Something You Should Know - How to Be Much More Interesting & A Fascinating Approach to Managing Your Money

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Starting point is 00:00:17 You can now make the first move or not. With opening moves, you simply choose a question to be automatically sent to your matches. Then sit back and let your matches start the chat. Download Bumble and try it for yourself. Today on Something You Should Know, how to protect your cell phone this summer from water and sand for less than 10 cents. Then, sound and solid money advice you haven't heard before, including paying off your mortgage fast.

Starting point is 00:00:47 And literally, I've just saved your listeners 25 years off their mortgage and tens of thousands of dollars in needless interest. This is something you'll never hear about from the banks, because they have no interest in telling you about that whatsoever. Then, ever notice that grocery stores only have windows in the front? I'll explain why. And we speak and listen to people all day long, and we could probably be better at it. Listening is not a capability. We treat it like that. We don't teach it in schools.

Starting point is 00:01:16 We expect kids just to pick up how to listen. It is a skill. And it's a skill which, when mastered, gives huge advantages in life. All this today on Something You Should Know. People who listen to Something You Should Know are curious about the world, looking to hear new ideas and perspectives. So I want to tell you about a podcast that is full of new ideas and perspectives, and one I've started listening to called Intelligence Squared. It's the podcast where great minds meet. Listen in for some great talks on

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Starting point is 00:02:34 Something you should know. Fascinating intel. The world's top experts. And practical advice you can use in your life. Today, Something You Should Know with Mike Carruthers. Hi, welcome to Something You Should Know. I know a lot of people, myself included, are looking forward to a summer of getting outside, going places, and doing things in a way that we really couldn't do last summer.

Starting point is 00:03:01 And with the warmer weather, that means trips to the beach or the pool or the lake. And one of the things you have to consider, of course, is how to keep your cell phone or tablet dry and sand free while you're at the beach or the lake or the pool. And there are special cases and bags you can buy at the store that will do a fine job of doing that. But a few years ago, Consumer Reports tested plain old baggy sandwich bags and snack bags to see how they performed in protecting cell phones and tablets. And what they found is they work really well, the zippered kind, if you zip them up correctly. They even dunked them in the water, and they kept the cell phones dry. Not only that, but you could still text, dial, and even talk through the plastic bag,

Starting point is 00:03:52 so you never really had to take it out. So the next time you're headed to the beach or the pool or the lake or wherever you're going, you may want to stop at that drawer in the kitchen and grab a plastic bag to put your phone or tablet in and prevent potential disaster. And that is something you should know. Over the years, I have interviewed a lot of financial experts. And one of my favorite people who discusses personal finance is Jordan Goodman. Jordan's a nationally recognized

Starting point is 00:04:26 expert on the subject of finance. He's appeared in the media for years. He was the Wall Street correspondent for Money Magazine, and he's authored several books on finance. His latest is called Master Your Debt. And I like Jordan because he doesn't always say the same things that all the other money people say. His advice is very sound, but it's often a bit different from what you've heard before. And I think you'll enjoy what he has to say. Hey, Jordan, welcome to Something You Should Know. Great to be with you, Mike. So let's start with debt, since that's the topic of your latest book. And also, I think, a topic on the top of a lot of people's minds. What's the topic of your latest book and also I think a topic on the top of a lot of people's minds. What's the lay of the land? Where are we with debt? Total amount of debt in the U.S.

Starting point is 00:05:11 is roughly $13 trillion, roughly $10 trillion in mortgage debt. Credit card debt is roughly a trillion. Student loan debt about $1.7 trillion. car debt about $800 billion, something like that. Some areas are getting better, some are getting worse. Credit cards are somewhat getting better. People are using money to pay down credit card debt. The one that's rising with the biggest burden by far is student loan debt, because people are really having a hard time paying that back. That's the biggest crisis right now out there. Generally, I mean, people, when they hear the word debt, there is kind of a negative connotation to it. But not all debt is bad. Yes? Correct. I mean, debt can be used to get things you couldn't get otherwise. You can't buy a house if you don't have cash for the house.

Starting point is 00:06:02 And yet you buy it over time and you pay it down and the mortgage interest is deductible and it's a way of you building equity. In theory, student debt should be a positive and if it's giving you the skills to get a career to pay it back and be productive in society. That's in many cases true but not always true because a lot of people don't really come out of school with skills that they can use and they've got the debt without the skills but in theory student-owned debt should be kind of a way of investing in yourself uh credit card debt in general is not a great thing it's very high interest rate um and it's typically for consumable kind of items

Starting point is 00:06:38 so people get into credit card debt because they don't have the money to make normal purchases car loan debt can be okay. A car is a depreciating asset. So I always like to say you want to borrow for something that's going to appreciate, not depreciate. But if you don't have the money for a car, then you've got to go into debt to buy the car. So debt is not necessarily a bad thing. You should be the master of your debt, not the victim of your debt. So what is the difference? How do you tell if you are master of your debt or victim of your debt? Well, you're a master of your debt if you use the debt to acquire skills or assets that

Starting point is 00:07:15 will appreciate value over time. You're a victim of your debt if you're paying on something that you really didn't get value for and it's digging yourself in deeper and deeper. A good example of a positive debt would you buy a house at a 3% mortgage rate, and you pay it off, and the house appreciates, and that was a very, very good use of debt. A bad use of debt would be getting into credit card debt, where you have 18, 19% interest rates piling up against you all the time, You're getting further and further behind. Do you think that people who are in over their head or get in over their head with credit card debt, for example, that they don't know there's a problem or they know there's a problem, but they just think, I'll deal with it later when I get rich?

