Money For Couples with Ramit Sethi - 94. “We paid off all our debt. Why do I still feel so guilty about money?”

Episode Date: May 2, 2023

Kate is 28 and Christine is 33. They’re married, living in the Detroit area with their nine-month old son. They’ve paid off credit card debt, sold their Ford at a profit, got out from a bad house purchase, and generally are doing extremely well for their ages. So why are they so anxious? This episode is brought to you by: Ness Well | IWT listeners can get an extra 5K welcome bonus when they apply for the Ness Card at nesswell.com/ramit. Babbel | Right now, when you purchase a 3-month Babbel subscription, you’ll get an additional 3 months for FREE. Just go to Babbel.com and use promo code RAMIT. LMNT | Right now, LMNT is offering 8 single serving packets FREE with any LMNT order. This is a great way to try all 8 flavors. Get yours at DrinkLMNT.com/RAMIT. Links mentioned in this episode • Get my New York Times best-selling book • Get Money Coaching with Ramit  Connect with Ramit • Download the Conscious Spending Plan • Get my no-numbers journal • Other episodes • Instagram • Twitter • YouTube 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. I just carry a lot of stress, worrying about the past and the future. Someday we're going to have to start paying off these student loans again, or someday we're going to have to pay for preschool, preemptively worrying about things like that.

I think I spent a lot of years of my life anticipating that I was going to never do well financially. So I was like mentally prepared for that until I wasn't. I don't think you should feel guilty for spending within our... plan. And I wish we had a little extra over at the end of the month, just in case of things going wrong. I don't know. I feel like I'm just always double checking to make sure I understand it all. Do we really have this much in our grocery budget or do we really have this much in our guilt-free budget? I don't believe that it's real. I was feeling like she's going to hide money or hoard money from me and she was feeling like I was about to put us back in credit credit. I want to

exude more confidence and competence. in our financial relationship. I want to learn these things so that I can teach them to my son in ways that my parents did not teach me. I have the vision to not want him to go through the feelings that I went through. Meet Kate and Christine. Kate's 28. Christine's 33 and they live in Michigan with their new baby. What's going on is that they both come from very different backgrounds with money. and they keep having the same conversations, which makes it feel like they're spinning and getting nowhere. As you listen, I want you to think about an area of life where you have felt stuck.

That is Kate and Christine. By the way, I wanted to let you know that on each episode now, we're highlighting each couple's numbers on screen for our YouTube viewers, so it's easier to follow along. People on the YouTube channel really love it. They like being able to see the numbers plus their faces and body language, so I would highly encourage you to check it out. Just go to YouTube and search for my name.

You can also get a copy of my book, including the audiobook on Amazon and Audible. Let's get to it. We've been having kind of the same conversation over and over for a long time, at least a year, I think. A year, yeah. When she thinks about money, it's always negative emotion for her.

I mean, I wouldn't mind if she brought up money to me, if it was like, hey, I want to do something today. What's more positive and less, like, you know, guilty about the spending. I don't think you should feel guilty for spending within our plan. And I wish we had a little extra over, like, at the end of the month, just in case of things going wrong. It's like, she'll tweak it every month. tweak what? Yeah, I'm a tweaker. I'll like tweak the categories of like,

we should spend this much in grocery and this much on the dogs. Hey, wait, are you doing this on my conscious spending plan? No, we actually have our own. You have a budget, don't you? Yes, exactly, because my CSP is not meant for tweaking and optimizing. It's meant for set it and forget it. Okay, now I'm starting to understand. You have your own little system, which is causing you problems.

I don't know. I feel like I'm just always double checking to make sure I understand it all. Like, do we really have this much in our grocery budget or do we really have this much in our guilt-free budget? Like, I feel like I don't believe that it's real or something or that it's right. Why is that? I just always feel like I'm missing something. I don't know if it's because I can't wrap my mind fully around the math or I just like don't trust it. And Christine, what's it like being on the receiving end of the stream of consciousness?

It's frustrating because, I mean, I was in some credit card debt when Kate and I met. And now we're through that. And I feel like I've made a lot of behavioral and psychological changes towards how I do with money. And I kind of hope that, like, Kate would, you know, come with me on that. And I feel like maybe there's still some open booms, you know, that past that we've gotten through. Your past? Our past together.

Well, I guess it was what I brought into the relationship. So, yeah, it would be, you know, my past and my best behaviors. And the bet that I brought into the relationship. And so I feel like Kate doesn't necessarily trust that I'm not going to put us in that place again. Okay. Kate, is that true? I don't want it to be true, but yeah, maybe a little. It can be really hard for people who've always felt behind with money to actually trust their plan.

So when Kate says she doesn't really trust her numbers, when she constantly logs into her accounts and tweaks things, it's really another way of saying she doesn't trust the plan, which deep down means she doesn't trust herself. The solution here is not to bust out a spreadsheet and show her how all the formulas work. This has very little to do with the numbers. What I want to encourage everybody here to do is to start trusting yourself with your money. You know, I see a lack of trust in so many different areas. It's when people tell themselves, yeah, I'm going to read that book, but in the back of their head, they know, even as they say it, they're not going to read that book.

