194. “$0 savings, $0 investments. Is it too late for us?” (Part 2)

Summary

Podcast Summary: Money For Couples with Ramit Sethi
Episode 194: “$0 Savings, $0 Investments. Is it Too Late for Us?” (Part 2)
Release Date: February 4, 2025

In Episode 194 of "Money For Couples," Ramit Sethi continues his in-depth financial coaching session with Lakeisha (38) and James (45), a couple grappling with significant debt and zero savings or investments. This episode delves into their financial struggles, the psychological barriers affecting their money management, and the actionable steps they are taking to transform their financial future.

Introduction: Revisiting Lakeisha and James’s Financial Situation

Ramit Sethi begins the episode by reintroducing Lakeisha and James, highlighting their precarious financial state:

Ramit [01:58]: "They have no savings, no investments, and they both struggle with the money messages they received growing up."

This sets the stage for a comprehensive examination of their financial behaviors and the psychological factors at play.

Analyzing the Conscious Spending Plan (CSP)

The conversation picks up with Ramit encouraging Lakeisha and James to reassess their Conscious Spending Plan (CSP). He challenges their initial perceptions of their spending habits:

James [02:14]: "The numbers are shocking. We have to do something."

Ramit scrutinizes their budget, revealing discrepancies and urging them to adopt a more disciplined approach:

Ramit [05:00]: "James, did you know that you make $60,732 per year?"

James [05:11]: "That's horrible."

This interaction underscores the importance of transparency and awareness in managing finances effectively.

Identifying and Rectifying Financial Missteps

Ramit guides the couple through a detailed breakdown of their expenditures, emphasizing areas where they can cut costs. He identifies their excessive spending on eating out and discretionary purchases:

Ramit [12:25]: "Do you track your guilt free spending carefully?"

Lakeisha [12:26]: "No."

Through targeted questioning, Ramit helps them recognize the unsustainable nature of their current spending habits, pushing them to make necessary adjustments.

Redefining Fixed Costs and Allocating Budget Proportionally

A significant portion of the episode focuses on restructuring their fixed costs. Ramit introduces the concept of proportional budgeting based on their incomes:

Lakeisha [22:16]: "Stuff. That's the best word I can think of to describe what I spend my money on."

By reallocating their expenses proportionally—where James contributes 40% and Lakeisha 60% based on their incomes—Ramit helps them create a more balanced and fair financial arrangement:

Ramit [29:14]: "Yeah, I feel great about that."

This shift marks a pivotal moment in their financial planning, laying the foundation for more sustainable money management.

Creating a Family Culture and Implementing Meaningful Changes

Ramit emphasizes the importance of establishing a positive family culture around money. He encourages Lakeisha and James to set meaningful financial goals that foster accountability and shared vision:

Lakeisha [32:24]: "In our family, we have one evening that we are all together, and we share a meal and a dessert and conversation."

By planning their eating out to once a month and increasing their grocery budget, they align their spending with their true values and long-term aspirations.

Building Savings and Investment Strategies

Acknowledging their lack of savings, Ramit guides the couple to prioritize building an emergency fund and investing for the future. He introduces the power of compound interest to illustrate the potential growth of their investments:

Ramit [48:44]: "So what does 1.3 million mean to you?"

James [48:50]: "I won't be broke when I retire. And not only won't be broke, I just will be able to enjoy retiring."

These discussions highlight the critical need for proactive financial planning to ensure security and prosperity in their later years.

Addressing Psychological Barriers and Financial Behaviors

Ramit delves into the psychological aspects influencing Lakeisha and James’s financial decisions. He identifies their tendency to avoid conflict and make indecisive choices, which have hindered their financial progress:

Lakeisha [60:51]: "I avoid conflict."

Ramit [66:01]: "You avoid being decisive with your money. Instead, you try to get buy in from everybody and ask people who should have no business telling you what to do with your money."

By confronting these barriers, Lakeisha and James begin to adopt healthier financial behaviors, such as returning unnecessary purchases and being more intentional with their spending.

Concluding Insights and Future Commitments

As the episode concludes, Lakeisha and James reflect on their progress and the lessons they've learned. They express a renewed commitment to facing financial challenges head-on and supporting each other in their journey toward a "Rich Life":

James [75:08]: "I'm working on that. It's definitely a challenge. Not only a challenge, but it's also a work in progress."

Lakeisha [76:11]: "We’ve already planned the one eating out meal and when that's going to be and looking forward to spending that time with family."

Ramit reinforces their commitment, emphasizing the importance of individual financial skills as a foundation for a strong, united financial partnership:

Ramit [58:32]: "Before we get married, I want each of us to have x thousand dollars in our savings account."

Key Takeaways

1. Transparency and Awareness: Understanding and accurately tracking income and expenditures are crucial for effective financial management.

2. Proportional Budgeting: Allocating expenses based on each partner’s income ensures fairness and sustainability.

3. Family Culture: Establishing meaningful financial goals and practices fosters accountability and aligns spending with values.

4. Building Savings and Investments: Prioritizing an emergency fund and investing for the future is essential for long-term financial security.

5. Overcoming Psychological Barriers: Addressing behaviors like conflict avoidance and indecisiveness can significantly improve financial health.

6. Commitment to Change: Continuous effort and mutual support are vital for achieving and maintaining financial goals.

Notable Quotes with Timestamps

• James [01:44]: "I had a repossessed car, credit cards and some loans."

• Lakeisha [01:48]: "I have not considered my future self at all. In fact, I've pretty much set that person up for failure in a lot of ways."

• Ramit [36:34]: "Let's do this."

• Lakeisha [54:37]: "It's almost like an allowance."

• James [73:32]: "I need to do better with my money."

Conclusion

Episode 194 of "Money For Couples" offers a compelling narrative of Lakeisha and James’s financial turnaround under Ramit Sethi’s guidance. By addressing both the practical and psychological aspects of money management, the episode provides listeners with valuable insights and actionable strategies to overcome their own financial challenges within a relationship. Ramit’s empathetic yet firm coaching style underscores the importance of honest communication, disciplined budgeting, and mutual support in achieving financial well-being and a fulfilling "Rich Life."

Transcript

[Ramit Sethi]

I want to give a huge thank you for reading my material, for listening, for watching, because I have some big news. My new book, Money for Couples, is officially a New York Times bestseller. I want to give a special thanks to my team who helps take the material that we create and shares it with the world, and to you who ordered the book, who came to my live tour, who tell your friends how important it is to live a rich life. That means a ton to me and it also helps get this book in front of more and more people. So thank you for your support. If there is someone in your life who can benefit from Money for Couples, please send them the link iwt.com money for couples so that they can get themselves a copy. Thank you again. If you and your partner want my help with your finances, please listen up. I'm especially looking for couples who have been affected by identity theft or they have been a victim of a scam. And if that has affected your finances, your money psychology, your relationship, I want to help. If this is you, Please [e-mail] apply if I think I can help. My team will reach out for an interview with you and your partner and if it's a good fit, I'll invite you to join me on the podcast. I'm only looking for couples who are serious and ready to do the work. So if that's you and you've been affected by identity theft or some kind of scam, Please [e-mail] apply on last week's episode we met 38 year old Lakeisha and 45 year old James.

[Lakeisha]

We've talked about money, but it's come more from a lack of right. I want to get on the other side of that.

[Ramit Sethi]

The couple recently moved in together and they're trying to get on the same page about their finances. But it's a challenge.

[James]

I had a repossessed car, credit cards and some loans.

[Lakeisha]

I have not considered considered my future self at all. In fact, I've pretty much set that person up for failure in a lot of ways.

[Ramit Sethi]

They have no savings, no investments, and they both struggle with the money messages they received growing up.

[James]

I'm scared to do things, so I guess that's why I didn't accumulate a lot.

[Ramit Sethi]

Today we're digging back into their conscious spending plan or csp.

[James]

The numbers are shocking. We have to do something.

[Lakeisha]

Okay, Guilt free spending.

[James]

I always got guilt about that.

[Ramit Sethi]

Are Lakisha and James willing to change the way that they mindlessly spend money and get focused on their rich life?

[James]

We want to be Better for each other so we can have a better future.

[Ramit Sethi]

Now let's get back to our conversation with lakeisha and james. When we left lakisha and james last week, we had just learned they have zero savings, zero investments, and $190,000 of debt between the two of them. Let's dig back into the numbers and we'll see if they're ready to make a change.

[Lakeisha]

If something were to happen, we have nothing. Like we would have to borrow money in order to mitigate whatever that something is.

[Ramit Sethi]

And have you ever gotten in that situation, lakeisha, like zero savings? Maybe you had. You got sick or you lost your job or anything like that?

[Lakeisha]

Fortunately, no, I have not.

[Ramit Sethi]

You're basically driving without a seatbelt. You know, most of the time you're going to be fine. The one time you're not and it's over.

[James]

Yeah.

[Ramit Sethi]

And nobody can tell you, no, I'm not a parent here to nag you. Put your seatbelt on. Build a savings account. I can't do it. Only you can. But when I see this, I feel extreme fear. I'm not afraid of a lot. I'm afraid of teenage girls because they're mean. And I'm afraid of big old insects, you know, that fly, maybe roller coasters. But I'm afraid of this because I know what can happen. I know that you're skating really close to the edge. And if something bad happens, especially with kids, you're in a loop and it is really hard to get out of it. So that's how I feel. Let's talk about the debt for you, Lakisha. You have $165,000 of debt. What is that?

[Lakeisha]

Student loans.

[Ramit Sethi]

Couldn't discharge those in bankruptcy. Okay, we know that. Thanks, republicans. Anyway, how much is your interest rate on 165k?