Starting point is 00:08:02 Well, I think people who get into credit card debt know there's a problem. They just don't feel there's any solution to them. Their expenses are more than their income. And it may be fixed expenses where their income went down or their expenses went up, and they just feel the only way to survive is to float it with credit card debt. And that in itself is a very expensive way to deal with having more expenses than income. So the solution to that is to increase your income, reduce your expenses, and hopefully have positive cash flows instead of negative cash flow. We have about a trillion dollars worth of credit card debt out there and at very high interest rates. And the people got into that credit card debt in general did not want to get into the credit card debt, but they felt they had to, to kind of survive.

Starting point is 00:08:48 Is it just kind of a, well, I'll charge this because I don't have enough money this month, but I'll pay it back next month. But then next month comes and something else happens. Is that typically kind of how it, it's just kind of a slippery slope or what? Well, that's right. It is a slippery slope. And of course, the American

Starting point is 00:09:06 society makes it very easy to get into credit card debt. First of all, they make it quite available. You get mailings all the time offering you just sign this and you get free money. And it looks very, very easy. And of course, the whole society is based around merchandising and selling and buying things. They want to sell you. Whether you can afford it is not their problem. It's your problem to figure out whether you can actually buy things. So people go for what I would call eye candy, the latest iPhone or the latest new car or furniture or TVs, whatever it may be, whether they can afford it or not. There is a certain kind of delusion in that, oh, I'll figure it out later and later arrives and they don't have the money and they pay a lot of interest on it. It can cost you more in interest than the original thing cost.

Starting point is 00:09:51 That happened for houses. People end up over 30 years paying more in interest for the house than they actually paid for the house originally. But at least you're getting some deductions. You're building equity. If you're using credit card debt for normal everyday expenses or consumables or things that immediately go away like a vacation, there's no return on investment for that. And when you find yourself in trouble, what do you do? I mean, if in fact your income doesn't cover your expenses, well, your income doesn't cover your expenses. So that's correct. And so a lot of people get into debt. So there are various ways of dealing with that. As far as credit card debt, you can do non-profit credit counseling,

Starting point is 00:10:39 where they will consolidate your debt into one payment at a lower interest rate. There is debt settlement, where you settle the debt for pennies on the dollar. That really hurts your credit badly. You can do it, but there's a real penalty for doing something like that. And of course, the end of the line is bankruptcy. Bankruptcies are down recently. People are being more conservative with their debt. We had a big explosion in debt going into the crash in 2008.

Starting point is 00:11:04 Then the banks clamped down sharply and they'd been more cautious in opening things up over the last few years. So fewer people are in credit card debt problems than they were, say, in the mid 2000s. Well, one thing people have often done when they have high interest debt like credit card debt is to take a second mortgage out on the house so that they now pay it off at a lower interest. Is that a good idea? That is not a good idea, but you're right. People do that all the time. What you're doing is exchanging short-term debt for consumables for long-term debt based on an asset. And it sounds good, but I don't want to be paying off a meal that I ate a month ago over the next 30 years and pay interest on that meal that was long ago consumed. So I don't like taking short-term debt and paying it off with long-term debt, which is typically what a mortgage is going to be.

Starting point is 00:11:55 Now, if you do a home equity line, that's something that is more flexible and you can pay it back when you get income in. It's deductible to some extent. But I do not like paying off short-term debt with long-term debt and getting yourself into long-term trouble. Because typically what happens, Mike, is that then you pay off the credit cards and then you spend the credit cards right back up again. And now you've got the long-term debt and the short-term debt if the basic income and expenses ratio is out of whack. Yeah, well, I've seen that happen. I know people that that's exactly what happens is they do something like get a line of credit or take out a mortgage, get their balances on their credit cards down to zero. And then, of course, now they go, hey, look, hey, I don't have any credit card.

Starting point is 00:12:41 I'm going to run these babies right back up again. Exactly, which is what the credit card. I'm going to run these babies right back up again. Exactly, which is what the credit card companies love. That's why they keep extending credit to people, because they have incredibly good profit margins. Remember, the bank is paying you zero on your savings at the bank, and they're charging you 14, 18, 20% on your credit card. So it's incredibly profitable for them, and they can afford to take some losses on people who don't pay because most people do pay. So that's why they keep pushing credit cards all over the place. Not a good use of debt.

