275. “We escaped debt so why are we still spending like this?”

Ramit unpacks how to stop overspending, stay out of debt, and start building wealth as this couple confronts the spending habits they thought they had already fixed.

Three years ago, Mason and Becca finally confronted a financial reality they had been avoiding. Despite good careers and the appearance of success, they had accumulated nearly $50,000 in credit card debt. They cut back hard, aggressively paid it down, sold their house, and moved to Florida. Now they have around $100,000 from the home sale sitting in savings, but they’re worried the same habits that got them into debt are starting to creep back in.

They still don’t properly track their spending. Shopping, expensive date nights and a large “miscellaneous” category make it difficult to see where their money is actually going, while Mason experiments with day trading and considers ideas for generating passive income. On paper, they’re doing far better than they realize: they have around $204,000 invested, $124,000 in savings, and a net worth of roughly $326,000. But without changing how they spend and manage their money, Ramit sees a real risk of them falling back into debt.

Ramit helps them figure out what comes after getting out of debt: how to stop mindless spending without giving up the things they love, save and invest intentionally, and start building real wealth. They rethink their plans for an $800,000 dream home, confront the scarcity they both grew up with, and discover how increasing their income and investing more could completely transform their financial future.

In this episode we uncover:

• How Mason and Becca built nearly $50,000 in credit card debt
• The conversation that finally forced them to change their spending
• Why they used a 401(k) loan to aggressively pay down debt
• How selling their house left them with around $100,000 in cash
• Why having that much money makes Becca anxious
• Why they’re scared of slipping back into their old spending habits
• How shopping, expensive date nights, and impulse purchases added up
• Why they still don’t properly track where their money goes
• How their $3,000 Disney annual passes fit into their Rich Life
• Why Ramit sees a real risk of them falling back into debt
• What Ramit sees in Mason’s day trading and passive income ideas
• Why their $326,000 net worth surprises them
• How Becca’s childhood shaped her belief that she would never be rich
• How Mason grew up seeing money as stress and struggle
• What they want their son to learn about money
• Why buying an $800,000 house would require major trade-offs
• How Ramit helps them rebuild their Conscious Spending Plan
• Why increasing their income becomes the biggest lever for their future
• How their retirement projection jumps from around $3.1M to $4.7M
• How they finally become completely debt-free

Chapters:

(00:00:00) Introduction
(00:02:45) How they built nearly $50K in debt
(00:06:39) Using a 401(k) loan to escape debt
(00:08:53) Selling their house leaves them with $100,000
(00:11:15) “We just swiped the card”
(00:14:37) Their old spending habits start creeping back
(00:16:31) They disagree about buying another house
(00:24:05) Ramit reviews their financial numbers
(00:31:13) Ramit digs into their 71% fixed costs
(00:37:30) Day trading and the dream of passive income
(00:38:46) How Becca grew up around money
(00:47:50) How Mason grew up around money
(00:52:43) What they want to teach their son
(00:56:41) Ramit starts rebuilding their financial plan
(01:07:26) Redirecting their money toward investing
(01:11:59) The reality of an $800,000 dream home
(01:19:18) Why earning more becomes the priority
(01:24:01) Their retirement could reach $4.7 million
(01:32:15) Their house timeline changes completely
(01:33:25) Mason and Becca become debt-free

This episode is brought to you by:

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If you’re ready to stop putting off your money goals, Road to $100K gives you a step-by-step plan to reach your first $100,000, focus on what matters, and accelerate your timeline while building your Rich Life. Join Road to $100K at https://iwt.com/100K

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Transcript:

00:00:00.000 — 00:00:04.440 · Mason
Vacation debts. Little purchases. Odds and ends. Things. Debt. We made debt normal.


00:00:04.480 — 00:00:07.080 · Becca
We should not be living this way.


00:00:07.120 — 00:00:10.840 · Ramit
How do you decide what you spend money on?


00:00:10.840 — 00:00:22.040 · Becca
Just buying things that we see that we want. Go into target coming out, spending two $300 extravagant dinners. When we're done with that, let's go bar hopping and just running up bills.


00:00:22.080 — 00:00:27.360 · Ramit
You ended up with 100 K in your bank account. Is that just sitting there right now? Yes. What does that feel like?


00:00:27.400 — 00:00:30.920 · Becca
Very intimidating. I don't want to be tempted to spend it.


00:00:30.960 — 00:00:35.280 · Ramit
You're creating these behaviors to shield yourself from yourself. Yes, yes.


00:00:35.320 — 00:00:40.480 · Becca
From the start, we had really bad money habits. We came from very similar upbringings.


00:00:40.520 — 00:00:41.840 · Ramit
Mom or dad ever tell you to save?


00:00:41.840 — 00:00:44.440 · Mason
Wasn't a lot of open discussion about finance?


00:00:44.480 — 00:00:52.920 · Becca
No advice at all. We don't know the right steps to not get back into that creep of just swiping the card.


00:00:52.960 — 00:01:01.890 · Ramit
To change your entire relationship with money, you would need to trust yourselves. Right now, you're a little weary of yourselves.


00:01:03.530 — 00:02:45.220 · Ramit
Imagine you woke up tomorrow morning and you had $100,000 extra in your bank account. How would you feel? Would you be happy? Or might you feel scared, even anxious, because you don't know what to do with the money? Mason and Becca, 34 and 32 years old, used to be in debt. They have diligently paid it off. They even sold their house and now they have $100,000.

But what are they supposed to do with it? Mason applied to be here on the podcast, and he said, we've spent the last three years buckling up and fixing past mistakes. Now that we've relocated to Florida and have $100,000 from our home sale, the challenge has shifted from paying off the past to protecting the future.

Let me take a look at their numbers. I'm going to pull up their conscious spending plan. Assets 11,000. Investments 204,000. Savings 24,000. Debt. 13,600. Total. Net worth $326,567. Fixed costs 71%. That's too high. Investments 2%. Savings 13% and guilt free spending 14%. I have questions. This is actually quite interesting because you can tell that the day to day spending, the fixed costs, the savings, the investment is out of alignment with their net worth.

And so we need to fix this so that they don't simply depend on a windfall, but they fundamentally change the way they treat money. That's what I'm going to try to do. Speaking with Mason and Becca, let's take a look at the application. So you wrote for a long time, we lacked a unified plan which led to significant debt.

Tell me more about that.


00:02:45.220 — 00:03:03.510 · Mason
So we've had a few years of of debt that we've been working hard to pay off, and we're now toward the end of that. So it's not something that we ever want to go back to Since we're so close to the end of it being completely green and we don't know the other side of that. Hmm.


00:03:03.750 — 00:03:04.990 · Ramit
Did you feel the same, Becca?


00:03:05.230 — 00:03:33.710 · Becca
Yes. I think we've been together for a very long time, since 20 years old. And we've, um. From the start, we had really, really bad money habits. Um, we came from very similar upbringings, um, of not having a surplus of money growing up. So I think when we started working and getting our career started, that money in our head was a reward for us to spend and to


00:03:34.870 — 00:03:58.240 · Becca
get into really unreasonable expectations of what we should be having, which is what led to a lot of debt that we got into. Um, it wasn't until about three years ago that we, I guess, got a little bit more critical thinking on, you know what? We should not be living this way. and we need to get a handle on how we're spending our money.


00:03:58.280 — 00:04:04.320 · Ramit
Take me back to that decision. Three years ago. Where were you? What happened at that very moment?


00:04:04.360 — 00:04:59.530 · Becca
The conversation really came up because we wanted to move out of state, and, um, we didn't think it was possible. Um, because we're like, we don't we don't have enough money in the bank to be able to move. But then we started to question, why? Why don't we have enough money? You know, our salaries look comfortable enough to be able to do something like that.

Why are we not feeling that way? And that's when I think we really uncovered I had credit card debt. He had credit card debt. And so when we looked at it together, we're like, we we have to do something about this. If we don't want to be in the same place that we are now in five years, we have to make a change. So it was really starting to go.

We need to hold ourselves more accountable and find a better discipline for ourselves than just spending a ton of money and not having any plan, any budget for it.


00:04:59.570 — 00:05:03.250 · Ramit
Wow. How did that conversation in a series of conversations feel?


00:05:03.290 — 00:05:31.210 · Mason
It was honest. It was very it was very brutal. Um, yeah. Very revealing. You took the lead and it was. It was a brutal conversation. It was a good conversation. There was no, like, arguments. It was just very factual. Like in hindsight, it was very much of a sit down that you recommend. Yeah. Um, it was just our first one.

So we didn't know the guidance, but it was very eye opening with what we had. Um, you know, what? We what we both owed. We put that together, we sat down, hashed out a plan, and it it came up. It came through.


00:05:31.250 — 00:06:07.370 · Becca
I think I felt a little bit of disappointment in ourselves, um, because we we have worked really hard and we grew a lot in our careers over time. And then realizing that we did not set ourselves up for success. So it was a I, and I think that was part of our avoidance for a long time is go like pretending like we are doing okay.