I know I should probably open up an investment account and they know they're not going to do it. I'd rather they just not say it. because once you get to the point where you cannot trust yourself, it's over. And so what I try to do on this episode and with other guests on other episodes is to help them shrink down the field of play, to really help them commit to something that they know they will be able to do and to start to rebuild the trust with their partner and oftentimes themselves. There's a pretty cool TikTok trend going around right now that I really love. It's called admin nights.

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How'd you meet? Well, we met basically right when I finished grad school. I had just moved home with my parents. And I was going to take some time to figure out what I was doing with my life. But we met and it was a whirlwind and we fell in love. and we ended up, I ended up moving out of my parents into her house pretty quickly.

How quickly? What was it, Christine? Oh my God. How many weeks? Probably. Oh my God, come on. This is like a stereotype. I know.

This is insane. Yeah, we can get a trophy. Honestly, best lesbian. All right, fine. All right. That's hilarious. Okay, so you... Okay, so you moved in and have you been together ever since?

Yeah. Okay, fantastic. Congratulations. That's awesome. So what happened in terms of the credit card debt that I keep hearing about? I feel like it was kind of a couple months into the relationship. We went on a vacation together and, you know, I was still only working a part-time job, kind of getting back on my feet.

And so Christine was paying for everything. and she was making more money than I ever imagined I would ever make. So I was just like, I don't understand those numbers. If you got it, you got it. I believe you. And then after that vacation, then she kind of told me the actual numbers of what she made and kind of revealed the beginnings of like the credit card debt.

It felt like, oh, I've just been, you know, letting her treat me to these dinners. vacation and I didn't even know that she was in debt and going into debt doing this stuff. And at the time, I didn't have much to contribute financially. It's a little worrying when I hear couples who just slide on into a relationship without conversations about money. That's because we come from totally different perspectives with money, different socioeconomic backgrounds, parents, views of money.

And so if you just slide on into a relationship without having a series of conversations, what does money mean to you? What's your parents teach you? What's something you're working on? Here's what I'm working on. Setting expectations helps you avoid these blowups that often happen when couples never talk about money. You said you had some credit card debt. How much did you have at the time?

I want to say I had like 3,000. How'd that feel to you? Terrible I wasn't really making much money When I was in grad school I really really struggled financially I had I had like a full ride

And I was teaching So they were paying me to be there But it was like simply not enough Yeah Christine how much debt did you have on your credit card At the time I want to say 5K

It felt like a lot It felt yeah I previous to that year. I hadn't carried any debt. So it was new to me. Okay. So when you got married,

did you both have credit card debt at the time? I think mine was paid off by the time we got married. Okay. When we got married, I think the debt at that time was probably closer to 10, maybe even 12. I was going up. Okay.

Having credit card debt. Why'd you get into debt? I made some, Yeah, in retrospect, I made some just really bad financial choices all at the same time. Like? I bought a house. I got a brand new car. And my sister moved in with me at the same time.

What kind of car? A brand new Ford Escape because that's where I work. You worked at Ford? Do you still work there? I do work at Ford. I do. Oh, my God. We make those great trucks that you love so much.

Well, my God. This is, you know, this is the ultimate irony because every time someone comes on this show, they drive a Ford. I go, why? Okay, so you're an engineer at Ford? Yes. Oh, that's cool. All right. So I went to GM for a little while, so I sold it, and then I bought a GM car.

Okay. And then after Kate and I bought this house and we were looking at the numbers when I was out of, actually, I think we were still in credit card that then. It was right when you like, you know, cars were going. It was a good market. So I sold my bolt then and we were able to take some of that money and pay off credit cards. Whoa. Okay. That's cool.

So you sold your car at the peak. First of all, this is amazing. It's like hasn't happened in decades where people are trading cars like commodities. You made a profit. It sounds like. And then you paid off your credit card debt with that money. Okay. Some of it. Some of it. I'll take it. Some of it. And what do you drive now?

We share a car. We have a Subaru. A Subaru! I knew it! I knew it. I was waiting. When you gave me that look, I was like, come on. Okay. All right. It all makes sense now. All right. One thing I want you to notice is that when people get large infusions of cash, they tend to pay off debt or save. This is very clearly shown in the research. And it applies to tax returns, stimulus payments, Lots of different cash infusions. But interestingly, when people get money that's just slowly increased to their paycheck, they tend to spend it. And this is really important to know because you should know how most people, including you, behave with money. Also, if you listen to this show and you're in my money coaching group,

you know how to take all types of money, large infusions, small increases over time, everything, and redirect that money towards your rich life. I'll add a link to my money coaching program in the show notes. Christine, I'm curious about your role in the relationship as it relates to money. You've mentioned debt, but I understand there's a story behind that house and your sister. How did you end up with this house? Yeah, so my parents, they had us when they were really young,

and they both struggle with addiction throughout our life. I have a sister who's intellectually disabled. So as soon as I felt like I was in a good place with money, I bought guardianship of my sister. My mom, he said that she was like, okay with everything was happening, but she's not a very trustworthy person and she's kind of chaotic. And I was told that, you know, a judge probably wouldn't grant it if I didn't have a home with like her own room and everything. Who told you that? Got a lawyer. How old were you at the time?