Starting point is 00:13:11 I must say a better use of debt is to use what's called the mortgage optimization strategy where you can pay your mortgage off much, much faster than most people ever thought possible, typically five to seven years. I think you've seen a copy of my book, Master Your Debt, and I've got a chapter on that called Mortgage-Free in Five to Seven Years. If you use your home equity line of credit as almost like a checking account, you can make dramatic progress on paying off your principal much, much faster than you ever thought possible. I could explain that more if that would be helpful, Mike. Please. So let me just do the traditional system, and I'm going to give you the alternative system.

Starting point is 00:13:48 The traditional system is you take out a 30-year mortgage, you make the same payment for 30 years. The first 10 to 15 years is pretty much all interest. You're making very, very little progress on the principal. And then in the latter years, you pay off the principal. Meanwhile, your money that you're earning is sitting in a checking account earning zero. This is the existing system that works very well for the banks. They pay you nothing for your money and you pay them interest for 30 years. And even better for the banks is when you refinance your mortgage, you start a new clock all over again and just pile on that much more interest. Okay. That's the traditional system that people think is working for them. It's actually working very, very well for the banks. The alternative system, which is called mortgage optimization,

Starting point is 00:14:29 is you use a home equity line of credit, or HELOC as it's called, which is a liquid line. You can put money in, you can take it out, you can write checks on it anytime you like, and you keep your income in the home equity line of credit. HELOCs are based on what's called average daily balance, how much do you owe today. So the money that's going in there is pushing your balance down, meaning you owe less interest. Then you pay your bills out of the HELOC, but every day you're making progress on your principal as opposed to a traditional system where your money's sitting in the checking account earning nothing and you make almost no progress for many, many years in the traditional mortgage system. The end result of this, depending on your cash flow, is you can pay off a 30-year mortgage

Starting point is 00:15:10 in about five, six, seven years on your existing level of income. There's a free website people can find out more about how this works, which is called truthinequity.com, and they model it for you and show you exactly how to do this. And literally, I have just saved your listeners 25 years off their mortgage and tens of thousands of dollars in needless interest. This is something you'll never hear about from the banks because they have no interest in telling you about that whatsoever. This almost seems too easy. Maybe we should go through a quick, real quick example. By the way, I'm speaking with Jordan Goodman and the name of his book is Master Your Debt. Hi, this is Rob Benedict.

Starting point is 00:15:52 And I am Richard Spate. We were both on a little show you might know called Supernatural. It had a pretty good run, 15 seasons, 327 episodes. And though we have seen, of course, every episode many times, we figured, hey, now that we're wrapped, let's watch it all again. And we can't do that alone. So we're inviting the cast and crew that made the show

Starting point is 00:16:13 along for the ride. We've got writers, producers, composers, directors, and we'll, of course, have some actors on as well, including some certain guys that played some certain pretty iconic brothers. It was kind of a little bit of a left field choice in the best way possible. The note from Kripke was, he's great, we love him, but we're looking for like a

Starting point is 00:16:34 really intelligent Duchovny type. With 15 seasons to explore, it's going to be the road trip of several lifetimes. So please join us and subscribe to Supernatural then and now. Every episode is a conversation with a fascinating guest. Of course, a lot of podcasts are conversations with guests, but Jordan does it better than most. Recently, he had a fascinating conversation with a British woman who was recruited and radicalized by ISIS and went to prison for three years. She now works to raise awareness on this issue. It's a great conversation. And he spoke with Dr. Sarah Hill about how taking birth control not only prevents pregnancy,

Starting point is 00:17:29 it can influence a woman's partner preferences, career choices, and overall behavior due to the hormonal changes it causes. Apple named The Jordan Harbinger Show one of the best podcasts a few years back, and in a nutshell, the show is aimed at making you a better, more informed, critical thinker. Check out The Jordan Harbinger Show.

Starting point is 00:17:50 There's so much for you in this podcast. The Jordan Harbinger Show on Apple Podcasts, Spotify, or wherever you get your podcasts. So take us through a quick example of how this method works of paying off your mortgage. I think that'll help. So let's have a house worth $300,000 and you get a first mortgage at $200,000, okay? And it's at a 3% interest rate, a good interest rate, okay? The traditional system, you pay the same thing and over 30 years you pay off that $200,000 in mortgage. So using the system, you would get a home equity line of credit for say say, $50,000.

Starting point is 00:18:26 You've got plenty of room there. You would then write a check on that home equity line of credit for $50,000 towards the first. So now you owe $150,000 on the first and $50,000 on the HELOC. You use this technique. You keep your income in the HELOC, and every day you're making progress. And after, whatever, say, nine months or a year, you pay that HELOC off $50,000 completely. Then you do it again. You write another $50,000 check towards the first. So now on the first, you went from $150,000 to $100,000.