We are setting ourselves up for success because I think on the outside looking in, we we did look successful. We owned a home. We had, you know, our cars, you know, we we were living the lifestyle that we wanted. But in our bank accounts it wasn't reflecting that way.


00:06:07.410 — 00:06:07.930 · Ramit
Wow.


00:06:08.090 — 00:06:08.610 · Becca
Mhm.


00:06:08.770 — 00:06:12.090 · Ramit
I wish more people talk like this. It's quite amazing.


00:06:12.130 — 00:06:15.970 · Becca
We've become very self-aware within the past few years about this.


00:06:15.970 — 00:06:39.250 · Ramit
I like what you said about the fact that you had progressed in your careers. Um, and you had the nice accouterments of things, you had the cars and the house and, but when you look in the bank, when you literally say, what do we have? What do we have? It wasn't matching up to what your expectations were, right?

I think that's really powerful. Okay. So you had this conversation. What did you do next?


00:06:39.290 — 00:06:43.610 · Becca
We took out a 401 loan. Huh? I know.


00:06:43.650 — 00:06:44.010 · Ramit
Okay.


00:06:44.050 — 00:06:47.450 · Ramit
I know I'm very confident on my book, but by then. Okay, fine.


00:06:48.010 — 00:07:05.780 · Becca
We did. Just to be honest, we took out a 401 K loan. We basically put our credit cards away. We're like, we're not using them at all. And we very aggressively decided to pay it off. Now we're we have probably close to $50,000 in credit card debt. We are down to 5000 now.


00:07:05.820 — 00:07:06.980 · Ramit
Whoa! Yeah.


00:07:07.340 — 00:07:08.140 · Ramit
Amazing.


00:07:08.300 — 00:07:09.300 · Ramit
How does that feel?


00:07:09.340 — 00:07:09.900 · Becca
Great.


00:07:09.940 — 00:07:10.420 · Mason
Feels good.


00:07:10.460 — 00:07:11.100 · Mason
It's.


00:07:11.100 — 00:07:16.820 · Mason
That's what I'm saying. It feels really good to be so close to green. Yeah. And nervous at the same time.


00:07:17.180 — 00:07:17.740 · Ramit
Nervous?


00:07:17.740 — 00:07:45.620 · Becca
Because what we have never had the education or the tools to know how to not put ourselves there. Yeah. I think both of our families very much normalized not having money. Being in debt is very normal and everybody is. So we don't know the right steps to not get back into that creep of just swiping the card and moving on with our day.


00:07:45.700 — 00:07:46.340 · Ramit
Okay.


00:07:46.380 — 00:07:59.990 · Ramit
This is very helpful to know. Now, you took the hard look in the mirror and you said, like, we got to change the way that we do. So you took the 401 K loan. You started paying off the debt. Did you know when the debt was going to be paid off? Did you calculate that?


00:08:00.030 — 00:08:00.630 · Becca
Yes.


00:08:00.670 — 00:08:01.150 · Mason
Yes.


00:08:01.150 — 00:08:06.990 · Becca
We had a plan. I think initially the 401 K loan was for 18 months. We paid it off in 12.


00:08:07.030 — 00:08:08.030 · Ramit
You paid off the loan?


00:08:08.070 — 00:08:08.430 · Mason
Yes.


00:08:08.710 — 00:08:10.390 · Becca
The loan is gone. That is.


00:08:10.390 — 00:08:10.790 · Becca
Gone.


00:08:10.950 — 00:08:35.750 · Ramit
This is quite rare, by the way. So one of the reasons that nobody in the financial industry recommends people take a 401 K loan is that people who take 401 K loans often sometimes usually have bad financial habits. So they take the loan, they don't change their habits and then they never pay the loan back.

So they've basically screwed themselves today and tomorrow. So the fact that you paid it off is rare. Very impressive. Don't do it again.


00:08:35.789 — 00:08:37.510 · Becca
We don't want to. We did not want.


00:08:37.550 — 00:08:38.349 · Mason
To completely agree.


00:08:38.550 — 00:08:42.070 · Mason
It was. It was a good option at the time. I'm glad we got a chance to pay it off early.


00:08:42.110 — 00:08:51.160 · Ramit
If that is one of the top five financial mistakes you make. Okay? Like you fixed it behind us. It's behind you. Yes. Are you married? Yes. Any kids?


00:08:51.200 — 00:08:51.880 · Becca
One kid.


00:08:51.920 — 00:08:52.480 · Ramit
How old?


00:08:52.520 — 00:08:53.440 · Becca
Six years old.


00:08:53.440 — 00:09:00.600 · Ramit
Six years old. Okay. Got it. So you also sold your house, I understand. Yes. Okay. How much did you buy it for? How much did you sell it for?


00:09:00.640 — 00:09:09.040 · Becca
We initially bought it for 169. It. We sold it for 289289. Yeah. 289.


00:09:09.040 — 00:09:14.280 · Ramit
And then, uh, did you subtract out all the fees and transaction costs and stuff like that?


00:09:14.480 — 00:09:18.640 · Becca
Yeah. So we ended up making about 113,000 off of the house.


00:09:18.680 — 00:09:25.200 · Ramit
Got it. Okay. All right. So you ended up with 100 K in your bank account? Yes. Is that just sitting there right now? Yes.


00:09:25.240 — 00:09:26.960 · Becca
And I say, whoa.


00:09:27.440 — 00:09:28.640 · Ramit
What does that feel like?


00:09:28.720 — 00:09:30.160 · Becca
Um. Very intimidating.


00:09:30.280 — 00:09:30.640 · Ramit
Huh?


00:09:31.200 — 00:09:39.720 · Becca
I made sure. Um, you know, I don't even I never even activated the card for that account because I don't want to be tempted to spend it.


00:09:39.760 — 00:09:44.200 · Ramit
So you're you're kind of creating these behaviors to shield yourself from yourself.


00:09:44.250 — 00:09:45.170 · Becca
Correct.


00:09:45.210 — 00:09:47.370 · Ramit
Both of you? Yes, yes. Mhm.


00:09:47.490 — 00:09:49.610 · Mason
We both have access to that so far account. I'm not touching.


00:09:49.610 — 00:09:51.650 · Becca
It but yeah we're just not touching it.


00:09:51.690 — 00:10:02.850 · Ramit
Okay. Okay. I don't mind that. I don't mind it. I would like you to get to the point where you trust yourself. Sure. But I understand that right now you're a little wary of yourselves.


00:10:02.890 — 00:10:03.490 · Becca
Yes.


00:10:04.010 — 00:11:05.300 · Ramit
Look, if you're sitting here saying, boo hoo, what am I going to do with an extra $100,000? I get that. But consider this. They make 150 or $60,000 a year. It is very reasonable for a couple making that much to eventually have $100,000 liquid, just as it is going to be for you to have more money in a savings account and an investment account than you ever thought possible when you're following my system.

So I want you to pay attention to this and not dismiss it. Because whether it's today, tomorrow, next year or ten years from now, you are going to have more money than you ever thought possible and you may not realize it, but you are probably going to feel the same way about money then that you do now. So pay attention because this is your future and you can apply what you learn today.

I want to understand a little bit more about how money works in your relationship. Take me through how the money flows. Do you both work? Where does the money go? What happens?


00:11:05.340 — 00:11:15.900 · Becca
Sure. So we do both work. We've always just put our money together in one account historically. And all of our money just goes to all of our bills.


00:11:15.940 — 00:11:25.220 · Ramit
And how do you decide on what you spend money on? And I'm talking about for the entirety of your relationship, not just the last three years.


00:11:25.260 — 00:11:26.340 · Becca
We just swiped the card.


00:11:26.380 — 00:11:32.100 · Ramit
Okay, so groceries, eating out, uh, trips, kids?


00:11:32.220 — 00:11:34.260 · Becca
Yeah. We don't talk about it. We just swipe.


00:11:34.300 — 00:11:35.460 · Mason
It's in there, we get it, we get it.


00:11:35.460 — 00:11:39.140 · Ramit
And then what happens once the bills come?


00:11:39.180 — 00:11:44.510 · Becca
Well, I think luckily, we've never been in a position where we don't have the money to pay our bills.


00:11:44.790 — 00:11:45.990 · Ramit
If you were in credit card debt.


00:11:46.230 — 00:11:48.070 · Becca
But it was never for bills.


00:11:48.110 — 00:11:49.110 · Ramit
Oh, what was it for?


00:11:49.590 — 00:11:51.270 · Becca
Very mindless spending.


00:11:51.310 — 00:11:52.910 · Ramit
Yeah. What? That's bills.


00:11:53.430 — 00:12:01.470 · Mason
We made it. Bills? We made debt. Normal. Um. So vacation debt. Uh. Little purchases. Odds and ends things. Debt. Okay. And it added up.


00:12:01.550 — 00:12:07.750 · Becca
And I guess that our habit was just paying the minimum payment. So in our head, we were paying it off.


00:12:07.790 — 00:12:15.430 · Ramit
Got it. And just so I understand. Because, uh, do you see trips or groceries or whatever? Not as bills.


