Why Everyone Is Drowning In Debt (and how to get out) - Caleb Hammer - #1123

Summary

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Modern Wisdom Podcast with Chris Williamson

Episode #1123 — "Why Everyone Is Drowning In Debt (and how to get out)"

Guest: Caleb Hammer

Release Date: July 13, 2026

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Episode Overview

In this candid and energetic episode, Chris Williamson hosts Caleb Hammer—YouTuber, financial educator, and host of Financial Audit—to break down the crisis of personal debt, why so many people fall into it, and the hard truths about fixing dysfunctional money habits. Caleb’s trademark tough-love approach comes front and center as the pair dissect generational attitudes, societal pressures, the psychology of spending, and strategies for practical financial survival in the modern world. The episode blends practical advice, vulnerable moments, and searing social commentary, with plenty of dark humor and self-deprecation throughout.

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Key Discussion Points & Insights

1. Caleb Hammer’s Approach & Persona

• Tone: Unfiltered, no-nonsense, often darkly comedic.
• How Caleb Describes His Work: "I'm yelling at a bunch of retards who suck with money and roasting them along the way and having a lot of fun doing it." (00:03)
  • He’s controversial by design, openly discussing receiving death threats and why he doesn’t shy away from mockery when it’s been consented to by guests.
• Consent in Roasting: The Financial Audit onboarding process is rigorous and ensures guests have control over what’s off-limits.
  • "They get to say what they don’t want to talk about…they still have that level of control." (04:25)

2. Moral Guardianship, Outrage & Social Media Dynamics

• Discusses "white knighting" and performative outrage, particularly from individuals not directly involved.
  • "It’s the being offended on behalf of someone who’s not offended. I will never get it." — Caleb (00:51)
• Commentary on social justice online: outrage is algorithmically rewarded because negativity gets more engagement.

3. Psychology of Appearing on Financial Audit

• Guests know they will be roasted and exposed, yet are brave to seek public help.
• "Anyone who comes on the show has seen the show, so they already know I’m an asshole…But they also do get resources and…change their lives for the better afterwards." — Caleb (03:46)

4. Access & Verification of Financial Information

• Describes methods to cross-check for concealed debts, mainly requesting screenshots from popular credit monitoring services. (05:00)

5. Is Life Financially Harder for Young People?

• Nuanced View: Objectively, certain things (like buying homes, healthcare, and college) are harder, but most other costs have dropped relative to average incomes.
  • "You don’t have to buy a house…even if you do, that might be a worse use of your money than just investing in the S&P 500." — Caleb (06:50)
• Healthcare called "fucked" and uncontrollable; education and housing provide at least some flexibility.

6. Generational Debt Patterns & Doom Spending

• New forms of debt (credit cards, BNPL) are rampant among Gen Z despite access to financial education.
• "Doom loop" psychology: bleak outlook drives ‘YOLO’ spending, reinforcing negative outcomes.
  • "Why not just put it on a credit card? …that makes sense." — Caleb (10:30)

7. Self-perpetuating Negativity & Consumer Sentiment

• Social/algorithmic reinforcement keeps people pessimistic, which impacts real economic behavior.
  • "Negativity is what drives our attention. So it drives the algorithm. So consumer sentiment will of course be lower." — Caleb (13:02)
• Actual economic data is not as grim as sentiment suggests.

8. Case Study: Bankruptcy & the American Debt Mentality

• [15:49–18:03] — Reaction to TikTok guest describing $91k in debt (car, bike, camper, medical, student loans).
  • "She’s retarded…How does she ever expect—She can’t get sympathy for not buying a house if she’s getting a camper, motorcycle, and car…” — Caleb (15:56, 16:22)
• Bankruptcy is procedurally easy but doesn’t address root behaviors. Real cost is often a cycle of repeat mistakes.

9. Root Causes: Emergencies vs. Chronic Poor Habits

• Debt blamed on ‘emergencies,’ but the habit of “spending whatever they wanted on fun” and failing to save is the true cause.
  • “It was your behavior before that emergency.” — Caleb (21:11)

10. Knowledge vs. Discipline

• Acknowledges “physics of the system” (knowledge) matters less than emotional regulation and behavioral change.
  • Uses own struggles with weight as an analogy for financial discipline. (22:14)

11. Lifestyle Inflation & High Earners

• "People on Financial Audit that are doing worse are the highest income earning episodes.…The closer they get from 100 to 200 to even a half a million dollars a year, the worse debt, the more credit cards, the more bullshit they have. It's, it's impressive. It's so bad." — Caleb (27:33)
• Higher income often means bigger, not better, mistakes.

12. Financial Personality Traits

• Most predictive trait: discipline.
  • “Everything in the world of budgeting comes from…discipline.” (24:19)

13. Debt & Identity

• Spending can be a way to “improve” identity; debt can also be a source of self-victimization and learned helplessness.
• Lifestyle inflation (spending increases with income) seen as a critical hidden risk.

14. Societal & Political Commentary

• Comparison of social benefits and tax burdens between US and UK; discussion on welfare, VAT, progressive taxes.
  • “The United States is actually the most progressive western major country for income tax. What we don’t have is VAT tax, which usually funds...the National Health Service.” — Caleb (58:24)

15. Financial Education & Systemic Frustrations

• Growth of high school financial education requirements lauded, but recognizes behavior changes are hard to teach ("I was a who didn’t give a fuck about school…").
• Fundamental syllabus for young people:
  • Budgeting (50/30/20 rule)
  • Car loans (20% down, ≤3-year term, payment ≤8% of income)
  • College ROI: “Don’t borrow more for your degree than you’ll make in your first year’s salary.”
  • Emphasis on career robustness and AI resistance.
• Warns against generational or gender ‘victim mentality’; more progress than many acknowledge.

16. Demographic Headwinds: Birth Rate, Social Security, and Retirement

• Declining birth rates threaten retirement systems (worker/retiree ratios plummet).
• Social Security insolvency projected without major reforms.

17. Wealth, Security & the 5 Million Dollar Milestone

• Quotes Kevin O’Leary (see Notable Quotes):
  • Most entrepreneurs are not nearly as liquid as they need to be.
  • Caleb recommends allowing early wealth to grow in equities, not just in T-bills unless nearing retirement.
• Security ≠ PJ ownership but means "weathering almost anything." (49:31)

18. Cultural Attitudes: Shame & Openness Around Money

• US tends to be secretive due to shame (especially around debt); UK is hostile to boasting about earnings.
  • “There’s a lot of shame around personal finances in our society and I think that’s pretty damaging.” — Caleb (53:20)

19. NIMBYism, Zoning, and Real Estate

• Housing crises traced largely to restrictive zoning and entrenched homeowners.
• “They’ll do every policy besides just letting developers build what the market demands.” — Caleb (110:43)

20. Financial Red Flags in Dating

• High car debt, financial entitlement, lack of ambition, "financial infidelity" (hiding spending/debt) all discussed as major partnership red flags.
  • "If I pull up to that TikTok girl we saw earlier and [she has] $50,000 car financing...like, we'll hook up, but we're not staying for a second." — Caleb (91:42)

21. Obsession with Optimization

• Warns about “Graham Stephan” types—people so obsessively frugal/optimized that it becomes pathological.

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Notable Quotes & Memorable Moments

On Generational Spending Patterns

• Caleb: “Gen Z is kind of getting into…something like doom loop…think everything’s going to be so bad forever. Why not just spend the money? Why not just put it on a credit card?” (10:30)

On Bankruptcy & Debt Culture

• Caleb: “She’s retarded. How…does she think she is ever going to get to home ownership if she’s getting camper, motorcycle and a $50,000 car?” (16:22)

On Discipline vs. Knowledge

• Caleb: “I know what it takes to lose this…This is all behavior at this point. I got the tits because I’m choosing that…Some people pay for them, some people do. I would pay to lose them!” (22:14)

On High Earners in Debt

• Caleb: “People on Financial Audit that are doing worse are the highest income earning episodes…The more credit cards, the more bullshit they have.” (27:33)

On US/UK Tax and Welfare Differences

• Caleb: “In the United States, the bottom 50% of earners contribute 1%. So 50% contribute 1%. That’s crazy.” (58:24)

On the Real Minimum Needed to Raise Kids

• Caleb: “We're richer than ever before and people have had kids when we were poorer than ever before…we overemphasize it, for sure.” (115:10)

On Money Red Flags in Dating

• Caleb: “High car debt would be absolutely horrible…It’s a big red flag.” (92:00)

On Cultural Differences & Shame

• Chris: “The UK is a great country to be poor in and a terrible country to be rich in. And America is a terrible country to be poor in and a great country to be rich in.” (55:30)

On NIMBYism in Housing

• Caleb: “The biggest NIMBYs are the ones that say in this neighborhood…’We accept,’ [etc].” (113:32)

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Timestamps for Key Segments

| Topic | Timestamp | |-----------------------------------------------------|--------------| | Caleb’s description of Financial Audit & persona | 00:00–01:40 | | Consent, outrage, and online offense | 01:40–03:46 | | Show onboarding, guest bravery | 03:46–04:51 | | Verifying financial data/access | 04:51–05:44 | | Is life harder for young people today? | 05:44–08:40 | | Cost of healthcare, education, and housing | 08:40–09:07 | | Gen Z debt mentality/BNPL/doom spending | 10:07–11:56 | | Self-perpetuating negativity & media | 12:09–13:38 | | Case study: $91,000 debt and bankruptcy | 14:49–18:03 | | Emergency debt, knowledge vs. discipline | 21:11–22:41 | | High income, lifestyle inflation, worst-off guests | 27:29–29:34 | | Financial success predictors & discipline | 24:19–25:36 | | Debt, identity, and self-victimization | 25:40–27:07 | | US/UK economic fairness, taxes and welfare | 55:30–61:00 | | Financial education in schools, best curriculum | 68:23–71:21 | | Zoning, NIMBYism, and real estate woes | 110:43–113:15| | Financial red flags in dating | 91:42–95:14 | | Money & relationships: shared finances, infidelity | 94:24–95:39 | | Impact of birth rate decline on the economy | 80:04–84:09 |

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Episode Highlights — Bullet Summary

• Tough-love is effective: Real personal financial progress starts with brutal honesty and self-examination. Most “emergencies” are the final straw after long-term lack of discipline.
• Behavior > Income: Irresponsibility and lifestyle inflation wreck high earners even more than low earners; there’s no income level at which bad habits are cured, only magnified.
• Generational & Cultural Differences: Americans tend to hide/wallow in financial shame while the UK punishes financial success; the societal safety net is extensive in the UK, but hostile to wealth.
• Practical Rules: Simple guidelines (like 8% of pre-tax income on car payments, not borrowing more for school than your first year’s salary) help cut through confusion and prevent disaster.
• Structural Problems: Car culture, housing policy, and social media fuel debt. Systemic mismanagement (e.g., Social Security) demands huge future reform.
• Financial Education: Expanded, but changing laws is not enough—behavioral shifts and discipline are key.
• Shame vs. Support: Lack of open discussion about money creates isolation and delays help-seeking—shame is damaging.
• Dating & Money: Debt, entitlement, low motivation, or financial infidelity are top relationship deal-breakers.
• Macro Trends: Declining birth rates threaten the sustainability of retirement systems; massive demographic shifts are ahead.

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Closing Note

Caleb Hammer pulls no punches—bringing humor, humility, and harsh reality to the finance world. This conversation is packed with real talk, common-sense distinctions between what can and can't be controlled, and repeated reminders that behavior, not circumstance, determines financial outcomes for most people. If you want to stop “drowning in debt,” start by changing yourself.

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Guest Links:

• YouTube: Caleb Hammer
• App: DollarWise

Host Links:

• Modern Wisdom Podcast

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Transcript

[Chris Williamson]

How do you describe what you do for work?

[Caleb Hammer]

Depends the viewer. If I'm talking to the nice little church lady, I'd tell her I'm helping. Helping young folks and some old folks with their money. I'm just talking to just a random person on the street. I'd say I'm yelling at a bunch of retards who suck with money and roasting them along the way and having a lot of fun doing it.

[Chris Williamson]

I was gonna ask why you get death threats, but you've kind of precluded that.

[Caleb Hammer]

I mean, I don't understand. Like, okay, if you come on financial audit, you would come through a multi week onboarding process and give me all these things, like, let's pretend you didn't want me to make fun of your curly hair for whatever reason. You would tell me that you would tell the producers that.

[Chris Williamson]

Because we ask you what's going on in advance. Yeah.

[Caleb Hammer]

So we don't bring it up. So. And then I get consent to make

[Chris Williamson]

fun of my sensitivity about Michelia.

[Caleb Hammer]

Exactly. So why get death threats for making fun of things that someone gave me explicit permission to make fun of? Makes no sense. It's the being offended on behalf of someone who's not offended. I will never get it. I'm not the person. I've never been that person. I don't understand it.

[Chris Williamson]

The white knighting.

[Caleb Hammer]

Yes. The. The moral hero. The. You're on your moral horse and, I don't know, you want your TikTok community to raise you up. I guess it makes you feel good, you get views.

[Chris Williamson]

It's one of my least favorite categories of people are those that their morality stands on the shoulders of other people that they're saying are worse than them. But don't look at how good I am because I don't want that scrutiny on me. Just look at how bad they are. And implicitly that makes me feel like a person that's of higher moral standing.

[Caleb Hammer]

It's pretty easy. Yeah. We had. When we were filming this episode, we had a guest on our episode that uploaded yesterday and. And I brought in one of my coworkers, employees, also friends, Tyler. Black dude, big black dude, very intimidating, could beat the shit out of anyone. And like, the guy where you were sitting is a piece of shit racist, like an actual racist.

[Chris Williamson]

He was like, did you do this on purpose?

[Caleb Hammer]

Cast him?

[Chris Williamson]

You brought a black person in with somebody that you knew would be racist.

[Caleb Hammer]

So the guy was sitting where you said. And he said, you know, I'm one of those people that says things that need to be said. And I was like, okay, pause. And brought in the guy that he would actually have a consequence, right?

[Chris Williamson]

Yep.

[Caleb Hammer]

Yeah. And he was like, yeah, N word. So I just said that. But you know what? He consented to it. Obviously. I wouldn't have my friend go through a situation he didn't like. He even reacted to it on his own stream later that day. He loved it.

[Chris Williamson]

No, just loves being called the N word. Gets off on it.