[Lakeisha]

I'm going to be honest, I have no idea. I haven't even bothered to look. I'm in one of those income based repayment plans. After seven more years, it'll all go away anyway, so.

[Ramit Sethi]

Oh, all right. That's actually really helpful to know. And that explains why you're paying almost nothing towards it. Yes, thank God, because I was looking at these numbers like, what the hell is happening here? Yeah, okay, good to know. Shall we continue moving along?

[Lakeisha]

Yes.

[Ramit Sethi]

Yes. Income. James, break it down for me. Let's get the combined monthly income.

[James]

Gross monthly income combined is 12, 4, 5, 3.

[Ramit Sethi]

James, did you know that you make $60,732 per year?

[James]

That's horrible.

[Ramit Sethi]

Yes, that's an interesting response. We can work on that. And then, Lakisha, did you know you make $88,704 a year?

[Lakeisha]

Yes.

[Ramit Sethi]

Okay. Both of you knew your income. Great. Combined, you make $150,000. That's kind of a lot, right?

[Lakeisha]

Yeah, I think it's good.

[Ramit Sethi]

Let's keep going. It doesn't look like either of you are doing too much pre tax, like, 401 investments. Is that correct?

[Lakeisha]

That is correct. The place that I work for, they were just recently integrated. So it's going to be a new company where I have benefits. So now starting 2025, we'll have 401k, have the option of getting the HSA. And so I wanted to max it out from the beginning. I told him as I was doing open enrollment, it was going to be like, with insurance, taxes, everything. It was going to be like, $900 out of my check. And he was. He was like, what? No, like. And so I still open the account, but I. I put it as zero because I was told from the person that I could change that amount later. Can I just say I want to? And I had a conversation with James about that recently, and he was like, let's wait.

[Ramit Sethi]

Let's wait till what? James, why did you react the way you did?

[James]

Well, first of all, it was the amount that she was trying to put away, and I would just. I would just wait till later until we get out of this hole that we're in. It was basically the message I was trying to convey to her.

[Ramit Sethi]

Wait till What? James, you're 45 years old, and you have zero savings and zero investments. How long do you want to wait?

[James]

I wasn't saying, like, don't ever do it or let's wait forever. It was just a large chunk, but we. At that point, we were not living together yet as well. You want to be.

[Ramit Sethi]

Wasn't it her money?

[James]

It was.

[Ramit Sethi]

So what does your opinion really matter about her money anyway?

[James]

The show. Don't. You're right.

[Ramit Sethi]

That's. That's correct. But do you. Do you all understand the dynamic that's at play right here?

[Lakeisha]

I asked him, first of all, I even brought it to him and asked him what he thought about it instead.

[Ramit Sethi]

Of just doing it correct like a child. Yep. And then James thrust into this role, which he shouldn't be in. James has $26,000 of debt and zero savings, too. What's he talking about? And then he naturally just assumes the role. Oh, I think you should wait. What do you have to do with this decision? It's your money. Lakeisha, you don't even live together at that point. But both of you are playing this dynamic. Parent child makes no sense. It's keeping you in a poor financial situation. Do you understand this?

[James]

Yes.

[Lakeisha]

Yes.

[Ramit Sethi]

Let me break down why the parent child money dynamic is absolutely toxic to relationships. First, your partner's not a child and you're not going to get them to act like an adult by treating them like a child. Number two, this dynamic is sexual kryptonite. Often the parent figure feels repulsed as a result of taking on the authority role and this is not good for any relationship. The good news is there's a way to change the dynamic. When you treat an adult like an adult, you tell them what you expect and you set clear boundaries. You may be surprised how often they rise to the expectation. More on this in my new book, Money for Couples. We'll be right back after a short break hosting this podcast and hosting a Netflix show. I have noticed a lot of patterns with couples and money. 50% of couples don't know their income, 90% of couples do not know how much debt they actually have, and most couples are not aware of how much they spend every month on subscriptions. Subscription creep is real, and if you are not monitoring your spending, it's really easy to pay for things you don't even use. If you're spending money on subscriptions that you don't even remember signing up for, you can take that money and redirect it to parts you really care about. Which is why I've partnered with this episode sponsor, Rocket Money to help. Rocket Money is a personal finance app that helps find and cancel your unwanted subscriptions, monitors your spending, and helps lower your bills so you can grow your savings. Rocket Money allows you to see all of your subscriptions in one place so you know exactly where your money is going. And Rocket Money has over 5 million users and has saved a total of $500 million in canceled subscriptions, saving members up to $740 a year when using all of the app's premium features. Cancel your unwanted subscriptions and reach your financial goals faster with Rocket Money. Go to RocketMoney.comit today. That's RocketMoney.com RocketMoney.com Ramit in my company we have a saying when we are trying to dream bigger about designing a new program and we say, if we could wave a magic wand, what would we want to see? And the magic wand is a tool to help you think about the best case scenario, like helping you hit your goals faster, more clearly, feeling good about it. So if you're a business owner, you might want the magic wand to get better insights into the future of your company. And if that is you, you should check out our sponsor. Netsuite by Oracle. Over 38,000 businesses have future proof their businesses with NetSuite by Oracle. The number one Cloud ERP. Bringing accounting, financial management, inventory, HR into one fluid platform. With one unified business management suite. There's one source of truth giving you the visibility and control you need to make actionable, quick decisions. And with real time insights and forecasting, you can actually see the future of your business. When you are closing your books in days, not weeks, you're spending less time looking backward and more time thinking about what's next. Whether your company is earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and take those opportunities that you now see. Speaking of opportunity, download the CFO's Guide to AI and Machine Learning at netsuite.com Ramit this guide is free to you at netsuite.com RamIT netsuite.com Ramit welcome back. Let's keep going with their CSP. Let's continue moving along here. Let's look at your fixed costs. So what number do I typically recommend your fixed costs be?

[Lakeisha]

Between $50,000 and $60,000.

[Ramit Sethi]

Correct. James, did you know that?

[James]

She did tell me, yes.

[Ramit Sethi]

Okay, great. So at 68, it's higher than it. I would like to see it, but it's not like 89. All right, we got some stuff we can play with. Let's just work our way down and then we'll go into the line. Items, investments, zero. So you know, you all know the way you're going. If you currently change nothing, you will be living on like Social Security. You guys want to do that? No, it's not good. Savings are at zero. Not good. And then this is really interesting. Your guilt free spending is 33%. Now, I don't believe these numbers, but I do believe they are a lot. Do you track your guilt free spending carefully? Yes or no?

[Lakeisha]

No.

[James]

No, no.

[Ramit Sethi]

All right, at the end of the month, is there any extra money?

[Lakeisha]

No.

[James]

No.

[Ramit Sethi]

Okay, so it's going, it's going somewhere. What's it going towards Amazon stuff. What else?

[Lakeisha]

Eating out.

[Ramit Sethi]

Eating out? Where you guys eat out?

[James]

It depended on a week.

[Lakeisha]

We have pizza every Friday.

[Ramit Sethi]

Please don't say Domino's.

[Lakeisha]

No, no, no, no, no, no. There's a local place, Bob's Pizza. We try like to try different pizza places every Friday.

[Ramit Sethi]

So. All right.

[Lakeisha]

When it's like we're in between paychecks. We'll go get a large pizza at Whole Foods.

[Ramit Sethi]

Hold on. Was that supposed to be like, we're so frugal. We got a pizza from Whole Foods. The hell's happening right now? Okay, this is amazing. Let me just tell you, my family, when we were eating out, which was not that often. Once every six weeks, we're going to the pizza place with a coupon and Whole Foods. I never walked into Whole Foods until I went to college. And I walked right back out. I'm like, this place isn't for me. Bye. Bye. I'll. I'll come back here in about 15 years. All right. Wow. We only get our pizza at Whole Foods. Amazing. Where else do you eat out pizza? What else?

[Lakeisha]

We said we were going to start going to Longhorn once a month.

[Ramit Sethi]

That's interesting. So the two of you talked about it and said, we want to do this once a month. That's the first time I've heard of planning. I like that.

[James]

On Wednesday we might go to Culver's. You know what I mean?

[Ramit Sethi]

What's that Burger place. Okay, how much total bill, Bill, tip, tax, delivery, everything.

[James]

We get the kids meals, so it's about $24.

[Ramit Sethi]

Laughing and covering her mouth. Hold on. There's definitely a lie happening right now. Lakeisha.

[Lakeisha]

No, I just laugh because we. We definitely do get the kids meal. Like all three of us will get a kid's meal because it comes with a free custard. We try to think about money.

[Ramit Sethi]

Please don't do this right now. Please don't try to justify the financial part of it. We've gotten two days out of a seven day week. And I'm getting your life history about longhorns and the custard. Just tell me where you eat out. That's all I want to know.

[James]

Okay. Culver's, Carol's Chicken. If it's all of us, man, we spending a good 40 to $50, you.

[Ramit Sethi]

Know, this is for how many people you know?

[James]

If my daughter's here, four. And if she's not, three.

[Ramit Sethi]

So three to four. How are you only spending $40 for four people eating out? Tax tip. There's no way. Can we just re reset because something is not right. I don't mind if you're overspending. I can help you with that. But I can't help if you guys are lying to me or if you're lying to yourself.

[James]

If we're going to the restaurant for pizza. Last week I spent 140something dollars.

[Ramit Sethi]

Okay. That's reasonable.

[Lakeisha]

On a weekly basis, I would say we probably spent at least $250 on eating out.

[Ramit Sethi]

How many times a week do you eat out?

[James]

Three or four times a week.

[Lakeisha]

I was going to say the exact same number. Three to four times a week.

[Ramit Sethi]

Do a little exercise with me. Okay. It's Sunday morning. We're going to go through the entire week. Anybody eating out Sunday? I'm talking coffee, lunch, brunch.