00:12:15.470 — 00:12:16.710 · Becca
I guess I don't.


00:12:16.870 — 00:12:18.190 · Ramit
Yeah. It's interesting.


00:12:18.670 — 00:12:23.070 · Becca
In my head, I think it's more, you know, mortgage, car payment, utilities.


00:12:23.110 — 00:12:57.680 · Ramit
Okay, interesting. I would say I see all of it as bills. Okay. Mortgage, Fritos. Any of it? Right. Disneyland. It's all bills. Um, some of them are static. They're automatic. Some of them are variable because we're charging different amounts, but at the end of the month they all transform like a fairy tale.

They all end up being bills. Sure. And then I gotta find a way to pay him off. Okay, so you essentially didn't track most of your spending except for the big ones. And was there ever disagreements about spending?


00:12:57.680 — 00:13:12.200 · Becca
I would say on a very minor level, um, you know, for me, like when we go grocery shopping, I'm a huge let's find the best deals. I'm going to coupon cut everything where he will just go without any thought to it and just buy whatever it is.


00:13:12.240 — 00:13:30.600 · Ramit
So in general, when we look at your entire relationship with money, would you say you are frugal? Extravagant? Like what do you focus on? What's your thing? Like for example, I tend to spend money on convenience. That's like my thing. What is it for you?


00:13:30.640 — 00:13:35.200 · Becca
For me, it would be like clothing and beauty products and jewelry. Got it.


00:13:35.440 — 00:13:40.930 · Ramit
Self care? Yes. Okay, cool. That's your. That's your money dial. Okay. Mason, what about for you?


00:13:40.970 — 00:13:54.290 · Mason
I do like to get out of the house. We work from home, so getting out and being able to go eat somewhere at some of the restaurants we have in our area. I like to do that. It's something that we can do altogether. It's something specifically for my son. It's something specifically for her.


00:13:54.330 — 00:13:59.770 · Ramit
What would be an example? Because it's like going to the park or like going to Disney World for seven days.


00:13:59.970 — 00:14:03.530 · Mason
Like we definitely go to we definitely do Disney World. So okay. I'm definitely a big fan of.


00:14:03.570 — 00:14:05.250 · Ramit
How how many times a year.


00:14:05.450 — 00:14:06.650 · Becca
We have annual passes.


00:14:06.650 — 00:14:07.290 · Mason
We go all the time.


00:14:07.290 — 00:14:08.690 · Ramit
How much is that these days?


00:14:08.970 — 00:14:09.570 · Becca
About 3000.


00:14:09.610 — 00:14:12.770 · Mason
$3,000 for all three of us to go. Oh, total. The time. Total.


00:14:12.810 — 00:14:22.650 · Ramit
Okay. $3,000. That is just the park passes, correct? Okay. Do you do the thing where. Because you have annual passes, you go for like, two hours and you're just like, all right. Absolutely.


00:14:22.850 — 00:14:23.650 · Mason
I'll do a ride.


00:14:23.690 — 00:14:27.810 · Becca
Like, we get a fully enjoy it and not have to be exhausted at the end of the day.


00:14:27.850 — 00:14:37.100 · Ramit
Wow. Okay. Um, you mentioned that you are afraid of going back to mindless spending. Tell me a little bit more about that.


00:14:37.140 — 00:15:01.820 · Becca
We have really bad habits just going to the mall. Many shopping sprees, just buying things that we see that we want. Um, just go into target. Going. Going in there for no reason and coming out, spending two, $300, um, extravagant dinners for a date night and then. Well, when we're done with that, let's go bar hopping and just running up bills.

You know.


00:15:02.140 — 00:15:08.140 · Ramit
Like, what's an example of something you buy that's, like, kind of expensive and kind of mindless Botox.


00:15:10.180 — 00:15:10.500 · Ramit
That's.


00:15:13.060 — 00:15:13.860 · Ramit
Okay.


00:15:14.460 — 00:15:16.060 · Ramit
How much does that cost anyway?


00:15:16.140 — 00:15:19.860 · Becca
Um, I don't get a ton. So maybe like $200.


00:15:19.900 — 00:15:21.220 · Ramit
200 per what?


00:15:21.380 — 00:15:22.420 · Becca
Uh, three months.


00:15:22.700 — 00:15:26.100 · Ramit
For three months? Yeah. All right. Well, I mean, look, I never saw a.


00:15:26.100 — 00:15:26.500 · Ramit
Line for.


00:15:26.940 — 00:15:37.950 · Ramit
Botox in a CSP, but I love it. Why not? All right, you spend on the mall, spend on eating out. And just to give me a sense of, like, a date night. Walk me through that.


00:15:37.990 — 00:16:08.670 · Becca
Sure. So have to hire a babysitter. So that's the first. Um, you know, usually it's going to be for a good 5 or 6 hours. We'll make a dinner reservation. Dinner is going to cost 2 to 50. Um, you know, we're not ready to go home yet, so let's go somewhere else. Let's go try out this bar that we've been looking into.

So we'll go there, get a few drinks. You know, maybe we'll go to another one. Um, or we'll go out with friends, um, and meet up with them. And then that just gets way more expensive because we stay out later with them.


00:16:08.670 — 00:16:21.990 · Ramit
And then in your own relationship, the two of you is one of you, like, hey, we maybe shouldn't do that, or are you the opposite where you're both like, yeah, I get it, let's get that. You should get that. Are you hyping each other up?


00:16:22.030 — 00:16:25.710 · Becca
We egg each other on a lot okay. When it comes to purchases.


00:16:25.750 — 00:16:27.590 · Ramit
Like, just get it. Like you like it. You should get.


00:16:27.590 — 00:16:30.230 · Mason
It. I would agree with that. Yeah. Both. Look, you look good at it.


00:16:30.270 — 00:16:31.230 · Mason
We both of us.


00:16:31.350 — 00:16:36.710 · Ramit
Got it. Can you think of a time where you were not on the same page about money?


00:16:36.750 — 00:16:59.470 · Mason
I think our timelines of maybe buying a house are different. We have sold house, so now we have money from that. Do we want to buy a house immediately? Do we want to continue to rent to explore the area? We we don't know. I'm on the lighter side of that. I want to kind of wait and explore. You also want a house that's part of your rich life, and that's fine.

Okay, I like that.


00:16:59.630 — 00:17:03.110 · Ramit
Have you had a discussion about exact timelines?


00:17:03.270 — 00:17:22.310 · Becca
Initially we were thinking when we moved to to Florida, I was going to be within a year. I think now that we're almost close to the year, we've set that expectation that it's not the right idea. I personally would like to do it within the next five years. He's more open minded to it. Just kind of based off of how our finances look.


00:17:22.350 — 00:17:23.189 · Ramit
Oh, good.


00:17:23.750 — 00:17:26.470 · Ramit
Yeah. Biggest purchase of your life? Finances should.


00:17:26.470 — 00:17:27.470 · Ramit
Be. Yes.


00:17:27.510 — 00:17:34.520 · Ramit
Probably the number one. Maybe the number two decision. Okay. Good to know. What's the plan for the 100 K?


00:17:34.920 — 00:17:44.800 · Becca
Initially it was to buy a house, and then I think we realized that if we just put that down as a down payment, we'd be back to not having any savings.


00:17:44.800 — 00:17:46.040 · Ramit
So what?


00:17:46.080 — 00:17:49.160 · Ramit
I thought that you're always supposed to buy a house immediately.


00:17:49.200 — 00:17:52.640 · Becca
Well, you know, that's what our realtor was trying to get us down.


00:17:52.840 — 00:17:53.840 · Ramit
The realtor.


00:17:54.200 — 00:17:55.960 · Becca
I know they're not our friends.


00:17:56.000 — 00:17:56.680 · Ramit
They're not your.


00:17:56.680 — 00:17:57.280 · Ramit
Friend.


00:17:57.320 — 00:18:06.240 · Ramit
Your realtor is like. They might be nice. They might buy you a nice lunch, but they are there to make a commission. I take a realtor. That's how far I trust him.


00:18:06.280 — 00:18:06.480 · Becca
Yes.


00:18:06.520 — 00:18:15.400 · Ramit
They're there to do a job. You work for me. I'm going to be polite to you, but that's about it. We're not gonna, you know, go watch a play together. All right, so you realize that.


00:18:15.400 — 00:18:20.920 · Becca
So now it's just sitting there, and we really want to find out what we should do with it.


00:18:20.960 — 00:18:21.200 · Ramit
Okay.


00:18:21.240 — 00:18:23.840 · Ramit
Did you ever think you'd have $100,000 just sitting in your account?


00:18:23.880 — 00:18:25.520 · Becca
No. Never.


00:18:25.960 — 00:18:31.610 · Mason
Not like, not until way later, after the house was paid off and way down the road. That's going to be much further down.


00:18:31.650 — 00:18:32.450 · Ramit
Like 20, 30.


00:18:32.490 — 00:18:33.010 · Ramit
Years from now.


