about with you guys is stop waiting for something to happen to you and start going on offense. with your money, with your conversations with each other, with your student loans. Stop waiting.

Go on offense. Okay. Moving along. Grocery spending, it used to be $1,800 a month. What is it now? $1,350, I think? No, that's what we planned, but it's $1,300, I think, on the CSP because we've replaced the $50 in the CSP for the Mothra subscription.

and so we lowered it slightly there. But in terms of actual spending... What's the number? Please, just tell me the number. 1175. That's good. Why you bury the lead like that? Because in August, it was 368,

but that was heavily cashed that month. Why do you use cash? Because you don't want to charge it on the credit card? When I go to my friend's office, I get paid in cash. So that's one place that I can spend the cash. Yeah. I don't love using cash because it makes it harder to track, but are you tracking it carefully?

We keep all of our receipts and I mark the back of the envelope that we keep it in with what store I paid, what store I went to, how much I paid, and what payment method. Fine. And then I feed it into chat GPT and it gets me totals. It's not my preferred, but if that works, fine. I'm fine with it. Sounds like you are either at 1,300 or lower than $3,300. $1,300 per month on groceries. Is that correct?

Yeah, the last two months we've really been. And to that, I've been shopping the store with a calculator. Amazing. Holy shit. You know, we need to create an I will teach you to be rich calculator. Like literally, it's magnetic, so it sticks to the shopping cart. And then everyone can see, they're like, what is this person doing with a calculator looking at a thousand island ranch dressing? And you're like, you don't.

And when they come up to you, they're like, excuse me, ma'am, what are you doing? You go, you look at them blankly, you go, you don't shop to a number? That's the phrase I want spreading across America. Can you guys help me do that? Yes, definitely. I seriously love it, though. Good job. That's amazing.

Okay, great job. You brought your groceries down by over $500 a month. Incredible work. Incredible. And that's what helped be able to pay the loan off even more aggressively. I love that. All right. still got a hundred bucks a month on clothes. What's that for? I think it's just to allocate if we need

something that comes up to the kids. Yeah. Do they need it? Um, no. No. I'll answer that. No. Well, okay. Chris answers. I love it. Victoria, let him, let him write. He just gave us a crisp answer. I want to correct him because when we had our current spending, it was $50 a month. And I opted to 100 thinking our dry cleaning was going to like pick up again with both. of us working. And so I up. Dry cleans when they have 91% fixed costs. What are you talking?

I'm putting off for a while, so. But, yeah. So I did inflate that number for his dry cleaning. But if we're talking about spending clothes on children, then, yeah, no, they don't need the clothes. Guys, am I, is this like a, do you not realize the severity of the situation you're in? Like, dry cleaning for a couple where you have 91%? percent fixed costs. You do not have enough savings to last, last time we spoke was a week.

Like, dry cleaning is not in the universe of what's possible. I'm sorry. That's just reality. My thinking and my validation for it was it saves time. What time? All I've been putting it was the stuff that needs to be like ironed and, you know, has specific conditions that I can't put to and get ruined. Like if I ruin my shirts, I only have a couple of them. Then I have to pay more for. Did you seriously think that was going to work? Was I close? Not even close. Not even in the same universe. First of all, you're speaking to an ironing master here. Okay. Second, you're speaking to someone who created a 30-minute video on YouTube on how to iron clothes. You never watched that for you. I'll watch it right after this.

Yeah. Okay. And third, I'm sorry, guys. Dry cleaning is a luxury service. You cannot afford any luxuries right now. We need to get honest. Well, I did, I did cut that. I only did the shirts, like I mentioned. So I have been sort of proactive, but yes, I acknowledge that it can be cut and I'll do it. Okay, I appreciate that. I guess what I'm looking for is instead of me having to pull you to make these decisions that rather you actually pull me, right now it's like there's a tug of war happening. I'm trying to pull you into financial safety and you keep pulling back with things like matcha and dry cleaning

guys I don't mind if you want to spend on matcha if you're making $175,000 and you have no debt you know and maybe a mortgage okay you are broke and we're talking about all these luxury services do you want to stay in this financial situation for the rest of your lives

no no then it can't be me pulling you along it's got to be you pulling me I'm going to change your clothing to zero because you can't afford new clothes or any services or on clothes. Cool. You went from 91 to 90%. Okay.