[Caleb Hammer]

No black. We scoured the Internet. No black person was like offended anywhere. There was a lot of white women that were super offended on his behalf, saying that he should sue the show for having to go through that. That's workplace harassment and all this stuff. When he's friends, we're. I'm friends with him. We're literally just having fun together, making fun of the dude that was a piece of shit in front of us. He and I were on the same team having a good time and it was this white lady upset on the Internet.

[Chris Williamson]

Kind of blows my mind that people want to step into that environment because it's very intense. It's not opposite someone originally it's one on one and then it's one on two. But there's also maybe someone behind the scenes and you know that there's all of these people on the Internet that are going to see you do this thing. The psychology of someone that's prepared to go on a show like that and go head to head with someone on their home turf and be an asshole, it's kind of impressive. It is almost impressive. I don't think that I would be very good at if I was an asshole doing that and being on this side. If you are an asshole by design, you're usually trying to keep it quiet so people don't realize. People aren't advertising their assholery up front.

[Caleb Hammer]

But that's what makes it fun though, is that anyone who's seen our show or anyone who comes on the show has seen the show, so they already know I'm an asshole. Then they watch two onboarding videos, one that gets sent to them when they have to watch in the green room. And I'm like, hey, I'm an asshole. I'm going to make fun of you. I'm going to yell at you, telling me what you don't want to do. So honestly, besides that piece of shit racist. Because I actually don't like someone who's actually racist. Every other guest that has come on the show, practically, other than a freaking few here and there. I respect the out of cuz yeah, that's crazy. Showing up to a show that a lot of people are going to see that you're going to get goofed on. But they also do get resources and the vast majority do change their lives for the better afterwards. That is the fun effect of it. They get to go through the whole cycle with us. And I think it would be crazier for them to sign up if everything, no matter their say, was on display. Since they get to say what they don't want to talk about, it gives them more control, which if there is something that actually would impact their life or their job or their family, they can call that out and not have that in the episode. So they do have that level of control, but they're still very brave and I have a huge amount of respect for them.

[Chris Williamson]

What is the process of getting access to somebody's financials and how do you know that they haven't kept something super secret behind the scenes that they haven't shown you?

[Caleb Hammer]

Right. Well, it would be difficult for like a checking or savings account, but we do get them to send us their credit karma with, you know, important things bleeped out.

[Chris Williamson]

What's that?

[Caleb Hammer]

Their credit karma. Oh, credit karma. Well, it basically shows your credit report for the most part. I mean, it's kind of simulated, it's not perfect. You're not getting your like requesting your three free credit reports every single year or whatnot. But it's the app that many people use to actually see what's going on and the impact of their new debts are opening their hard inquiries, everything like that. But if we get them to send their screenshots, that way we can see if there's debts that they don't even know about because oftentimes there are debts that they don't know about, collections that they don't know about. So we're able to hold their feet to the fire that way.

[Chris Williamson]

Do you think it's genuinely harder for young people today or are expectations the problem?

[Caleb Hammer]

It's harder to do certain things. I mean, you're not going to be able to do the single income household thing. Like that's going to be. There's going to be harder things, right? That's going to be harder. Buying your first home is going to be harder. You know, getting your first car might be harder. It depends, you know, how you do it. That one's definitely a hit or miss for sure, that that's going to be harder. But being independent in terms of groceries or rent or getting a comfy office job, that is Relatively decent pain, like we've never had it. Better than ever before. Now, you can take a snapshot in time this year, this period in exact time. Yeah, for college graduates, it's objectively shit. That's just an economic situation, not a general generational situation. Because five years ago, college graduates had a great. They're entering the best job market in the history of humanity. Essentially, when that pandemic money was just flowing from tech companies, anyone could get a job. But now it's objectively not. But that's a period in time, not a generational thing. So the cost of practically every category of life spending as a percentage of income has dramatically dropped since the 1950s. Besides a few things that are very important, buying a house, health care, and barring for school, borrowing for school. Do you have to do that? You know, there's different paths. We can talk community college, we can talk apprenticeships, trade schools. Okay, so there's flexibility there. House. You don't have to buy a house when, you know, if you're a young person right now, you don't have to. And even if you do, that actually might be a worse use of your money than in just investing in the S&P 500. Health care. Yeah, that one's fucked. Can't really control that one. That's a mess. So if something bad happens to you,

[Chris Williamson]

what's happened to the cost of healthcare over time?

[Caleb Hammer]

Oh, just endlessly. The premiums. And if an emergency happens. Healthcare is one of those issues that's actually really interesting when it comes up on the show because I get very invested in trying to learn as much as I can about the personal finance categories across the board. But for healthcare, for some reason, I've just missed it because this is one of those things that was never my passion. So I never fully dove into the reason, the why and how. I just make sure, you know, I have the general necessity, the. The things that someone would need to make sure they're getting a halfway decent plan through their job and whatnot, making sure their premiums aren't completely out of control, that they can afford their co pays, that they have their highest deductible taken care of in the case of an emergency. But speaking on the cost of health care, you know, this is. That's definitely out of all things in the financial world, not my expertise. And I said. I said that on another podcast that hasn't come out yet. And now that it's come up in two podcasts in a row, in a row, I'm just, you know, I Need to educate the fuck out of myself on health care because it's very curious because housing. Could talk about housing all day. Costs of college and school, I could talk about that all day. But not health care.

[Chris Williamson]

It's one of the big three.

[Caleb Hammer]

One of the big three.

[Chris Williamson]

Housing, health care, school. You know a lot about the first, the first and the last.

[Caleb Hammer]

But it's a lot more that you can control. So I'm interested in the things you can control. It's very difficult for people to be able to control their actual health care situation whether or not they have a pre diagnosis or there's only a few

[Chris Williamson]

plans off get into an accident.

[Caleb Hammer]

Yeah, exactly. But school and housing, there's a lot more control. And financial audits more about what things you can control.

[Chris Williamson]

It's interesting that you said as a percentage of earnings, the cost of living in almost all areas could be fun. Has become more affordable.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Except for three that are fudgeing massive.

[Caleb Hammer]

Massive.

[Chris Williamson]

And those three have done so much damage that they've managed to basically net detract from all of the gains that were made in everything else.

[Caleb Hammer]

Yeah, I mean it's pretty brutal. But again with the two that I can speak on a little better. House, you don't have to buy a house. So you have more choices there. You don't have to buy a house fresh out of college, you don't have to go. When it comes to the cost of school, there's so many different paths that include going to school and that's local four years, that's community college. That's not going to private institutions or going to your dream school because it has a sports team. You're like it's. It also has to do with. If cost of college is high, you need to make sure you're getting a degree that has an appropriate return on investment. So there's lots of choices there. So those three categories are pretty brutal. But of two of them, you still have choice in it.

[Chris Williamson]

Gen Z borrowers are carrying more credit card debt than millennials did at the same age, despite growing up with more financial information than any generation before them. Yeah, 98% of Gen Z say credit is important, but only 53% believe they have adequate access to it. And more than half of Americans have used Buy now Pay later services. 59% of those users were Gen Z.

[Caleb Hammer]

Oh yeah, that makes sense. Paying for Klarna everything. It's a very Gen Z thing. Tap to pay. Super easy to use those. They're at every checkout for any concert you go to. Pretty much anything you want to do. So that's not surprising. There is, I'm not, I'm forgetting the term off the top of my head, but it's something like doom loop or something that a lot of Gen Z is kind of getting into where mostly because of the information out there and the algorithms they find themselves in, they think everything's going to be so bad forever. Why not just spend the money? Why not just put it on a credit card so it makes sense.

[Chris Williamson]

It seems to me like a big part of it is people being so unsure about the future and feeling like things are not going to get better that well, fuck it, it's almost like the end of days. You know there's this interesting story about during the blitz In World War II in London, the amount of casual sex that people were having went through the roof. But lingerie sales stayed the same and it was just people thought look, I might die tomorrow. It doesn't really matter about how sexy I look in bed, let's just get down to it. And it's kind of the financial equivalent of that. I'm just going to dump it all. Which is this weird sort of recursive system. It's this self reinforcing mechanism that if you have negative information about the economy and about the quality of life for young people and about how hard you've got it and the fact that it's never going to get better, that encourages people to behave in a way that makes the thing true.

[Caleb Hammer]

Yeah, absolutely.

[Chris Williamson]

Kind of wild. It's a reality, it's a self fulfilling prophecy that kind of gets not made out of nowhere. There are real material changes but it's certainly worsened and it's tracked.

[Caleb Hammer]

The University of Michigan does consumer sentiment survey and I think they've done it since the 1980s and right now is one of the three lowest we've ever had. I think it was right when Covid kicked off the Great Recession and now, but now is not even near Great Recession in any other indicator anywhere. It's not right when Covid kicked off when everything shut down and no one know what was knew what was going to happen. But consumer sentiment is basically at an all time low.

[Chris Williamson]

What do you think's going on?

[Caleb Hammer]

Well, we are stuck in those algorithms. You make money on negativity. Like even I have a documentary channel, more of a passion project, not much of a moneymaker. It's cold.

[Chris Williamson]

I like it.

[Caleb Hammer]

Oh thanks. Called Front Page. Still getting the feel of it. But either way, I mean the reality is the, the topics that are interesting to talk about are the more negative ones. Super positive content isn't as interesting to talk about. For whatever reason. I'm not interested in learning about super positive. Not interested in talking about super positive.

[Chris Williamson]

So does it feel urgent?

[Caleb Hammer]

No. Exactly. So that's the information that's getting out there and it's the information that catches people's attention, keeps them in the algorithm. So I'm not surprised at all. I mean nightly news other than one fluff piece is usually just negative, negative, negative. Even about the heat outside. It' like the apocalypse. It's. It's always just negative. So it's not surprising. That's what drives our attention. So it drives the algorithm. So consumer sentiment will of course be lower.

[Chris Williamson]

Right. And that is impacting people's behavior, which actually brings that reality, brings that imagination into reality or brings the news feed into your finances. Pretty interesting.

[Kevin O'Leary]

Yeah.

[Caleb Hammer]

Even though consumer spending is actually relatively healthy overall. Like this isn't the best year in our economy, but it's also not even close to the worst year. Things are relatively healthy. There's some bad things like a called out. There's the new graduates, bad job market for new graduates. And there's a lot of things at play there. There are a lot of things that play there. There's the nervousness of AI. There was the over hiring during the tech boom, during COVID They've cut back there. And if there's. If there's no people leaving their jobs voluntarily, there's no jobs opening. And the people that are leaving their jobs in text are the one getting laid off. And they're not rehiring someone who's getting laid off. So those job openings that were there during the pandemic aren't there. So there's actual neg things happening right now, but it's not the overall economic situation we're still having. Okay. GDP growth post inflation.

[Chris Williamson]

Warren.

[Caleb Hammer]

Iran done. Allegedly. We'll see.

[Chris Williamson]

Is it.

[Caleb Hammer]

He signed the idea of peace or something yesterday. And so did Iran, the leader of Iran.

[Chris Williamson]

That's like a guy with erectile dysfunction saying I've signed the idea of erection today.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Signed the idea of a. Of a penis. I want to get you to react to a financial case here. Can we pull up that TikTok?

[Financial Audit Guest]

I've had such a bad financial burden the last couple years. So after meeting with attorney and doing lots of research, I realized that filing bankruptcy really isn't as bad as it's made out to be. And it was truly going to be my best bet to file chapter seven and you know, truthfully, my consumer debt really is not that bad. A lot of people have it a lot worse financially, but for me, $91,000 was just too much. It was uncomfortable and I just wanted to get a fresh start, move to Texas to directly after high school. And I made a lot of very irresponsible decisions financially and really dug myself into a big hole of debt. I decided, let's go ahead and file bankruptcy. Let's give myself a clean slate. That way I can stop stressing and I can actually do better. Okay, just to give you a little breakdown of the debt that I do have, that totals up to $91,300. I owe about $51,000 on the vehicle that I have. We did try selling that, trading it in, all that good stuff. But way too much negative equity to come out on top of. I bought a motorcycle back in 2022. Thought that was a great idea. Americans tried selling it, not able to get what we owe out of it. And I do own a camper and I owe about 13, 400 on that.

[Caleb Hammer]

She's retarded.

[Financial Audit Guest]

I live out of that camper because I can't afford a house. So I am keeping that since I do live in it. I have twenty two hundred dollars worth of medical bills that I had no idea were in collections. And then I have $12,000 worth of student loans. However, those do not get forgiven with bankruptcy. So I will still continue that payment. And then I have about $7,700 worth of credit card debt all coming into a grand total of $91,300.

[Caleb Hammer]

First of all. Okay, yes, it is harder to get into a home now. Yes, a large down payment is difficult to get to. Interest is not great on a house. How in the world does she think she's possibly, possibly going to. Sorry, I don't mean to scream at you. You're not a guest on my show. Why does she think in. In what world does she think she is ever going to get to home ownership if she's getting camper, motorcycle and a $50,000 car. $50,000 car when she's moving to a brand new state? This is, this is so American. We are so debt brain broken. And she's actually right. I mean bankruptcy is actually not that hard, not that brutal, a little expensive, but it's really not the worst. It fucks your credit for a bit. And it's not a good learning lesson. People usually end up in the same situation they are without changing their behavior before going through bankrupt. But she is right on that, but how did she ever expect. She can't get sympathy of not buying a house if she's getting a camper, motorcycle and car, of which minimum payments on the camper, on the motorcycle and car are likely over $1,000 together. Like $1,000 going against anyone's income, unless you're like in the top 1% is going to aggressively prevent you from saving anything. Remember, she can get an FHA loan on her first house. She can get, what is that as low as 1.5%, something like that down on your first house. How would she, how is she surprised? You can't get anywhere. And that also is really stupid. Getting a trailer instead of renting an apartment because she's, she's getting debt on a depreciating asset. It's almost even worse because an expense could pop up. Have to get new tires. She has to pay rent anyway. Likely to park somewhere and get the utilities plugged in. No, she has America summed up.

[Chris Williamson]

What are the hidden costs of bankruptcy that no one wants to talk about?

[Caleb Hammer]

I mean usually it costs. Costs a couple thousand bucks to go through it, go through the process and get a lawyer on your side. Some court filings. There is the credit impact. There is a credit impact, seven to 10 years depending. And with that, that could really make it more expensive to get into an apartment because that's usually instead of just a security deposit, you might have to do first month, last month.