[James]

Sunday, we eat breakfast at home.

[Ramit Sethi]

How many times you eat out on Sunday? Give me a number.

[James]

Probably once, right?

[Lakeisha]

Once or twice. Because he always brings lunch home and then dinner. Depending on if we have groceries or not, we will eat out again on Sunday.

[Ramit Sethi]

Great. So is that two or three times on Sunday?

[Lakeisha]

At least two.

[Ramit Sethi]

Two times. Great. Monday. What do we got?

[James]

Monday? We probably. We don't usually eat out on Monday.

[Ramit Sethi]

No, no, none. No. Coffee, croissant, whatever. None of it. Okay, great. Tuesday.

[James]

Tuesday. If we have leftovers, we eat that on Tuesday. If we probably. If we don't have leftovers at least once.

[Ramit Sethi]

Let's say once.

[James]

Yeah.

[Ramit Sethi]

All right. Wednesday.

[Lakeisha]

I would say once.

[Ramit Sethi]

Okay, great. Thursday, Breakfast, lunch, dinner, snack.

[Lakeisha]

I would say zero. I would say zero.

[James]

Friday, probably twice.

[Ramit Sethi]

Twice. All right, Saturday. Saturday. How much?

[James]

Saturday, probably twice.

[Ramit Sethi]

Twice. Anybody want to say three times? Lakisha, what's that big smile on your face?

[Lakeisha]

Just to pay a week. Maybe three times.

[Ramit Sethi]

Let's say three. All right. Now, I don't know if you've ever heard of Ramit Sethi's magic number of eating out. Have you ever heard this number?

[James]

No.

[Ramit Sethi]

The number goes like this. Take whatever a couple tells you and triple it and you will get the real number. And guess what? Your number happens to be.

[James]

Six or nine.

[Ramit Sethi]

Nine. Exactly. Three times what you told me. What do you make of that? First of all, am I getting a round of applause for this? I freaking invented this. I'll take the win for myself. It's my podcast. That's pretty amazing, don't you think?

[Lakeisha]

Yeah, it is. It is.

[Ramit Sethi]

And are you a little surprised? You thought it was three times and it's nine times a week.

[Lakeisha]

I'm shocked. I am.

[Ramit Sethi]

So whatever number you told me we spent 250 a week, you better triple that right away. Does this tell you if we zoom out about your entire financial picture, we.

[Lakeisha]

Don'T know where our money is going?

[Ramit Sethi]

That's correct.

[James]

What else we need to plan.

[Ramit Sethi]

Yes. Love that. But, James, I love your answer, but I notice again, you go towards the future. We need to change. We, James. You're not going to change unless you actually can diagnose and analyze what is happening today. You cannot move forward unless you stick with the present and understand it. So give me that answer.

[James]

We don't plan.

[Ramit Sethi]

We don't plan. Agreed. Would you say that you are impulsive with your spending?

[James]

Yes.

[Ramit Sethi]

Okay, good. And do you have, like, some good stories that you tell yourselves about why we need to go out tonight?

[James]

Of course.

[Ramit Sethi]

We're busy. We went into this whole thing about time management. I don't believe it. So do you see that? If we ended the call right now, what do you think would happen with your money?

[James]

It will continue to be the same old, same old.

[Ramit Sethi]

I agree, lakeisha.

[Lakeisha]

We would continue to live in the way that we are and feel like we don't know where it's going or why we don't have enough for our future selves.

[Ramit Sethi]

Yeah.

[Lakeisha]

When the answer is there, what is the answer? We're spending it now.

[Ramit Sethi]

Yeah. What are you spending it on?

[James]

Things we don't need to.

[Ramit Sethi]

Yes, that's true, but I don't love that answer. I would say you're spending your money unconsciously. You're not spending it on your rich life. If I asked the two of you, what is your rich life, would you have told me eating out nine times a week is in our rich life? No.

[Lakeisha]

No.

[James]

Absolutely not.

[Ramit Sethi]

What would you have said instead as it relates to eating out?

[Lakeisha]

Getting a chef once a month.

[Ramit Sethi]

Okay. That would be nice. Probably not in the financial position to do that today. So what is your rich life today as it relates to eating out?

[James]

Keeping it to maybe once or twice a month.

[Lakeisha]

If we can hold on to a specific place that we know we want to eat out at.

[Ramit Sethi]

Yeah.

[Lakeisha]

Then I think that would make it more meaningful.

[Ramit Sethi]

I like that. I like the idea of a meaningful meal together. If I were in your situation, I might say our rich life is having one day each month where we all go out as a family and have a great meal and we all share a dessert together and we appreciate it. What do you notice about that?

[James]

It's goal oriented.

[Lakeisha]

If we try to go outside of that one time, it would make us go back to that. Like, this isn't the one time that we're supposed to go. It would give us something to hold ourselves accountable to. If we're waiting for that.

[Ramit Sethi]

Yeah, it's. It's slowing down and creating the life you want. It's not life happening to you. Oh, we're busy. So we stopped at this place and, oh, we got that thing and it's around the family. So the whole thing about we're going to do one time with our family, that's so beautiful because it allows the family to talk about it. Maybe one of your kids gets to choose this month and the other gets to choose the next month. It becomes a whole thing. And the thing about sharing a dessert, like, when I was a kid, we never got dessert, so forget about that.

[James]

Right.

[Ramit Sethi]

But okay. It's hard to go from 36 times to one time. We're going to have to talk about that. But the fact of being able to share this and appreciate it, this is what we can do right now. I hope that in the future we can each have our own dessert. We can each do more. Basically, there's a way to create meaning out of restraint. You see that? Yeah.

[Lakeisha]

Yes.

[Ramit Sethi]

Do you ever say no to spending money?

[James]

I feel guilty about it sometimes, so.

[Ramit Sethi]

Okay.

[James]

I absolutely do.

[Ramit Sethi]

Yeah. Okay. You say no, and then what do you do with the money that you didn't spend?

[James]

Buy something else to spend.

[Ramit Sethi]

It's not great.

[James]

I know, right?

[Ramit Sethi]

You feel guilty about spending it, but then you just spend it anyway. What's that about?

[James]

I'll probably spend on something that I say I need. If we don't have nothing to eat in the house, I go get something to eat or something like that, or put gas in the car.

[Ramit Sethi]

Okay. Lakeisha, what about you?

[Lakeisha]

If I say no to spending is because it's not there. So you know how the parents say, no, we don't have money for that or whatever, it will legit like, no, we really don't have it. So if I say no, it's because it's not there usually, as opposed to I don't want to spend it on whatever that thing is.

[Ramit Sethi]

Okay. So can I ask again? Like, when was the last time you told your daughter no when it came to spending money?

[Lakeisha]

She doesn't ask for things a lot. Like yesterday when we went to Target. I feel like that's why I was more compelled to say, okay, it was an $11 sweatshirt. It was cute. She doesn't ask for things a lot. So I said yes.

[Ramit Sethi]

Okay. What do you spend your money on? Lakisha? 88,000 bucks a year.

[Lakeisha]

Stuff. That's the best word I can think of to describe what I spend my money on.

[Ramit Sethi]

Stuff. What are we talking about?

[Lakeisha]

I like buying things for the home a lot, so decorations and I love to DIY stuff, like make T shirts or sew things. So I. I get. I have a lot of craft items as well. That's what I like spending on.

[Ramit Sethi]

All right, shall we look at the fixed costs and go through the line items?

[Lakeisha]

Let's do it.

[Ramit Sethi]

All right, let's take a look. So your rent is 16%. If we combine it. How are you splitting your money now that you are living together?

[James]

So I. I give her the thousand dollars is what I give her towards your rent.

[Ramit Sethi]

Okay, and why is that?

[James]

Well, there's a number she came up with. Well, came up with together, since she does make a little bit more than me, we thought that would be a fair amount.

[Ramit Sethi]

Wait, she makes more than you, but you're paying more for rent? How does that make sense?

[Lakeisha]

Let me tell you how this conversation went. I'm going to tell you exactly how it went. He asked, what number would I like for him to contribute? And I said, how much can you. And he said, I don't know. I was thinking of what if I give you 5, 500 each paycheck, and that could go towards rent or, you know, part of utilities or whatever, and then, like, everything else will kind of figure out as time goes. Like stuff like groceries and gas and stuff like that. So that's how that conversation went, like, almost verbatim.

[Ramit Sethi]

And do you all feel good about this?

[Lakeisha]

No, I'm good with the number. I don't feel good about how it happened because I feel like there was nothing we, like, did or looked at in order to come to that conclusion. It was just an abstract number.

[Ramit Sethi]

But that's like, that's the way that both of you are living your financial lives.

[Lakeisha]

Right when I want to.