Subscriptions are still at 238 and a $1.308. $100. Cut the rest. You're at 89%. Miscellaneous 102? Okay, I'll keep it. Child care we talked about. And you're going to get the job within three weeks.

That's the plan. Great. Fine. Utilities, 1008? Utilities are, yeah, they're propane. electric water and internet. What do you guys keep your air conditioning out of curiosity? Nowadays, it's usually off.

But like when it gets hot. It's not what he axed. Yeah, it's usually too low, in my opinion. I don't know. I think it's like 69. It honestly, it fluctuates depending on the humidity, all sorts of things. How it is at night?

How come Victoria's just giving me a number over and over and John's going like this? John. I can't give you an answer. Why not? It depends on a lot of things. No, it doesn't. John. 72, 76.

Okay. It depends. I guess we'll depend ourselves into being broke. But we'll put it to 70 when we need it. Victoria, what am I really asking when I ask about the AC? How much of our electric bill is being overspent on AC? Yes. And if I'm asking about that, then I'm asking about that for food and for clothes and for phone

and for all of this stuff. the real question I'm asking, if you listen to the question behind the question, is how much control do you have over your fixed costs? And I actually think the two of you don't believe you have any control. I think the way you see the world is the world happens to us and we just simply deal with it one thing at a time and we're never going to get ahead. Look at the nods coming from both of you. You don't believe you have control over it, do you? Not entirely. No. I like to think we have control over it, but I don't. I don't think we have full actual control. One thing I would like to say about the electric, though, is I feel like this summer in New York, at least. I don't know how.

It's not about New York. It's not about air conditioning. It has nothing to do with that. It's not about that. It's about the way that you look at your relationship to the world. Do you believe you have any control over it or not? You can? Yes.

No, I mean, historically, I think you deal with what you're, dealt. And if you think that way, then you don't think you have control. Which way do you think, Victoria? Well, that is how I think. Victoria just said something that actually shines a really powerful light on what's going on. She said, I deal with what I'm dealt. That is the belief that has been keeping them stuck. When the AC is expensive, they deal with it. When groceries are $1,800 a month, they deal with it. When they rack up credit card debt, they deal with it. The world happens to them, and they just react. In psychology, this is called having an external locus of control.

It's the belief that your life is controlled by outside forces. The economy, the weather, circumstances, things just happen to you, but you have very little control over what happens. The opposite is an internal locus of control, the belief that you control your future through decisions and actions. And here's what's interesting. Victoria and John actually do. have some control. They just proved it. Victoria cut groceries from 1800 to 1300. That's over $500

a month. She shops with a calculator now. She did that. The world didn't force her to. She did it. So they can change their behavior when they decide to. The problem is they don't believe they can. And the moment something feels hard, like giving up dry cleaning or setting the thermostat to 72 instead of 69, they retreat back to, well, we need this. And it depends. Do you see the pattern? Make a change. Hit resistance. Justify why they can't do more. It's hard. I've never seen it done. It would threaten my identity. These are all manifestations of their money psychology, that external locus of control. It's actually a lot easier to believe that the world controls you, because then you're not responsible for it. You're just a product of circumstances, high grocery costs, hot summers in

New York, needing dry cleaning for work shirts. To be really blunt, they control the thermostat, literally and figuratively. They can set it to 72 and save money. They can iron their own shirts. They can cut their matcha subscription. And they can be proactive about their student loans instead of waiting for someone to contact them. You guys actually don't realize how much control you have over your life. Even things that you think are solely biological. You can change what you like to eat. You can change what time you wake up. You can change your energy level. But none of this happens if you don't believe you can change. So the real question is, will they choose to take control, or will they keep believing that life just happens to them? Do you think that you deal with what you're

dealt? Yeah. Yeah. I think that's really honest. And I think that is the fundamental issue going on here. You look at your spending. You both have a litany of reasons why. You're very good at explaining things. Well, we need this and then there's that and then there's this one thing, but this exception because of summer in New York. When I look at this, I say you have 89% fixed costs and you are broke. And you've already experienced what happens when bad things occur. Wage garnishment, all kinds of stuff. If it's me, I take a freaking hatchet to this spending.