[Chris Williamson]

Because that includes rent. Not just buying.

[Caleb Hammer]

Yeah, yeah, just rent.

[Chris Williamson]

Right.

[Caleb Hammer]

Instead of just doing a security deposit like someone with a decent credit score, you might have to do first month, last month as well, which makes it very burdensome to get into an apartment. But you're in a risk, you're a riskier person, you have bankruptcy and a lot of people have apartment collections, so it's not surprising they would request that. You'd have to get into a predatory car loan. If your car breaks down, you don't have money. You have to get a 25 interest rate car. Just a horrible like 8 year term. And it's probably some piece of car that you buy for 20 is worth 15 before it's even driven off. Then the credit cards you get, you're not getting the, the good intro 0% cards. You're like, you're getting credit 1 cards at 29 with monthly fees even if you pay on time. So you just get access to worst services. In the world of dads, you're not getting approved for decent personal loans. And again, like I said, the most important thing bankruptcy doesn't actually fix anything unless you fix your behavior. Because just like consolidating your debt or transferring to another credit card or even letting things go to collections and negotiating them, just like, just like all those bankruptcy, if you do not change the your behavior that got you into that situation in the first place, you will literally end up right back there again in a few years. We've had a. We've had quite a few upper aged people on our show that have been through bankruptcy multiple times and now they're heading there again. Cause it changes nothing.

[Chris Williamson]

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[Caleb Hammer]

Well, a lot of it. It's not necessarily a misconception, but it's the wrong way to look at it is because of an emergency. Like yeah, if you have $0 something happens. You would have to probably go into debt for that. But people don't look at what happened before then. They were living their life, spending whatever they wanted on fun. They never saved up even a one month emergency fund or a highest deductible coverage. They didn't save up anything. So of course when an emergency happens, you're going to go into debt. But it wasn't the emergency that did that. It was you living your life not saving up even a three month emergency fund. Which I would recommend six, by the way. But it's not saving that got you into that emergency debt, not the emergency itself. It was your behavior before that emergency.

[Chris Williamson]

Yeah, I don't know. It seems to me like a lot of financial success. It has a knowledge component of understanding the physics of the system, but a huge part of it is emotional regulation. What's the relative amount of knowledge versus emotional regulation when it comes to being good with money?

[Caleb Hammer]

Depends where someone comes from. I mean, so I'm in a place of privilege now. You could say I have information and yet I look like this. I know what it takes to lose this. This is. Now, this is. This is. I have the knowledge. This is all behavior at this point. I got the tits. I got the tits because I'm choosing that. Some people pay for them, some people do. I would pay to lose free. Yes, I pay to lose them, but instead I'm just not doing the work that would be required to lose it. I have the knowledge, don't have the behavior.

[Chris Williamson]

Yes.

[Caleb Hammer]

So there are people in those financial situations. There are going to be the people that come from a very different life. Incredibly low income, no opportunity in their neighborhoods, no people to look up to, maybe even bad Internet, so they don't even get to watch the same podcast as us. Don't have a good library to go, read a good personal finance book. And I don't want to just victimize someone or infantilize someone, but there are harder situations to come from. Doesn't mean they can't get out of it. It just might be a little more difficult and you need to surround yourself with the right people.

[Chris Williamson]

Do you find it difficult when somebody comes in front of you and a lot of the time it is because of decisions that someone has made and this illustrious, like, tailwind that you've had of all of these people that have made bad decisions, and then somebody comes in front of you who has come from a situation which has put them so far on the back foot financially, do you sometimes find it hard to change gears with them as opposed to sort of pointing the finger too much to actually be like, oh, I see you. I see you in this problem that you're going through and that you've been put into?

[Caleb Hammer]

Yeah, I mean, we really only allow people on the show where it's their fault because it's a personal behavior show. So anyone that complains about the people on our show saying that, well, they can't control that. No, everyone that comes on our show, they can control if someone applies and it's something out of their control, Something like an incredible medical diagnosis. That's where we send them, like a page of resources and like, if we can connect you with anyone, let us know. But it doesn't make sense for financial audit because financial audit is about personal change. So we just. We just don't have those people because that's not the conversation.

[Chris Williamson]

Yeah. What, going back to personality traits, what do you think of the person? Personality traits that predict financial success.

[Caleb Hammer]

That predict financial success. Certainly being disciplined. I mean, discipline comes down to everything. Everything in the world of budgeting comes from or money comes from budgeting. And budgeting is all about discipline. So, you know, that's why we created Dollar wise, that personal finance app, that budgeting app that is made for the everyman, not just like the, you know, super financial nerds who want to use things like ynab, things like that that are incredibly difficult to use the discipline to actually log into that app, connect their accounts to their banks, see where things are going, and take the actions on the advice that's given to them based on their actual financial information that's plugged in. Without the discipline, even a tool like Dollar Wise that is incredibly useful to changing people's lives, you got nothing.

[Chris Williamson]

It's like you could be tracking all of your calories using macro factor or something, but if you're not going to change what you're eating, it doesn't make a difference.

[Caleb Hammer]

Yeah, it's discipline. If, you know people. People are excited when they leave Financial Audit or they watch Financial Audit and even me like a diet. Even me like a diet. If you did a fitness audit on me, I might be excited for a couple of weeks. Then, you know, if you don't have the discipline, sometimes you fall back. It's easy to have a fire under your ass for a couple of weeks if you don't have that discipline for the long term, it's difficult. It really is.

[Chris Williamson]

What does debt do to someone's identity?

[Caleb Hammer]

Unfortunately, it turns a lot of people into victims that they're really not. A lot of people have more control than they're really willing to admit. What does it do to their identity? That's interesting. Some people use debt to improve their identity more than anything. You know, pulling up, you really care what the person next to you at the stoplight thinks about your car. I don't know why people care about that. I've never cared about that. A lot of people use debt to get the clothes that make them look good, the jewelry that makes them look good. Unfortunately, actually that quality tends to come from lower income communities anyway. It's kind of crazy how that works. But people use debt to change their identity, but then people also use their identity of debt to put themselves in a place of victimhood and like, oh, I'm in debt. I can't, I can't do anything. I may as well just spend the money. I already have the credit card debt. Let me just put it on a credit card again. What's an extra $10 gonna do to $5,000? And the answer is not much. But it's a death of a thousand cuts. They just think that over and over again.

[Chris Williamson]

Yeah, it's a very strange sort of death debt spiral where the sunk cost fallacy. If this is already bad, what does it matter if it's a bit worse? And also, if you're stressed with finances, you probably want something that makes you feel a bit less shitty. That could be food. I'm going to sedate myself from my financial troubles by further ingraining myself into my financial troubles, which also becomes a spiral of itself.

[Caleb Hammer]

Yeah, and that was totally me in college, you know, when I had a lot of bad debt. Car debt, student loans, private student loans, multiple credit cards, and family debt. I absolutely went to McDonald's, swiped the chase Freedom card, getting it close to maxing out constantly. And because it felt good, what did it matter is basically max out anyway. What's an actual max out credit card gonna do?

[Chris Williamson]

Do you think lifestyle inflation's become a bigger problem than inflation itself?

[Caleb Hammer]

Oh, bigger problem. I wouldn't say. Oh, that's a good question. You're a professional podcast host. That's nice. Damn. I'd say inflation is worse overall. I'd say worse overall because that impacts everyone. That's not your choice. Right, Such a choice. But I'd say on a personal level, yeah, no, that's bad. That's bad. That's gonna, that's gonna fuck you over. When someone gets the 20%. No, no one gets a 20% raise. Okay. When someone gets a 5% raise but increases their spending 6%, you know that that is very common on our show. You know what's interesting? People on Financial Audit that are doing worse are the highest income earning episodes. People often, you know, you open the show with getting death threats and stuff and death threats, and it's kind of minimal. But we do get lots of complaints and stuff about the show. One of our biggest complaints is, you know, I'm yelling and making fun of poor people. Those are actually the people I usually make fun of. And yell. At the least it is the high income earners that if they just fix a couple things, they can get out of debt pretty quickly. But they also get into worse debt because they have a higher income. So they get approved for more debt. They're always the worst off. They lifestyle inflate. I swear, the closer they get from 100 to 200 to even a half a million dollars a year, the worse debt, the more credit cards, the more timeshares, the more cars, the more bullshit they have. It's, it's impressive. It's so bad.

[Chris Williamson]

It feels, I think probably incredible to a lot of people that you could earn half a million a year and have a bad financial situation, which I

[Caleb Hammer]

wouldn't be surprised if the majority in the United States did, who make that much. Why you have a half a million. Go get yourself the nice house. Go get yourself the nice car, the nice clothes. Why not? You worked hard, deserve it. It's in our culture. We want, we're consumers.

[Chris Williamson]

Do you think that are the things that richer people waste money on different to the things that poorer people waste money on?

[Caleb Hammer]

Absolutely. I'm trying to get over my fear of flights and I guess I'm rich now, so that's nice. Knock on wood with all that.

[Chris Williamson]

Does that help you get over your fear of flights?

[Caleb Hammer]

I rented a pj. Tell me that's a waste of money.

[Chris Williamson]

Easier or harder.

[Caleb Hammer]

So it's a control thing for me. I don't like being stuck in a situation that I can't control.

[Chris Williamson]

Do you know how to fly the pj?

[Caleb Hammer]

No, but I can say let's land. I can't do that with a commercial.

[Chris Williamson]

Well, you can. You could make a big enough fuss that you would like but it would

[Caleb Hammer]

be a real headache and bad for my career too.

[Chris Williamson]

So that would be a real headache.

[Caleb Hammer]

Yeah, but like. So pause. Yeah.

[Chris Williamson]

What was the first time with your travel anxiety getting on a PJ like?

[Caleb Hammer]

It was. Oh, the PJ itself. It was actually really bad when we filmed it too. We filmed that. It's on the Internet. I burst down in tears. It's really bad.

[Chris Williamson]

I'm sorry, man.

[Caleb Hammer]

Oh, it was, it was anxiety. Like that's not.

[Chris Williamson]

I don't think that you should dismiss it like that. So.

[Caleb Hammer]

But it's not like something bad happened to me. Right. Like anxiety's make belief. It's like it's not real. My brain thinks it's real, but it's not. So I was crying, I was sad. But you know what was actually making me more sad and crying? A lot of people thought it was out of pure terror. It was remembering a lot of the things that I. I haven't done. A lot of the family I haven't visited because of my fear of travel.

[Chris Williamson]

It's grief. As much grief as it was anxiety. So interesting point here. There's a guy called Vinny Shorman who. A hypnotist in the uk. I have a friend. My friend's name is Sky King. Sky King, Right. This guy lived in Hawaii while he was a kid. Flies all around the world, loves Asia. Been to Japan a bunch of times out of nowhere, just developed travel anxiety. Bad travel anxiety. Tried to get on a plane, couldn't bailed out. Tried to get on a plane, couldn't bail out. I think this happened maybe six, eight, maybe 10 times. And I put him in touch with Vinnie. Now, some people have better results with hypnotism. Some people have worse. In a single session, Vinnie fixes travel anxiety. And I don't know what the full story is, but I know that the Simpsons theme tune is an integral part of the anchoring for how he gets over his travel anxiety. Duh duh duh duh duh duh duh duh duh duh duh duh.

[Caleb Hammer]

Interesting.

[Chris Williamson]

And that was really interesting. That was like. It's a fucking cool gift to give somebody to unlock that. But I know what you mean. There is nothing wrong rationally in terms of the utilitarian approach view of the universe. There is nothing happening. But your felt experience of I'm getting on this jet that I've paid money for, that's kind of a momentous occasion for me. It's this landmark as a person who talks about money doing something that's kind of canonical in everybody that has money's life. And my experience of that has been tarnished by the fact that I've got this thing that isn't me that I don't want in me and is kind of behind the steering wheel a little bit. I think that's. I think that makes sense.

[Caleb Hammer]

But it was nice because I was working with a panic therapist at the time and just started working with him again, thank goodness, because I need to get over this thing. And he didn't let me get off. Like. Like.

[Chris Williamson]

Is he with you?

[Caleb Hammer]

Of course I. Yes. So I brought him.

[Chris Williamson]

You brought your panic therapist on the jet with you?

[Caleb Hammer]

It was our plan, you know, we kind of.

[Chris Williamson]

Oh, it wasn't like an intervention or something?

[Caleb Hammer]

Well, actually, technically, I heard him the day before, so we already decided. But yeah. So we brought him with us. He's really cool. And I'm working with him now again. And we have. We have a game plan to get over it. But, yeah, it was. It was. It was really simple. It was Austin of San Antonio. So it was nothing. I just. I wanted to get on a plane again because I was just preventing myself from getting on a plane. So that's a very quick flight.

[Chris Williamson]

How long had it been since you were on?

[Caleb Hammer]

The decade, at least. Yeah. So mostly road trips, places. But even that still gives me kind of anxiety, which is just. It's just. I hate it. But, you know, we have a game plan. We're doing some things. I want to go be on some more shows.

[Chris Williamson]

I mean, dude, if some people's exposure therapy is. We just need to get a spider and put it in the corner of the room. Your exposure therapy requires a private jet.

[Caleb Hammer]

Exactly.

[Chris Williamson]

It's a slightly higher bar. It's just as well that you're rich, because if you won, you'd be fucked.

[Caleb Hammer]

Exactly. Exactly. What really sucks is the same exact model private jet I was in just crashed in Laredo, Texas yesterday, and a CEO in Austin, Texas, died on it. So that's like kind of fucking with me.

[Chris Williamson]

That plus Oliver Tree. There aren't many forms of.

[Caleb Hammer]

Yes.

[Chris Williamson]

Air transport that are feeling pretty safe right now.

[Caleb Hammer]

Yeah. The next one's a commercial. We're doing a commercial next. We're doing some long road trips to kind of.

[Chris Williamson]

I would book, if I was you, I would try and get maybe your row and then one behind, one in front. I was thinking that just in case there's a, you know, one of those.

[Caleb Hammer]

I just didn't want to be around people. But.

[Chris Williamson]

Yeah, that's also nice. That's also nice. So you've got some anxious, panicky tendencies.

[Caleb Hammer]

Yeah. Really Just that one thing you built,

[Chris Williamson]

you built a show which is essentially high stakes live confrontation. Right. With strangers about their most shameful secrets.