[Ramit Sethi]

Oh, I agree. I. I don't want that either. I want to show you how to start using numbers effectively. But what you just did was such a common conversation that couples have. It's like, what do you want to do? Here's what I feel comfortable with. I'm like, feelings. Why the hell are we. Why are we talking about feelings right now? I want to talk about cold, hard numbers. Talk to me about ratios. Talk to me about percentages. This is the stuff I need right now. And it's a lot of, like, I don't know. How about you? This is so common. So let me show you a different way. Okay, I get it. When you move in with a partner and you try to divide costs for the first time, it can feel overwhelming, but it doesn't have to be. Up next, I'm going to show Lakisha and James what to consider when making this decision. We'll be back after a short break. In my 20s, I I wasn't really thinking about the food that I was eating. I didn't know about nutrition. Wasn't something on the top of my mind. I used to order through this thing in New York called Seamless. They would deliver food I would order three times a day. And now I realize I'm not trying to do that anymore. I need to feel good. I'm on tour for my new book, I'm traveling, I'm doing multiple interviews a day. I need to be on my A game and so the food I eat needs to give me energy. And so I've learned about things like macros and protein and I'm intentional about what I put in my mouth. If you want to feel better in 2025 with better food choices, I recommend Thrive Market. This episode's sponsor, Thrive Market, makes it simple to find trusted 100% non GMO brands without spending hours in the grocery store. Using their on site filters, you can shop based on what matters to you. Low sugar, gluten free, organic or high protein options, all just a click away. Plus, Thrive Market's smart cart feature is really useful. When you create an account, they'll ask you about your preferences and they will automatically build a cart full of cleaner versions of your favorite brands. You can tweak it before checking out, but it's a great way to get started. Ready for a junk free start to 2025? Head to thrivemarket.com ramit and get 30% off your first order plus a free $60 gift. Okay, look, there are a lot of things people tell you you should do and you don't. I'm not going to sit here and lecture you about flossing your teeth. But there are important things that we ignore and I want you to get these right. Imagine, if you will, that you have just suffered your premature death and now your husband or wife, they're grieving, sitting at the dining room table trying to figure out how to log into your E Trade account while the tears fall down and soak your keyboard. If you don't set up a will before you die, you're definitely going to be seeing this scene happen from hell. And that's why I'm so happy to announce that trust in will makes creating your will easy. You can actually get 10% [e-mail] Ramit my coworker recently created a will for her family on trust and will, and here's what she told me. It was incredibly easy. Very straightforward. I followed very simple prompts to fill out all of my personal info My family, beneficiaries, assets, et cetera. In less than an hour, I had a will, power of attorney documents, last will and testament, and hipaa authorizations. I can download these docs, have them executed, or even hire an attorney to look over them for me. Now, I personally used an attorney for my own estate plan, but I recognize that not everyone has access to an estate attorney. If that's you, trust and will is a great option. It makes estate planning accessible and affordable. You can save loved ones time and stress by having all of your documents in one place. And they are safe and encrypted. They also have live customer support available through phone, chat and email. Let trust and will uncomplicate the process for you. Protect what matters most in [e-mail] Ramit and get 10% off plus free shipping. That's 10% off and free shipping at trust and will.com Ramit let's get back to the conversation now. Right now, if you break down your money, you have lots of ways to do it. You could just combine everything, which married couples often do. And I think in general, it's a good idea. You could split it 50 50, which would make no sense, but some people just think that 50, 50 is fair. Or you could do it proportionally. Now, proportionally actually works out really well because Lakisha, you make 60% and he makes 40% if you break down the numbers. So the way that that works is basically for any joint expenses, James pays 40% and Lakisha pays 60%. How does everybody feel about that?

[Lakeisha]

Yes, I feel great about that.

[Ramit Sethi]

Okay, let's make a couple changes here. So let's take your rent, and that would mean you, Lakisha, pay 1050, and let's just watch what happens here. That means, James, you pay 700. Wow. Big changes happening already. So already what we can see is that the look at the fixed cost for each person. They went 57% for James, but now Lakisha is at 75%. Lakeisha, what were you doing before James was contributing to the rent?

[Lakeisha]

Drowning. Yeah, I filled this out alone months ago and sent it to him. My csp. I think my number for fixed cost was in the 90s.

[Ramit Sethi]

You're spending too much. We're about to see that. Are you only spending $400 a month on groceries? This is way lower than I normally see, especially for a family with kids. Right.

[James]

Okay.

[Ramit Sethi]

Normally I would see like 800 to 1200 bucks.

[Lakeisha]

Oh, no, we're definitely not spending that much. I am a coupon Shopper. Our total at the grocery store Yesterday went from 2:31 to 1:90 after coupon.

[Ramit Sethi]

I don't think that groceries are going to stay at 400. I don't think it's possible. Candidly, I'd like to adjust up because I hear a couple of times the two of you mentioned, like, we didn't have food, so we went out. Like, that's just not acceptable. It's not. When you have high fixed costs, there will never be a day where you, quote, run out of food and go and have to get restaurant food. It just makes no sense, especially not making $150,000 joint. Okay, so one of the things I talk about in my book, Money for Couples, I want to show you it's coming out is creating a family culture. In our family, we dot, dot, dot. For example, in our family, we have a no debt policy. That's part of our culture. What would it be for you?

[James]

Our family only eats out once a month.

[Ramit Sethi]

I love that. But give it to me with a little bit more meaning behind it, because right now it feels, like, a little bit dreary. Give it to me that in a way that's meaningful for your family.

[James]

Our family only eats out once a month.

[Ramit Sethi]

I like it. It was theatrical. But give me something else. Lakeisha, you want to help them out?

[Lakeisha]

In our family, if we can't pay for it outright, we don't buy it. And that's not something we're doing.

[Ramit Sethi]

Okay, can we stick with the dining thing? I just want to show you an example of actually making something fun and not dreary. So it'd be like in our family, a special family dinner once a month. We rotate who chooses, and we all share one dessert, which we appreciate. That's how I would say it. But your family's got your own culture, so you'd say something a little different.

[Lakeisha]

Yeah, I got it. In our family, we have one evening that we are all together, and we share a meal and a dessert and conversation.

[Ramit Sethi]

Love it. Beautiful. That's a rich life. I love that. Let's keep going. I'm moving your groceries up to 800 because you're gonna need groceries. There's a line on here, row 20. Now, I believe I invented the conscious spending plan, and I don't recall putting in a line row 20, called cigars and alcohol. What the is this? That was 200 bucks from one person and 250 from another. Is this a joke?

[James]

I think that's a roundabout amount.

[Ramit Sethi]

Oh, is it higher?

[James]

No, I definitely have not spent as much as I usually would spend on cigars.

[Ramit Sethi]

How much do you usually spend?

[James]

Six months ago, I was at probably at least $300 a month for cigars, but it's just cigars. With alcohol, I would say probably about $500 a month.

[Ramit Sethi]

Okay. What are you drinking?

[James]

Bourbon.

[Ramit Sethi]

All right. And Lakeisha's over here smiling like I'm not going to call on her next. Lakeisha, what about you?

[Lakeisha]

I like wine.

[Ramit Sethi]

Are you in the cigars thing, too?

[Lakeisha]

Nope, that's all him.

[Ramit Sethi]

So what do y'all think? I mean, I know what you think is like, Ramit's about to come down and drop the hammer. If you want to do it, you could do it. Can I be very honest with both of you right now?

[James]

Yeah.

[Ramit Sethi]

I think you came to me because you want help. And I respect you. I respect your time, and I am going to raise my expectations for both of you.

[Lakeisha]

All right?

[Ramit Sethi]

Okay. You have zero dollars in savings. You have kids. You have zero dollars in investments. Right now you're at 73% on your fixed costs. There's just no world where it's okay and where I'm going to buy any of these stories about we're actually doing better. I just need to be more conscious. This is all BS and you know it. The thing is, you want me to make the change for you. You want me to come in here and be like, stop it, guys. And then you can be like, I know we should try better. We have been trying better. We should. I'm not going to play that game. That's what both of you want. I'm not going to do it. If you want to keep doing it, you could do it. It's your money. It's your rich life. The fact is, you have no savings and no investment. One illness, one problem with your kids, one car accident, and you are out of the game. And at 38 and 45, there's very hard to get back in it. So I guess what I'm asking you is, are you ready to take this seriously? What do you want to do?

[Lakeisha]

I want to do the best. And we're not doing our best.

[Ramit Sethi]

All right, let's do it then. But it's going to be you doing it, not me. So here's what I'm doing. I'm turning over control of the CSPDU. Your goal is to get this number down to 60%. Tell me how you want to do it. I'll make any changes. You tell me. I'm just the executor. But the only rule Is you have to each do one thing and toss the ball back to each other. Go ahead.

[James]

I guess the line for cigars and alcohol, we can Change it to $100 each.

[Ramit Sethi]

Can I ask you a question, James? Do you think you should be spending money on alcohol and cigars when you are in $26,000 of debt? No.

[James]

So, okay. So. No. Okay.

[Ramit Sethi]

What's happening right now? You're a grown man. Why do I have to tell you this? You already know it. Is it that you are waiting, like, your dad looked over your shoulder, and he was like, are you sure you need that? And you allowed yourself to be put in that child position that you're now waiting for me to do that?

[James]

When we talked, you said that, you know, sometimes you. You feel like that if I work hard, if I do this, I deserve at least one cigar every other day or something like that. So that's what's in my mind.

[Ramit Sethi]

Has that approach worked for you?

[James]

It has not. No.

[Ramit Sethi]

So do you want to keep the same approach and hope that it magically changes? No. I think before we go into all these numbers, you all need to decide, like, how do we want to show up right now? Like, imagine here I am, like, trying to run track or something. I'm running the 400, and every time I go out there, I'm like, oh, I'm so tired. Like, life sucks. It's so hot. My shoelaces. And I just keep losing. And then my coach pulls me aside and says, listen, you actually have pretty good skills, but how have you been showing up? I'm like. I'm kind of a downer. I'm always, like, complaining. And he goes, how do you want to show up? How would I. How would I answer him?

[Lakeisha]

You want to show up to win?

[Ramit Sethi]

Show up to win. What's my attitude going to be?

[James]

Like, let's do this.

[Ramit Sethi]

Let's do this. That's right.

[Lakeisha]

Motivated.

[Ramit Sethi]

Exactly. And all the stories I used to tell myself, if only this one guy wasn't here. I'm. The stories are gone. I got a new story for myself. I deserve to win. So how do you guys want to show up as we're about to get into this csp?

[Lakeisha]

Motivated.