I was 25, maybe 26. 25, 26 years old. You took guardianship of your sister. That means you were her legal guardian? Yes. And the lawyer told you you got to buy a house. I did all this legwork, character letters about myself, figuring out what the living situation needed to be.

And one of the things they said was, yeah, you're going to have a much stronger case. if you buy a house. And how did you react to that? I mean, did you say, okay, I'm going to do it. It's just a matter. It's what I need to do next, or were you like, oh, my God? So I think something that I is like a saying that is persistent in my life is,

if there's a will, there's a way. Okay. And so I think I ran the numbers initially and I was like, okay, this is going to be, I'm going to cut it real close. Like, I drain my savings. Did you end up selling the house? Yeah. We walked away with 12K

after all the realtors fees everything. So we use that as a down payment for this house. Okay, got it. And what was the price you paid and sold just out of curiosity? I bought my house at 142 and I sold it at, was it 180K? Yeah, I think 180, 185. Yeah, that's good. It's good for everybody to hear.

You know, you think you walked away with $40,000. But actually, when you subtract out, let's just go through the list. Your realtor fees. What else? The down payment for the next house. Yep. Repairs. Mortgage fees.

Repairs, mortgage fees, right? Anything else? I don't think so. Closing costs. Closing costs on the new place. Yeah. Totally. You end up, instead of 40K, you end up with like 12K.

Makes perfect sense. I think this is quite startling for people. Was it startling to you? I knew that going in. Okay, good. And told the realtor, like, if I can't sell it for this much, it's not worth it. Like, we'll stay here, basically. Wow.

Okay. All right, good. All right. So you got the 12K, put it as a down payment for the new place, and that's where the two of you are right now? Yes. That was so important. Do you notice how many ways home ownership is explicitly and implicitly favored in America? Literally the court telling Christine that she should own a house to show she's more stable.

I find that absurd. Think about how that message would be received by young people, poor people, minorities who have been systematically redlined out of home ownership. What a joke. Also notice that she bought her house for around $142,000, sold it for $185,000, but only walked away with around $12,000. I think that about 90 plus percent of people would simply take 185, subtract 142, and go, yep, you walk away with $43,000.

No, you have to account for all the phantom costs, including transaction fees. And now, I will acknowledge that she did have more cash, but she took some of it for the next down payment. But that's what most people would do. The point I'm making is that if and when you buy, you must factor in all costs because you cannot simply take a big number, subtract the smaller one and go poof, profit. Great. All right. So do you still have the credit card debt, Christine? No. So we paid that off about a year ago. It was all paid off. How'd you pay it off? Bonus, tax returns.

Yeah, for a while, we decided no credit cards are allowed to be used. We were buying everything on debit cards. Of course, like everyone does. Just to keep things like really separate. And we were paying off the credit cards steadily. And did you make progress that way? Yeah. Good.

Yeah. Slowly. Great. All right. So both of you have paid off credit cards. That's great. Did either of you ever celebrate? we probably did something small.

I don't know. Like what? Port a beer. Cheers. Christine, do you remember that? I do remember it. I think we were probably already going out. So someone's like,

Cheers, it's Friday. And the other one's like, oh yeah, we paid off this debt that's been with us for years. Okay, that cheers too. All right, let's drink. Exactly. What?

So do you understand why I'm asking the question? Yeah. Why? Because it's a big deal. It's a big deal. And creating these rituals around money, I think, is really helpful. And part of the reason that you may still be psychologically stuck in the past is that you haven't truly internalized that we are credit card debt free. We did it.

Do you believe that? Yeah, a little bit. Yeah. I think it goes a little deeper. A lot of people are able to grow their money faster than their money psychology. These are the people who have money in the bank, but still agonize over buying cucumbers. Or they check their accounts multiple times per week, which is total overkill and is happening here. Or they simply still live in scarcity, in fear, rather than embracing this.

new chapter of life. You don't just magically embrace a new chapter. You have to take a second to recognize it and you have to do that over and over again. Think about it. In school, these rituals happen for us, like graduation, different grades, different teachers, even different buildings. But with money, we have to create these rituals ourselves. So ask yourself, what rituals have you created around money for yourself and for your family? 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

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If you don't like it, they will give you your money back, no questions asked. So what seems to be the issue on a day-to-day basis? I think I just carry a lot of stress, worrying about the past and the future. The past being credit card debt? Yeah. Just kind of like not wanting to get back there and also carrying probably some very unhealthy messages and just feelings about money. Okay. And then what's the future?