[Caleb Hammer]

Yeah.

[Chris Williamson]

You're someone who has panic attacks. You run a show that gives other people panic attacks.

[Caleb Hammer]

Yep.

[Chris Williamson]

Is that a coincidence or is this just like the most elaborate exposure therapy ever?

[Caleb Hammer]

It's great. I mean, that's what people have to go through. They have to go through it. What's actually nice is because of mine, and I'm, you know, working with my guy for a while now. Like, I can actually work through them pretty well. And now if someone actually does have a legitimate panic attack on the show, I can help them through it, which is pretty nice.

[Chris Williamson]

Oh, cool.

[Caleb Hammer]

We just pause the cameras and do that real quick.

[Chris Williamson]

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[Caleb Hammer]

Usually I can tell they kind of just go flat faced in that moment. Like they, they disengage. Their eyes kind of go blank and maybe even like a little bluish. And I'm like, oh, okay. So we just literally pause. I'm like, hey, okay. You know, I go from the crazy voice to like just down to like, hey, you okay? Remember, you know, it's like of course they know. It's like real and everything. But I'm like, yeah, we can take a pause you know, you can take a break, and then I help them. If they're, like, actually having an anxiety attack, I'll do, like, a breathing exercise real quick. It's like three and six out, and that's pretty rare these days, but. And we definitely have people that need to do, like, a lap around the building. A producer will take them, or they need to go outside and hit a vape that read.

[Chris Williamson]

Yeah, hit a vape. That's good. That's why, Jared, I need a fucking E pipe. For the people that are listening. I require. I want to be able to come up with. I want to be able to pontificate, but I want to be able to do it with nicotine. So if anyone can find me a pipe that looks legitimate like this, but I can have some nicotine. And that would be. I wonder whether part of the reason that you're not inducing as many panic attacks is because you're getting soft in your old age.

[Caleb Hammer]

You think so?

[Chris Williamson]

Yeah. I wonder whether it's because you've taken your foot off the gas.

[Caleb Hammer]

I just threw something at someone the other day.

[Chris Williamson]

You'd be fucked here. There's so many projectiles. There's so many potential projectiles. Some of them are heavy as well.

[Caleb Hammer]

No, honestly, I am proud of it. I think our onboarding process is so thorough. We've had people that have come to work with us or people that interviewed with us that have worked for, like, Dr. Phil and a lot of other type shows. Dr. Phil's close in Dallas, so that's why him specifically. But they go through our process and they're like, this is crazy. I've never seen an onboarding process like process like this at all. Because usually for, like, I'm not speaking Dr. Phil at all. Don't sue me. But many shows like that, daytime tv, they don't give a fuck about their guests. But we actually really care because, one, they're members of our audience. So a little selfish there. Okay, A little selfish. I want members.

[Chris Williamson]

If you kill them, you're going to reduce the audience size.

[Caleb Hammer]

Yes, exactly. And I want them to do well. Whether that's. You know, you could look at it from two perspectives. Pretend like you hate me and I'm the selfish, most piece of shit ever. Fine, take that. Obviously, I want them to do well

[Chris Williamson]

because it proves me or do it because of me.

[Caleb Hammer]

It shows that it works. It shows that the show works. So selfish.

[Chris Williamson]

Care about how what the mechanism is can be. Because you don't like me. I'm an asshole. You want to Prove me wrong. Saying that I don't think that you're going to be able to turn it around or because you love me and you think that my advice is worth listening to and you turn it around.

[Caleb Hammer]

Yeah, and. Or there's the second option where it's. And that's the real option that I actually really do care about how they succeed. So I really want them to do well. And the average guest pays off. It's just over like 20,000 doll dollars and 12 months of debt after coming on financial audit. That's our most recent annual report. We do one every December.

[Chris Williamson]

How much of that impact that you have on people's debt do you think is because of the knowledge that you give to them and how much do you think is because of the intensity of the emotional discomfort that you put them through?

[Caleb Hammer]

Yeah, it's a mixture of both. There is the. That tough love, crazy and fun approach of it. Like I think oftentimes 90 of the time they're having a good time too. Like they know the craziness of the show so. But they have fun and that's not for everyone. But I'll don't come on the show if it's not for you. So it's like a show I would actually personally go on when I was in debt. It would have worked for me. Someone screaming at me, that works for me. It worked for me when I played sports. You know, it's whatever, it works for me. And then we set them up with lots of tools afterwards. They get dollar wise for free forever no matter what. They get all of our personal finance courses. They get a certification through course careers to help with their jobs. They get access. Any kind of resource that we're working with third party, they get access to. So we try to give them everything and then we check in with them. I don't remember the exact dates but it's like the day their episode goes live, a week after that, a month after that and then three months after that. And we do two updates a week with former guests on our in our Hammer Elite membership. And we're endlessly checking in with them with surveys and we tell them to reach out anytime they want. So there's the mixture of the show and that lights a fire under their ass and the post filming support as

[Chris Williamson]

well post coital care process. Yeah, I did Love Island 11 years ago and famously the UK series. I don't know whether it's happened in America yet, but the UK series of Love island has killed more people than any other TV show. Two past stars took their own lives, one of whom was a really good friend of mine.

[Caleb Hammer]

That's crazy.

[Chris Williamson]

Then the fucking host took her on live. Caroline Flack. Caroline Flack. Yeah, I just, I. Once. That's strange. Twice, you're like three times. Including the host. You're like, there's a fucking pattern here. But one of the issues, and this was something that I saw especially, I think Love island broke the App Store when it came out. It was the number one app in the world above ChatGPT, above fucking Claude. And there was shutdowns on servers and shit. Like 300,000 concurrent downloads at a moment. Like downloading the app to watch the. I don't know what it. I don't know what you do. Voting on it or something maybe. And the post show care routine thing, because I did the first. I was the first person through the doors of the first ever episode. Wow, right. Of the first season. So they were. We were the guinea pig. We were the first child where you make all of the mistakes. You drink when you're pregnant, you smoke in like, you fucking forget to feed it for 12 hours. Like all of that stuff. And once you finish up, you should have a support system as you get thrust back out into the world. Now the first season that I did was like way smaller. It was 10 times smaller than season two, which was 10 times smaller than season three, which it really sort of took off on that exponential. But had it have been even a bit more exposed, there was the least amount of post show support. Even though it was that much smaller, the post show support was basically nonexistent. And then each time that one of those incidents occurred, you could tell that itv, which is the company in the uk, that was. It's Channel three in the uk, right? A dev Channel three and Channel seven. And every single time that one of these horrible, horrible situations happened, everybody got an email just reminding you that you have access to the safety and care team. Whenever I'm like, dude, fucking too late, man. You know, like something about the horse bolting and the door being closed. But the.

[Caleb Hammer]

We also probably didn't get the opportunity when walking out of the island to be like, hey, if I do this, make sure it's not in the episode. So it's like you, you were like,

[Chris Williamson]

no, don't control the edit. Exactly, you do not control the edit. And the entire universe is watching you and commenting on you. And then what's mad is you come out because it's recorded and published live, but you only enter back into the world Once it's happened, you have no idea what's made the edit. You have no idea what people think of you. You could come out and be the hero or the most hated person in your country. It's fudgeing crazy.

[Caleb Hammer]

Yeah. Should I get into that? Everyone's doing that. Everyone's doing these pouches. Like, would I be like so locked in? Dude, no. That's scary. I'm asking for advice first before I go full.

[Chris Williamson]

Those are mine. So those ones are. That's just caffeine. That's just 50, 50 milligrams of caffeine.

[Kevin O'Leary]

These.

[Chris Williamson]

These are very healthy for better for you. Nicotine. Those are knickknacks.

[Caleb Hammer]

So that's like everyone in the world is doing pouches right now. Like, how locked in would I be?

[Chris Williamson]

I have a bit of an oral fixation, which I'm sure that the people that think I'm gay on the Internet are gonna love to hear me say. Have we got any toothpicks? Jb, can you get. If you're outside. Jonathan, can you bring some toothpicks in from the cupboard, please? I wanna show those. Just something to fucking dick about with while you're working, I think is very important. If you've got a pen or whatever. Sometimes you try. I could get the pipe.

[Caleb Hammer]

Yeah. Bite my fingernails. That's my thing.

[Chris Williamson]

That'll do you. What. What income level do people's financial problems fundamentally change?

[Caleb Hammer]

I'm saying it's behavior. It's fully behavior. Again, like I said, the worst situations I've seen in the entire show are high income earners. Absolutely horrible. So I. I'd say never. It gives you more opportunity to get out of a bad situation. But I wouldn't say the income levels. Everyone thinks when they make the next $10,000 in their income, their entire life is going to change, their spending changes. But if their behavior is the same, if their inclinations are the same, their lack of discipline is the same, they're actually just going to be in a worse situation. So I would actually argue that if behavior doesn't change at the more income level, your situation might actually get worse

[Chris Williamson]

because you now are playing with bigger chips on the table. Yeah. And if you're fudgeing it up, you've got more access. I never thought about that. Such a good point. That you've got more access to credit. People think banks, credit cards think that you are a safer bet. Because of that, you can fuck yourself harder.

[Caleb Hammer]

Yeah. And I guess I'll put an asterisk on my statement. There is like you got to hit a base, basic minimum level, right? Like if you can't pay for like the cheapest rent in the area, put food on the table, utilities, then obviously anyone that's not making up to that point, yeah, that's a threshold where it's like game changer because you're just like surviving. But if you can't even hit the survival, like that's not even in the conversation. But typically we don't really allow for that that much in this country, in western society, I mean, you'll see it, but you know, we have lots of child support services for low income, food support, housing support. It's not perfect. No one's going to argue it's perfect. But we do have a lot of, a lot of social programs to help those people that are in those lower.

[Chris Williamson]

Friend of the show Iced Coffee Owl Boys had Kevin o' Leary on and he gave some insight about where he thinks different levels of income impact your lifestyle. You pull that up for me, Jared. Look at this.

[Caleb Hammer]

What would you say are the main four tiers of wealth where if you hit a certain amount, life.

[Kevin O'Leary]

I tell everybody this. You should strive very hard if you're an entrepreneur, to have $5 million in T bills, not in anything else, just t bills. Making 3.82% this morning, you know you've made it and you've safeguarded your family for the rest of your life. If you can get $5 million liquid in T bills. Most people that consider themselves very successful entrepreneurs do not have $5 million liquid in T bills. They don't.

[Caleb Hammer]

But what net worth should you be at to justify 5 million in t bills?

[Kevin O'Leary]

Well, you should be at. The first thing you should do is get the 5 million liquid be worth $5 million liquid. That's far more valuable than anything else. Liquidity with wealth is actually a superpower. Most people say I'm very wealthy, but they couldn't raise a million dollars by 2 o' clock in the afternoon if they tried. It's tied up in all kinds of things they think are worth a lot until the shit hits the fan. The plan is, if you're an entrepreneur, the hardest thing is to make the first million really hard. And when you make the first million, put it in T bills. Just as hard, but not as hard is to get to 2 million. 2 to 3 is actually quite easy because you figured something out. But where you get undisciplined is you start buying shit you don't need because your man needs to get to 5 million liquid. You have to have 5 million liquid, to call yourself a successful entrepreneur. And I don't care who disagrees with me, they're wrong.

[Caleb Hammer]

I guess I'll be wrong. I mean, no, I agree. One of the first goals I had was to get to 5 million as quick as I could. But invest it in the stock market. I don't really understand. Get your first million, put it in low indexing, T bill. T bill like Treasury. So I'm not really understanding like putting it in bonds or something. It just makes sense if, if you make your first million in your young, let it grow in the marketplace at an average of 8 to 10%. That makes more sense. I mean, I guess if you're approaching like 60 and you make your first million off of a business being successful. Yeah, put it in something more conservative. But if you have time on your side, unless America collapses, like the stock

[Chris Williamson]

market's going to do over a long enough time horizon, you'll weather any of the little wobbles.

[Caleb Hammer]

Yeah, exactly. So, but I do agree with that 5 million mark. Because that 5 million mark, if you do the 4% rule, it's 4% of 5 million, I think, what is that, $60,000 a year? Something like that. So you live a good middle class income off of that using the 4% rule. So that works. So that was one of my first big goals. It's, I don't like the idea of taking the first million you make and then literally just not letting it grow past inflation. That doesn't make any sense. If you're getting your first million, you should let it work. Have it work for you in the stock market. I'm not saying reinvested immediately into the business. And certainly he's correct where people start getting money and they start blowing it. He's 100% correct on that. It's just weird to take the first million and put it into something low index, especially if you're young.

[Chris Williamson]

Is there a financial milestone that creates the most happiness for people?

[Caleb Hammer]

Yeah, a lot of the happiness that can be achieved through wealth. Like you can't buy friends, you can't buy family. So a lot of the happiness that can actually be achieved through wealth, I'd say if you can cover, if you can weather practically any emergency, including like a cancer diagnosis, something really bad, if you can.

[Chris Williamson]

How much money is that?

[Caleb Hammer]

I mean, honestly, I think that 5 million is a good marker. That 5 million is a good marker. You can really start pulling into it for, you know, a few years. If it's like really aggressive, really bad, you Want to go to the best in the world. So with that, you know, you can weather anything. You can. Even if you blow through the five, hopefully you make it to the other side and you can start bouncing back. But that gives you unlimited flexibility. You don't get to do the crazy things that are super fun. You don't get to do the. You can't buy a pj. I can't buy a pj. Now I can rent a short little trip, but I don't think that's what drives happiness. It's a fun thing, moment of happiness. But I think the true happiness that you actually can buy is Security. And 5 million is a really good number to get.

[Chris Williamson]

It sounds like a massive number for people to feel financially secure.

[Caleb Hammer]

Yeah, but you know, you can weather literally practically anything. That's the question. Like you can weather almost everything. With a few hundred thousand hours set aside, you can, you know, take a while to find a new job if you have a few hundred thousand. But I'm saying if I'm really thinking like you can weather anything, 5 million is a great number to have.

[Chris Williamson]

Yeah, I totally didn't think about the fact that you can afford to invest in, specifically the S and P, any kind of tracker if you're younger, because there's going to be some movements, there's going to be periods of downturn, but over a long enough time horizon. And I mean, if the S and P goes to fucking zero, there's much bigger problems than what you're doing with your money.