If it's me, I go, wait a second. We can change everything in our environment. We can get rid of some of this spending. We can increase our earnings. We can change the air conditioning even. I do feel like I tried this summer to actually turn the AC off

a lot that I was home and it was one way that I tried to help not make the AC cost us as much money as it had been in the two summers prior by keeping it on 24-7. Okay. So. I don't think this conversation is really about the AC.

This conversation is about, do you believe you can control how much money you spend? If you told me we care about AC and we want to keep it at this temperature and we're going to find other ways, I would say fantastic. It doesn't matter to me. But I'm not hearing that. what I'm hearing is a lot of justification for why you cannot change things. I can't change that. It's not my money. It's not my family.

You decide. What you can't do is simply relitigate all the decisions you made which got you here. You can't do that and expect to change because it's not going to change. Right. What about your savings? Last time we talked your savings, we're at $1,155. That's one week's worth of savings for John. What is it now?

It hasn't changed. How come? Actually, that's a lie slightly, right? Didn't we open that high-yield savings account? Yes. And something's going there. Tell me. I think it's $100 every two weeks is going to the high-yield savings account that we opened upon reading, I think, your first book.

Good. Yeah. Repeat the number again. How much? $100 every two weeks. Great. So you have about $13 or $1,400 total. Correct.

Okay? It's going the right direction. I really like that. What do you guys think about that? When I told you last time you have less than one week's worth of savings, how did that strike you? I mean, it wasn't surprising. I know that. I know that we don't have any foot to stand on.

Okay. But it's scary. Yeah. I mean, I just have to hit the ground running with the same energy that I did the last time when we got off the call the first time and have a job within the next three weeks so that we can get that savings. number to be higher. I think, yeah, we were very, a lot of energy. I think we can keep it going. I think another thing that I was trying to plan out in some of our number planning and discussing was how long will it take to build up like a six or 12 month savings plan. What was your gut? What did you initially discover? If we were

to do it like after paying off debt and we have money like that $3,000 to put towards it, I think it was just over a year, if I remember correctly, to get to six months. I think it probably took a bit more than that because if you're saving $3,000 a month and you're trying to get to six months, that's $66,000. It takes a long time, years. I don't mind it. I don't mind. It usually takes years.

to get to six months of emergency fund savings. It's totally normal. I do mind that right now you still only have a week's worth of savings. It's really scary to me. I will tell you what I would do if it were me. What I would do is I would take all the savings that we just did, taking a look at this, you now have $1,172 a month

that has flowed all the way down to guilt-free spending. and what I would do is I would redirect a lot of money towards emergency fund. So right now it appears you're doing about $220. I would put $500 towards savings, leaving you with $672 in guilt-free spending. That's pretty low. That's 5%. But the fact is, you need savings.

I would furthermore probably reduce the amount I paid towards debt. reduce it. Yes. Shocking, right? Yes. Yeah. Why do you say that? Why is it shocking to you?

I mean, everyone fears debt. So. Well, not fears, but it's... Okay, improper, overwhelming debt. We shouldn't, we shouldn't be in debt. If we don't have the cash to pay for it, then we shouldn't be buying it. At the end of every month, we should be paying the statement balance if we are carrying

debt. Yes. Here's why I think that you should consider reducing the amount you put towards debt. I certainly would. You have a family. Expenses come up. You two have shown repeatedly over many years that you are not properly planning for the future. Like simple things, expenses come up and derail you.

and you haven't come up with an effective solution for it. You need savings. You need it. So I love the fact that you're being super aggressive about paying off debt, but my question is why? Why be so aggressive that you're putting all this money, almost $3,000 a month towards debt to pay it off in one year? Why? Because they're paying $845 a month in interest on the MX. I understand that.