What's that worry? The future is like, are we going to like someday we might have to have two cars. Someday we're going to start paying off these student loans again or someday we're going to have to pay for preschool. and just like preemptively worrying about things like that. Ah, you love to worry. You could say that. Is that fair enough? Yeah.

What do you like about worrying? It makes me feel like I can be prepared for things. That's a good answer. Anything else? I know the classic answer is control. Control. Would you agree with that? Mm-hmm.

Okay. All right. Christine's over here. grinning. What do you think, Christine? Anything else you want to add? No, yeah, I think Kate, like Kate's account every dollar person and she, like she said in the beginning, if she could save it all, she would. Like, if, you know, if we didn't have GFS and it all went to savings, I think that would be her preference to make her feel better. You like that, Kate? Do you want to save everything? I would like to save more aggressively, yes. You want to create a blanket

made out of $1 bills? Keep you warm? Yeah, maybe. I mean, we can do it. It's not that expensive. You know, give me $100 and some yarn. We could probably make it happen. True.

This is going to sound really off course, but I went to music school for classical music. And, you know, that's not exactly a lucrative field. and I think I spent a lot of years of my life sacrificing for this thing and also anticipating that I was going to never do well financially. Ah. So I was like mentally prepared for that until I wasn't. What changed?

I realized that I wanted. things like a family and a home and a comfortable life and the opportunity to participate in society the way normal people do. Yeah, I was definitely operating on that mindset for a long time. And so I think in order to exit that mind, that area mentally, I kind of decided that I was going to put music aside as a viable career path. It's something I still do, but I basically decided I'm not going to try and make money at this anymore. Fine. So you made money at other stuff? Yeah, I have a different job.

Great. How do you feel about that? I feel good about my job, but I think that there's a little bit, like, there's a part of me that associates the abundance of money with like a failure as a musician. That's deep? Yeah, because it's like part of being a musician and making it as a musician is like really extreme sacrifices. Yeah. Do you hate money?

I used to think I did, but no. Do you love it? No. How do you feel towards it? we are reporting wow tell me more

um like we're kind of I'm still building trust for it like building the belief that it's worth pursuing like

instead of this other thing that I was dedicating my life to yeah And I think that there's some hurt and sadness over the structural issues that led me to that breaking point, the decision point. I can understand that. I mean, you spend your whole life becoming really good at this. You internalize a set of beliefs that are reinforced by the structures around you, right? People making jokes about, well, you know, that's why we went into music and all that kind of stuff.

this sort of artists are meant to be poor and starving and it's everywhere. And you decided to set it aside consciously. And here you are. That comes with grief. Yeah. Even though I see those instruments in the back, I can see that you're still active as a musician in some form. It's not the same as going the path you originally thought for yourself.

But this path you chose now, the one where you made. more money. What does that give you that music did not? So much. Tell me. Friends, good mental health, a sense of like direct material feedback that I am doing something that other people value in the world. Yeah. And how about with your family?

I feel like I am bringing something to the table for them. It feels like when I was dedicating hours of my day to just saxophone, it really felt selfish. That's got to be a weird feeling. It feels selfish, but you're also not making any money. Right. But then it's kind of like, well, I've just been doing this for so long. what else am I supposed to do? And if I were to give up,

it makes me feel even worse than I feel. It's this nice little box that you kind of ended up in. Yeah. There's a lot of entangled, bad thoughts and beliefs and voices. Well, I think it's very courageous that you were able to decide the next chapter of your life. One thing that I'm really hoping

is that as you really start to internalize this new chapter, the one that you yourself chose, that you can get really specific and vivid with what your choice has gotten you. Yeah, it's true. And I'm just wrapping my mind around the future stability that I'm going to have as a result. I started a retirement account, which I never planned on. Yes. So it's those kinds of things that have been enabled by this choice. was really interesting. On this podcast, we talk about how you grew up around money a lot, but I haven't had the chance to dive into the professions people choose and their effect on your money psychology. If you know artists, you know they have some seriously messed up beliefs about

money. And it's not just artists themselves, though I do think the entire industry does attract certain types of people. It's the culture that's been created and systematically reinforced. It's the unlimited supply of musicians who want to be famous, which allows a pyramid-like structure of poorly paid people at the bottom and a few stars who everyone wants to be. You see this dynamic with actors and actresses, rappers, concert pianists, it's everywhere. One thing I love about this show is that we can be deeply intimate with two people, but we can also get the opportunity to zoom out and talk about the structures around us and how we are products. of our environment. Kate recognized her environment wasn't serving her, and she made a conscious choice to change it. That takes real courage, but it also comes with a basket of emotions, grief, shame, confusion, but also excitement and curiosity. So let me try to understand where these feelings

are coming from. When you think about the money messages you received growing up, what do you remember hearing from your family? I remember just being arguments. Your family middle class? What were they? It's honestly hard to gauge. Probably upper middle class, but during my time growing up, it was very tumultuous in terms of like my mom would work and then she would be not working because she was having babies and raising babies.