[Caleb Hammer]

Yeah, we'll be killing each other. Yeah, yeah, yeah.

[Chris Williamson]

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[Caleb Hammer]

I think it's pretty damaging that in our culture talking about money is shameful in general and in debt, I mean, I think it's good to have a good laugh on a tick tock short things like that, that's fine. But I think if we have a whole system where people feel shameful to even bring up their close friends, their family or even their therapist that they're in a bad financial situation, they're not going to get that emotional support, they're not going to get that encouragement that they actually need to change because they'll just be weathering it themselves. That's a very difficult thing. You don't want to again going back to even just the cancer thing, you don't want to be going through that yourself. It's almost impossible. You need support. Anything you go through, any kind of support system is good. And if we have a massive level of shame around it, which I would say in our country, in our society, we definitely have, people aren't even willing to say what they make.

[Kevin O'Leary]

Yep.

[Caleb Hammer]

You know, they're like embarrassed or they're afraid of making it too much and people look down on them for like they'll be jealous. You know. So there's a lot of shame around personal finances in our society and I think that's pretty damaging.

[Chris Williamson]

It's interesting as a British person, we have shame but in the opposite direction. We have shame about talking about how much we make. If we make a good wage poor there because there is such a strong tall poppy syndrome that if you're seen to be too big for your boots or doing too well, that can often cause way more ire. It's like an interesting. I understand why people would feel personal shame around talking about being in a bad position financially. What does this say about me as a human? What does this say about my habits? Maybe people are going to think less of me, but there is a

[Caleb Hammer]

pro

[Chris Williamson]

social fuck that person's down bad. Hey man, I really want to help you as opposed to dude, I just got this new job and I got a 30% pay increase. I can't believe it. I've been working so hard for this for a long time. If that's not someone that's got your best interests at heart, that triggers in them not pity, which is not an emotion that people want to feel, but it induces envy, which is way more active, you know, that's the sort of thing that can get you ostracized from a friend group. And again, this isn't everybody. I've got amazing friends in the uk, but I met a million people running nightclubs. I had one of the biggest events companies in the UK for a long time. A million people.

[Caleb Hammer]

Right.

[Chris Williamson]

In person with a tight pair of jeans on, holding a clipboard, giving out wristbands and free champagne. I had a handful of close friends that I could talk to openly about everything that was going on. Successes, failures, all the rest of it.

[Caleb Hammer]

That's good.

[Chris Williamson]

That's not a great friend. Exposure to conversion funnel. Right. A million people, handful of friends.

[Caleb Hammer]

Oh, yeah. And that's why you had them, though, you know, that's. No, a lot of people don't.

[Chris Williamson]

That's true. Yeah. And as an only child, that was like, fuck. Like, I've got some people that have got me. And that's cool. Just. The UK is a very inhospitable environment for people that are trying to do things financially. I've got this line. I wonder whether you agree with it. The UK is a great country to be poor in and a terrible country to be rich in. And America is a terrible country to be poor in and a great country to be rich in.

[Caleb Hammer]

Yeah. I mean, a lot of poor people move to and stay in the uk. A lot of wealthy people leave. I'd say the analytics just follow that in general.

[Chris Williamson]

Bingo. Fucking nailed it, dude. Forget the pithy maxims. I just dialed the entire financial industry. There's a safety net in the UK which. Moving to America, to me, feels like quite brutal.

[Caleb Hammer]

Quite like, why leave the Council of State? It's comfy.

[Chris Williamson]

It is. National Health Service. I've got this stat. Britain spends more on working age welfare every year than it collects in income tax.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Working age welfare. And the difference gets borrowed every single year.

[Caleb Hammer]

Yeah. That's insane. And all the productive people that would actually contribute to the tax base are leaving the. The wealth drain. The brain drain in the United Kingdom is. I feel bad for your country. That's. Honestly. It's a place where, I mean, the majority of my life, I wouldn't have considered moving there, but there was a part where I was like, oh, this would be the best place to go live in because you get the cool walkability of Europe and like the nice, you know, okay, winter and nice language. And it's your language. Exactly. So I wanted to kind of go there for a bit. It's gone. I don't. If the UK comes back, it'll be the biggest comeback story in the history of civilization.

[Chris Williamson]

But yeah, we're like 90 down at the moment.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Game of football.

[Caleb Hammer]

There are, you know, I mean there is the conversation where it's like yeah, GDP per capita, there'd be 51st state. Did you see that?

[Chris Williamson]

Yep. Yeah, I got a lot of. For putting that.

[Caleb Hammer]

Well, I mean that's true, but they're

[Chris Williamson]

also got a lot of from Americans.

[Caleb Hammer]

Well, Americans are, I don't know, Americans are rich and. But there are some other true things. The UK when it comes to safety and a lot of things, you know, ranks higher. So there's not just like it's not all trades. Yeah, it's not all. But like no, it is true. I mean unfortunately it's going the same direction as Spain or southern Italy, one of those places where it's people go there or are born there, get educated there and then leave to somewhere where they can make double the income. And why wouldn't they? We're such a mobile world, dude.

[Chris Williamson]

If you're inhospitable. And this is the thing that I understand some of my lefty leaning friends, Jimmy the Giant is one of them and he thinks that taxing the rich, he means like the ultra rich, he means like hundred millions plus of liquid or whatever have held asset wealth. But that, that is something that's justified. That's something that would help to raise up the underclass and people that are unemployed and need that. But I think the bottom 55% of the population in both the UK and the US are net withdrawers from benefits as opposed to net contributors. Yeah, like just that statistic income tax.

[Caleb Hammer]

In the United states, the bottom 50% of earners contribute 1%. So 50% contribute 1%. Like that's crazy. We're a very progressive income tax society in the United States. United States is actually the most progressive western major country for income tax. What we don't have is VAT tax, which usually funds like the National Health Service and whatnot. So in Americans, Americans. That's the fun thing about Americans, including especially populist Americans, either left or right. We want the Scandinavian social programs, but we want to do it on like a Florida tax system. Americans are not willing to pay the actual taxes required for the systems. And it's never about the wealthy people paying a lot in taxes because that doesn't fund at all. It's all about the, the flat tax, the VAT tax. The national sales tax, where everyone has to pay an extra 1, 2, 3, 4, 5% or whatever it is on everything they purchase. That's what funds those social programs. And the United States would never tolerate it at a national level.

[Chris Williamson]

Have you ever seen what a set of accounts for a normal limited company that has to. That's within the VAT threshold. So I think it's $120,000 a year. 120. Fuck. That was very unanglicized. £120,000 a year or above that your limited company makes. And after that point, you're VAT reg, you're registered for vat. Have you ever seen one of the accounts submissions? Dude, it is a. As somebody that had a limited company for a decade and a half in the uk, I still do. My rental properties go through that, although they don't breach the threshold, so it doesn't matter. It is a fucking nightmare. Each individual transaction, you charge the person who is getting the service from you an additional 20%. That's what VAT is, 20%. And then you claim back that VAT up to an amount from the government. So it's this fucking Ouroboros, this endless. Financially, bureaucratically, in terms of paperwork, it's this huge overhead. And I understand what VAT is for. I understand that we have lots of services that you don't have in America. They need to be funded somehow. National insurance, that's another type of tax that's not seen in America.

[Caleb Hammer]

But if you do the math, after everything that you get free in the United Kingdom after people pay for it, and the median income here, after the median taxes here, after the median paying for the private services here, we still end up with more money in our pocket in the end.

[Chris Williamson]

No way.

[Caleb Hammer]

Yeah, it's pretty close, but it's still.

[Chris Williamson]

Even with the. Health care is one of the biggest costs. Even though health care is the single most common reason that people go bankrupt in America as well, I think.

[Caleb Hammer]

Yeah. Which isn't surprising. And honestly, people make it sound more consequential than it is. As we talked about earlier, bankruptcy is actually not that even big of a deal, really. It's really not. It's. It's overblown. I mean, it's not great. I don't just like go get bankrupt, like that's not wonderful. But it's like people make it sound like the scariest thing in the world and it's really not. But I mean, I looked into that two years ago. Maybe the numbers have changed today, but two years ago, that's what it looked like and we still have like out of a major nation. Yes, you're gonna have micro states where it's like Switzerland, you know, much smaller. Obviously their GDP per cap and everything is just gonna be a lot higher in those kind of places. Or like Monaco, something like that. But as far as like a major nation, large nation, the United States like destroys when it comes to disposable income. The income you have after all the important stuff after you get taxed and everything. We just lead because we just encourage. Our system just encourages that. But what's interesting when talking about the United Kingdom and you talked about your more left wing friends that like want to raise taxes and stuff there, what's also interesting on the left right spectrum is during the Great Recession that 2008, 2009, 2007, the United Kingdom went more conservative where the United States went more liberal with their spending. We pumped a lot of money into the economy. The United Kingdom, I had it in my austerity. They went austerity and you can see what the outcomes were. We went into debt for it as a nation, but we recovered in a couple years. The United Kingdom's GDP just recovered from 2007, I believe like a year and a half ago. Two years ago, yeah. So the, their more conservative approach of spending, raising taxes, cutting spending there in the recession, it failed, it objectively failed across Europe. In the United States, you know, Donald Trump, Covid pumped a lot of money into the economy. We're very liberal with our spending. Yeah, we chuck the money in. So it's, it's, you know, where we're pretty progressive. I mean 50 of our federal spending. Yes, it's mandatory spending. It's not, you know, whatever, but it's still social spending. So left versus right, it's not, it's not always, you know, one side's gonna always be in the right because the more right wing running of their federal budget in the United Kingdom failed. When it came to the Great Recession, it just, it destroyed, it destroyed the economy, destroyed productivity, destroyed spending.

[Chris Williamson]

Well, even that now has kind of become quite squirrely because when you talk about conservative spending, a lot of the time that's more pro capitalist that more prepared now to turn the money printer over. So it's the existing archetypes of what it even means to be left and right. Pick any, pick stuff about which races you do or don't like, which cultures you do or don't like, which religions you do or don't want inside of your country. Like everything that the whole tectonic plate underneath what used to be stereotypes and cliches. That's all moved.

[Caleb Hammer]

Oh completely. I mean you do see it in race. It was the more 90s liberal, which I'm probably more aligned with on this perspective if we wanted to color blind society, you know, and it was the more right wing people that were like, well no, we see, you know, they're different than us, you know, that kind of stuff. Like I don't know about the 90s at that point, but even still that was the more 90s liberal perspective. Now it's the more centrist, even right wing position, colorblind society. And people on the far left, they're like, no, we need black dorms, we need black graduations. We see race first no matter what. And it's very interesting how that shifted. And I don't think with bad intention to be clear. I don't think they're evil for that. But I do think it's sometimes when people get to the extremists they horseshoe around.

[Chris Williamson]

Correct. Yeah. It far left and far right end up looking a lot closer than you'd think.

[Caleb Hammer]

Yeah.

[Chris Williamson]

That just going back to the bottom 50% contribute 1% of the taxes. But then when you net it down in terms of what's given all different types of aid and assistance, I think it's up to the bottom 55% are net detractors.

[Caleb Hammer]

Yeah, it doesn't from the economy. And with we have systems made for that. The tile tax credit is made for that. It is usually lower income people that have more kids. That's just how it is. And lower income people pay less taxes, but they get the same child tax credit. So this is more money is going to go to them in the end.

[Chris Williamson]

Do you think that would surprise most people to find out that the bottom 55% of the population are net detractors from the benefit system as opposed to net contributors?

[Caleb Hammer]

Oh, of course, absolutely. Listen, I can I. Every time I take a political compass test, I find myself on a centrist, you know, slightly leaning right economically and then decently left socially. But I had like an extreme socialist on my show the other day, episode's not out yet. And I was talking to her and I was like, how much is the top 1% pay in taxes? She says, nothing, they pay 0%. I'm like, no, it's like 30% of all income taxes. Top 10% pays like 50%. Top 50% pays 99%. It blew her mind. She has no idea because we're in such misinformation Algorithmically defined places on the Internet. There was a study done by some elite university on the east coast where they were researchers were going into TikTok and engaging with left wing content and then a different one would do right wing content. And TikTok immediately found out in about three minutes whether you wanted if you're anti men or pro left or anti woman or pro right. And they would just put you into that camp where all of a sudden all the information you got, all the content you watch, was the extreme version of that. And that's all you were getting because you show you engage with that and if you engage with that, they want to give you more so you stay on their platform. It makes sense from their business perspective. So it's not surprising at all that people wouldn't be aware of that information if it goes against their worldview.

[Chris Williamson]

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[Caleb Hammer]

Yeah, I mean, that's why Financial Audit's about the perspective of the individual and their responsibilities and what they can change. Because some people comment, why aren't you talking about the system that them in the first place? And I'm like, that's not what this show can change. You can go vote. Congratulations, you contributed to changing the system that you want to do. But the reality is on that show, only one person can change what's happened in that person's life immediately, and that's that individual. So you're right. Talking about the system, it doesn't help anyone on that personal level. It's the actual choices. There, there. And there is good news. The United States is actually taking a pretty important step towards it. We're close to 40 states that now require a personal financial education course to graduate high school. It's close to 40 states. It wasn't even half of America just a couple years ago. So there's a syllabus.

[Chris Williamson]

What do you think of the syllabus?

[Caleb Hammer]

I haven't looked at it, but I mean, the governor of Michigan came on the show and you know, she wanted to talk about it and you know, she's Democrat. She's probably going to run for president. And I was very impressed with how much she actually cared about making sure people needed to learn about basic personal finances before graduating high school. I think that's important and I'm glad to see that we're doing that as a country now. I don't know about you. I don't know what the grade system is like out there in the United Kingdom, but I was a who didn't give a about school. I would have done whatever the minimum thing required to pass that school, and I wouldn't. Or that class. And I wouldn't have learned anything if I was in school. I don't know. I. Other than the things I was actually interested in, which is mostly history classes and music classes at that time, I did the basic bare minimum to pass and I wouldn't have learned anything. So there is that consequence. But at least we're trying.

[Chris Williamson]

If you were to put together a Syllabus of principles financially to teach young people what would be the biggest ones.