00:18:33.050 — 00:18:56.250 · Mason
For sure. Now that we're out, we just don't know what the next, um, step is for that because I agree. I think I want you to, uh, I'd like to get you another house, uh, into a back backyard with a pool and all the things. Um, but also, it could be, like a good starting point for different, uh, financial aspects, different brokerage accounts or different avenues.


00:18:56.290 — 00:18:59.930 · Ramit
You mentioned something in the application about a business. Can you tell me about that?


00:18:59.970 — 00:19:16.130 · Mason
Yeah, I had an idea about starting an arcade. There was a small 800, 900 square foot, um, underutilized building at the complex that we're actually staying in. And so I pitched them and sent them a letter of intent to rent the space and introduce arcade.


00:19:16.130 — 00:19:18.130 · Ramit
But this is like arcade with video games.


00:19:18.170 — 00:19:21.050 · Mason
Yeah, just just video games with the tap pass.


00:19:21.090 — 00:19:22.970 · Ramit
Got it. What do you think of this?


00:19:23.010 — 00:19:44.020 · Becca
I think it was a good idea to help make some passive income. Um, because it could, the way that the idea was set up was to make it staff less in a very high volume vacation area. So I was on board for the idea, but I think it was just throwing out the idea. Man, I would love to get some angle. So no plan with it.


00:19:44.460 — 00:21:59.319 · Ramit
I'm picking up a lot of clues that their relationship with money is not really that healthy. I'm hearing phrases like passive income, which can be a big sign of a dreamer. I don't like the phrase passive income because I know the truth about what it takes. This idea that's peddled online of you can just plop a quarter into some machine, and it will just print out money passively for the rest of your life.

Guys. It's bullshit. That's not how it works. In order to generate passive income, it takes a lot of work and a lot of time, and much of the time it doesn't even work. If your goal is passive income. To me, it's an immediate red flag because it means you're trying to effectively get rich quick. So as I'm getting these clues, I'm starting to wonder.

Are they actually in a healthy position or not? I'm actually really glad that we get a chance to talk, because if you remember, they were worried they were going to slip back into debt. And based on what I'm hearing, I think that might actually be a realistic possibility unless they make a change. We're going to look at the numbers right after this.

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00:22:01.000 — 00:23:29.740 · Ramit
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00:23:37.980 — 00:24:03.900 · Ramit
Here's my question for you today. Do you know exactly what you need to do to reach your first $100,000 in investable money? Most people don't. That's why I created the road to 100 K, a step by step program that shows you exactly what to do, where to focus, how long it's going to take to get to 100 K, and even how to accelerate your timeline.

You can learn more at


00:24:05.380 — 00:24:08.540 · Ramit
100 K. I want to take a look at your numbers.


00:24:08.580 — 00:24:09.020 · Becca
Sure.


00:24:09.060 — 00:24:12.100 · Ramit
What was it like to do the conscious spending plan together?


00:24:12.140 — 00:24:19.180 · Becca
It was eye opening. You know, I don't think we ever really sat down and looked at our numbers like that before.


00:24:19.220 — 00:24:21.630 · Ramit
Did you have any disagreements with each other?


00:24:21.630 — 00:24:27.790 · Becca
When we were talking about it, I did see him going, oh, well, that doesn't matter. And I had to remind him that no, that is a monthly call.


00:24:27.830 — 00:24:28.630 · Ramit
Oh, really? Yeah.


00:24:28.630 — 00:24:28.990 · Ramit
What's an.


00:24:28.990 — 00:24:29.630 · Ramit
Example?


00:24:29.670 — 00:24:43.150 · Becca
Um, some of the subscriptions. So for example, the annual pass we have to Disney. He's like I mean that that doesn't have to go on there. And I had to remind him that that has that is a monthly cost that we pay on every month.


00:24:43.510 — 00:24:51.150 · Mason
That's right. It makes sense now that you mentioned it, I just I was overlooking it and it's a 12 month low interest purchase. And that makes that makes it a cost.


00:24:51.150 — 00:24:51.710 · Mason
So yes.


00:24:51.710 — 00:24:57.430 · Ramit
Your instinctive reaction was that doesn't matter. Why why was that your first reaction? Why wouldn't it matter?


00:24:57.510 — 00:25:05.110 · Mason
Because maybe I knew that it was going to be paid off. It was the money is there in the account. So it's in my in my mind it's paid.


00:25:05.150 — 00:25:05.590 · Ramit
Mhm.


00:25:05.950 — 00:25:09.510 · Mason
And that's probably not the healthy way of looking at that. It's still being paid.


00:25:09.550 — 00:26:24.570 · Ramit
Yeah. That's not the right way to look at it. But I like how honest you're both being because you have these very interesting mental contortions that you use, and I'm not coming down on you at all. Just. I think it's interesting to learn more about ourselves. So, for example, Becca, you go. Originally you go.

Um, like, eating out is not a bill, right? It's a bill. And our $3,000 a year Disney payment doesn't count because we have the money. It counts. So I want you to kind of start to shine a light, almost like you're putting on one of those headlamps, right? And you're just looking at our own beliefs. And sometimes you might interrogate your own beliefs.

Um, often you interrogate your partner's beliefs because it's easier to see someone else's. But what I what I want to model for you is that it doesn't have to be like you're stupid or you're a bad person. It's just like, whoa, isn't that interesting? What do you mean by that? Oh, how come you think about it like that?

You're going to discover hundreds of these little contortions that you do as you start to embrace a new chapter of your money? Sure. Okay, let's take a look at the numbers. Mason, can you read off the word in bold and then the number next to it?


00:26:24.570 — 00:26:44.650 · Mason
Assets at 11,000. We have investments of 204 $867,000. We have savings at $124,300. Debt $13,600, for a total net worth of $326,567.


00:26:44.690 — 00:26:46.370 · Ramit
Okay. What do you think about those numbers?


00:26:46.410 — 00:26:56.850 · Mason
I know we've had debt kind of holding or kind of kind of staying, but it's now such a low number. I, uh, I want to I want to make it zero. Okay. And keep it zero.


00:26:56.850 — 00:27:03.810 · Ramit
We could definitely make it zero. I mean, if you just look at the savings versus the debt, you could do that while we're sitting here, if you wanted.


00:27:03.850 — 00:27:04.410 · Mason
We were just.


00:27:04.810 — 00:27:05.170 · Mason
Thinking.


00:27:05.210 — 00:27:08.130 · Becca
Yeah, if we should just wipe that out at this point.


00:27:08.170 — 00:27:15.660 · Ramit
We can talk about that for sure. Okay. You will walk out of here having a clear decision on that, I promise you. Okay. Okay. And, Becca, what do you think about these numbers?


00:27:15.700 — 00:27:21.140 · Becca
I feel a lot better about it than what I did this time last year.


00:27:21.180 — 00:27:22.260 · Ramit
Oh, why is that?


00:27:22.300 — 00:27:39.260 · Becca
Because we actually have a real savings at this point. Um, seeing our investments, though, the actual the 401 K and the pension, the rot that we have makes me feel a lot more comfortable than where I thought we were, because I wasn't looking at it. I didn't know how much we had.


00:27:39.300 — 00:27:40.260 · Becca
In the accounts.


00:27:40.300 — 00:27:41.620 · Ramit
What did you think was in there?


00:27:41.620 — 00:27:44.140 · Becca
Probably about $60,000, is what I thought.


00:27:44.180 — 00:27:45.620 · Ramit
And it's 204,000.


00:27:45.660 — 00:27:46.300 · Becca
Yes.


00:27:47.500 — 00:27:48.500 · Ramit
It's, uh.


00:27:49.940 — 00:28:25.180 · Ramit
We are so funny when it comes to money. We go most of our lives agonizing. You mentioned that you cut coupons at the grocery store, and I'm just imagining, like, sitting there, like, looking on your app, going to the grocery store, like, oh, I saved 129 on green beans. And and meanwhile, you have more than triple the amount you thought in investments, right?

So this is good to know It's good for you to see almost the hilarity of how we behave, because that will help you change the way you behave. Your savings at 124,000 is that 100 K from the house.


00:28:25.180 — 00:28:25.300 · Ramit
The.


00:28:25.300 — 00:28:31.300 · Becca
100 K is from the house. And then we've been consistently saving each month as well.


00:28:31.340 — 00:28:32.460 · Ramit
How long have you been doing that?


00:28:32.620 — 00:28:38.500 · Becca
I started actually putting away savings into an Heisei two years ago.


00:28:38.540 — 00:28:38.820 · Ramit
Wow.


00:28:38.860 — 00:28:40.900 · Becca
And I'll do $1,000 a month.


00:28:41.180 — 00:28:42.700 · Ramit
How did you decide on that amount?


00:28:42.740 — 00:29:09.420 · Becca
When we started paying off our debt and getting really into making sure we're not just overspending on mindless stuff, um, I kind of looked at how much I was making compared to the bills we had at the time and went, okay, I could take $500 from each paycheck, and if it's just going out and not in my spending account, I know I can live without that money.

So I've continued that. I would like to eventually do more than.