How many kids? Three, and I'm the oldest. My dad lost his job in 2008 and never really went back to working full-time after that. So then it kind of all fell back on my mom. I mean, Kate, parents have a very nice house on a lake. And when I met her, I was, you know, I thought, you know, she didn't want for anything, you know?

Yeah, okay, great. So upper middle class at a minimum. And what were your professions of your parents, Kate? My mom's an attorney and my dad is an engineer. When they talked about money when you were a kid, what was the context of that? They fight, they smile, what? They fought. Like what?

They would fight about, my mom would be mad at my dad for not working harder. And my dad would be mad at my mom for spending too much. just back and forth like that. But they had totally separate finances, which was always very confusing. Why? Because they don't trust each other. They just don't agree on things. They're not really collaborative with each other.

They still married? Yes. You laugh? Is that a laugh like, I'm not quite sure how they're still married? Yeah. Okay. Kind of. Even Christine's like, yeah.

Okay, got it. Understood. So they don't see eye to eye on money. They kept their money separate. They're still married, like decades later. Yep. Still going at it, fighting, arguing? I bet they don't fight much anymore,

but that's because they're so separate now that they just probably don't even really talk about it. They share a house, and that's pretty much the extent of it. Gotcha. How do you feel about that relationship now that you have your own family? Very perplexed. Because I feel like Christine and I have found so much power in collaboration and communication. Like we are, all of our plans for the future are joint.

And I feel like that makes things much simpler and more fruitful. Yeah, I love that. And I just see my parents now approaching retirement age and they're both stressed out that they're not going to have enough for retirement. And I'm like, now that I'm married, I'm like, you could have just been working this out together all along and you be better off. You see that stress in your own life anywhere? Well, yeah. I'm obviously stressed probably unnecessarily. I don't know. I mean, I inherited my mom's stress genes.

She loves to be worried too? Mm-hmm. When you were a kid, she was worried about what, what you ate, or do you have a raincoat on? She gets your grades up. What else? Yeah. Just always be careful, be careful. Right. I'll be careful mom. And can you complete that sentence?

Be careful because what? You don't want to get hurt or you don't want to poke your eye out or you don't want to break your sister's nose. Love that. Okay, great. Now, this is real. And so you as the oldest and the recipient of all of that, be careful, be careful. What if this happens? How did you receive that as, let's say, a 10-year-old and older? Responsibility and burden. How would you say that that's manifested in your life as you became 15, 20, 25, et cetera? I think I feel like I have to always have the safety net in place. Like, that's my role, kind of. If I do that, it means I'm fulfilling my basic inherited duties.

And if I don't do that, then I'm failing everyone around me. And what's going to happen if you don't tell everybody, be careful. What's going to happen? Everything's going to go wrong. There you go. Kind of like how your mom felt probably, right? Mm-hmm.

All right. So your mom was sort of anxious about money, anxious about everything. You internalized that. Yeah. Is there an area of your life where you are confident, comfortable, intuitive?

I feel that way about being a mom. I love it. Tell me about that. I just, I feel like with my son, I kind of have the vision to not want him to go through the feelings that I went through.

And I feel like I have a good handle on how to go about that. He's only nine months old. I love hearing you say this. How did you arrive? at that feeling already at nine months as a mom? Well, I did a lot of therapy and self-reflection during the months that I was pregnant and just kind of mentally preparing myself

and knowing my own tendencies and having tools in place to deal with them. Highly sophisticated. Like A-plus. You're not saying that you know everything. You're not saying you're perfect. Nobody expects that. but I love hearing you use the word vision.

I have a vision. We have a vision. I think your son is very lucky. Yeah. I want to exude more confidence and competence in our financial relationship and just our financial life. I want to learn these things so that I can teach them to my son in ways. that my parents did not teach me. What a profoundly important moment.

Kate didn't miss a beat when I asked her what area of life she's comfortable and confident and intuitive in. If you are listening or watching this, what's your answer? For me, it's this. I love talking to people. I love hearing from you. You can see me when I'm talking to these couples. I'm here 100%.

And it's fascinating to hear. Kate talk about where she's intuitive because it tells me she's not an overthinker in every part of life. With her son, she has a vision, such an important word, is something bigger than the day-to-day worries that usually consume us. But did you catch how she developed that vision? It didn't just come naturally. She worked hard at it. She did therapy and she worked on herself about what she wanted to pass on and not pass on and how she wanted to show up as a mom. To me, this is actually amazing

because it means that all of us can do the same thing with our money. You're not bad with money. Reframed that. I haven't always been great with money, but now I'm learning how to take control of it. Did you grow up poor? Yeah.

Yeah. Where there's a will, there's a way. There's a strong connection, right? And is that a recurring theme in your life? You know, when it came to college and all that, I remember asking my dad, like, how are we going to pay for it? And he was like, it's simple, we're going to stay poor. He said that. As in like, oh, then you'll get financial aid and it'll be, you know.