[Caleb Hammer]

It would start with budgeting. Because if you can't budget, there's nothing else. So budgeting's that, you know, we talked about the discipline, personal responsibility, that's a little harder to teach in school, but at least learning how to budget a household. Starting with something like the 50, 30, 20 method, which is 50% on needs, 30% on wants, 20% on investing. Smallest categories investing. You get to spend 30% of your money on bullshit. Obviously that changes in places like New York, la, San Francisco, but that's a good place to start from. So teach that concept. Teach. What is a good car loan to get? I enjoy the money guy rule. You put 20% down no longer than a three year term and no more than 8% of your income is the monthly payment that equals a car you can afford. Actually teach the value of college and a degree. Instead of saying everyone needs to go to college and borrow as much as it takes to get whatever degree you want at any institution you want, instead teach. Okay, a good general rule is don't get a degree of which you borrow more for than you'll get in your expected first year's salary. So that's a good one.

[Chris Williamson]

Oh, that's nice.

[Caleb Hammer]

Yeah, it's a good rule to just not borrow more than you need. What's.

[Chris Williamson]

I don't know how America stacks up in terms of different courses at different universities. Can you give me some examples of low, medium and high? And what would be expected? Because there's no way I've seen some of the fucking student debt bills.

[Caleb Hammer]

Oh yeah, that's bad.

[Chris Williamson]

There's no way that somebody's gonna. Some people wouldn't even earn that back in five years of being at work if they had zero costs and all of the money went back to their student loan.

[Caleb Hammer]

Yeah, absolutely. I mean, so strictly thinking college, let's get rid of trades or anything like that. Community college, you can go there for two years, you can get your basics out of the way. In fact, a lot of community college, you can get your four year degree now at like nursing and whatnot. Austin Community College here you can go for like a thousand bucks a semester, 2,000 bucks a semester, super affordable, super cheap. Many people can work their way through it. And that's in Austin. And it's, it's similar in other areas. From there you want to transfer. If you're going to transfer to an institution more affordable, just standard, maybe directional school like western Texas, you know, something like That I went to Western Michigan University where it's a little more affordable and you complete your final two years there and you take federal student loans for that. And the big question from. Well, okay, to finish your question. So the four that more directional school, finish your four years but beyond that then you're talking like you're going out of state at a four year institution. Skipping community college out of state's like double the cost. Then you can go beyond that. Then we're talking private institution. You actually go beyond that and think international which is why people really care about rankings in the United States because that gets international students. They care about rankings and they'll pay an extra premium to go to schools in the United States. So that's why they really care. But I try to stay down here, try to stay in that community college for the first two years and then transfer to the in state institution. Federal student loans, subsidized or unsubsidized. At least you have the protections with federal student loans. Really try not to go private. The only reason you'd be going private is because your family already makes a decent amount of money. So that that's how I would approach it. And then it's degree selection that's the important one. You have to look at the fields you're going into a lot of the. Unfortunately there is a big gender division and this isn't anti women. I don't want to be on that weird anti women but there is an actual reality that women are getting lower return on investment degrees in the United tend to get more things like social services, psychology, sociology, things like that that don't return. Where men tend to really think about the income post. I don't know if it's ingrained societally or culture or they to be the provider or whatever, but for whatever reason they tend to go, you know, more engineer, things like that and women, you know, more teachers. So that's really important to think about the degree and the return on investment. And now honestly a thing to probably consider is how AI resistant your career field is going to be. Who knows where that's going to go.

[Chris Williamson]

I think unfortunately women are going to be hit hardest by that. So there is, it's referred to as the lanyard class.

[Caleb Hammer]

Okay.

[Chris Williamson]

People that wear lanyards to work, it's middle management, it's marketing, it's hr. And that is a big chunk that sort of white collar lanyard people. That is going to be a big chunk of what AI comes for first supposedly. And that is going to I tweeted this and I go, people got very mad at me about it.

[Caleb Hammer]

That you're looking at your responses to tweets. Who cares if people are getting mad?

[Chris Williamson]

I go on that once every two days and I see what furor has occurred within the last 48 hours.

[Caleb Hammer]

Look, they don't matter.

[Chris Williamson]

I post and ghost. But it's just interesting to see what the sentiment is. How close to a third rail or beyond the Overton window is this thing that I just see.

[Caleb Hammer]

Internet is not real life. So it's just so hard to take into account what it said.

[Chris Williamson]

Very true.

[Caleb Hammer]

This last election in midterms, I swear it all went opposite of what you saw on Twitter. You're gonna think all these like out outsiders were gonna win because they're so big on Twitter. It was nothing. It was nothing.

[Chris Williamson]

Yeah. The sexy campaign on social media is not middle America who are voting and actually have the time and the preparedness to be able to go out and have registered and are fucking ready to go.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Anyway, I said we've just got ourselves now. We've overshot it a little bit. I think women out on men up to the age of now about 32, 33. That's about £1,111 more to 29. I don't know what it is after that and only then does it. But that has grown. It was up to 29. Now it's up to 32, 33 I think for women out earning men, given that you've just about reached young people gender parity between men and women in terms of earning, you are now about to see that what probably to women feels like we finally arrived economically. Okay.

[Caleb Hammer]

Majority of degrees.

[Chris Williamson]

Yep. Two women for every one man completing a four year US college degree by 2030, et cetera, et cetera.

[Caleb Hammer]

Master's degrees even more correct.

[Chris Williamson]

PhDs also more, but not more more. That situation of parity is maybe going to be at risk and I think a lot of fingers are going to be pointed that we just arrived and now robots built by men have just taken our opportunity that is still so fucking green that we haven't settled into it away from us. That I think is going to be one of the biggest stories of the next decade. I mean there's going to be many, but one of the ones that people are going to feel the most is more war between the sexes.

[Caleb Hammer]

Oh yes. The gender wars are so extreme. The political division right now in the most recent federal election, the gender divide in the generation Z is further than any other generation in American history. It's, it's, it's, it's scary. I'm actually scared. And it's impacting more things than this that it's impacting reproduction numbers which impacts the overall economy. It impacts retirees, the retiree to worker ratio. If people aren't, and people aren't. People hate each other. Now they have, you're swiping based on political affiliation on the dating apps, you know, so it, it is very scary and it's sad to see. And unfortunately, again, it is usually like the white women that are calling me fascists online for personal responsibility finance.

[Chris Williamson]

You're in very good company with regards to that.

[Caleb Hammer]

Yeah, yeah. But it's like, it's a, it's really weird because I really just want the best. And talking about statistics or anything isn't sexist. It's not right now, you know, I didn't even say it earlier because it shouldn't be about the sexes, but when we talked about people struggling post college degrees to not get a job, it's actually not women. They're, they're getting jobs at the same rate as new degree holders as traditional. It's men that have fallen off the cliff. But I didn't want to focus on that because this shouldn't be a big gender war. But the gender wars among Gen Z right now is insane and we're going to have massive consequences down the road, just as we've seen in South Korea, in Japan, and I'm terrified for that as a hopeful future retiree.

[Chris Williamson]

Yeah. This was from my newsletter this week. Asian women now earn more on average than white men in the US A finding that adds a wrinkle to common narratives about patriarchy and white supremacy. Asian women are winning.

[Caleb Hammer]

Yeah, yeah, sure, of course. And like, I understand there's the history. Right. So you gotta put. Many people feel burdened by history. I get it. Victimhood's easier to have than you know, saying like, oh, we're doing okay now. I think, I think it's, it's very, there's two, there's two sides on that. More, I guess, if you have to put it in a camp. Right wing perspective is like, you know, oh, everything's good now. So, you know, we don't even need to think about what came before. Right. It's like, okay, but there is an actual history. And then on the left wing side that's just as bad is like they don't even recognize that there has been progress. It's all victimhood, it's all bad. Women are oppressed. All this stuff, it makes no sense. Have to acknowledge the realities of the history. And you have to also recognize when we're trying to change society that we actually have changed society and people are doing better than before.

[Chris Williamson]

The thing that's kind of an unseen cost of always looking with a historical context that forgets the present is that it actually denies people who are in a good situation from ever feeling like they're in a good situation.

[Caleb Hammer]

Yeah, absolutely.

[Chris Williamson]

You go, hey, hey, you fucking arrived. I get it. Burdens from the past, things that need to be remembered so we don't fall back there. The main fear is if we, for, if we don't keep talking about it, maybe we'll go back there. Right, sure. That. Keep a weather eye on that, make sure that that's happening. But if you make progress in the present, always neutered by what. Where it came from in the past, you never actually give people the gift of feeling, the opportunity for celebration.

[Caleb Hammer]

Couldn't agree more. But you're evil for saying that, so I'm aware.

[Chris Williamson]

It's fine. I've been called it a lot. People aren't fucking Caleb Hammer. Like that's the. I did a four hour debate about the birth rate decline. I could have just. It was who it was Stephen Jay Shaw who did the Birth Gap documentary, Simone Collins, who did they say people are fucking?

[Caleb Hammer]

Because they're not.

[Chris Williamson]

No, no, no, no. It was a demographer, a pronatalist and a statistician. It was broadly, broad, broadly in agreement. Although the reasons were what was being debated. It was kind of. I've been deep down this rabbit hole

[Caleb Hammer]

for a while which if anyone knew the actual reasons we would be able to fix it. Right. And every country has tried to write

[Chris Williamson]

a lot of money out of things

[Caleb Hammer]

and it worked in Hungary for a year and then it fell back. So.

[Chris Williamson]

Correct. There is a number. So Lyman Stone would be an interesting one for you to talk to from an economic implication. He's like Institute for Family Studies, which you may have referenced at some point. He's the man when it comes to. He's like tip of the fucking spear. There is a number that you can pay people to fix the birth rate and it's not that much, but it's fucking loads compared with what we spent. It's like 10% of GDP.

[Caleb Hammer]

It's a lot. I mean it might be required at some point.

[Financial Audit Guest]

Right.

[Caleb Hammer]

Because that's like collapse of human civilization at some point, I don't think. You know, luckily the United States or like generally pro immigration people want to Move here. So we'll be fine. But places like South Korea are done.

[Chris Williamson]

Yeah. For every hundred South Koreans, there'll be four great grandchildren. Yeah, 96% gone within a century.

[Caleb Hammer]

What's the same?

[Chris Williamson]

So have you looked at the economic implications, sort of macroeconomic implications of a declining population?

[Caleb Hammer]

Yeah, I mean, I'm more focused on the retirement when we were. These numbers I'm going to have to be a little fuzzy on because it's hard to remember exactly, but when we first started a social program called Social Security that has good intent, not an evil program, mismanaged, not support smart in the end, you know, we had like a worker to retiree ratio of like 100 to 1. What are we at now? We're like, it's close to like 10 to 1 or something. You could have these numbers. But the, the closer and closer we get, the more burden it is on the individual. And if you have social systems that are solely reliant on a growing population, growing tax base, it doesn't work. They fail. So all the social programs are starting to fail. You're seeing them starting to buckle. Social Security is going to have a mandatory 25 cut in 2032 is what's projected.

[Chris Williamson]

Why?

[Caleb Hammer]

So when there were more workers, we were contributing more money than was going out. So that money was starting to build

[Chris Williamson]

because old people don't work, but they do need caring for.

[Caleb Hammer]

Yeah, which makes sense. And that Social Security fund was starting to build, but where was it? Like around early 2000s or something? We started to take more out of it than was going in as the baby boomers started to retire. And also there's this less people. People replacing them. And by 2032, unless the retirement age changes, unless the cap on Social Security tax changes, unless we reduced the cap

[Chris Williamson]

on Social Security would be brought down.

[Caleb Hammer]

Or, or we also cut benefits to those who are already high incoming. You know, all controversial for different reasons. Whatever. That's not the point. But unless something changes, the fund goes to zero. And then the only money that goes out is the money coming in. And that's projected to be a 25ish percent cut by 2032.

[Kevin O'Leary]

Me.

[Chris Williamson]

That's going to be unpopular.

[Caleb Hammer]

Oh, it's good. Whoever's president is going to get killed. I mean, it's going to be bad. We'll probably just. Honestly, the probably write a law, we'll borrow the difference and our debt will just go even further. Probably what's going to happen. The last time we made a compromise was during the Reagan administration. If I'm not mistaken. Where they barely wage raised the retirement. You have to remember the average lifespan for what is it now?

[Chris Williamson]

65.

[Caleb Hammer]

Yeah. Right around there. And we raised it like two years. The average lifespan for when we started Social Security was like if you actually make Social Security you're going to live for another two or three years. Now you're going to live a couple decades. So it just doesn't, it doesn't make sense anymore. It though, even though it's super unpopular among the highest voting base, the boomers, Social Security retirement age for what it was actually intended to when FDR signed it into law, should have been raised almost like 70 by now, which nobody sounds evil.

[Chris Williamson]

Yeah. Does anybody like the idea of working and working and working?

[Caleb Hammer]

This is.

[Chris Williamson]

I've still not been able to thread this needle properly. I've done four hour fucking discussion with the best on the planet as far as I could find to talk about this stuff. Endless episodes with Steve and I've had Lyman on before. I've had Simone's husband on people that are skeptical, critical, all this stuff. I'm like, dude, like if you care about the quality of life of people, more people are going to be old in the future than ever before. We're gonna have more old people than ever before. And where do you think the money to support them comes from? Like, do you want grandma and that? Nobody. I've said this a gazillion times. Nobody should have kids that doesn't want to have kids. Nobody should have kids that doesn't want to have kids. There is a more extreme position than that which is it's your duty to have kids to feed the economic engine. I don't subscribe to that view. But like just the fact that birth rate decline is not a problem is kind. We shouldn't, we shouldn't consider it, especially from a left leaning perspective. We shouldn't consider it because it's good for the environment. But I, I've really, I've really struggled to thread this needle like properly.

[Caleb Hammer]

It's a hard one. The thing that disappoints me is, you know, before I was even born or Radaround, when I was born in the 90s, they considered taking that Social Security fund and having it, having that money get put into something like the S&P 500, which at this point it would be insanely large and we would have enough money to do whatever we want. We would have like a Norway level sovereign wealth fund. It'd be incredible because Norway's actually capitalistic and smart with their money. Apparently via the government. But we said no, let's tie it to the low t bills like Mr. O' Leary was talking about. Which is another reason why I'm against like low T bills because guess what? Didn't grow, now it's being drained.