Starting point is 00:18:54 You pay off the HELOC over the next year. Okay. And then you do it twice more. So after four years, your first is paid off. And the fifth year, you've paid off your HELOC. And you are now mortgage-free. That's an oversimplified example of how it works. But you see, every day you're making progress on the principal because the money that you're earning is going into pushing your principal down instead of the traditional system where it's sitting in the checking account

Starting point is 00:19:17 earning nothing for you while the bank is earning money off your money. Think of a couple that's 35, they just got their first home, and their mortgage is paid off by age 40 Think of a couple that's 35. They just got their first home and their mortgage is paid off by age 40 instead of 65. I think that would have a positive impact on their life. Conventional advice has been from many money people is to leave your mortgage alone, especially if you have a really low interest rate, because you'll do better in the stock market than paying off your mortgage. Well, that sounds good, but you're conflating two different things. There's one thing that's certain and one thing that's uncertain. What's certain is what your mortgage is and how many years it'll pay off. What's uncertain is your returns in the stock market. So yes, we've had

Starting point is 00:19:57 a bull market for quite a few years and let's hope it goes on forever, but the stock market can go down too. So you don't want to count on the stock market going up forever and getting positive returns. Whereas you know for sure using a strategy like this, you can pay your mortgage off in five or six years, and then you have all your cash flow that you could be investing in stocks. I'm not saying do one or the other, but if you use this technique and have most of your cash flow pushing your mortgage down, becoming mortgage-free is a great thing, just as being credit card-free and student loan-free. I'm big on getting out of debt as fast as possible, because it then frees you up. The rest of your cash flow can be invested for your future. One of the things that's always bothered me, and it doesn't take a rocket

Starting point is 00:20:39 scientist to figure out, that the banks charge an awful lot of money to borrow, like on credit cards and other kinds of loans, but they sure don't pay very much when you put your money in there to sit in a savings account. That's why banks make so much money. That's why the banks have all the big buildings in town, is they're charging interest on mortgages, on student loans, on car loans, on credit cards, and their cost of funds is pretty much zero, and they pay nothing on savings accounts. And then when interest rates go up, you've been noticing lately, interest rates have gone up. The long-term treasury, which a year ago was maybe 0.5, is now 1.5 or something like that. Well, when interest rates go up, they charge more,

Starting point is 00:21:23 but they don't pay more, right? Interest rates have gone up, but they're still not paying anything on savings accounts or money market funds or CDs, basically. Do you differentiate and have a preference between banks and credit unions? Yes. Credit unions, in many cases, they're non-profit. They tend to pay higher interest rates on savings, not that much higher, but at least somewhat higher. And they tend to charge lower interest rates on loans because they are owned by their members. They don't have the profit motive the way a shareholder-owned bank would. I actually have several resources in the resource section of moneyanswers.com that are credit

Starting point is 00:22:02 unions. There's one called Consumers Credit Union, which is currently paying about 4% on savings, for example. That's a lot more than you're going to get from any commercial bank in the country. 4%, that's pretty good. 4%, correct. And the other kind of bank you might want to take a look at are online banks that, again, do not have the expense of brick and mortar and so on, where because they don't have all that brick and mortar expense, they pass it on to you in the form of higher savings rates and lower loan rates. It does seem though that as much as there are strategies and tactics to do this, a lot of this is more fundamental in terms of the way people think about money, that, yeah, you can do these little

Starting point is 00:22:45 tricks, but if you don't really get a handle on the big picture, you're never going to get anywhere. Well, that's right, and people are not being trained. I mean, I'm very big on personal financial awareness and literacy. It's getting somewhat better. I think there are currently 17 states that require some kind of course in personal finance before you can graduate from high school, which is good. It could be better, but at least it's something. Colleges tend not to teach personal finance very much at all. I've always said a small amount of effort and knowledge about personal finance has a huge payoff. And what you want to do is create the right habits. Personal finance is not an incident. It's not a moment. It's not a

Starting point is 00:23:26 one-time thing. It's an ongoing learning process. And the more time you spend learning about these things and implementing strategies, the better you're going to be. So there's people doing really, really well in society today that have learned about these things. They've maximized their mortgages. They have investments working for them. They're doing great. And then there's lots of people that have not learned about these things. They're struggling with student loan debt. They can't get a down payment to buy a house. And in many cases, it's just knowledge that makes the difference between struggling and thriving. I've heard people say, it's interesting to me that, you know, when you're young, you say, well, you know, I got plenty of time to get this figured out right now. I want to enjoy my life and, and, you know, I'll make more money later

Starting point is 00:24:08 and straighten this all out. And then when, when it's later, people go, well, it's too late. You know, there's nothing I can do now. I don't, there's not enough time left to fix this. Well, you have to be where you are, where you are at that moment. When you're starting out a job, you have a fantastic advantage, which is time. I'd rather have more time than more money. Because if you start young, in your mid-20s, and you set up an automatic savings program, certainly a 401k at work, but also like an automatic savings program at a mutual fund or something like that, to have that compounding for many, many years, it is going to end up being a lot more than if you start later in your late 30s or 40s, even with more money and have less time for that money to compound. People often underestimate the value of time and compounding of money, which over a long period of time really, really does add up.