So. Hold on. What is your conclusion from that? Today or then? Ben. I didn't really understand how that college is expensive. I mean, I guess I asked the question, so I knew that it was something people worried about.

But I was really kind of asking, like, do you have money set aside for me? You know what I mean? And now? Do you have ideas how this is going to happen? When you look back to his answer? Now I see it as like lack of ambition. Really?

Like, I was younger then. It kind of felt like, oh, so you don't have any hope. beyond this. This is the life that you see for us. Got it. So you're saying, looking back now with your wisdom,

you see your dad's comment that the only way we're going to pay for your college is for us to stay poor as dad keeping himself small, limiting himself, playing small so that that was the only way

that you could afford to go to college. Is that how you see it? Yeah, that or he like, he didn't see anything better for himself either. I see. Did he go to college? No. Okay. And how about your mom? No. Are you the first to go to college? Yeah. Wow. Congratulations. Thank you. That's quite amazing. You went to college. You took care of your sister. You're an engineer. Have you celebrated this? when I started making you know, like good money. Yeah.

I made, I didn't know what I was doing. I had no idea what to do with that amount of money and I think because I handled it so poorly. Um, it, and I think that's what, you know,

that's where the frustration is between Kate and I is like, I would, I want to celebrate and feel like I worked really hard and, and, you know, buy whatever I want or whatever it is. But I know that those behaviors, uh,

sent us sound like a wrong path. So it's difficult. And so what would you say you do instead? Instead of celebrating? Yeah. Like in, I guess, the past year, it felt like, you know, we restricted ourselves. I mean, there was a lot going on with Kate networking and all that, but it, yeah, it feels like restriction. Kate, when you hear Christine share her story about how she grew up and any of that is surprised to you?

No. Okay. anything strike you as you hear that last part where I asked her if she has celebrated her accomplishments? Yeah, I don't think necessarily that we've celebrated explicitly, but I don't know. I'm inclined to feel like our whole life is kind of a celebration. Not. I know. It doesn't count.

It doesn't count. That's like telling your son when he turns five and, you know, he goes, hey, where's my birthday cake? And you go, every day's a celebration when you're breathing oxygen. Sounds like, I hate you. And gosh, from hearing what I'm hearing, Christine, honestly, the journey you've been on,

it's worthy of celebrating. You know what's funny? Professionally, I'm very happy and proud of my business and my coworkers and my Netflix show and this podcast. But I'm really proud of two things. First, my relationship with my wife because we love each other

and we spend a lot of time working on getting better together. Second, the fact that I got physically fit because I was a skinny Indian guy, and that's what I used to call myself. And it took a lot of work, not just physically, but mentally. And those things don't come naturally to me. On the fitness side, I should be wearing an extra large Cisco shirt and working in tech, but it took an immense amount of different decisions and embarrassments and humbling myself. to learn how to change my body.

The lesson here is about what you are proud of. If you're in a relationship, you cannot compliment someone too much. You cannot celebrate too much. How many couples have you heard on this podcast who've paid off $50,000 of debt, but they never even celebrated? This is such an easy win that I want all of you to go for it. Pick the areas of life that you are proud of and celebrate it. You will get a lot out of it.

It's interesting when you can afford to buy lots of different things what you actually choose to spend your money on. For example, I've tried these different shampoos. At a certain point, I was just like, most of these are all the same. I'm just getting the one from the drugstore. I was talking to a friend about what type of meat we buy. He was shocked that we didn't buy the most expensive meat. And I think the lesson that I have taken as I have made more money is just because it's

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I want her to feel trusted and loved, and supported. Good. And how do you want to show up when it comes to money? with peace. How are you showing up today? With anxiety. Scarcity?

Yeah. Yeah, I think so. I think so. Maybe a lack of self-trust. Self-trust, a lack of self-tok. Okay. All right, so now tell us and tell her what you want to show up with when it comes to money. I want to show up with a solid foundation.

that we can build on together. I want to show up with excitement and happiness. Abundance? Yeah. Possibility, maybe, instead of worry? Yeah. Fair enough. Do you want to go wild?

You want to spend all your money tomorrow and just go blow it in Vegas? No, definitely not. I don't think so. I don't think anybody wants to do that or expects to do that. I think you're going to be prudent. You want to go back into credit card debt? No. Okay, good. It's good to get that out there. So how can you show up with abundance and possibility, but also not go into credit card debt? Are those things reconcilable? I think that's what I'm not sure about. I'm still really transitioning out of like kind of an old frame of mind and trying to really let go of the past and live in the current circumstances. Okay. So take all the idealized things that we just discussed. For a moment, just give me two

minutes of your time now. What would it look like if you lived your life like that? What would be different about the way you talk to your wife? Here's a hint. Would you be doing that stream of consciousness thing? No. Hell no. Why? Because it's not fun for anybody.