It sucks. Yeah. that was why. But what about if something happens? What about if John loses his job? Yeah. I think to your point, you know, if we paid off the Amex, for instance, in extended three more months, at least the limited payments amount that's going towards saving now would be more beneficial than that three extra months. So we'll eat the three months, but have a cushion. That's the way to think about it. It's like, yeah, we're going to have to eat some and pay extra interest. That sucks. We need to take accountability. We messed up in racking up all this debt,

and so we're going to have to pay for it. Fine. But we need to protect ourselves as well. That's how we think about it. So like- Offense is a good defense. Is that three of the guys? Go on up. Yes. Okay. Let me show you what I mean. I'm not going to tell you the exact numbers because you need to decide for yourself, but take a look. Right now you're paying 2837 a month in debt. Okay, maybe that's a good idea. Maybe not. I don't know. Let's say we take it down to thousand. We got 837 extra dollars to put in. So just to simplify things, I'm going to put $1,000 here, 220 plus 837. We'll just call it $1,000. I just added it straight here into your savings. Now you are saving $1,500 per month. That's a lot. That's a lot. So by the end

of the year, at least you will have one month worth of fixed costs. Yeah. Guys, you need it. You need it. You need savings. You are too exposed right now. How does it feel? Feels wrong.

You know why it feels wrong to you? Why? Two reasons. Number one, you've been taught that debt is bad, which is ironic because you actually ran up a ton of debt. So what kind of lesson is that? Second, it feels wrong because you are used to only tackling the thing directly in front of you. You are not used to planning further out. Look at John

nodding his head. That makes sense. So I will say kudos to you for creating this debt payoff plan because it's very, very sophisticated to be looking ahead and planning a year. But what you did was you basically said like, this is bad. Debt is bad. I want to make the bad go away as quickly as possible. That was essentially what you did, right? Yeah. Exactly. And so what I am encouraging you and challenging to do is like, hey, yes, debt is bad, but we also need to look even longer. We need to look bigger. We need to realize that we're going to have to pay interest. It's going to suck. And also, the worst case that would happen for us is not paying an extra 500 bucks in interest. It's that we get laid off and our family is destroyed. That is the worst. Yeah, that is definitely worse.

All right. So that's up to you, but that's something I would consider. The difference between paying off debt in one year versus two or two years versus three, in the grand scheme, negligible. But having a fat savings account so that you can sleep well at night, especially as parents, very, very powerful. John and Victoria are learning to think bigger, not just about paying off debt, but about building real financial security. If I can be really honest here, there has to be more to life than just getting by. So when do they actually get to? live. When does this stop being about survival? Let's talk about their rich life right now. When do you

get to think about a rich life? When I have the funds where I'm not, you know, worried about debt. So I don't know when that would be. Well, why don't you know when that would be? Because if we have a debt payment, pay off payoff date, why wouldn't that occur in a year? That's a good point. I mean, yeah, I mean, two years was the plan. I guess because it's it, we, we, we just, we just, just, we haven't gotten there yet. So for me, that wasn't, that wasn't real. So you can't think about a rich life until you're debt free. I was able to think about it before, but I mean, my rich lifestyle right now is sad to say being debt free and, wait, that's not sad. I think that's cool. That's very mission oriented. Hey, we got, it's taking accountability. Hey, we got ourselves into

the situation. We are creating an aggressive plan to, pay it off. We are being thoughtful. So when we get this gift money and when we have these monthly transfers, we are being very thoughtful. Do we need to pay it off in one year? Can we extend it to 16 months, 18 months, 24 months? What is right for our family? So I actually find this very exciting to think about what is our rich life. It's being debt free right now, but how are we going to get there in a way that's right for our family? And I guess my rich lifestyle is to go on that. Now that, we're talking about it is kind of a little bit more clear is being able to have these things in progress where I can know, okay, we've got this plan for to be, you know, have the property