00:29:09.420 — 00:29:10.300 · Ramit
That, though. Good.


00:29:10.380 — 00:29:18.830 · Ramit
That's the that's a very healthy way to do it. It's like I'm putting the money away. Yes. I'm not even going to see it. And then, believe it or not, you live.


00:29:18.870 — 00:29:19.190 · Becca
I don't.


00:29:19.190 — 00:29:19.350 · Becca
Need.


00:29:19.350 — 00:29:45.150 · Ramit
It. You don't need it. It is crazy. Very common when people are really tight. Maybe they have a lower income or their bills are high and they go meet. This stuff is impractical. I can't even say $50 a month. I go try it. Try it with 20. Just have it automatically set aside. You will not miss it. Right? Great work.

After two years, you have $24,000 saved. That's great. All right, let's keep going. Becca, can you read off your gross combined monthly income, please?


00:29:45.190 — 00:29:48.350 · Becca
Sure. 13,256 okay.


00:29:48.390 — 00:29:56.190 · Ramit
For a household annual income of $159,000. Let's look at the rest of the numbers here. Fixed costs. What's that percentage?


00:29:56.190 — 00:29:57.270 · Becca
71%.


00:29:57.310 — 00:29:58.270 · Ramit
What do you think about that?


00:29:58.310 — 00:29:59.350 · Becca
It needs to go lower.


00:29:59.390 — 00:30:04.070 · Ramit
Agreed. It's high. We'll go down to investments. What's the number?


00:30:04.070 — 00:30:05.070 · Mason
$200.


00:30:05.070 — 00:30:09.990 · Ramit
$200 or 2%? 2% savings. What number?


00:30:10.040 — 00:30:11.120 · Becca
13%.


00:30:11.160 — 00:30:11.640 · Ramit
That's pretty.


00:30:11.640 — 00:30:15.840 · Ramit
Good. That's that thousand dollars. Yeah. And then you have an HSA.


00:30:15.920 — 00:30:16.640 · Becca
Yes. Good.


00:30:16.680 — 00:30:20.960 · Ramit
And you're putting 300 away. Out of curiosity, are you investing that money?


00:30:21.000 — 00:30:28.840 · Mason
I wanted to wait to come on the show and ask you what to do, because they have to have over anything over $1,000 can be invested. I'm there now.


00:30:28.880 — 00:30:39.760 · Ramit
So we'll talk about that. Good. Good. Health savings accounts are awesome accounts. I'm glad you have one. And then finally, guilt free spending at 14% or 1442. Is this accurate?


00:30:39.800 — 00:30:40.960 · Becca
Yes. Huh?


00:30:41.120 — 00:30:45.880 · Mason
It's just about. There's also a miscellaneous line that I think will cop will take a lot of things out, too.


00:30:45.920 — 00:30:47.360 · Mason
Yeah, right. I think combined.


00:30:47.360 — 00:30:49.840 · Becca
Between those two, I think that is very high.


00:30:49.880 — 00:30:54.440 · Ramit
And, um, your Disney stuff, where did you count that.


00:30:54.480 — 00:30:54.920 · Ramit
In.


00:30:54.920 — 00:30:59.680 · Becca
The subscriptions is where I put it. That looks really high, but that's part of where I put that.


00:30:59.720 — 00:31:00.400 · Becca
Good good.


00:31:00.440 — 00:31:07.920 · Ramit
Good good. I'm glad you. That's exactly where it should go. Okay. Totally. It must be important because you made it a fixed cost. So I'm assuming you're going to do Disney every year?


00:31:07.960 — 00:31:08.520 · Ramit
Ideally.


00:31:08.610 — 00:31:11.930 · Ramit
Okay, cool. Shall we dive into the fixed cost?


00:31:11.930 — 00:31:12.530 · Ramit
For sure.


00:31:13.130 — 00:31:24.410 · Ramit
So we're at 71%. We like to see this number between 50 to 60%. Let's look at your rent which is $2,550. That's pretty good. That's good.


00:31:24.450 — 00:31:31.010 · Mason
It is. We found a good spot when we moved. It was also fairly fully furnished. So we got to just move right in. It was a really good dream.


00:31:31.010 — 00:31:40.330 · Ramit
It was. Listen up, America, we need more furnished apartments. People don't want to have to buy a bunch of furniture. Now, I love a furnished apartment. All right. Car payment, 765. One car payment.


00:31:40.330 — 00:31:41.170 · Becca
That's one car payment.


00:31:41.210 — 00:31:44.450 · Becca
One car. It's a it's a Honda Pilot. Good car.


00:31:44.930 — 00:31:47.210 · Ramit
Good. 765 includes gas.


00:31:47.770 — 00:31:48.850 · Becca
Um, no.


00:31:49.170 — 00:31:52.170 · Mason
I would say it doesn't include gas. We also work from home, so traveling.


00:31:52.170 — 00:31:52.650 · Mason
Our gas.


00:31:52.650 — 00:31:53.410 · Becca
Costs are very.


00:31:53.410 — 00:31:54.170 · Becca
Low. Pretty low.


00:31:54.210 — 00:31:56.090 · Becca
I would say maybe $100 a month.


00:31:56.130 — 00:31:57.210 · Ramit
All right. I'm going to add it here. Okay.


00:31:57.250 — 00:31:57.890 · Ramit
Okay.


00:31:58.170 — 00:32:05.530 · Ramit
Wait. So what else are you missing if you didn't include gas here because this is a big tip off. If you didn't include gas, what else? Did you not include?


00:32:05.570 — 00:32:06.370 · Mason
Maintenance.


00:32:07.020 — 00:32:07.260 · Ramit
Okay.


00:32:07.740 — 00:32:13.300 · Ramit
I'll make it 125. Besides the car, what else are you not including in this conscious spending plan?


00:32:13.340 — 00:32:16.180 · Becca
Honestly, I think I was thinking gas was under miscellaneous.


00:32:16.220 — 00:32:16.780 · Becca
Am I? Yeah.


00:32:16.820 — 00:32:38.020 · Ramit
This is. See, this is what people do. They throw them, they see the miscellaneous, and they treat it like a junk drawer. Ah, it's covered in there. It's got no miscellaneous is for this stuff. You did not count even though you tried to count everything else. Another mindset shift I want you to have. Yes. Right.

So let's just quickly run through this here. Groceries at 800. Is that accurate?


00:32:38.060 — 00:32:39.020 · Ramit
It is.


00:32:39.060 — 00:32:48.820 · Ramit
Okay. Clothes at 250. Yo, you've got some nice clothes on. You're telling me 200 bucks? 250 a month. Get set. I don't know if I believe that.


00:32:48.820 — 00:32:49.980 · Mason
I don't buy often.


00:32:50.900 — 00:32:52.900 · Becca
I sell my clothes.


00:32:53.180 — 00:32:56.980 · Becca
And I sell this stuff to money. I still buy.


00:32:56.980 — 00:32:57.220 · Becca
More.


00:32:57.220 — 00:32:57.500 · Becca
Clothes.


00:32:57.540 — 00:33:01.060 · Ramit
Come on. I know how much you get when you sell your clothes. It's like pennies on the dollar.


00:33:01.100 — 00:33:03.700 · Ramit
It's not a ton. All right. But that doesn't.


00:33:03.740 — 00:33:05.910 · Becca
I kind of help myself with that.


00:33:05.950 — 00:33:06.990 · Becca
Yeah. All right.


00:33:07.390 — 00:33:16.430 · Ramit
Let me ask you a question. When you had that conversation three years ago and you took a hard look in the mirror. What spending changes did you make.


00:33:16.430 — 00:33:32.950 · Becca
During that time where we were aggressively paying off the debt? We were not buying clothes. We were not going out on date nights. When we paid that off and we moved, we started creeping back up on some spending there because we felt a little bit more comfortable in doing that.


00:33:32.990 — 00:33:33.470 · Becca
Okay.


00:33:33.510 — 00:33:39.790 · Ramit
I don't mind a little bit of increased spending. I do mind it if it is mindless.


00:33:39.830 — 00:33:40.390 · Ramit
Sure.


00:33:40.870 — 00:33:42.190 · Ramit
Where is it today?


00:33:42.350 — 00:33:43.150 · Becca
Better than it.


00:33:43.150 — 00:33:43.830 · Becca
Was.


00:33:43.830 — 00:33:46.710 · Becca
But there's still mindless spending. Okay, 100%.


00:33:46.750 — 00:33:47.310 · Ramit
Cool.


00:33:47.390 — 00:33:52.630 · Ramit
Subscriptions are at 605. So we have the Disneyland. What else do we have?


00:33:52.670 — 00:34:01.670 · Becca
Um, I also put in my son's extracurricular activities there, and then there's a meal service. Um, Amazon.


00:34:02.270 — 00:34:02.710 · Mason
Prime.


00:34:02.750 — 00:34:03.310 · Mason
Autism.


00:34:03.350 — 00:34:03.870 · Becca
Audible.