Starting point is 00:24:58 What else do you find that people just, you know, if they just knew this, it would help so much. Well, I think the power of compounding is certainly something a lot of people don't really appreciate. And having it be a habit, not an accident, as I put it. So set up automatic investment systems. We talked about an automatic system for paying your mortgage off faster. The more automated you can make these things, the more likely they are to happen. Otherwise, if you wait till the end of the month to do something, somehow you forget

Starting point is 00:25:29 and you enter the next month and it kind of never happens. So automate good habits as much as possible, both in saving, investing, paying down debt and investing in yourself, including learning. I mean, this is what I've done for many, many years. That's what my website's all about, moneyanswers.com, is helping people learn about all these things. I've got about 150 different resources in about 20 different categories to help people get out of debt, get better health insurance, save on travel, cars, investing, mortgages. I mean, these areas I've been dealing with for a long, long time. In every area, there's something you can do probably better than you're doing today.

Starting point is 00:26:08 Well, that automatic thing to me is like magic because it's amazing if you never see the money. If it goes somewhere else first, you don't miss it. But if you have it, it's very hard to take the time to say, okay, now I'm going to put this in a savings account or in somewhere else where I'm not going to touch it. If you never touch it, you don't miss it. This is why they say pay yourself first. This is what your grandmother would tell you, right? Pay yourself 10%, whatever it is, off the top. You'll never notice it. But set it up. I mean, you can set up like with a mutual fund, say an index mutual fund, where you put in $100 or $200 or whatever it may be automatically every month into a no-load fund with no commissions whatsoever, and it just keeps

Starting point is 00:26:54 compounding. Certainly, that's one of the advantages of a 401k or 403b at work is it comes out pre-tax. You don't ever even see it. It goes in there. You invest it. It's growing tax-deferred for many, many years. Probably the best thing out there of anything, Mike, is the Roth IRA. You can put it up to $7,000 into a Roth IRA where it grows tax-free. You're putting in after-tax dollars, but it grows tax-free forever. When you take it out, no matter how much it's grown, there are no taxes on it whatsoever. So that's something you should certainly maximize. You don't get a tax deduction up front, but I'd much rather have it grow tax-free than get a small tax deduction up front

Starting point is 00:27:34 for a deductible IRA. Well, this is great. I mean, I don't think there's anybody who hasn't had some bumps along the way on the financial road of life or wish that they had done something differently than they did with their money. And I think your advice is really helpful. Jordan Goodman has been my guest. He's a personal finance expert and the author of several books. His latest is called Master Your Debt. There's a link to his book at Amazon in the show notes.

Starting point is 00:28:01 And he mentioned a couple of websites, truthinequity.com and his website, moneyanswers.com. And I will put both of those websites in the show notes as well. Thanks, Jordan. All right. Thank Me, But Am I Wrong. Each week, we deliver four fun-filled shows. In Don't Blame Me, we tackle our listeners' dilemmas with hilariously honest advice. Then we have But Am I Wrong, which is for the listeners that didn't take our advice. Plus, we share our hot takes on current events. Then tune in to see you next Tuesday for our listener poll results from But Am I Wrong. And finally, wrap up your week with Fisting Friday,

Starting point is 00:28:44 where we catch up and talk all things pop culture. Listen to Don't Blame Me, But Am I Wrong on Apple Podcasts, Spotify, or wherever you get your podcasts. New episodes every Monday, Tuesday, Thursday, and Friday. Do you love Disney? Then you are going to love our hit podcast, Disney Countdown.

Starting point is 00:29:03 I'm Megan, the Magical Millennial. And I'm the Dapper Danielle. On every episode of our fun and family-friendly show, we count down our top 10 lists of all things Disney. There is nothing we don't cover. We are famous for rabbit holes, Disney themed games, and fun facts you didn't know you needed, but you definitely need in your life. So if you're looking for a healthy dose of Disney magic, check out Disney Countdown, wherever you get your podcasts. speaking and listening. Sound. And since you do it all the time, this speaking and listening, you probably don't think a lot about how you do it. And since you've been doing it all your life,

Starting point is 00:29:51 you probably figure you're pretty good at it. And maybe you are. And maybe you could be better. One of the world's leading experts on communication and sound is Julian Treasure. He has some great TED Talks available if you want to see them, and he also gives workshops on the subject. He's author of a book called How to Be Heard, Secrets for Powerful Speaking and Learning. And after you hear what he has to say, I'm pretty sure you will be a better speaker and a better listener. Hi,, welcome. Well thank you Mike, it's a pleasure to be here. This as you might imagine is a topic of interest to me because I make my living talking and listening, it's what I do on this podcast.