tax paid and be doing it by ourselves and have those motions going and knowing that all that is set. I think, I mean, I don't know if that could be a good rich lifestyle, but knowing that that's available. It doesn't do anything for you. That is just things that need. to happen, but it doesn't give you anything. There's nothing about you specifically in that statement. Victoria, you want to elaborate? He says in the book that moms and dads don't ever do anything for themselves. So right now, you're being dad and you're being a provider and you're making sure everything's being accounted for. But like I did last year after having Luca, I went to ballet class on Wednesday nights once a week.

And that was mine. That was something that I got to do. That was me. It was something I enjoyed. And I'm grateful that I got to go. I do think it was money well spent because postpartum depression is real. But what Rameed is saying is that everything that you just said doesn't give you anything in return. I may not have said it enough for it at all.

But for me, knowing that you were able to do that stuff. There's nothing specific that you are saying. You need to find something specific. All I really can go into savings for all I'm concerned. Hold on a sec. This is very interesting. So, John, you're getting emotional talking about Victoria being able to do ballet classes, right? Why?

Because I love her and that's what she likes to do. There's something pretty beautiful about that. You are working hard. you want Victoria to be able to do that or whatever she wants. There's something beautiful about that. Do you hear what Victoria is saying? Focus more time on myself. Why do you think she's saying that?

It's needed. Think about your son. I guess, yeah. If I'm being a role model for them and then that's all they see. I mean, I've thought of that, but right now it's just business is business. Can I gently push you on that? This idea that right now, I'm just going to be heads down. I'm just going to focus on the thing in front of me.

And later I will deal with this vague, ambiguous, rich life stuff. Never happens. And men, particularly men who find control in systems and numbers, men like you and me who are optimizers, we are the ones who end up living only for some distant future. And the loved ones around us are like begging us, please be present right now. That's the family I grew up in.

That's all I know. My uncle passed away before he got to enjoy retirement. And it's one thing his wife, keeps mentioning is you know, they were just about to get to enjoy that part of their life and he didn't get that far. How does that apply to you?

How do you take that in? That's something I have to just accept in terms of just how I've seen things. So it has been pretty tough. But I know this family that he's given up so much for we all have so much benefits.

It may just be worth it. Take your time. Take your time. We're in no rush. Sorry. I actually really appreciate you being so open. Money is very emotional. I really appreciate you being this candid with me.

Keep going. That's really all that is to it is he put in the hours. And I mean, my grandfather put in the hours until the day he died. had this same clothes, same minimal lifestyle, but they've given up so much for, I guess, allowing our family to have things. That's a rich lifestyle. That's a hero. That if they work hard, if they buckle down, if they provide for their family, that's a good man. Is that what you're telling me? Yes. I agree with you. I think that being able to help your family, being able to be solid being able to be there for your family. I think that's a great man. I agree. But I also hear

Victoria saying something in addition. Victoria, what are you asking for? For him to go find time to work out. I know that's something he wants to do. If it means spending some of this less debt payment money on a gym membership because he gets you out of the house, it gets you away from the kids, it gets you concentration to actually work out, that might be worth it. What do you think, John? I mean, I appreciate that. And an adjustment that I don't know if it's going to be so easy because, you know, it's still something that's going to preoccupy my time wherever I am.

What does that mean? You're at the gym doing lateral raises and you're like, this could be my MX bill paid off three days early. No, but in a certain sense, Yeah, it just may be a distraction. You know, if you're distracted, you don't enjoy things that you can't get the full experience. John, are you all or nothing? Yeah. Like if I don't have, if I'm not perfectly debt-free, I can't enjoy my time at that.

I'm pretty extreme. I usually am zero or a hundred. How does that work out for you? I mean, right now, not well. For work, it's going well. I like the honest answer. I mean, people, I do my work pretty well. It's, you know, like I said, I've stuck to that.