00:34:03.920 — 00:34:05.720 · Mason
Spotify. Some little, little odds and ends.


00:34:05.760 — 00:34:07.160 · Ramit
How much is the meal delivery?


00:34:07.200 — 00:34:08.679 · Mason
100, $100 a month.


00:34:08.720 — 00:34:09.399 · Ramit
Okay.


00:34:09.480 — 00:34:15.639 · Ramit
And then miscellaneous, which is $1,005. So that's your catch all? Yes. What do you think falls under that?


00:34:15.679 — 00:34:16.720 · Mason
The haircuts.


00:34:16.919 — 00:34:17.399 · Mason
Right.


00:34:17.399 — 00:34:18.240 · Mason
Um, I.


00:34:18.800 — 00:34:33.440 · Ramit
Agree, I think any self-care is probably in here, and I think that would be hair massage, nails trainer, whatever it may be. There's a lot of stuff that I think falls in here. I suspect it's probably higher than $1,000. What do you think?


00:34:33.480 — 00:34:35.240 · Becca
It depends on the month. I think it can be.


00:34:35.280 — 00:34:39.320 · Mason
I don't know, we were trying really hard to pick out, like, what else that could include?


00:34:39.360 — 00:34:40.760 · Ramit
Do you track your spending?


00:34:41.080 — 00:34:41.600 · Ramit
No.


00:34:41.639 — 00:34:45.399 · Ramit
No. Okay. Did you track it when you were paying the debt down?


00:34:46.080 — 00:34:48.080 · Becca
We still weren't tracking it very well.


00:34:48.080 — 00:34:48.520 · Becca
Wow.


00:34:48.600 — 00:34:50.520 · Becca
We were just not doing stuff.


00:34:51.679 — 00:34:52.320 · Ramit
My team at.


00:34:52.679 — 00:35:56.850 · Ramit
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00:37:30.870 — 00:37:43.750 · Ramit
I think I understand your numbers now. I have some other questions I want to ask you. There was a note in your conscious spending plan next to the investments that said day trading pre-market. What does that mean?


00:37:43.750 — 00:38:00.680 · Mason
So that is me. Um, I do have a brokerage account. I do trade out of it. I do trade small account. It's under $1,000. While I don't want to lose it or day trade it away. It's all I will have to use for this account.


00:38:00.720 — 00:38:01.760 · Ramit
1000.


00:38:01.800 — 00:38:02.960 · Mason
I started with $1,000.


00:38:03.000 — 00:38:03.560 · Ramit
Yeah. What is it.


00:38:03.560 — 00:38:05.600 · Mason
Now? 600. So not. Not doing. Not doing.


00:38:05.600 — 00:38:05.920 · Mason
Hot.


00:38:05.960 — 00:38:11.360 · Mason
Okay. But it's also learning. But this is all the year into the the plan or the strategy.


00:38:11.400 — 00:38:13.920 · Ramit
Got it. Did you two of you talk about this?


00:38:13.960 — 00:38:15.560 · Ramit
Yes. What? Did you swear?


00:38:15.840 — 00:38:25.200 · Becca
Um. I was open to him trying it out. You know, I think in my head was, you know, if it's something he could learn and be able to be successful at it, I don't see the issue in it.


00:38:25.240 — 00:38:29.040 · Ramit
Got it. And what if it went to zero? What would you do.


00:38:29.600 — 00:38:36.640 · Mason
If it went to zero? I would no longer be able to trade for that time frame. I'd try to keep it from January to December.


00:38:36.640 — 00:38:38.600 · Ramit
And after that, what would you do?


00:38:38.640 — 00:38:44.760 · Mason
I guess reassess. How was my skill if I took it to zero? Not great. So maybe I should stop.


00:38:44.800 — 00:38:45.360 · Ramit
Pretty honest.


00:38:45.400 — 00:38:46.080 · Ramit
All right.


00:38:46.120 — 00:38:54.560 · Ramit
Okay. Got it. Let me understand how you both built your relationship with money. Becca, what do you remember your family saying about money when you were young?


00:38:54.560 — 00:38:57.320 · Becca
I had separated parents and


00:38:58.360 — 00:39:17.200 · Becca
they didn't talk a lot about money, but I could tell even as a kid we didn't have a ton of money. Um, we we got our necessities. Not a lot of our wants. And I remember, you know, my dad will go to our dad and say, hey, I want this. He goes, I give your mom enough money each month. She can get.


00:39:17.200 — 00:39:17.640 · Becca
That.


00:39:17.680 — 00:39:29.520 · Becca
So we asked my mom and she goes, that money went to bills. I don't have money for that. So I knew we didn't have money, but there was really no discussion outside of that about money.


00:39:29.560 — 00:39:33.840 · Ramit
What do you take away from dad tossing the ball to mom? Mom


00:39:34.960 — 00:39:37.160 · Ramit
telling you that the bill. What do you make of that?


00:39:37.560 — 00:39:41.240 · Becca
That neither one of them wanted to take responsibility for it.


00:39:41.560 — 00:39:42.640 · Becca
So. Hmm.


00:39:42.680 — 00:39:48.480 · Ramit
And you mentioned that everybody in your life has normalized having debt.


00:39:48.520 — 00:39:48.960 · Ramit
Yes.


00:39:49.000 — 00:39:49.960 · Ramit
Tell me about that.


00:39:50.000 — 00:39:58.490 · Becca
Yeah, I, I did not grow up in an environment that was wealthy by any means. I think everyone normalized that because that's how they got by.


00:39:58.530 — 00:39:58.930 · Ramit
What did.


00:39:58.930 — 00:39:59.570 · Ramit
They say?


00:39:59.770 — 00:40:13.730 · Becca
Um, you know that we we work hard, but sometimes we don't have enough money to make ends meet, so we put it on a credit card. So it just it was very normalized in my environment to not have a lot of money.


00:40:13.890 — 00:40:22.850 · Ramit
Got it, got it. Okay. So let's fast forward to you getting a little bit older. Your teenager. Did your relationship with money change at all?


00:40:22.850 — 00:40:54.380 · Becca
When I was 16 I got a job and I think that was the first time in my life I was ever actually able to get things that I wanted because I was able to start buying them, but I, I was fairly responsible with it back then. I saved half of my paycheck up until I was 18, so I bought my own car. I was able to pay for two years of my college with it.

Um, I think the issue was I turned 18 and went wild and didn't try to uphold what I was doing with saving money.


00:40:54.380 — 00:40:57.620 · Ramit
So you were saving from 16 to 18. Where'd you learn that?


00:40:58.140 — 00:40:58.860 · Becca
Um.


00:40:59.180 — 00:41:00.020 · Becca
I don't know.


00:41:00.340 — 00:41:08.580 · Becca
Actually, I, you know, I went and opened up a bank account, and maybe the lady there told me that was a good idea. I have no idea.


00:41:08.620 — 00:41:11.180 · Ramit
That's interesting. Yeah. Mom or dad ever tell you to save?


00:41:11.220 — 00:41:11.780 · Ramit
No.


00:41:11.980 — 00:41:14.820 · Ramit
Do you ever talk about investing debt? Any of that?


00:41:14.860 — 00:41:15.420 · Ramit
No.


00:41:15.500 — 00:41:16.660 · Becca
No advice at.


00:41:16.660 — 00:41:17.180 · Becca
All.


00:41:17.220 — 00:41:22.300 · Ramit
You said at 18 you started spending your money. You called it going wild. Yeah. What'd you spend it on?


00:41:22.860 — 00:41:27.100 · Becca
Parties. Um, trying not to live at home.


00:41:27.100 — 00:41:27.700 · Becca
So.


00:41:28.420 — 00:41:34.020 · Becca
Apartments. Um, just utilize everything I could just to not go back home.


00:41:34.060 — 00:41:34.580 · Ramit
Got it.


00:41:34.940 — 00:41:35.940 · Ramit
Credit cards.


00:41:36.220 — 00:41:39.540 · Becca
I did start those when I was probably about 21.


00:41:39.580 — 00:41:40.020 · Becca
Okay.


00:41:40.340 — 00:41:41.860 · Ramit
Um, did you finish college?


00:41:41.900 — 00:41:42.620 · Ramit
I did not.


00:41:42.660 — 00:41:45.860 · Ramit
Okay. So what happened after you left college?


00:41:46.420 — 00:41:51.030 · Becca
I started working full time, and I got an apartment and just started paying my bills.


00:41:51.070 — 00:41:51.590 · Ramit
Did you save.


00:41:51.590 — 00:41:52.590 · Ramit
Anything? No.


00:41:53.070 — 00:41:57.350 · Ramit
How'd you go from 16 saving to not saving.


00:41:57.430 — 00:42:04.870 · Becca
I think in my head, I had time. I was. You know, I can spend this money now because I have so much time.


00:42:04.870 — 00:42:08.310 · Ramit
So I'm young. I'm going out. I'll deal with the saving stuff later.


00:42:08.350 — 00:42:08.630 · Ramit
Right.


00:42:08.670 — 00:42:16.750 · Ramit
Okay. Did you have anybody in your group of friends that was financially savvy?