[James]

Motivated.

[Ramit Sethi]

Love it. Let's do it. Here we go. James. First, what do you want to do?

[James]

Took out the alcohol and cigars.

[Ramit Sethi]

All right, take it out. I'm zeroing out alcohol and cigars. I want you to look at this number as I go down the list. This is your fixed cost number. It's at 73% our goal is to get it to 60. Here we go. Cigars, zero and zero. What do we see that number change to 67%. To 67%. All right. We're going in the right direction. What else?

[Lakeisha]

I would like to change the child support college students to zero for right now.

[Ramit Sethi]

Explain this to me. What is this category?

[Lakeisha]

I was sending my niece and my daughter $50 every two weeks. But they're both employed. They don't necessarily need it. They never asked for it. I just wanted to do something.

[Ramit Sethi]

Love it.

[Lakeisha]

So that's what I was doing.

[Ramit Sethi]

I love. I love your niece and kids and everything. Give them a big hug next time you see them. But the checks have stopped. All right, 200 bucks. That's zero. And what. What's this? Child support for 600. That's James, right?

[James]

Yeah. That's legal. I have to pay legal.

[Ramit Sethi]

We're keeping that. Okay, great. Let's keep it. The number is 65%. Oh, my God. We're making better progress than I thought. Toss the ball back, Lakisha. Toss it to him.

[James]

I guess miscellaneous can change to $100 for each.

[Ramit Sethi]

I like that. Can I tell you what is in that category? So I include miscellaneous. It's 15% of all your other stuff. I found another magic number, which is 15% is typically how much people don't think about for their fixed costs. That would be things like something breaks in your house or a car repaired you didn't plan for. So I add in 15%. Now, here's the thing. When you have a very financially healthy position, you should actually be putting that money aside. And then at the end of the year, you can make a little rule, oh, we didn't spend it. Let's invest most of it. Spend it, whatever. The fact is, you can't have $793 a month in miscellaneous costs. It's just out of control for your abilities right now. That means you got to be tighter, more intentional. Okay, so we're going to reduce it, but what are the implications for the.

[Lakeisha]

Two of you if we reduce it? Then to your point, we need to. When you scroll down, then we need to plan for those miscellaneous things happening and being more proactive instead of reactive.

[Ramit Sethi]

That's exactly right.

[Lakeisha]

Boom.

[Ramit Sethi]

You nailed it. So let's do it. Watch what happens to the number. It's going to be quite amazing. We're changing the $300 to $100 miscellaneous, and we're changing the 493 to 100. What's that number?

[James]

Wow.

[Lakeisha]

59.

[Ramit Sethi]

59% 59%. Give yourselves a round of applause. That's really good. Well done. Honestly, I'm amazed. This is incredible. Keep in mind we have increased your grocery spend.

[James]

Wow.

[Ramit Sethi]

By a lot. By double. That's amazing. Now let me ask you this. Who cooks at home if food gets cooked?

[Lakeisha]

I usually cook it.

[Ramit Sethi]

Wow. Okay. How. How often does food get cooked?

[Lakeisha]

Probably three to four times a week.

[Ramit Sethi]

That actually seems to me like a pretty big deal. Because let's just say, let's round down on this one. Let's say it gets cooked twice a week. So let's say one night everybody comes home, they're tired, and there's no food cooked. What's everybody going to end up doing immediately?

[Lakeisha]

If we're spending this much on groceries, there's going to always be food here. And me personally, if there's food here, I'm going to make something. I'm not going to buy something. It's going to be by the time I place an order and go pick up or before it's delivered, I could have made something already. So if there's food here, then I'm going to go to see what I could throw together.

[Ramit Sethi]

I kind of love your answer and I love the attitude you had when you answered that. Just like I'm going to make it when there's food here, I'm known for it. That's amazing. That's the attitude that I want to bring to the money. I'll tell you my example. When there's extra money, I'm going to invest it. I'm known for investing extra money. That's like, we can bring that same attitude to different parts of our life. So I. I just wanted to point out, I'm struck by how awesome that attitude was right there and that energy. So you have it in you. I just want to see us bring it to other parts of life. Anything else on fixed costs? We got this phone bill. Who's you all paying for your kids phone bills?

[Lakeisha]

Here I am. Yeah. So there's four lines. My line, my two daughters, and my niece. So I. I raised my niece from like seventh grade through high school.

[Ramit Sethi]

That's awesome. Do you want to keep paying for her phone?

[Lakeisha]

Yes, I do.

[Ramit Sethi]

Okay, fine. James, what about you? 125amonth. What's that?

[James]

This is just me. I got this phone on there right now. Pin on his phone.

[Ramit Sethi]

Subscriptions are at 110. Any duplicates, you all can cancel. Since you're living together.

[James]

Absolutely. We could definitely.

[Ramit Sethi]

Let's make a change right now.

[Lakeisha]

How much what's your gym membership?

[James]

33Amonth. And so I have like peacock and things like that, but I can get rid of that. So for mine, you probably could just Change that to 33. For my gym membership, 33.

[Ramit Sethi]

Love it. And for you, Lakisha, I think you.

[Lakeisha]

Should leave it at 60.

[Ramit Sethi]

All right, fine. So you're at 58%, which is within the 50 to 60% for fixed costs. I think that part is good. But now we need to get pretty aggressive because you are 38 and 45. You have zero savings and zero investments. You all can live a rich life, but it's up to you how hard you want to push it. And I want to show you an example so you really start to understand the numbers here. Lakisha and James have said they want to plan to move forward, which I love to hear, and that's what I'm about to give them. But as you heard James say earlier, he's scared when it comes to investing. And this is common for people who don't understand how investing works. I'm about to show them how easy investing can be and how impactful it can be. We'll get to that after a quick pause to support our sponsors. I just got back from my book tour where I was doing stage events in theaters all over the country. Now can you imagine? We got this intro rolling, we got me Netflix clip and then I walk out with some ill fitting baggy ass suit. This guy hasn't hemmed his pants since 1996. No, thank you. First of all, I'm not a financial advisor. I don't dress like them. Second, I want to be professional and I want to be approachable. I want my clothes to create an impression before I ever say a word. And that is exactly what Next Level Wardrobe helps me do. Next Level Wardrobe is run by my wife, Cassandra, and she styled me for every event, including travel time, downtime, stage time, even TV time on places like Good Morning America. Because when I come out to present, I want to convey who I am. I want to feel comfortable, I want to feel good, and I don't want to feel stilted and rigid. That's not the impression I'm going for. So if you are a professional who wants to dress better, maybe you got a promotion, maybe you've recently had body changes, maybe you're tired of wearing the same old clothes you Wore in your 20s, then I recommend you check out Next Level Wardrobe. Next Level Wardrobe is the top ranked personal styling company in the US for successful professionals of all ages and Sizes. No matter your dress code, no matter your job title, NLW will make sure that you are buying the right items so you can wear them for any occasion. And they'll help you build a versatile wardrobe, one that fits you. Not one that a stylist chose for herself, but one that is you. So that all of your clothes fit perfectly. And you will never have to ask that dreaded question, what do I wear today? This is perfect for professionals who don't have a lot of time and who want to look polished. They're leading teams. Maybe they're the face of their brand and they always want to leave the right impression. Next level wardrobe will help you look like an elevated version of you. You can take their free styling quiz@nextlevel wardrobe.com ramit elevate your [e-mail] ramit that's nextlevel wardrobe.com ramit let's get back to the conversation. Pick a number. How much do you all think that you should invest every month?

[Lakeisha]

20% of our income.

[Ramit Sethi]

Okay, cool. So 20% of your, shall we say gross income or net income?

[Lakeisha]

Gross.

[Ramit Sethi]

Gross. Okay. Love it. Wow. Aggressive. So that's $1478 a month for you, lakisha. So let's just put it right here. Okay. Wow, good. That's 27% of net or 20% of gross. Cool. What about for you, James? Pick a number.

[James]

I guess I match hers to 20% of.

[Ramit Sethi]

Of gross. All right, let's go ahead and do the same thing just to see what happens. That's going to be about a thousand bucks a month. All right. So right now you basically dropped your amount that you can spend a lot every month, your guilt free spending, you actually don't have that much money left over. So the more we put here in your savings, you know where that money's coming from.

[Lakeisha]

Money we spend now.

[Ramit Sethi]

The money you spend eating out and what else?

[Lakeisha]

Shopping.

[Ramit Sethi]

Yeah. You all can save money. I'll show you how much you're gonna have. But that money comes from somewhere. And it would come from eating out and shopping. Is that a surprise to you or is that something you expected?

[Lakeisha]

No.

[James]

I know that it's going to take some type of sacrifice to get to where we need to get to.

[Ramit Sethi]

I like that. How come you haven't done it before?

[James]

It goes back to a lot of the things. Like you said, we wasn't thinking about our future selves. Not only that, but since we've met each other, I think we want to be better for each other. So we can have a better future.

[Ramit Sethi]

I like that. What do you think, Akisha?

[Lakeisha]

It just feels different to be doing this with someone else that has the same goal in mind. That's what makes this feel different. So you don't feel like you're sacrificing alone.

[Ramit Sethi]

It's really difficult to be the only person in a relationship who's carrying the weight. And sometimes your partner is unengaged, or sometimes they're actively working against you. You know, it's like I'm trying to save money. And then my partner's like, hey, come on, it's Friday. Let's go out. How are you supposed to deal with that? It's like constant temptation in the house. But on the other hand, if the two of you have a bigger vision, then what are we doing this week becomes very powerful. So let's take a look at the compound interest. How much you're going to have. Right now you have zero. Your annual addition. If we were to do just the number we picked out, it's an aggressive goal. But let's just see what happens. $29,736 a year. Years to grow. How many years should we say?