Correct. What else? It's not productive. Yes. What else? And we deserve better, a better use of our time. Yeah.

It's not actually getting you where you want to go and it's costing you a lot. You see the costs of doing that, just that one little thing? Yeah. How are they? I mean, it snowballs into arguments sometimes or just general, more general stress than is even warranted. And by doing that, what would you be able to do instead? We could enjoy time together playing with our baby or watching a movie.

You guys ever laugh when you're doing the conscious spending plan and talking about money? Probably not. But it's fun, right? Like, I'm laughing right now, joking around with the two of you, you know, your car and all this. Money can be funny, don't you think? but what is it about when the two of you talk about money that it suddenly becomes so serious? What is that? I think we're trying to defend our own positions.

Yeah. We go into it defensively. Yeah, I'm trying to convince her that this is why we should do this or we shouldn't use the credit card for that. I agree. You can't be funny when you're making a court case. Okay. But yet, here we all, all three of us are and we're joking around and everybody's teasing each other. It's quite fun. I feel like we're all learning something. Is there a way that when you

talk about money, you could bring in some of that humor, some of that teasing, some of that love that you have in other parts of life into the money discussions? Christina, I'm seeing a smile on your face, so I want to start with you. Yeah, I think we could. I was feeling like she's going to hide money or hoard money for me because I believe the money was there. And she was feeling like I was about to put us back in credit card debt. Right. But we go into these conversations with these beliefs about each other. And they're kind of the worst beliefs, aren't they?

Yeah. Like she's hoarding. She's going to put us back into credit. I mean, that's serious stuff. Meanwhile, I talk to you, the two of you're laughing. You've paid off credit card debt. You've had a son. You've made career choices.

Like 98% of what we have talked about is positive. Do you realize that? Yeah. So why is it that in your conversations with each other on these money topics that seems like 98% of the time is super serious and potentially even negative? I think that's why we came to apply for the podcast. We're like, why everything's so good? Yeah. struggling to talk about it.

Yeah, we've been wondering that. Like, we have a good life. We have a great relationship. Yeah. And then all it takes is one conversation about a purchase or whatever. Right. So what do you say we take a look at some of the numbers? Because I'm really curious.

All right, let me pop this up. So your assets, let's go, Kate, can you read me off your assets here and give me the full numbers? $348,000. Okay, and what is that? That's mostly our house and our car. And then we included some of my instruments in it. Cool. All right.

Investments. What do you see? 109,202. Okay, great. Savings? 10,000. All right. And debt. 293,281. And what's that?

That's our mortgage and student loans. Okay, how much is student loans? Mine are about 34,000. I think Christine's are about 8,000. Is that right? Okay. Yeah. Okay, great. Total net worth?

173,921. Okay, how do you feel about that? Good. Cool. Christine, how do you feel about that? I don't know. I guess I'm neutral. That's it?

Is it good or bad? I think it's not bad. Okay. I don't think it's bad. You got a net worth in the six figures. Pretty good to me. Let's go, Christine, this time. Can you read me?

your gross monthly income for each of you? So I'm bringing in $8,408 a month, and Kate is bringing in $1,200 a month. So total you're making $115,000 a year gross. How do you feel about that? Good. I feel good about it. Great.

I feel good about that too. All right. So you're netting $7,000 a month. And your fixed cost, what's that big number right next to the fixed costs? 54%. Whoa. How do you feel about that number? Great.

Great. I feel great about it too. Right in the middle, 50 to 60%. I took a look at your housing. I added up these two numbers. You're at 27, 28%. Right on the money. You live in a, what's a general area you live in? We live in Detroit. Okay, got it. Yeah, I was going to say, it's hard these days to get on 28%. You know, we talk about 28%. It used to be possible. It's very difficult. especially for young people, and especially in high cost of living areas, you've done it.

That's great. Don't move. You got a good thing going with your housing. And this, by the way, is on, Kate, I understand that are you making like a part-time income right now? What do you think you might make ballpark if and when you go full-time? Probably like $40,000 to $50,000 a year. Whoa. Let me remind you that Kate and Christine are 28,000.

and 33. And most importantly, they recently had a baby boy and they have a loving dynamic. It's very obvious. A little bit about their numbers. Their net worth is about $350,000. They have just over $100,000 invested, $10,000 in their emergency fund, $93,000 in debt, which is a mostly paid off house and two relatively small student loan balances. Christine makes $8,400 a month as an engineer, a number that's likely to go up given her age. And Kate is making $1,200 a month as an event planner. She's also their son's primary caregiver right now. So if and when she switches back to full-time work, her income will go up.