[Chris Williamson]

I saw some stats around Sam Bankman fried's investments with FTX. Anthropic was one of them. I think SpaceX was another one. And because during administration, bankruptcy, whatever the fuck it's called, what's it called, liquidation, like when we sell it all, sell everything, get the value of it right now and just give people the pennies on the dollar to what it is that they're owed by this bank that goes under that was run by a guy that played League of Legends while he was on Skype calls. If they'd held to now, everybody would have got their money back. I mean you could have paid people probably double, triple, quadruple. The investment in Anthropic is worth like a fucking insane amount of money. The same thing goes with SpaceX IPO that just occurred. That's a question. What do you make of having the world's first trillionaire in existence right now?

[Caleb Hammer]

Yeah, it's interesting. A lot of people are very angry about it. You know, a lot of I, I'm happy that you can get rewarded in this country for the things you do. We're getting Internet beamed from space. I love my Tesla. The self driving is insane. If people haven't been in a recently updated self driving Tesla like you can read, eat, drink coffee, scroll on TikTok and the car will get you somewhere perfectly fine with that without looking at the road. It's one of the crazy. That's technology no one would have even dreamed of 20 years ago. The things that we're doing, the private space like, I think you should be rewarded for it. Trillions, a lot. Yep, it's crazy. But even if the argument is you're against someone being a trillionaire, what's then the action? The action is you're forcing him to sell a position of his own company. You're saying we're taking a gun and we're saying you must sell a position of your company to pay tax on it. I'm against that as a philosophy. That doesn't make sense. Should a trillionaire exist? I don't know. But if you decide the answer is no, the actual action that comes from it is world's worse than whether or not a trillionaire should exist. Forcing people to sell their companies crazy.

[Chris Williamson]

It's a really interesting argument I understand inequality is one of the craziest distorters of human behavior. So one example from Candice Blake, who's out in Australia, she looked at levels of self sexualization and beautification of women and correlated posts on Instagram and Twitter at the time with the geolocation it came from and looked at the wealth inequality in that area. Women that were in higher wealth inequality ecologies posted more sexy selfies, did more self beautification and more self sexualization. The reason for that, her theory was when you see both how high you could climb and how low you could fall, if you pick the right or wrong mate, that on average will be at least contributing to the household or maybe the breadwinner and the primary provider for you and your future family, you start to turn on the taps in terms of the way that you work. And that's one example in one very small niche of one very small study, when globally everybody is now aware that there is a guy on the planet right now that could lose a trillion dollars and still be the richest man on the planet, that you and me and everybody is closest to the second richest man in the world than the second richest man in the world is to the first richest man in the world. World. That is deranging. It's deranging to the way that people see their place in society.

[Caleb Hammer]

It is, I just try to put it in perspective. And if the thing, the thing is I've, I'm, I do well and I'm okay with paying more in taxes. If that's the argument, I'm not okay with it if we're not even able to investigate fraud, if we're not able to blah, blah, blah. You know, there's a lot of things, the bureaucracy is insane. So I'd rather not pay more in taxes until we actually get our shit figured out. But even still, I would be okay with paying taxes if we say it's going to fund something that's going to help people. But the conversation's gone away from that to saying that man has a lot of money. That's evil. Let's take it. That's no longer the conversation. I want to fund something that's actually good if we're going to raise taxes. So it's, They've lost me at that conversation. And also they think like, where does him being a trillionaire affect you? For me, I think what actually affects someone's personal life is they have to call a cashier to unlock a toothbrush at a corner shop. That's actually impacting you on a daily life zoning laws is impacting you because it's preventing houses and higher rises being built which impacts your housing costs. Student loans being tied basically to hiring more administrators. That impacts you. There's so many more things impacting you than someone whose companies that he owns, you know, large stakes and went public and they're being valued high, which made his net worth go exponential. There's so many more things to address first than freaking out about that. But something in the human nature, especially of the more extremists, I will say, and more populous is like, that person has a lot of money. I don't, let's take it. But even if they took all of his money, I think everyone gets like what is it like a thousand or two thousand bucks? It's something, it's something that it would actually be really nice and for a lot of people could be life changing. But that's one time it would drive inflation extreme and it would actually just be damaging in the end because then we don't have life changing technology.

[Chris Williamson]

Why would it drive inflation extreme? Speak to me as if I'm five.

[Caleb Hammer]

Well, you know, talking to you like

[Chris Williamson]

you're a fucking LLM here. Can you imagine if you had a Caleb LLM? It's just shouting, screaming at you all the time.

[Caleb Hammer]

A rapid supply of 350 million Americans spending a couple thousand bucks just out of the gate. Like a trillion dollars just pumped into the economy like that. I mean that'd be brutal. Just look what we did during the pandemic pumping hundreds of billions. So it'd be pretty brutal.

[Chris Williamson]

Whilst also sounding like the sort of thing that we would want. Want but not.

[Caleb Hammer]

You need people to spend money.

[Chris Williamson]

Want in the micro but not in the macro.

[Caleb Hammer]

Yeah, not so much that it drives insane hiring sprees. That pushes everyone's incomes to insane levels. That pushes inflation higher.

[Chris Williamson]

What are the biggest financial red flags in dating?

[Caleb Hammer]

High car debt would be absolutely horrible. If I pull up to that TikTok girl we saw earlier and $50,000 car financing. A $50,000 debt on a car. Like we'll hook up but we're not staying for a second.

[Chris Williamson]

Okay.

[Caleb Hammer]

It's a big red flag.

[Chris Williamson]

High car debt. What else?

[Caleb Hammer]

I think it's nice for people to off offer like splitting the bill on a first day. You know, I like being I guess the man and like paying for it. But I think it's actually, it's a green flag when people, you know, if they expect you to pay for it, I think is a bit of a Red flag, you know, if they're thinking

[Chris Williamson]

like they're that special thing and that's why entitlement.

[Caleb Hammer]

I don't know, it just kind of turns me off. Specifically if when people have that main character syndrome and it gets tied into the financial situation of like expecting things, you know, that's kind of gross to me. A bullshit degree. I mean, less, Less bullshit.

[Chris Williamson]

Just toss that out to the side.

[Financial Audit Guest]

Yeah.

[Chris Williamson]

What you do your degree in? Yeah, no, sorry, this is.

[Caleb Hammer]

I dropped out.

[Chris Williamson]

This is not going to work. No. You meet me on an imaginary. Imaginary.

[Caleb Hammer]

Would you date me? I dropped out.

[Chris Williamson]

How much debt you got?

[Caleb Hammer]

That 25,000.

[Chris Williamson]

That's all right. I date you.

[Caleb Hammer]

Okay.

[Chris Williamson]

Yeah. Nice tits. Thank you. Car payment degree.

[Caleb Hammer]

Yeah. And that entitlement of like expectation around spending. Okay on them.

[Chris Williamson]

Anything else?

[Caleb Hammer]

What a low ambition. I know that's kind of tied to finances in general, but if someone's that ambitious, I don't need someone to be ambitious to want to go make a million bucks a year. But if someone isn't driven in their career or even just hobbies, if they're not driven, what a turn off.

[Chris Williamson]

I think going low ambition, high materialism is the perfect cocktail. It's like, hey, you're allowed to be materialistic as long as you've got the conscientiousness to know where the limit is and to be able to keep the front of the funnel pouring in.

[Caleb Hammer]

Yes. You've described a gold digger and we've had lots of them on the show. They're the. Oh, I love a couple with a gold digger. I can just, just. I can just verbally punch all day. Why so much fun? It's just so much fun because I see the person, the typically, unfortunately a man, but I've actually had the reverse a few times. But usually the man's actually working, making a lot of money, and she's over there feeling entitled. And I see all the spending in their own statements. I see proof in front of me of her just spending all this money and feeling like they should do all this while this guy over here is struggling, working two jobs. It is just. It is a brutal thing. And the nice thing, the thing that I love about it is seeing that light bulb go off in his head when he notices this person's just using me.

[Chris Williamson]

How many couples have broken up because of what you've revealed financially?

[Caleb Hammer]

Very rare on the show. We've. We've had a couple, had one divorce. It wasn't from the show and it was a couple years ago, which is a Bad marriage. But it's actually pretty rare for people to break up. You should.

[Chris Williamson]

Couples merge finances at some point.

[Caleb Hammer]

It's nice to have a joint account that incomes go in and then bills come out of, and then we can send fun money to our own accounts from there. I think after marriage makes a little more sense. At least common law marriage, because then you have some. Some of those protections in the case of death or whatnot. But yeah, I mean, it's fine. And it's fine if people want to keep it separate as long as they can actually budget the household. People just usually fail at that without getting insight on the full thing.

[Chris Williamson]

What's your perspective on prenups?

[Caleb Hammer]

Yeah, it's fine if there's like a big wealth divide. Yeah, big wealth divide. It makes sense. I think if you're both making 100, it's a bit weird.

[Chris Williamson]

Do you often see financial infidelity, like hiding purchases or debt or accounts so

[Caleb Hammer]

common, and most people don't think it's actually much of anything, but the other person feels really hurt in the end. They just don't realize it because spending is just one of those things where it's not. It's not viewed as extreme as cheating. It's not as extreme as cheating, but it does impact the other person that they're hiding it from more than they think. The moment it's exposed on the show, you can see the pain in their face.

[Chris Williamson]

It's still trust, right?

[Caleb Hammer]

Yeah, it's trust. Exactly. Trust. Not talking to the person. It's a lot of things, and it hurts them personally.

[Chris Williamson]

If you're not being honest with me about this, how can I be certain that you're being honest with me about anything else?

[Caleb Hammer]

Oh, yeah, absolutely.

[Chris Williamson]

It's a vicious cycle with that stuff. What, is there a, like, sex difference in what men and women go broke doing?

[Caleb Hammer]

Honestly, no, not really. I mean, I'll get a little able

[Chris Williamson]

to be equally in similar directions.

[Caleb Hammer]

I mean, they. Everyone loves collectibles. They just get like, different. I got La Booboos on the women, and I got Pokemon cards on the men.

[Chris Williamson]

Everyone loves collectibles.

[Caleb Hammer]

No, no, but like, you know, it's like split down the genders. Like, like. Like both genders love it.

[Chris Williamson]

Does everyone love with Warhammer 40k and others obsessed with Beanie Babies.

[Caleb Hammer]

Exactly. So, I mean, you'll get some more frivolous spending. Maybe a guy will put some more into his car, a girl will get more extensions. But it's similar levels of bullshit. What's actually interesting is, you know, talk about Young men, gambling issues. But the. It's actually pretty similar in terms of percentage young men and young women.

[Chris Williamson]

No way. No way.

[Caleb Hammer]

Men is higher, but it's pretty close. It's pretty close.

[Chris Williamson]

What do you think of prediction market kids? What's your.

[Caleb Hammer]

It's fun. Just like drinking. Just like smoking weed, Anything like that. I think it's cool if you can control it. If you know you have an addiction or an addictive personality you need to keep yourself away from. Like that.

[Chris Williamson]

Yeah. Mental health issues impacting spending. Is that true? Like shopping addictions and stuff?

[Caleb Hammer]

Yeah. Or if you're depressed, it feels good to get that dopamine spike of a quick purchase. Absolutely, yeah. Mental health affects everything in the end. It's kind of that. That discipline thing. Right. Everything stems from the discipline. When it comes to personal finances, if your ment health's bad, usually your discipline's gonna be bad.

[Chris Williamson]

I can't remember where it was I read this. I think it might have been the UBI test study. There was two that were done 20, 24. And one of the points there was, if you're poor, you can only really get small doses of pleasure from small things. But that means that you're more likely to spend frivolously because you need to relieve the stress. It's that point that we made before. Like, if you have not that much pleasure in your life and you're burdened with worry and you don't know what the future has in store for you, yeah, you're gonna go and buy cigarettes because the cigarettes alleviate your suffering. There's certain things I remember, there's this example from Sam Harris fucking years ago. It was during some of the more crazy race conversations around mid-2020. And. And I was struggling to see philosophically consistent arguments about white privilege. And he came up with one that I thought was so fucking cool. And he said, if I've ever gone through TSA and I've had my bag pulled, I've never once thought that it's because of my race.

[Caleb Hammer]

Interesting.

[Chris Williamson]

Isn't that an interesting kind of white privilege? I've never once thought that I fucked up. I left water in the water bottle. Or it's a random check by tsa. Cause they've gotta do it. This is what they do.

[Caleb Hammer]

Yeah.

[Chris Williamson]

That is not true if you're of a different race.

[Caleb Hammer]

Yeah.

[Chris Williamson]

It's just straight up not true. And the same thing. The same thing to a degree, is also true when it comes to being poor. That there are these sort of secret psychological loops that people go through about what their financial position means to their identity, how they then cope with that identity, with their behavior, which feeds back into the financial position. That seems to be one of the very unseen death spirals. And it's too complex to put on a billboard. It doesn't sound sexy. What fucking intervention are you going to have as a politician or as a potential president going. And we are going to teach people how to intervene in their conscientiousness when they begin the downward death spiral of sedating themselves from feeling bad about their financial position. Doing things that makes a financial position worse was. No, it's way too complex. Despite the fact that it might be one of the key driving forces.

[Caleb Hammer]

Okay.

[Chris Williamson]

How can we give people. I mean we do we give people fucking social media, which is some of the freest dopamine that you can get on the planet. But I think all that that really does is raise the waterline of minimum dopamine that you now need an even bigger dose to be able to break out the top of it. I wonder whether we would be in better financial positions without social media.

[Financial Audit Guest]

You.

[Caleb Hammer]

Oh, probably. I mean we see things. We see the lifestyles that people pretend they have all the time and we like to chase lifestyles. We're jealous. We're jealous people. Jealous species. That makes sense. I think that's one of the drivers of lifestyle inflation.

[Chris Williamson]

And unfortunately poor people will go broke trying to look rich.

[Caleb Hammer]

Oh yeah. The car especially. Absolutely.

[Chris Williamson]

Is that what's the dumbest purchase category that people constantly overspend on?

[Caleb Hammer]

Constantly in America? It's certainly the car. Well, and it's baked into our infrastructure. You have to drive. You have to drive to have a job. To have to drive like that is the reality. But people will over justify how much car they need needing the new car because of the new safety rating. Like cars would literally kill you five years ago or something like, I don't really get that fuel efficiency. Like you can make some arguments and stuff, especially in times like now where gas is up. But people will justify the heck again like her out of getting a $50,000 car loan for a car that you do not need.

[Chris Williamson]

What is the rough rule of how to work out what price of car you are able to afford?