[Lakeisha]

25.

[Ramit Sethi]

James, you're. You're 45, right?

[James]

Yes.

[Ramit Sethi]

Let's say 20 first, and then we can see what happens if we wait five more years.

[Lakeisha]

Okay.

[Ramit Sethi]

Interest rate of 7%. Let's just go ahead. Anybody want to guess how much you're going to have?

[Lakeisha]

1.3 million.

[James]

Okay, James, let's go with 1 million.

[Ramit Sethi]

1.3 million. Damn, Lakeisha, that was a excellent guess. Okay, so what does 1.3 million mean to you?

[James]

I won't be broke when I retire. And not only won't be broke, I just will be able to enjoy retiring.

[Ramit Sethi]

How much will you be able to enjoy your retirement? Like, give me a number. How much will you be living on?

[James]

Maybe 65k. Maybe.

[Ramit Sethi]

All right, not a bad guess. So we're going to use something called the 4% rule. It's not perfect. It's good. Back of the napkin. We're going to take that number, multiply it by 0.04. That means you'll have about $52,000 per year. There might be some benefits. You might have some Social Security, I think that's for sure. And do y'all own or rent? Rent.

[Lakeisha]

Rent.

[Ramit Sethi]

Okay, so you're going to have housing costs at that time, and they will likely continue going up. We'll see. So how do you all feel about living on $52,000 a year?

[James]

No, that's not going to get it.

[Ramit Sethi]

That's not going to do it. Oh, what about longhorns? You see, the choices we make today directly affect what we do tomorrow. So if you really consider it and you break it down, the nine meals a week out, literally costing tens and tens of thousands of dollars. Now, if you can afford it, I got no problem. You love good food. I love it, too. But the problem is right now, you're not on a sustainable path. And this assumes nothing bad happens. No layoffs, no injuries, not everything's perfect. Let's keep looking. There's another thing I want to point out. If we wait 25 years because something really powerful happens, then, well, James might have to work longer. I would hate to put that James in that position, but let's just take a look. At 25 years. Instead of 1.3 million, you're at 2 million.

[Lakeisha]

What?

[Ramit Sethi]

That's crazy, right?

[Lakeisha]

I understand compound interest, but I did not think it would go up that much just from five years.

[Ramit Sethi]

Oh, you don't think so? You want to see what happens at 30? Watch this. This is just five more years. Three million. Do you understand that it took roughly 18 or so years to get to a million. Then it took a few more years to get to 2 million, and then 5 years to get to 3 million. What does this tell you?

[Lakeisha]

We can't do anything about the past, the tyindsight, but we should have started years ago.

[Ramit Sethi]

Yes. And what should we talk about right now?

[Lakeisha]

We need to start today.

[Ramit Sethi]

Exactly.

[Lakeisha]

Like today.

[Ramit Sethi]

Exactly. Do you see why I was so alarmed at this 900? Like, oh, let's talk about it. Let me ask for permission. Why put yourself in that role, asking somebody who candidly does not know about investing? You got to decide, each of you for yourself what kind of life you're going to live. We could talk about the marriage and, like, marriage, staying together, living together, all that stuff. But regardless, each of you is getting older. You have to take action regardless of what the other person does. Do you see that directly in the math?

[Lakeisha]

Yes.

[Ramit Sethi]

Lakisha, you see it. James, what's going on with you? What are you feeling right now? I just want to check in with you.

[James]

The numbers are shocking. We have to do something.

[Ramit Sethi]

That's a good answer. We have to do something. I love that. We have to make a change. Now, I want to point out, I want to caveat some of this, because if you all were investing $29,000 a year for 25 years, you could get to 2 million bucks. And if we take that number and run the 4% on that. That's $80,500 a year. That's good. That's nice. Solid. That's accounting for inflation, by the way. Plus we add on however much for Social Security. That's nice. Okay, cool. The problem is you really can't afford to invest $30,000 a year. Do you know why?

[Lakeisha]

Why?

[Ramit Sethi]

Anybody tell me what's completely blank on the csp?

[Lakeisha]

Savings.

[Ramit Sethi]

Yeah. What's savings?

[Lakeisha]

For emergencies.

[Ramit Sethi]

And right now you have no emergency fund.

[Lakeisha]

Yeah.

[Ramit Sethi]

You also have no money set aside for a new car, a vacation, somebody graduating, none of it. So we need to build that money up and we need to do it fast. Because if one of you gets in financial trouble, you are in really, really bad trouble. So we have a limited amount of money here. How do we want to allocate it?

[Lakeisha]

Maybe if we did 20% net as opposed to gross.

[Ramit Sethi]

What's my recommendation for the conscious spending plan for savings? It's 5 to 10%. Okay, why don't we start there? Notice I just typed in 500 just to see. That's 13 of James's net income. So that's too high. So James can afford to do like 200 bucks a month. Do you all see why I was so alarmed with the cigars and alcohol and like the negotiation? It's like, what are we even talking about? We have nothing in savings. We can't be talking about cigars. What this shows is that James, you currently have $517 per month to spend guilt free spending. And Lakeisha, you have $385 per month to spend guilt free spending. Now what do you think of these numbers?

[James]

That's better than probably what we were doing.

[Ramit Sethi]

No, you were spending thousands per month.

[James]

Right. So that's way better.

[Ramit Sethi]

Let's stop using better and worse. Okay? Let's stop putting moral judgments on spending money. That's an old way of thinking. Because think about it, what you're saying. James and Lakeisha, you've also said this. You've. You've both kind of said, like, I've been bad. Have you noticed that? As in spending money is bad. That's something that like people tell their kids. That's bad. Don't put, put that back. The thing is, you both have said like, I've been bad, but that you're spending all your money. You're literally spending more than you make. You're spending thousands eating out. So it's not even working. By telling yourselves I've been bad. Let's stop talking about money like that. And let's instead start talking about what is our rich life. So no more good and bad spending. More or less has nothing to do with that. It's all about, here are the numbers. How do we want to allocate our money within those numbers? Lakeisha, what does it feel like to see that you have $385 a month to spend guilt free?

[Lakeisha]

While the amount doesn't feel good, it feels good to know that that's what I'm working with and that's what I can work out of. It's almost like an allow. You were a child and you had an allowance. Once you spent it, that was it. You didn't have a credit card or anything to fall back on. Once it was gone, it was gone. So if I feel like that's my allowance, then I know that I have a number that I can go back to as opposed to thinking that this whole check is at my disposal. I could do with it what I want.

[Ramit Sethi]

I think it's good to set boundaries for yourself, and I think at this stage, it's good to have these bumper lanes. You need some guidance right now because obviously just having that entire check just sit in your checking account is not working for you.

[Lakeisha]

Yeah.

[Ramit Sethi]

How are you going to deal with the eating out if the two of you only have, like 500 and 300 bucks a month?

[James]

We definitely got to reduce that.

[Ramit Sethi]

Do you all see how it works together? You can't actually go out to eat nine times a week anymore or 36 times a month. It's kind of funny when you put it that way, right? It's like you were eating out more than once per day. So there's just no money for it. You don't have to try. There's just no money for it. That's it. The money's gone. It's moved to a savings account. It's gone to an investment account. It's just not there anymore. So now what happens if somebody's tired on a Thursday night and they're like, I don't want to eat this raw celery. Let's go to Ben's pizza? What are you all going to say?

[James]

No?

[Lakeisha]

No.

[Ramit Sethi]

And then what if one person goes, I'll pick it up.

[Lakeisha]

If I don't have room out of my 387, then I'm not going to do it?

[Ramit Sethi]

Yeah, all right. I like it. That was a pretty good answer. I like that. I think probably just watch out for becoming the police of the other person's finances. Right. You don't want that. I think you probably need to recalibrate your relationship. You know, I talk a lot about money dynamics in money for couples and parent child is one that we notice here and that's going to have to be changed. Like even asking for permission for your own 401k, it just like makes no sense. Looking over someone's shoulder and saying like, do you need that? That also makes no sense. It also strips the other person of their own individuality. We don't want that. We need each of you to stand up on your own before you can effectively be a team. So have you thought about that? Have you thought about the role of money in your relationship moving forward?

[James]

That's one of the biggest reasons we wanted to get on with you.

[Lakeisha]

I'm so inexperienced with dealing with or even having a roll of money in a relationship. And he has had some bad experience. And so I feel like given those perspectives, we knew that we needed help outside of ourselves.

[Ramit Sethi]

I'm so glad you reached out. Here's my observation. I think that because I look at the two of you at 38 and 45 with no savings and no investments, it's clear that there's a lot of love. And I love the compromises that the two of you are talking about. I love that I'm challenging. I'm pushing you on the eating out and the cigars and the rolls and. And you're with me. You're staying with. This is hard stuff. You're staying with me. I appreciate that. If I were in your shoes, what I would want to see for both of you would be for each of you to become financially skilled before you were to move forward and combine anything. That would be my own personal opinion. Why do I say that? Because right now your finances are not in great shape. You've started, hopefully this proportional combination, which I think will be much more fair for joint expenses. But if you were to get married and combine everything, I think it would probably be a bad situation right now. Do you agree?

[Lakeisha]

I agree 100%.

[Ramit Sethi]

And James?

[James]

Yes.