Yeah, John, you do the work well for other people. But the question is, what about yourself? What I would really love for you to internalize is you can create a powerful debt payoff plan. No doubt, you need to pay off your debt. I agree. You can create a powerful. savings plan. You definitely need more in savings. Okay, yes. And you can go to the occasional gym. Or like, I like chips. So if I were in your situation, I would say once a week, I'm going to go out and eat chips and salsa.

Five bucks, but it's just something I enjoy. Whatever. The point is not about spending 50 bucks or five. It's not about that. It's about you not grinding yourself into the husk of a man that so many men turn themselves into. And it's not just about you. It's about your wife. It's about your kids. It's about everyone seeing that you are not going to do the same exact thing that your uncle and your grandpa did.

You can pick and choose. Victoria, what do you think? I would love it for him to go do something because I feel like he would be a little stress free, a little less stressed. if he did something that wasn't just the everyday, always has to be done hustle around working and a family. If the two of you did not make any more changes after we talk today, where do you think you would end up?

Not in his house? Well, we would probably end up eventually back in the same place because we're not dealing with, I think, the initial problem, right? If we're sole focus right now is paying down debt so aggressively and getting rid of it and everything can be dealt with after, are we going to deal with it after? No, that's the whole point of making the rules now while we're in the thick of it so that once we're out of it, we have a plan for our money and that we know what we're going to do and that we're not in the same spot again in three years, two years,

whatever time frame that works out to be. It's a powerful realization, Victoria. If I were in your situation, I would never want to be back in this situation, ever. And it would not just be a desire. It wouldn't be like, oh, I hope we never end up back here. I would put systems in place to guarantee that we are never back in this situation.

I would build up a fat emergency fund. I would have automated transfers going here and there. I would have rules on spending and owners for different categories. I would be talking about money on a weekly basis until we became extremely comfortable and then maybe moving it to a monthly basis. And I would be using money not just to save and invest, ensuring that we never got back into debt, but also be taking a little bit of that money for guilt-free spending, modeling it for each other and for the kids. That's how it becomes systematic. It's not about hopes.

It's about building a system. So I think if we just commit to a weekly meeting, then things will change because every week we're going to be discussing thoughts and money and bringing things up that maybe the other has done that we want to talk more about. Like, how did we get here? How did this happen?

How did that happen? Why did this happen? So obviously you can't name all the specifics to that. right the second, but just taking, like John said, more accountability for everything that's going on. I like it. I think it's a good start. Until now, a lot of your financial life has just been one game of whack-a-mole after another. That's it. One game of whack-a-mole, whether $10 or $10,000, just whack-a-mole. I would create rules so I never have to play that game again. I just hate it. I refuse to play it. And because I know that I have control over my life, if I don't want to play a certain game, I'm not going to play that game. I will create rules so that I can play the game

I choose to play. Not the game that the world assigns me. That's something I would think about. Since you both said that you would like accountability, then here's what I would like to see from you. I would like to see updates from you over the next month. In fact, I'd like to see them after each money meeting. We're trying to stop playing whack-a-mole, start living a rich life. I would be very interested to see your revised CSP, which I think we made some pretty interesting changes too. I'll be very interested to see any rules that you create to make your life easy.

Remember, you create the rules, nobody else. So the rules are meant to make your life better and easier. I'll be very interested in all that. I think that's going to be absolutely incredible. With that, I'm very excited to see what the future holds for you. Very excited. trust me when I say that if you do this for four weeks and you both show up, you have an agenda, each of you contributing something to the agenda beforehand,

you show up with a plan and you practice your communication, you will be shocked at how much you can improve in four weeks. All right, John, Victoria, I want to thank you both. It's a real pleasure to get a chance to follow up with you and to talk more. Keep me updated, okay? Thank you. Well, dear. Thank you. John and Victoria are learning that changing your relationship with money isn't just about budgets and spreadsheets.