Even their conscious spending plan metrics are very good. 54% fixed costs. 27% on housing. This is all great. So where's the celebration? Where's the pride? Okay, so far, in our discussion,

what has surprised you about what we've talked about? I think I've been surprised at how hard it is to think about celebrating. Yeah. I think we just, we don't prioritize the, just doing stuff,

the two of us or just as a family. Oh. And the vacation we just took was great. We went with friends and it was awesome. But yeah, I do wonder if we need to do more celebrating just for the two of us to celebrate kind of what we've accomplished. Yeah, I agree. And you have accomplished a lot individually and together. In some ways, I'm more proud of you than the two of you are of yourselves. It's unbelievable, really.

Like, it's, I'm sitting here like, oh my God, what you've accomplished, making decisions about leaving music or at least putting it to the side for your primary career. And of course, Christine, how you grew up and what you do now is incredible. So, yes, we are going to structurally change the way that you spend money on celebrating for the two of you. It's like a blank canvas. You two can choose what you want to do there. Yeah. I think I've been holding off on having this conversation with Christine.

She, you know, has accused me of saving too much. So all you needed to do to have this conversation was, Apply, get screen, fill out all kinds of releases, get selected out of thousands of applicants, and then schedule it to appear with me on this podcast. Well, here we are. Go ahead. Please have the conversation. I'm listening. We're all listening. Well, yeah, Christine, I think that we are unique and that we have a lot of large purchases that we have in our goals for the future. But I think that the only way we can make those happen is if we save a little more than the recommended percentage to get there and to really be able to achieve those goals.

Pause, pause. Can I, before we get Christine's reaction, hey, can I give you a slight reframe a little different way to say that in same content, just a little differently? Okay. Christine, I'm so proud of how far we've come. We've each paid off credit card debt. We've joined our finances. We've built a beautiful life.

We have our son. We have our dog. We have this house. I'm happy. And I'm excited to do this with you. So would it be okay if we talk about adding some savings, not just for the sake of saving, but so that we can start to extend. experience the next level of our rich life. The honeymoon, the instruments, the night out

with the four-course meal, that's what I want to do. That's the kind of life that I want to do with you. You sound a lot nicer and more positive about what we could be doing and the possibilities rather than why aren't we doing this. I agree. I agree. How did I start my whole thing? Do you remember what I said? Yeah, you talked about how proud you are of us and how great we're doing that we deserve better.

You can never say that enough. You'll notice there was one key difference. I mean, yes, I started with appreciation and yes, I explained the why. when you said but I went like this like I grimaced because you're equating like hey we're doing okay but I think we need to save more it almost reminds me of you know going back in time and your mom telling you all her worries and things be careful and I wondered if you could just reframe that to and we're doing good. great and I want us to do even greater together.

So that is what my impetus was. What do you think? Yeah, that sounds right. Okay. Now let's get Christine's take. What do you say? Well, I think one thing that I should remember is at the end of Kate's of Alice to me we got married, she promised that our life would never stop getting better.

That's exactly what she said. And I feel like I haven't heard that. since like and have it backed up with like actual action um so i'm really excited for it thank you for seeing where i'm coming from and for seeing that i'm not trying to hoard money or say and beg us i i just want us to live our best possible life the numbers come second the rich life comes first a very interesting conversation with kate and christine today i'd like to share their follow-ups that they sent me after we talked. What surprised us? We were most surprised to realize that we actually don't celebrate our wins. We often look at our life as one big,

ongoing series of rewards for our hard work, which is true, but we see now that that perspective doesn't give us the space to relish and celebrate what has already been accomplished. It seems like a subtle mindset shift, but it's actually important to distinguish between daily gratitude. and special celebrations of big moments. Number two, how we have been showing up about money versus how we would like to show up about money. Kate said, in the past, I've been showing up to our money conversations

with anxiety, defensiveness, and restriction. I would like to instead show up to our money conversations with openness, abundance, possibility, kindness, trust, and curiosity. In order to do this, I need to let go of the parts of my past that hold us back, such as my learned impulse to control and the guilt and shame I harbor about leaving music behind as a viable career path. I want to fully dive into this new chapter of our life and allow us to enjoy and celebrate our successes and to think bigger about the possibilities for our life because I know that Christine and I are so powerful and full of potential as a team.

Christine said, I feel like in our money conversations now, I'm being very defensive. I avoid dreaming about a richer life because I don't want to stress Kate out. In the future, I want to prioritize being open to having a richer life, and I want to be vulnerable enough to create that rich life with Kate by dreaming with abandon. They also said, we changed our CSP to factor in a new savings category, which we are calling New Zealand. After discussing it further, we decided that we want to save up for 10 years, then take our son with us on an amazing, super memorable international family trip.

10 years from now because we want their son to be old enough to fully remember the trip. As for our honeymoon, we decided we will take it within the next year or two. We will go somewhere cozy in the mountains where we can hike during the days and enjoy a private hot tub in the evenings. I want to thank Kate and Christine for coming on this show and sharing their story and their finances with all of us. Every time guests come on this show, it shows huge amounts of courage to open up their lives for all of us. us, so thank you very much. Thanks for listening to I Will Teach You to Be Rich. I'm Rameet Satey. 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.