Starting point is 00:30:35 But why are you so interested in it? Well it came about from being interested in sound originally. I got to do a TED talk in, I think it was 2009, about the effects of sound, which is what, you know, I do kind of for a living, which is audio branding for companies. But then I got very fascinated by the fact that, you know, companies make a lot of noise, a lot of sound, largely unconsciously, but of course companies are just groups of people. And it all comes about fundamentally because most people aren't very good at listening. That's what I realized. We teach reading and writing in schools. We do not teach speaking much at all and listening hardly ever. It's a silent skill. Most people confuse it with hearing and they're very different things. So that was

Starting point is 00:31:26 really the realization. That's what got me on the track. And then I did some more TED Talks about speaking and listening and they became very popular. And I wrote a book and that's really how the focus came about. When you look at people who speak well and people who don't speak well. What's the difference? What is it that people who speak well do that people who don't speak well don't do? I think a lot of people who speak well understand a couple of things. Firstly, that speaking and listening are intimately related. It's not a straight line. It's not simple.

Starting point is 00:32:02 It's not just I speak, you listen. Because the way you listen affects the way I speak, and I speak you listen because the way you listen affects the way I speak and the way I speak affects the way you listen so there's a kind of dynamic circular relationship going on there so we need to be thinking about listening when we're speaking the best speakers are also good listeners I think and they're very conscious also that they're always speaking into a listening now that's something that most people don't think about everybody listens in a different way every human being

Starting point is 00:32:32 has a unique way of listening and it changes over time i mean you've probably spoken on stages where you get the graveyard slot just after lunch well it's a very different listening that you're speaking into when people are a bit slow and all the blood's at their gut than first thing in the morning or last thing in the evening. You have to ask the question, what's the listening I'm speaking into? So I think that is probably the biggest single differentiator. It's people who are great at speaking understand that listening, being conscious of listening, is really important.

Starting point is 00:33:09 You talk about in your TED Talk some of the things that people do when they speak that really hurt their message. You even mention your mother. But there are a lot of things, and I hear them because I talk to people and I notice how people speak, things that dilute their message, make them sound like they don't really know what they gossip, condemnation, negativity, complaining, excuses, exaggeration, and dogmatism. We see an awful lot of these things around us in the last years of her life she did become very negative and my goodness it's so wearing isn't it to be around somebody who's entirely negative where you say look the sun's out oh it'll be raining later you know the story i told absolutely true story is i took a paper into her she was in the hospital she'd hurt her arm

Starting point is 00:34:21 and i said oh look it's october the first today and she said i know isn't it dreadful well it's dreadful what what hope is there really unfortunately you know that was the filter she saw the whole world through everything was dreadful and you know when you're around somebody for whom everything is dreadful it's very very difficult so you know these these are things which we can monitor a little bit. And, you know, my whole message really is to become conscious, conscious of what we're doing, conscious of these little habits, which if they get out of control, I mean, they're not bad and wrong. It's not never do them. But if they get excessive, they do make us very hard to listen to. It's like being around somebody who's entirely dogmatic you know people confuse opinions with facts

Starting point is 00:35:10 and that's unfortunately becoming more and more true so we have this table thumping this dogmatism this making other people wrong all the time and it's deeply concerning to me that you know that's a loss of listening, which is really hurting the world. And it's making the world a more dangerous place, I'm afraid. Let's talk about listening, because I think people think they listen because they hear. So if I hear you, I must be listening. But really listening, listening is different than hearing. So talk about what real good listening is is different than hearing so so talk about what real good

Starting point is 00:35:47 listening is well i define listening as making meaning from sound so you hear everything but when you listen you do two things first of all you select certain things to pay attention to not or not everything you hear just some things and then the second thing you do is ascribe meaning to them. Listening is not a capability. We treat it like that. You know, we don't teach it in schools. We expect kids just to pick up how to listen. It is a skill. It's a skill you can practice. It's a skill you can master. And it's a skill which, when mastered, gives huge advantages in life. And that, Mike, I think is the biggest realization that, I mean, hopefully people listening to this might take away. And you practice that skill by doing what?

Starting point is 00:36:37 Well, there are lots of exercises that, you know, some of them I've put into my third TED Talk. Incidentally, people value speaking much more highly than listening and it's interesting the TED talk I gave on listening has got around one fifth as many views as the TED talk I gave on speaking so we're into sending much more than we are into receiving and we need to pay much more attention to listening so there are exercises I mean I can recommend a couple right now. Reacquainting yourself with silence is a very, very good idea. Silence is something which we don't encounter that often.