00:42:16.990 — 00:42:32.030 · Becca
I don't think we did until our late 20s. And I think that actually was what got my mind started going. Oh, these people are my age. They're doing well with money. They know what they're doing. Why am I not doing that?


00:42:32.070 — 00:42:33.230 · Ramit
How did you know that they were doing?


00:42:33.230 — 00:42:35.670 · Ramit
Well, we would talk about it. Really? Yeah.


00:42:35.830 — 00:42:39.950 · Ramit
This is both of you. Okay, so these are friends. What did you say to them?


00:42:40.190 — 00:42:59.480 · Becca
Well, I ask them advice. You know, we would get into conversations and ask what they were doing or how they did it. Um, and they talk about saving money. They talk about how they would split up their bills with their spouse. Um, and talk about, um, you know, not doing the mindless spending that we do.


00:42:59.480 — 00:43:00.240 · Ramit
So


00:43:01.320 — 00:43:05.560 · Ramit
it's quite interesting hearing your journey. Um, did you grow up religious?


00:43:05.600 — 00:43:06.400 · Ramit
I did.


00:43:06.440 — 00:43:07.720 · Ramit
Are still religious?


00:43:07.760 — 00:43:08.320 · Ramit
No.


00:43:08.400 — 00:43:13.440 · Ramit
I see. Oh. At what age did you maybe step out of religion?


00:43:13.480 — 00:43:14.600 · Becca
About 26.


00:43:14.640 — 00:43:15.800 · Becca
Aha. Um.


00:43:16.320 — 00:43:17.640 · Ramit
What was going on then?


00:43:17.640 — 00:43:22.800 · Becca
I just started going on a deep dive of really looking into.


00:43:22.800 — 00:43:23.600 · Becca
What.


00:43:23.760 — 00:43:28.720 · Becca
I grew up thinking and realizing. I don't agree with that anymore.


00:43:28.800 — 00:43:29.400 · Becca
I see.


00:43:29.720 — 00:43:36.000 · Ramit
And as part of that journey, um, what other parts of your life did you reexamine?


00:43:36.040 — 00:43:59.690 · Becca
I became a whole different person. I feel like in that time frame, I just started realizing the person I was was not who I wanted to be. Wow. And I think this financial piece kind of came with it, too. Um, because it really made me realize, who do I want to be and where do I want to go? And not living a life that other people told me I had to live.


00:43:59.730 — 00:44:01.930 · Ramit
Tell me more. I'm very fascinated.


00:44:01.970 — 00:44:02.650 · Becca
Sure.


00:44:02.850 — 00:44:24.650 · Becca
Um, you know, I think, you know, growing up, um, religious. And then I think just kind of the environment I grew up into, like with my mom, like, you work really hard, but you really have nothing to pay off for it. She doesn't take big chances on anything in her mind. I'm supposed to work 40 hours a week, go home, not do anything else.

And I realized like I was missing something in.


00:44:24.650 — 00:44:24.850 · Becca
My.


00:44:24.850 — 00:44:42.930 · Becca
Life. And it's because I was mirroring the way that she lived her life. And that's not how I wanted to live it. Mhm. Um, you know, I think there was a lot of judgment from her or even people that we grew up with in a religious standpoint in church and everything. And I, um, really started to realize, like their opinions did not.


00:44:42.930 — 00:44:43.410 · Becca
Matter.


00:44:43.610 — 00:44:49.740 · Becca
Of me and to make me happy, I need to start living the life that I truly want to live instead.


00:44:49.780 — 00:44:51.140 · Ramit
And you were married at this point?


00:44:51.180 — 00:44:52.220 · Ramit
We were. Yeah.


00:44:52.780 — 00:44:55.940 · Ramit
I'm going to come to you, Mason. But were you religious as well? Did you grow up religious?


00:44:55.980 — 00:44:58.020 · Ramit
We met at church. Grew up religious? Yeah.


00:44:58.060 — 00:44:59.420 · Ramit
And are you still religious?


00:44:59.460 — 00:45:00.300 · Ramit
I'm not.


00:45:00.500 — 00:45:02.740 · Ramit
Same time period where you had this realization.


00:45:02.740 — 00:45:05.140 · Mason
Maybe a little bit earlier, but generally.


00:45:05.140 — 00:45:14.420 · Ramit
Wow. Um, this is very rare. Like, it's not rare for people to, you know, change their views on religion. But in a married couple that met at church.


00:45:14.460 — 00:45:14.780 · Ramit
Yep.


00:45:14.820 — 00:45:29.540 · Ramit
To go through the journey together. And it's no surprise. That's why I kind of got a clue that there may have been something going on with religion. Because to change your entire relationship with money in your 20s by asking friends and listening.


00:45:29.540 — 00:45:30.060 · Ramit
Mhm.


00:45:30.300 — 00:45:32.140 · Ramit
Suggests there's something else going on.


00:45:32.180 — 00:45:33.300 · Ramit
Yeah. Wow.


00:45:33.780 — 00:45:42.340 · Ramit
What money messages that you grew up with do you think you are still bringing to this relationship today?


00:45:42.900 — 00:45:44.340 · Becca
I think I.


00:45:45.630 — 00:46:02.430 · Becca
for so long just thought I wasn't going to be rich. I thought that was just reality. I thought everybody's poor because everybody around me is poor. So I think I haven't found that confidence yet to know that I don't have to be that way.


00:46:02.430 — 00:46:02.910 · Ramit
Wow.


00:46:03.870 — 00:46:18.230 · Ramit
It's interesting. It kind of shows up in your conscious spending plan, the spending on certain things without tracking it carefully. That is indicative of somebody who's like, yeah, I'm not going to be wealthy like little old me.


00:46:18.270 — 00:46:18.830 · Ramit
Mhm.


00:46:18.910 — 00:46:21.950 · Ramit
But actually you very well could be.


00:46:21.990 — 00:46:22.630 · Ramit
Yes.


00:46:22.990 — 00:47:50.690 · Ramit
When I think about how Becca grew up with money, I think about like a sponge. Just someone absorbing the lessons learned, but not really knowing how to make sense of what's going on. When you're a child, you don't understand how money works. And for so many guests, including Becca, their parents don't tell them anything about money.

Oh, sure, they might leak out stress and anxiety, but they're rarely talking about savings and investing in different tax vehicles. No, it's just like we don't have money. So what are we to make of that as children? Many of us are consumed with scarcity. Many of us might save a little bit of money and then spend it all in a single night or in a month.

Becca did something interesting. She became pretty responsible with her savings. She saved half of her money. And when I asked her, where'd you get that idea from? I don't know, maybe the lady at the bank. And then she goes on just a couple years later to spend all of it. I am begging all the parents who watched this show, stop trying to protect your children with money.

You are not protecting them by not talking about money. Money is not something that is an evil monster. It's actually something you need to engage with and discuss, even if you have made mistakes in your own life. I wish Becca had been better trained with money. It would have put her in a completely different place.

but to her credit, she has found that place pretty much on her own. Tell me about how you grew up with money. What do you remember your family saying, Mason? About money?


00:47:50.850 — 00:48:33.970 · Mason
Um. Good question. I mean, I also came from a family of, uh, divorced parents, so money was always tight on both sides. Uh, I don't remember openly having money discussions about this. Um, but as a kid, you just notice things. So you notice the car changes or the furniture going away, or, you know, garage sales and moving all the time, and you realize these things.

So, um, money messages and like, things from, from how I grew up, it was all, like, self-taught. And that's not it wasn't great. I didn't have great habits and and saving or spending, um, until I got into a serious relationship with her. And that made me want to change all of that.


00:48:34.130 — 00:48:37.610 · Ramit
Furniture going away. What's that about?


00:48:37.690 — 00:49:08.540 · Mason
Yeah, I had I got to see my my dad struggle through the divorce. There was a lot of changes to the house and selling that and what we would come over and visit and sleep on and stay on, um, almost being on the like, verge of like, cards being like, canceled or bankruptcy or losing a house and like, things that you will see.

Um, that was all normalized to me. And I don't think I ever want to be in that position or show that I'm in that position to our son.


00:49:08.700 — 00:49:09.140 · Mason
Mhm.


00:49:09.180 — 00:49:12.340 · Ramit
So if I can read between the lines, tell me.


00:49:12.340 — 00:49:12.820 · Ramit
If.


00:49:13.060 — 00:49:16.260 · Ramit
This is accurate. Your parents separated. What age were.


00:49:16.260 — 00:49:16.740 · Ramit
You.


00:49:17.940 — 00:49:18.660 · Mason
12.


00:49:18.700 — 00:49:28.820 · Ramit
Okay. That's a tough age. And it sounds like your dad had to downsize. You go to his place. It's probably smaller. Not as much furniture, not as comfortable.


00:49:28.860 — 00:49:29.820 · Mason
100%.


00:49:29.860 — 00:49:33.180 · Ramit
What did you feel at that moment as a 12 year old? Pretty smart at 12.