[Ramit Sethi]

Oh, amazing. Okay, we're all on the same page. That is because each of you doesn't yet individually have the skills to manage money. As you start this journey, you're going to realize some things are going to come up like, oh my gosh, like one of us is sticking to the plan and the other one is looser. How are we going to navigate that? One of us can't get things paid on time, the other can, etcetera, etcetera. And that's okay. Not everyone's going to be perfect the first time, but you've got to get on solid foundation. And I would be specific. I would say, look, before we get married, I want each of us to have x thousand dollars in our savings account. Like, I want x thousand dollars in our investment account. Pick a number that's reasonable based on what we have decided here. It shows a commitment to excellence. And I don't know about you, like, I. I want excellence for myself. My wife wants it. We want it for each other to have savings and investments seems pretty straightforward. It doesn't seem too crazy to me. What do you all think?

[Lakeisha]

I agree.

[Ramit Sethi]

So, yeah, I want to revisit something Lakisha said in the previous episode, which is important to acknowledge now, knowing that the two of them are creating a new path. Lakeisha said that she has wanted to fire her therapist for over a year, but she hasn't done it. I want to know why she's dragged out this decision that is seemingly straightforward. Can we talk about this therapist for a second? Lakeisha, is this a different therapist than James?

[Lakeisha]

Yes, different therapist.

[Ramit Sethi]

And you, you wanna fire them? How come you haven't?

[Lakeisha]

I don't know. I've been working with her for a while and so I just feel weird.

[Ramit Sethi]

Okay. So it's just like an uncomfortable conversation. It is.

[Lakeisha]

It's uncomfortable conversation. To be honest with you, until you said it, I never thought about just sending an email saying, like, hey, I don't want to do this anymore, or I'm firing you. I don't even know how to begin having that conversation. To be honest.

[Ramit Sethi]

I don't mind that. But can I ask you, like, how do you think your inability to switch therapists is affecting your finances?

[Lakeisha]

I have no idea. I never even thought of it. I never made a connection between the two at all.

[Ramit Sethi]

What do you think it means? That you cannot fire a free therapist. Free to you. What does it mean? What does it say about you?

[Lakeisha]

I avoid conflict.

[Ramit Sethi]

Yes, you avoid conflict. And so how do you avoid conflict with your money?

[Lakeisha]

File for bankruptcy.

[Ramit Sethi]

Yeah.

[Lakeisha]

Which I've done.

[Ramit Sethi]

Which you've done.

[James]

Yeah.

[Ramit Sethi]

Didn't change anything with your spending, did it?

[Lakeisha]

No.

[Ramit Sethi]

You avoid being decisive with your money. Instead, you try to get buy in from everybody and ask people who should have no business telling you what to do with your money, you ask them for their advice, right?

[Lakeisha]

Yeah.

[Ramit Sethi]

Conflict. Avoid it at all costs. And when I say all costs, I mean literally, it's costing you hundreds of thousands of dollars. Same thing. Inability to be decisive, to make A decision for your own well being, for your own mental health is the same way you are not prioritizing your own financial well being. This is why having uncomfortable conversations is not an optional skill. It is required in this world. Required. You can't get by. You can't be successful if you can't have uncomfortable conversations. You can try to say, can I get out of it? Which you have. Okay. Any surprises about that conversation we just had about?

[Lakeisha]

Your therapist never made a connection between the avoidant behavior there and here?

[Ramit Sethi]

Yeah, a lot. And I actually think a really good therapist will help you make those connections. I don't know this therapist. It's. I'm not qualified to make a judgment about them. But sometimes people are great. They're just not a good fit for you. I've had that. I've probably had people who said, like Ramid seems like he knows what he's talking about, but I just don't like the guy. That's okay. There's lots of other likable people out there. But I want you to put yourself first. Your financial health, mental health, relationship health. You can kind of see that it's not all firing on all cylinders because I can see it on the csp. Now we got to talk about the bankruptcy. We've mentioned Lakisha's bankruptcy a few times now, but we haven't gotten into detail. Now that we've identified that Lakisha avoids conflict, I want to talk about how she made the decision to file for bankruptcy. What happened? You charged a bunch of stuff up.

[Lakeisha]

Yes. Basically had a lot of different debt. Credit cards, loans, all of it. And I did this money coaching program.

[Ramit Sethi]

Hold on. It wasn't iwt.com money coaching.

[Lakeisha]

No, no, no.

[Ramit Sethi]

It was not money coaching by Ramit Sethi. No. Who was it by?

[Lakeisha]

I hate to put them out there like this. It's called Thriven.

[Ramit Sethi]

Let's just look at their website together. Well, that's a friendly looking man. On their financial advice with purpose. We believe everyone deserves a financial plan off. All right, hold on. First thing we want to look at is our solutions. Oh, oh, I see a word. That's a big red flag on the right. It says explore multi year guarantee annuities. Oh, let's just click over to annuities, which are kryptonite for most people. Not all, but most. What is an annuity? Blah, blah, Variable annuity. You're right here. I would be like, I'm out. I don't want to talk to somebody who's selling a variable annuity because it's a investment. It's horrible. The only person that benefits from this is the salesperson. All right, I'm going to look at this later. Okay, so what, this per. This was offered for free through your workplace?

[Lakeisha]

Not through my workplace. I think it was something that maybe was like an ad or something that popped up when I was scrolling on Instagram or something.

[Ramit Sethi]

Did you get taken to this page, which is the biggest red flag of all? Look at the insurance page. All Life, Universal and Variable. There's so many red flags on this page. But again, how would the average person know? They don't know what these red flags are. They go, sounds good to me. All right, so you signed up with them and they told you what, declare bankruptcy.

[Lakeisha]

And talking about debt and where. Where my money was going, I feel like in a lot of ways it was like, okay, so what can you do to change this? Basically, like, what can you do to get out of this situation?

[Ramit Sethi]

Hold on. They said that to you or you said that to them?

[Lakeisha]

No, they said that to me. And I said, I don't know. That's pretty much, like, why I'm here. I'm trying to figure it out. And I did not see a path forward as a result of that conversation to pay off the debt. When I said bankruptcy, the person said, well, I don't see what other choices you have. And shortly after that conversation, I filed.

[Ramit Sethi]

Do you remember how much debt you had at the time?

[Lakeisha]

Somewhere between 20 and 30,000.

[Ramit Sethi]

You had $30,000 in debt and you declared bankruptcy and was it accepted?

[Lakeisha]

Yes.

[Ramit Sethi]

30K. We could knock that out so fast. Do you realize that now?

[Lakeisha]

Yes, I realized that while we were going through it, I even said to James, like, I was like, I don't even know why I did this. From the moment I filed and started the process to it actually being discharged, it was months in between. And so at multiple times, I felt silly about doing it.

[Ramit Sethi]

Why didn't you speak up? Do you know why?

[Lakeisha]

I had already started it. I, I. Avoiding conflict. Didn't want to.

[Ramit Sethi]

Yes. Yes. Wait, stay there with me. Avoiding conflict, Putting some sales rep ahead of your own self. Do you see that?

[Lakeisha]

I do.

[Ramit Sethi]

Do you see how that has affected you to the tune of hundreds of thousands of dollars? And it is intertwined with the inability to get rid of this therapist, which could be knocked out by tonight, which has affected so many other things, including your own investments. Do you see that?

[Lakeisha]

Yes.

[Ramit Sethi]

What is your conclusion from that?

[Lakeisha]

I need to face conflict and learn how to have difficult conversations.

[Ramit Sethi]

Yes. And what about yourself and your finances?

[Lakeisha]

That I have to face it. I can't avoid it. I can't run from it. I have to deal with my finances head on.

[Ramit Sethi]

Yeah, I agree. If I asked your kids what they have learned about money from their mom, what would they say?

[Lakeisha]

Two things come to mind which are both not great. How to spend it or nothing.

[Ramit Sethi]

And let's say I asked them, what do you mean how to spend it? What would they say?

[Lakeisha]

They both think that I shop a lot. So if you want something, buy it. I do think that they think and feel like I work hard. So work hard, get money and then spend it on the things you like and want to do. I think that they feel like that's how I live and treat money.

[Ramit Sethi]

Do they know that you have no savings and no investments?

[Lakeisha]

No.

[Ramit Sethi]

What do you think they're gonna think when they hear this?

[Lakeisha]

They're probably going to be surprised. Fortunately and unfortunately, I do feel like for my youngest daughter, she might feel a sense of urgency as it relates to having to rely on like a scholarship or something to go to college. Luckily, my oldest daughter, she was able to get a full ride. So I think in a lot of ways they will feel like there's no safety net. They got to figure it out.

[Ramit Sethi]

I think that's true. Do you accept that there is no safety net for them?

[Lakeisha]

No, I don't want it to be like that. I didn't have one. I don't want that for them.

[Ramit Sethi]

But. But that is the case. That is reality right now. And if we're talking about investing aggressively and saving, there is not a safety net for your 14 year old or 11 year old in the near future. It's just not there. I'm sharing this because I often say in order to live a rich life, you have to be honest. Honest with yourself and honest with the people around you. This is avoiding the tough conversations in your case, with yourself. Can you accept that there will be no safety net for them?

[Lakeisha]

No.

[Ramit Sethi]

Okay, then what are you willing to do about it?

[Lakeisha]

Whatever I need to. Just like I would do whatever I need to do right now, today, for them. I have to do that for the future, for them. In the future. As opposed to just today?

[Ramit Sethi]

24 hours ago, you spent 50 unnecessary dollars at Target.

[Lakeisha]

Yep.

[Ramit Sethi]

So I hear you saying it, but I don't see the behavior matching it. What could you do to have your behavior match the very powerful message you just shared with me about willing to do anything for your kids, change my.

[Lakeisha]

Behavior and be transparent about those changes?

[Ramit Sethi]

Love it with them. What about the shopping?

[Lakeisha]

Stop. I don't need any more clothes. Like, even what I bought yesterday, I. I didn't. I don't need that.

[Ramit Sethi]

What are you going to do with those?

[Lakeisha]

I don't even know.