[Caleb Hammer]

It comes down to the monthly payment. If you get a debt as long as you put 20% down, it is a three year term. The minimum monthly payment should be no more than 8% of your income. If it is, then you're getting a car that's likely too much out of your affordability.

[Chris Williamson]

Range seems like a pretty simple formula.

[Caleb Hammer]

Yeah, it's easy. It gets most people a pretty good car.

[Chris Williamson]

What does that get an average owner making 50 grand a year?

[Caleb Hammer]

I don't know. Should we do the math? I can do the math.

[Chris Williamson]

Do the math.

[Caleb Hammer]

Okay, well shit, then I have to understand what 20% down would be. So it'd have to be post 20%. Okay, okay, okay. $50,000 because it is gross income. So talking eight. So that's 40,000. You can do 40,000. Divide that by 12. So I mean that's pretty chunky. No, no, no, sorry, that's not eight. I did 80%. Okay, so $4,000 divided by 12, that's $333. But you have to come. So as long as you put 20% down, it's a three year your car payment, $333.

[Chris Williamson]

You can probably get a good bit of cough for that money.

[Caleb Hammer]

Decent. Decent. I mean interest rates, depends on your credit score. Might have to go a little higher. Then you just need to pay it down quicker and I'm okay with that. You just got to put extra towards it. You just don't have to freak out about it if you're doing that, if you're following that rule.

[Chris Williamson]

I guess a lot of people need credit to build a financial future whilst also struggling to build credit to qualify for it because they lack credit history.

[Caleb Hammer]

Yeah, but there's credit builders now, there's charge cards now, or you know, you put the money on there to spend, but it's building credit. So there's a lot more resources today than before if people are just willing to look.

[Chris Williamson]

Can someone become obsessed with financial optimization to the point where they make their life worse?

[Caleb Hammer]

Was, I mean, our friend, our friend Graham Stephan, I think a little. Right. I mean, I don't know. Is. I don't think he needs to. I love the dude. I love the dude. But everything you see on camera is actually what you get in reality. And he will micro freak out about just a little penny he's going to spend on lunch or something. And he'd make more money. If you use that mental effort on producing a piece of content.

[Chris Williamson]

Isn't that a hidden cost? A strange kind of hidden cost of obsessing over finances too much.

[Caleb Hammer]

But you know what, he has fun with it. So it's actually probably not making his life worse.

[Chris Williamson]

Well, yeah, because his enjoyment from scrutinizing and saving is greater than the enjoyment he would get from the spending. Yes, it's this weird. I mean he was built to be a saving Engine.

[Caleb Hammer]

Yes.

[Chris Williamson]

He's like the fucking LeBron James of saving money.

[Caleb Hammer]

But I think for some people, if you get to that way and it's not actually your passion and it's more coming from like, let's say, I don't want to overuse the word trauma, but trauma of like growing up poor. So now you're just freaking out about it constantly. I think that could be to, you know, hurt your lifestyle.

[Chris Williamson]

Interesting archetypes of people that grew up without money. I. I grew up without money. And some people grow up to. I've never had this before. Fuck it, we ball. Or I've never had this before. It might be taken away. I'm not gonna spend it.

[Caleb Hammer]

That's us. Yeah.

[Chris Williamson]

You read Die with Zero by Bill Perkins?

[Caleb Hammer]

No. Oh, dude, I know, but I haven't read it.

[Chris Williamson]

Really fun. It's three hour read or listen or whatever. And he's just got some interesting ideas that, that I would be. I know you're doing financial audit. Are you sitting down with other people that are Morgan Housel's of the world, the Bill Perkins of the world. Have you got any desire to do that? Because I would love for you to scrutinize financial philosophies from people that have got popular financial books.

[Caleb Hammer]

It'd be fun. But I also have to acknowledge, even though there's some topics that I'm interested in learning from experts from. I'm no different from just a dude off the street. I'm not a fucking expert. Like I'll listen to people, but it's hard for me to push back against a true expert in their position. That's why I like keeping to what I do. It's basic. Personal finances is so basic until you get to the crazy. So basic until you get to the top. 0.1% is this budgeting, control, discipline, low index funds, low cost index funds, target date retirement funds, emergency fund.

[Kevin O'Leary]

That.

[Caleb Hammer]

That's the. I'm into bread and butter.

[Chris Williamson]

You've exited all of your rental properties?

[Caleb Hammer]

Exiting. Yeah. Better return on investment in the stock market. All day, every day. No hassle either. I mean I'm not the one fielding the calls when something breaks. But you know, it's just every month is up and down depending on what needs to be repaired. And just even if nothing needed to be repaired, the only thing you take advantage of is some leverage there, which can be nice, especially if the market booms. But in general, real estate has lost now to the S&P 500. Just consistently. I'd love to own a piece of commercial like you do.

[Chris Williamson]

That's great.

[Caleb Hammer]

You know you get some, some quick depreciations on there, which is really nice. So that's something I'd be willing to get into at some point.

[Chris Williamson]

I'm unwinding all of the houses I have in the UK except for the one that I still live in that's like still my, my place of.

[Caleb Hammer]

Well, that's a collapsing country. So.

[Chris Williamson]

That's true. That is, that is true. But I mean I, there was a period and this was sort of what I grew up with. I was very fortunate that when I started doing business the guy that that was my partner was five years older than me in the exact same industry. I'm very, very financially responsible and I only child, so didn't have anybody that was entrepreneurial, understanding the UK system and working in the same industry with the kind of cash flow and the sort of pacing that we would get. So I just followed the same path that he was on and his was every time that you get to about £30,000 of spare cash deposit on a buy to let student property between two and five bedrooms in a good student area, hand it off to a management company, they'll take between 10 and 20% and a wait you just 20% rinse and repeat. I managed to negotiate to 12, but rinse and repeat. Okay, that's pretty good. And let's say I never talk about money, this is my Britishism. But I've got you here. So let's say the best purchase that I made was £150,000, a five bed student property in Heaton in Newcastle and I would have put 25% down. So I think all in with stamp duty and fees and all the rest of this stuff I think I put somewhere in the region of like 50 grand down and that would make after everything 1800 pounds a month. And then there would be maybe some repairs that were needed on top. So let's say 1500. So that's like 18 grand. 18 grand a year. Great cash vehicle.

[Caleb Hammer]

Yeah.

[Chris Williamson]

But what you were really doing it for was to tie because it's an interest only mortgage. So you were just tiding over hoping that everything would be kept in, maybe it would spew out a little bit of cash and that would be lovely. But you were waiting for the capital gains. That was what you wanted. I'm going to hold this for 10 years and it's going to go from 150 to 200 to 250 and then it's going to be. And I'm unwinding all of these properties and like the future that I promised myself has not come to fruition. They've all appreciated Hooray, but Keir Starmer's changed the capital gains tax. I'm getting fist fucked off. That and the gains that I thought that was going to make didn't occur. And I'm in the exact same position as you. I also now this is my fault. I have to pull the fucking money across from pounds to USD. So I'm going to get fist fucked on the exchange and I'm going to have to do something creative in order to be able to. It's company to company so it's relatively easy linear to do limited company in the us, the UK to an LLC over here. But like I was thinking this is going to be, you know, retirement fund stuff and maybe if I'd held it for the rest of time and never left the uk, that would have been it. But when I started and I was behind Dave, business partner that was sort of laying this groundwork for hey, this is how you get to a financial level of real comfortability that that route is, is not the same anymore at all. And, and everybody fucking hates landlords. So like something that used to be, hey, you're holding on to this property, you're making sure that it's kept to a high standard, you're making sure that we're well looked after, you're a good landlord. Even if there's a management company in between you and us, there's no prestige really associated with it now in the same way.

[Caleb Hammer]

No, it was kind of interesting. I mean I got shit from the landlord thing too. I mean, I don't really care because it's usually coming from people that have no impact on anything in society. But a couple of the places I bought were basically unlivable and I brought them up to be a place for people to live in. And people like literally they were on the market, people were not buying them to bring it up to live in. Because it was in the student area of Western Michigan University. No one was going to live in the student section, no one was buying a house to live there. So it was places that just weren't being lived in that I made livable and actually benefited.

[Chris Williamson]

There was a period in the UK and I came in after this which is, it does make sense. One of the big criticisms, you took a two bed or three bed classic family home and you rejig all of the walls and the construction to turn it into five or six or seven bed student Properties. There's no fucking family in Newcastle that needs a seven bed house in Heaton that is basically locked in for the rest of time that this is going to be a student property. And now if you ever stop. It's called an hmo. It's a house of multiple occupancy. If you ever take it out of that, you can never get the license back. So they're now trying to reverse that back to try and encourage families to buy these houses. But the problem is I'm never going to sell one of my houses. Well, that's not. I would sell it to whoever wants to pay the price. But no family is going to pay the price that I can get from somebody that wants it as an investment property because they are going to have to knock all of these fucking walls down and turn it back into what it was before it was turned into a student house, which I didn't do.

[Caleb Hammer]

Governments will do any rule, regulation, tax, whatever, to think they're trying to encourage something other than literally just make zoning laws better for people to just build what people are demanding. I will never understand it. That's why, that's why I love this town. I love Austin because we let people build more houses on units now on lots. We let people build higher houses. We got rid of parking minimums where the government forced you to have a certain amount of parking spots. It's so stupid. They'll do every policy besides just letting developers build what the market demands.

[Chris Williamson]

Dude, there is a lot near Zilke that I drive past sometimes and it used to have one old style ranch house that probably had two beds. It was up on sticks. Walk up a little set of wooden stairs to get to it. Classic wooden, ranchy house. And it had a trailer thing. That was for some, for pancakes. It must have been a business that the person had started at some point and there was a bit of a yard outside or whatever. And then one day, no house, no trailer, just flattened like there'd been a miniature atomic bomb that went off. There are now three ground floor, first floor, second story houses built on this one fucking plot of land. Yeah, and they look nice. I mean, it's still all green and insulation and wood and shit at the moment. But.

[Caleb Hammer]

And that's nice. That's due to literally Texas and the city of Austin just a couple years ago, like passing those kind of reforms.

[Chris Williamson]

I heard that the housing problem in America would be fixed if the zoning laws were changed. That there's enough demand and enough capital to be able to make the houses the Only issue is that the NIMBY problem.

[Caleb Hammer]

Yeah, it's the NIMBYs. Yeah. Which makes sense. I mean if you're thinking about your own interest in California and la, you want the cost of your house to continue going up forever. That's usually where the majority of your wealth is. You can borrow against that. So of course you don't want more development coming in, housing prices to fall. It's economically against you. And you're usually a big voting block, you're a big important part of local elections and you can be a loud voice at the city council meeting. So it makes sense that people are against it. But I don't know, I'm EMB all the way build with the market demands. I think a couple restrictions make sense. I don't want it like a. You shouldn't be drilling for oil in someone's backyard. You know, I don't know, I, I'm overall pro data centers because the information around it is a lot of misinformation. But do I want a data center in my exact backyard? No. Build them in the middle of nowhere. That's what I like. So it's just like, yeah, there's some restrictions make sense but let the market build what the market demands.

[Chris Williamson]

I wonder how many people are eat the rich. They're taking the money that young people need in order to be able to buy houses whilst also being. I don't want any houses built near me.

[Caleb Hammer]

Oh yeah. Usually the biggest NIMBYs are the ones that say in this neighborhood, you know the signs. What is it in this neighborhood we

[Chris Williamson]

accept science is real. Women are women.

[Caleb Hammer]

Yes, yes.

[Chris Williamson]

Women are people. Black people are the. I know the exact sign that you mean.

[Caleb Hammer]

They're usually the NIMBYs.

[Chris Williamson]

Yeah, yeah. Interesting. How much money do you need to raise a kid?

[Caleb Hammer]

Well, definitely less than people think for sure because I mean forever throughout human existence, you know, we were just having kids and it was fine. It is a little harder today. But going through public school, getting them on your insurance, all that good stuff. If you're not thinking about having to get parent plus loans like you could, you can do it on just a normal middle class salary for sure. You can have quite a few kids, but an exact number I don't have that.

[Chris Williamson]

I think people believe that it's more expensive than it actually might be. But again a lot of that is what do I think I need and what do I think that my kid would need versus what, what is actually needed? This is an interesting part of that birthright debate that we had where in order to have the kid, realistically assuming that you don't have some huge windfall of money, the total pie of money that you have to spend is not going to change all that much. In fact, it might go down as one partner needs to take time off work in order to raise them and then childcare costs and all the rest of it. That means that your lifestyle needs to take a hit. You need to. I'm not going to be able to go out for dinner as much. I'm not going to be able to upgrade the car as frequently. And that feels like. That feels like getting poorer.

[Caleb Hammer]

Yeah.

[Chris Williamson]

Where what you've done is you've just reportioned the money from what would have been car to know what now is

[Caleb Hammer]

child, which I empathize with. It makes sense. So if you don't want to have kids, don't have kids. That's kind of what you said earlier. Right? You know, we shouldn't force people to have kids, but we also shouldn't be doing misinformation of people thinking they need to have an endless supply of money to have kids. Like, like we're richer than ever before and people have had kids when we were poorer than ever before. Like you do need money, you need school supplies. You do need to make sure they can be on your health insurance. Like there are a lot of things you need money for, but we overemphasize it. For sure.

[Chris Williamson]

Forcing people to have kids is horrendous. But scaring people out of not having kids when they could because of misinformation is also something that never gets spoken about.

[Caleb Hammer]

Oh yeah.

[Chris Williamson]

Yeah. Caleb Hammer, ladies and gentlemen. Dude, you're awesome. I appreciate you. I think what you do is great. Where should people go to check out all of the shit you've got going

[Caleb Hammer]

on Caleb Hammer on YouTube and I recommend everyone download Dollawise change their lives.

[Chris Williamson]

Unreal. Until next time, man. Appreciate you.

[Financial Audit Guest]

Thank you.

[Chris Williamson]

Goodbye my beauties.

[Caleb Hammer]

Dude, that was fun.

[Chris Williamson]

I get asked all the time for book suggestions. People want to get into reading fiction or non fiction or real life stories and that's why I made a list of 100 of the most interesting and impactful books that I've ever read. These are the most life changing reads that I've ever found and there's descriptions about why I like them and links to go and buy them. And it's completely free and you can get it right now by going to ChrisWillX.com books that's ChrisWillX.com books.