It's actually about building new systems and having hard conversations and shifting how you see yourself in each other and money. If you want help doing that work, whether you're buried in debt like John and Victoria or you just want to get to the next level, my money coaching program can give you the structure and accountability to make real changes and make them fast. Go to IWT.com slash money coaching to sign up. I will see you in the program. Now, here's what I think is going to happen with them. I think Victoria will get another job. She's proven that she can hustle.

She did 61 applications in 21 days, so that's not the issue. The issue is what happens when they hit their next obstacle. I'm talking about when the car breaks down or when one of the kids need something expensive or Christmas rolls around, and they're tempted to make it just a little special date. That's when I'll know, if anything, has actually changed. I noticed that John cried when he was talking about his uncle, a man who worked

until he died and never really got to enjoy his life. I think John is starting to recognize the trap that he's been building for himself, but we have to acknowledge that he's been building that trap since he was a child. And I don't think Victoria is going to let him off the hook. She's also pushing him to have a life beyond just grinding. Personally, I'm rooting for them, but I also know that change, real change is hard. Now let's check out their follow-ups. Hi, we're meet and team. It's Victoria and virtual John. Just checking in with a quick update since our filming. Some of our biggest takeaways from our first filming in August was for me to find work, which we updated in September that I very quickly found work within

three weeks after 60-something applications in one interview. I was ultimately like, oh, after three weeks from that job, it wasn't the right fit for either of us. I realized after that a full-time job may not be the best thing for our family right now. And so I ended up accepting a office manager role at my friend's medical practice. I work there three days a week. And then the other two days a week I do stuff for the family and the kids and it's been working out quite nice. One of the other assignments for us was to do weekly money meetings and we'll be honest we did not hit that goal. Since the end of September we've had about three meetings, not weekly, but it did start a habit of trying to sit down and talk about money instead of avoiding it. One of the responsibilities

was for John was to be taking over some of the mailed bills, which was an idea that was great in theory, just with him working a full-time job out of the house. and being the one who cooks dinner mainly, it did not come to fruition. So I basically reorganized our filing system because I realized it was a heap of a mess and there was papers all over the place and backlog. As I said, I'm terrible at opening mail, so I took care of all of the backlog. I took care of all of organizing. We take care of all of the mail as it comes in now.

And also another takeaway was to work on our grocery spending, but we have realized that food is one of our yes dials, which is something that we tried to say in our update. You do like cooking. We like eating well. We buy wholesome ingredients. So one of our yes dials is food. And we are becoming more intentional rather than trying to drive the number as low as possible. We did see a big savings initially. As we said, we used up a lot of our stock pantry. We do continue to use chat GPT for. our grocery planning and meal prep, and so that does help. Sorry, I deposit videos on woke up. Part of our takeaway was to make a debt payoff plan, and without a full-time second income, it's hard to execute. So we were still treading water until December, so we have decided as a family that we

are going to make better decisions this year, and so one of those better decisions is we put our house up for sale and we are listed. We have had open houses. We have had scheduled showings. We've had offers made. We've had an inspection done. So we have contracts on the table. We are basically almost at the signing point. So we are looking to put about 550 down on the house. We are looking to stay in district. for a teenager. Depending on the final house that we end up, you know, securing and having a winning bid for will determine what our final all-in housing costs and percentage of income looks like, but I'm bearing in mind the property taxes, trying to keep it under 10. We're not looking to go over

our max budget. Our max budget does include, I believe, our debt currently, which we are are looking to obviously wipe clean when we switch houses. Money talks will have to happen weekly in our new house twice a week, more than twice a week, just to get into the habit so that we can keep on top of making sure that we stay debt-free. All the things that we have to bear in mind, habits that we have to continue to forge the dreamer mentality and the overspending is, I an old habit that will die hard. We are still learning our lesson, but we're learning it and we're growing. Listen up.

If you want my help with your specific money questions, there are only two ways to get it. First, you can apply to be on this podcast at IWT.com slash apply. Or second, you can join my money coaching program instantly at IWT.com slash money coaching. In that program, you get access to live virtual. events, monthly group coaching calls, live Q&As, and an amazing, huge community of other people like you. Check it out at IWT.com slash money coaching.