[Ramit Sethi]

No, like, what are you going to do with it?

[Lakeisha]

I could return it.

[Ramit Sethi]

Are you. Wow, this is interesting.

[Lakeisha]

No, I'm just thinking, I guess because I, in my mind I thought if I returned it, I would get, what, 25 bucks back? Where would I put that in the grand scheme of things? What would that help? And I don't know the answer to that question.

[Ramit Sethi]

How would I approach it?

[Lakeisha]

Unless. Put it in your investment account.

[Ramit Sethi]

Yeah, I would have a rule. When I have unexpected money, here's how the money flows. And because I'm behind on investing, I would put the majority of it towards investing. I'll put the second part of it towards savings. And I might keep, you know, 5% for guilt free spending. But I don't have time for uncertainty. I don't have time to be indecisive. And 25 bucks actually starts to add up to a lot considering the amount of clothes you've talked about. I'm candidly shocked that you're not willing to be decisive about returning clothes that you bought last night. James, any thoughts?

[James]

No. I totally agree with you.

[Ramit Sethi]

This is where a partner can be really strong or a partner can say, you know what? I see you. I know that's hard for you. I think $25 goes a long way. And I'm inspired by seeing you take these small steps. Gosh, you're getting me to think about taking small steps with my money. Maybe I can return something from my closet. Do you see how partners can make each other bigger and better? That's pretty cool. It's a cool opportunity. One partner's struggling, the other steps up. Hey, I love you. You could do this. We got a vision together.

[James]

Absolutely.

[Ramit Sethi]

What do you think, Lakeisha?

[Lakeisha]

Honestly, now I do want to return it, like tonight. I'm gonna go back to Target.

[Ramit Sethi]

Hell yeah.

[Lakeisha]

Here you go.

[Ramit Sethi]

Maybe send Jameson.

[Lakeisha]

Yeah, I'll send him a three seat, but yeah. You feel that?

[Ramit Sethi]

James, what would your kids say about you as it relates to money? What lessons have they learned?

[James]

Maybe since she doesn't live with me, she sees me spending on her. You know what I mean? When she's with me and when she asks me for things. So maybe. Maybe I need to change and tell her no.

[Ramit Sethi]

When was the last time you told her no?

[James]

I told her no last week. Matter of Fact, just here, maybe Friday, she had called me and asked me for some money. It was more of I just sent your mom some child support, so I'm not giving you money.

[Ramit Sethi]

So can I make a suggestion?

[James]

Yes.

[Ramit Sethi]

Maybe there's a better way of talking to her about money because you know, I just sent your mom child support. So the answer is no. I mean, I think there's probably a better way. What do you say?

[James]

Absolutely.

[Ramit Sethi]

Okay.

[James]

Absolutely.

[Ramit Sethi]

Like we're talking about an 11 year old, right? She's pretty old, she's pretty smart. She's picking up on that. Let's say she keeps going, she ends up talking to me in 20 years and what's she going to tell me? What's her relationship with money going to be?

[James]

Oh, wow. Spend.

[Ramit Sethi]

Really?

[James]

Definitely, yes. And then that would be my fault. She'll be talking about, just like we talked about some of the things that happen with us, our parents. She's going to be talking about it with us.

[Ramit Sethi]

That's right, absolutely. She's going to be talking about you. I can't wait till I speak to one of the kids of one of my guests. Okay. That's going to be the day that I really, I feel proud. But I'll tell you something, you have the chance to change that.

[James]

Yes.

[Ramit Sethi]

Right now though, don't treat her like 11 year old is little. They're not. 11 years old is really smart. How do you want to show up when it comes to money? And your daughter, like she calls you, she asks for something and you say what you've previously said. I think there's a better way. How do you want to show up with her?

[James]

One asks for what if she needed four?

[Ramit Sethi]

Nice.

[James]

And then just try to get her to think about, you know, do you really need that? Not only that, but teach her how to save some money. And I think that's one of the biggest parts.

[Ramit Sethi]

How are you going to do that? Do I need to pop up the CSP on the screen right now again? No. Because what am I going to see if I look at your savings?

[James]

Zero.

[Ramit Sethi]

Right.

[James]

So I have to show her.

[Ramit Sethi]

Yes. How are you going to show her?

[James]

Master, I'll save your money.

[Ramit Sethi]

Hell yes. And tell her, so this is how it goes next time she calls you. What does 11 year old ask for anyway? I don't even know.

[James]

Everything. Roblox cards.

[Ramit Sethi]

All right.

[James]

All type of things.

[Ramit Sethi]

First of all, I wish I hadn't asked that question because I'm gonna get like 5000 people commenting and telling me, oh my God, Ramit so out of touch. I don't want to know what 11 year olds want. Don't email me, don't comment, don't message. I wish I never said this. Anyway, here we are. She texts you, she calls you dad. Give me this gift certificate for whatever you say. You know what? I'm so glad you asked because I had this conversation the other day that I've been wanting to tell you about. Right there. I'm gonna pause. What have you already seen in my.

[James]

Response to her taking the opportunity to teach her the value of money and. Yeah.

[Ramit Sethi]

And actually just like excitement. Right. I'm so glad you asked.

[James]

Yeah.

[Ramit Sethi]

Because I had this thing that happened and I've been wanting to talk to you about it. Oh, my God. Amazing. Okay, great. So then you say, you know, I realized I haven't been as responsible as I could be with my money. And here I am. I want to teach you lessons, but I'm learning my own lessons. I took an honest look in the mirror and I realized what? Finish the sentence for me, then I.

[James]

Need to do better with my money.

[Ramit Sethi]

I haven't saved as much as I want, so I'm going to be saving money for myself. I'm building my own discipline, just like I want you to do every month. I'm putting money aside for my own savings, for my own investments. At this point, she's like, okay, what do I care? Like, do I get my gift certificate or not?

[James]

Yeah.

[Ramit Sethi]

And then you say to her, I love you. You know, I want to get you everything in the world, but it's not possible right now. I have to prioritize my savings. So unfortunately I can't get you that game. But I love you. What do you think about that?

[James]

It's pretty good. I think that's definitely something that I'm going to have to.

[Ramit Sethi]

To do to make it your own. Change it to what feels right for you. But just like the key points of that was like, oh, I'm so glad. I'm so excited you brought that up. Right. Totally different way of reacting.

[James]

Yeah.

[Ramit Sethi]

Sharing a lot of kind of vulnerable stuff. Like, when was the last time you told her, as a dad, I haven't done the best I could. That's kind of new, right?

[James]

Yeah.

[Ramit Sethi]

I don't know. I don't even. Like, I found that really hard to admit until my birdies that, like, I had these things that I was struggling with that I wasn't perfect at. And to admit that to a kid is like a hundred times harder. Any parent knows that. But you can do it because you've. You've done it all night long tonight with me. But it's so much more powerful to admit it to a kid because kids never hear their parents say, I messed up. I'm sorry. I'm working on improving myself. Holy. A kid is sitting there like they're going to hang up and they're going to remember that call for the rest of their lives. I have to say I'm impressed with the progress Lakeisha and James made in the short time we spent together. They had breakthroughs around their past and how those experiences have shaped their behavior with money today. Most importantly, they realized that some of these deeply rooted behaviors around money aren't even serving them. And even though we've mapped out a plan to help them build up their savings and create a healthy retirement, I want to remind you that it's easy to make a plan, but the magic is in actually doing it. I've given Lakisha and James some new tools to build their rich life, but the rest is up to them. I have a lot of confidence in them. Lakisha and James, I believe you can do it, and I want to wish you the best. Let's listen now to James's follow up video.

[James]

I think one of the biggest surprises out of the conversation was the fact that Kesha and I had some type of parent and child dynamic going on when it comes to our finances. And I didn't like that. That's not the type of guy I am. So we're working on that. I think one of the biggest takeaways is the fact that even through the fact that I was embarrassed by my situation, Ramit let us know that it's actually a possibility that we actually can get out of the situation. Just a little hard work. And so I'm working on that. It's definitely a challenge. Not only a challenge, but it's also a work in progress. What specific changes we have made this weekend, I canceled the lion's share of the subscriptions that I had. That was tough because I showed, like, watching my videos and things of that nature. So we're working on it. Hopefully, we will be one of your biggest success stories. And that is a goal of mine, that the next time we talk to James and Keisha, we'll be in a lot, a lot better place.

[Ramit Sethi]

And now Lakeisha's follow up.

[Lakeisha]

My biggest surprise was just that the connection that was made between my spending habits and that of my mother's. I never, ever thought that there was a connection between my spending and her spending. So to make that connection and bring it to my attention was pretty crazy. Some takeaways that I had one was the fact that we were eating out as much as we were. I did not consider that. And then one that actually leads into one of the changes that we have made since is not eating out as much. So we actually spent a little bit more on the grocery bill and have made all meals at home as a result and we'll continue to do so. We've already planned the one eating out meal and when that's going to be and looking forward to spending that time with family as my daughter and my niece will be home for the holidays and from college and so looking forward to sharing that meal and experience with them. Thank you so much for your help. Appreciate it.

[Ramit Sethi]

I was recently on a podcast called Something you should know with Mike Carruthers, and I like this podcast with Mike. I've been on it several times because he doesn't just skim the surface, he asks the kinds of questions you and I actually want answered. His episodes are short, sharp, they're packed with insights you can use right away. And I really enjoyed my interviews on the show because every episode dives into fascinating topics that make you go, whoa, I didn't know that Mike talks to experts about stuff that matters, like why feeling sad might actually be good news, how your imagination shapes your reality, and even quirky things like how animals really communicate. So check this podcast out. Search for something you should know wherever you listen to podcasts, and look for that bright yellow light bulb logo.