Starting point is 00:37:14 And if you can't get silence, which often is the case in a city, you could try simply peace and quiet, you know, relatively quiet places. Nature is very lovely to have around you if you can't get absolute silence but silence resets your ears it recalibrates it's the baseline for all sound and we don't get enough of it in our lives so that's one way of practicing and a great thing to do if you're in any kind of built environment at home, in the office, even in the car, I guess, is savoring sound. That is like you would food. You're very conscious if you put something bad in your mouth, you'll spit it out. But with our ears, we ignore sound so much, we kind of become numbed out because there's so much noise around most of the time and it's really important to become sensitive to that again so you can do that by closing your

Starting point is 00:38:09 eyes and having somebody walk you around your house or your office and just listen and go wow I never noticed that buzz or knocking sound before it's really probably been irritating me for years. And asking the question, is this the most productive and lovely sound I could have in this room for what I want to do there? So then it's into designing rooms and spaces with your ears as well as with your eyes. I find that I'm more sensitive to sound than I used to be. And I guess what I mean by that is that irritating sounds irritate me more. And, you know, I've noticed that I probably don't hear as well as I once used to. Well, you and everybody else, me included, it's called the cocktail effect

Starting point is 00:38:59 because our hearing does degrade as we get older. It falls off. We lose the high end quite a lot. You know, sadly, the biggest threat to hearing in the modern world is headphones. There are many, many kids, unfortunately, ramming, you know, 100 decibels of music into their ears for hours. And what they don't know is they're flattening those tiny little cells, those hair cells in your ears, which allow you to perceive sound.

Starting point is 00:39:27 And once they've been damaged enough times, they give up the ghost and you become deaf. It's a huge problem in the United States, deafness, and it's going to get a lot worse, sadly, because of headphones. So you mentioned that a good way to practice listening is to incorporate some silence into your life and all that. But when you are actually listening to someone, if someone is speaking to you, what is it you're supposed to be doing that makes you a good listener when you hear the words coming at you? It's about intention, really. So the most important thing in terms of listening to somebody is to give them your full attention. Scott Peck said you cannot truly listen to another human being and do anything else at the same time. And I agree with him completely.

Starting point is 00:40:16 We're so used to partial listening, faux listening, doing something else, tapping away on a keyboard or a device and go, yeah, no, I am listening to you. No, you're sending a text. That's different. So it is attention, first of all. And being conscious that you're doing something is the first part of that battle. Really, I talk about four C's of effective listening and consciousness is the first of those. I'm doing something here. I'm not simply, you know, it's not a background activity. The second one is compassion. Compassion is very important when you're listening. Attempting to understand the other person is such a wonderful thing. You know, seeing the people you meet as opportunities to learn something. That is such a transformative way to see people

Starting point is 00:41:04 rather than being dismissive and judging the book by the cover and thinking you know what they're going to say and all that kind of stuff. The third C is commitment, which is really necessary. And that's the Scott Peck thing of putting everything down. You know, listeners to this, I wonder when the last time is that you absolutely stopped doing everything and gave somebody the incredible gift of your full attention. In the modern world, we're into multitasking with time poor. There's always things going on. You know, there are huge corporations spending billions to get your attention away from the person you're with. So why not try that after you listen to this podcast?

Starting point is 00:41:50 You know, sit, look at somebody, listen to them. Don't be preparing what you're going to say next. That's speech writing. That's not listening. Actually give them full attention and you'll probably get the reaction. What are you doing? Because they're so unused to that way of communicating. And then the fourth C is curiosity, real ferocious curiosity about what they're going to say and what I might learn and where it could lead. Those are really good

Starting point is 00:42:20 places to listen from and commitment is absolutely critical. Something interesting I've noticed is that when people speak, sometimes they just speak without putting a lot of thought into what they're going to say. I see this in podcasting a lot. I've asked podcasters, you know, why are you doing a podcast? And sometimes it comes down to, well, it's easier to talk than it would be to say, do a blog and to write everything out and edit it as if talking doesn't require the preparation and the intention of making it interesting. So people will like what they hear and find it interesting and engaging. Oh, definitely. And we're back again, I think, there to the intention and to what's the listening I'm speaking into. I will say, you know, I train people on public speaking from time to time. And I say, look, the important thing is it's not about you. And I'm sure that's what you feel when you're doing this very successful

Starting point is 00:43:22 podcast, Mike. It's not about Mike. It's about what can you give. So the very title of your podcast, Something You Should Know, is about the audience. And if the focus is on them and the gift you're giving to them, then you're in the right place to start with, really, aren't you? It also seems, though, that, and I know a lot of people, I'm sure you talk to people who don't really give a thought to making it interesting, that you can tell me things in a really boring way, or you could tell me things in a really interesting way. And listening to you, for example, I mean, you don't um and ah, I don't think I've heard you um or ah since we've been talking. That's not true for most people. It's infectious.

Starting point is 00:44:14 I just said um. There are people who don't think about what they're going to say until they say it. It tends not to be very interesting interesting and people are bored by it. And yet it doesn't take a lot of thought to put something together in your head that is interesting or more interesting because you've edited things out or you've focused it to the person you're actually talking to. Definitely. I mean, a lot of it's about fear. It's filling space. And one of the reasons that I recommend reacquainting with silence is because that's a great thing to do if slow down, to gather your thoughts. You don't have to fill it. The biggest sin that I see people, particularly people who get nervous, committing on stage is gabbling, is thinking they've got to fill every second with lots and lots of words.

Starting point is 00:45:20 It's not necessary so i wouldn't do it here on a kind of radio style program a podcast because if you stop for 20 or 30 seconds that's dead air and people think they've lost the program and they go and do something else but if you're standing on a stage i mean i do this i used to do this quite often when we used to stand on stages I could stop for 20 or 30 seconds quite happily and just stand there. And nothing's happening. And the audience are probably thinking, I wonder what I might have for lunch. And they feel quite comfortable because I am obviously not looking uncomfortable. You know, I'm not sweating and shaking and obviously lost my way.

Starting point is 00:46:02 And we have a moment. And when you get comfortable with silence like that, you can slow down, you can enjoy the pauses, and you do not have to fill them up with filler words. So I think that's really where that's come from over the years. I've become more and more comfortable with speaking at my own pace without having to gabble and fill every bit of the time with words. Which makes it more interesting because it has peaks and valleys and pauses. And it's the way it draws people in when you talk that way as opposed to... And this is another thing I find that I'll talk to people before I interview them on this podcast, and they speak in a very normal way.

Starting point is 00:46:50 And then as soon as we start, they get very, what's the word, hesitant. Like they're afraid, maybe they're being fact-checked by somebody. They parse out every word, and there's a lot of ums and ahs that weren't there beforehand there i guess it's just self-consciousness that now that we're actually doing this uh now i have to be really careful what i say and it screws it up breathing is a really good way to counteract that for anybody who has these things happen and isn't used to the situation. They're put in a big, deep breath. You know, if your voice goes a little bit like this

Starting point is 00:47:33 when you go on stage, nice, big, deep breath. Because your voice is only breath, it's the fuel for your voice. It's all it requires, really. And then practice helps. You wouldn't go on stage at Carnegie Hall to play a piece if you've never played the piano before. But it's amazing to me how many people will stand up on a stage in front of people or give a webinar in front of people these days,

Starting point is 00:47:59 it's more likely, without having practiced using the tools and without having practiced delivering the thing really well you owe it to yourself surely and i think what you just said mike was absolutely on the money about variation whether it's prosody you know the sing song of speech pace volume or volume you know you to vary things is what creates the interest otherwise it's like a billiard ball it's a featureless thing and people get into repetitive cadences don't they you often hear that in people who are not very good at public speaking where everything goes like this and if everything i said went like this every single sentence was you know eventually i would hypnotize you and

Starting point is 00:48:45 you'd be in some sort of comatose condition and go to sleep. So variation is the heart of engaging people's attention. I think you're absolutely right. Well, as I said, this is a topic that's particularly interesting to me, but I think it's interesting to everybody because how we speak and how we listen, our communication skills, it's part of how we navigate through the world. And I think your advice is really helpful. Julian Treasure has been my guest. He's got some great TED Talks I think you'll enjoy, and I'll put links to them in the show notes. And he is author of the book, How to Be Heard, Secrets for Powerful Speaking and Listening. And there's a link to

Starting point is 00:49:25 his book at Amazon in the show notes. Thanks, Julian. Well, thank you, Mike. It's been an absolute pleasure talking to you. The next time you go to your grocery store, you'll notice that there aren't any windows in there except the ones in the front. Why? Well, it's a component of retail shopping psychology. Retailers try to create an environment where people feel comfortable spending time and money. In the case of windows, well, having no windows creates this sense of suspended time where shoppers won't notice inclement weather or that it's getting dark outside so they stay longer and the longer they shop the more they spend there are some practical considerations to large windows letting in sunlight can

Starting point is 00:50:15 cause fading on packages which make them seem old and worn to consumers also swapping out valuable wall space for windows would reduce the number of displays and products available to shoppers. And that's why there are no windows. And that is something you should know. We are getting close to 5,000 ratings and reviews on Apple Podcasts.

Starting point is 00:50:40 I'd really like to hit that number, and you can help. Go to Apple Podcasts and leave us a rating and review. And a five-star one is preferable. I'm Mike Kerr Brothers. Thanks for listening today to Something You Should Know. Welcome to the small town of Chinook, where faith runs deep and secrets run deeper. In this new thriller, religion and crime collide when a gruesome murder rocks the isolated Montana community. Everyone is quick to point their fingers at a drug-addicted teenager, but local deputy

Starting point is 00:51:10 Ruth Vogel isn't convinced. She suspects connections to a powerful religious group. Enter federal agent V.B. Loro, who has been investigating a local church for possible criminal activity. The pair form an unlikely partnership to catch the killer, unearthing secrets that leave Ruth torn between her duty to the law, her religious convictions, and her very own family. But something more sinister than murder is afoot,

Starting point is 00:51:35 and someone is watching Ruth. Chinook. Starring Kelly Marie Tran and Sanaa Lathan. Listen to Chinook wherever you get your podcasts. Contained herein are the heresies of Rudolf Buntwine, erstwhile monk turned traveling medical investigator. Join me as I study the secrets of the divine plagues and uncover the blasphemous truth that ours is not a loving God

Starting point is 00:52:07 and we are not its favored children. The Heresies of Rudolf Bantwine, wherever podcasts are available.

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