00:49:33.460 — 00:49:48.460 · Mason
Um, you know, you get you get to grow up fast, which, you know, you learn to to try to do the next steps of do I have to start helping my sisters? Do I have to start dropping extracurriculars and sports and things? Um, yeah. It was it was a big drawback.


00:49:48.500 — 00:49:56.660 · Ramit
Right. And did you start hearing more about money at that point? Because presumably money's got to be tighter for both parents.


00:49:56.980 — 00:50:20.340 · Mason
Again, it wasn't a lot of open discussion about finance. Um, one thing I do distinctly notice or remember is, like my mother constantly checking the books and like having pages and pages of bills and scrolling through them and filling out all these things. And that, to me, was how bills were handled. You struggle over them and you stress over them.

And then the next month you do it again.


00:50:20.380 — 00:50:26.620 · Ramit
Yeah, that's pretty clear. I think a lot of people believe that you struggle. And who struggles? Mom struggles.


00:50:26.740 — 00:50:28.660 · Mason
Sure. She she struggled.


00:50:29.900 — 00:50:43.190 · Mason
Uh, she also went back to school and put herself through school with three kids and and got a better spot. So like, I learned that you can get out of those certain scenarios. Wow. I also watched my dad not do that and slide different directions.


00:50:43.190 — 00:50:46.990 · Ramit
So really, what was your takeaway from that differential?


00:50:47.910 — 00:50:57.550 · Mason
My takeaway was you can work hard and get out of where you are. And that's what my mother did. So that was the work ethic I learned.


00:50:57.750 — 00:50:58.390 · Ramit
Okay.


00:50:58.590 — 00:51:15.510 · Ramit
Do the two of you as a couple have role models? Um, folks that you look to, you get inspired by when it comes to money, when it comes to parenting, when it comes to relationships, I'm seeing a kind of a quiet realization on both of your faces right now.


00:51:15.550 — 00:51:17.030 · Becca
I don't think I have one.


00:51:17.310 — 00:51:17.750 · Ramit
Wow.


00:51:18.350 — 00:52:01.640 · Ramit
That's honest. I actually think that it explains a lot. And if anything, if I were in your position, I'm thinking like, wow, I'm proud of how far we have come, the transition we've made as a couple because we don't really have anybody who's guiding us. We had to figure this stuff out on our own. So I think that's quite powerful.

You could turn that narrative into like, oh my God, this sucks. We don't have anybody around us or wow, look how far we've come despite it. And now that we realize it, our next goal is to find a couple who we really respect and want to learn from. Sure, take that mindset you've already got. Make it bigger and more explicit.


00:52:01.840 — 00:52:02.480 · Ramit
Okay.


00:52:02.760 — 00:52:42.850 · Ramit
Mason and Becca both grew up with money scarcity. And interestingly, when people grow up with scarcity, I find that they can go one of two directions. One, they can become even more scarce about money protective, worried, anxious, or the other direction. They basically spend it all because they go, finally, I have some money and I'm going to spend it.

The key is you cannot predict which direction they are going to go. And with Mason and Becca when they met, especially for the early part of their relationship, they both decided to go the spending route. What kind of financial future do you want for your son?


00:52:43.130 — 00:53:06.170 · Becca
I want him to be able to be successful in money management from day one when he becomes an adult, but I don't want him to have to go through what we did, which was living very paycheck to paycheck. I would like to be able to set him up and be comfortable.


00:53:06.210 — 00:53:12.650 · Ramit
What if he turned 18 in? He opens up his checking account. There's $100,000 in it. What would you teach him to do?


00:53:12.970 — 00:53:13.650 · Ramit
Um.


00:53:14.050 — 00:53:25.570 · Becca
All my hope would be to invest it, to be able to really think about how he could really utilize that money for his future, instead of just mindlessly spending it.


00:53:25.810 — 00:53:29.210 · Ramit
Well, we have a great opportunity because his parents happen to have $100,000.


00:53:29.250 — 00:53:29.450 · Ramit
Yes.


00:53:29.490 — 00:53:39.820 · Ramit
And to your credit, you are not immediately spending it. Right? I really respect that you have put it aside while you learn so that you use it thoughtfully.


00:53:39.860 — 00:53:40.180 · Ramit
Sure.


00:53:40.220 — 00:53:49.940 · Ramit
I want to talk about what you want to do with your money. Yes, 100 K that too. But just in general, what kind of life do you want to live?


00:53:50.020 — 00:53:51.420 · Ramit
Dream home?


00:53:52.020 — 00:54:20.260 · Becca
Um, several vacations a year, have family vacations and then one on one vacations. Mhm. Um, you know, date nights, often. Um, being able to maintain our social life, um, without feeling stretched thin for that, being able to go shopping and not feel like we're overspending in that amount. Um, but overall, to just not have the anxiety that I have every single day.


00:54:20.260 — 00:54:21.060 · Becca
I still have it.


00:54:21.060 — 00:54:21.300 · Becca
I.


00:54:21.300 — 00:54:22.700 · Becca
Do. Okay. Mhm.


00:54:22.780 — 00:54:23.940 · Ramit
Mason, how about you?


00:54:24.020 — 00:54:42.870 · Mason
Um, definitely owning a home and with with some of your requests, a pool. I think there's got to be there, you know? Um, not worrying about the spending because it's something that I. I can afford. Maybe it is maybe not the nicest things that are out there, but definitely nicer.


00:54:42.910 — 00:54:43.310 · Mason
Hmm.


00:54:43.470 — 00:54:54.670 · Mason
I want to set up my son to mirror how we are with our money once we get in a good spot, and so far, we're really close to that good spot.


00:54:54.710 — 00:54:59.550 · Ramit
Okay, nice. I don't know the exact number here, but for the type of lifestyle that the two of you talked.


00:54:59.550 — 00:55:00.070 · Ramit
About.


00:55:00.310 — 00:55:04.750 · Ramit
What kind of income do you think you would need to comfortably be able to do.


00:55:04.750 — 00:55:05.230 · Ramit
That?


00:55:05.270 — 00:55:07.910 · Becca
250,000. At least.


00:55:07.950 — 00:55:10.750 · Mason
250. Maybe 300,000. I think that'd be a great goal.


00:55:10.790 — 00:55:22.510 · Ramit
Yeah. The type of lifestyle you're talking about is probably 300 to $350,000 a year in your area. Okay, so at 350,000, you're making 160 K right now. What does it tell you?


00:55:22.550 — 00:55:23.790 · Becca
We need to make more.


00:55:24.030 — 00:55:55.200 · Ramit
If you want to live that life. Yes. You would need to increase your income, I agree. Do you need to do that tomorrow? No, no. So you got time? Plenty. Think of how much you've changed in the last five years. Oh my God. If you continue that stretch, you have time. Then the question becomes, hey, if we want to live a lifestyle that's going to take X years, it's going to require us one doubling, tripling, whatever our salary, which is obviously a lot of work and good luck.

Do we want all of those things?


00:55:56.240 — 00:55:57.320 · Ramit
What do you think.


00:55:58.120 — 00:55:59.120 · Mason
I would.


00:56:00.120 — 00:56:02.160 · Mason
Like if we had the means? Of course I would like to.


00:56:02.560 — 00:56:05.520 · Ramit
But I'm saying it takes a lot of work.


00:56:05.560 — 00:56:06.240 · Becca
I'm fine with.


00:56:06.240 — 00:56:07.880 · Becca
That. Okay, I think.


00:56:08.440 — 00:56:18.960 · Becca
I think we're great hard workers. You know, I think it's just not always knowing where to go from here. We'll work very hard to get to what we want. We always have.


00:56:19.000 — 00:56:19.720 · Becca
I believe that.


00:56:19.840 — 00:56:26.970 · Ramit
I love that. That's a very interesting answer. I don't hear that. Um, as often as you would think, yes, I do, I want that. Yeah, and I'm willing to work.


00:56:27.010 — 00:56:32.770 · Becca
I already have plans to up my career, so I know I can get to those goals that I.


00:56:32.770 — 00:56:33.850 · Becca
Want to do. Great.


00:56:33.890 — 00:56:35.690 · Ramit
Oh, well, what do you do for a living?


00:56:35.730 — 00:56:37.490 · Becca
I'm an HR manager.


00:56:37.530 — 00:56:38.010 · Ramit
Great.


00:56:38.010 — 00:56:38.970 · Ramit
And, Mason.


00:56:39.570 — 00:56:41.610 · Mason
I work customer service for an energy company.


00:56:41.650 — 00:57:07.010 · Ramit
Great. Okay. I want to help you position yourselves with your money for building real wealth. Right? For so that you can live the type of rich life that you envision. And part of this is going to be changing your mindset. But we actually have to do the numbers as well. So I would like to try to get these fixed costs down.

If we can get them down, then we can redirect more of that money towards investments, savings, etc..


00:57:07.170 — 00:57:07.570 · Ramit
Yeah, sure.


00:57:07.610 — 00:57:14.930 · Becca
That's why we thought about knocking out that debt because we we're aggressively paying it. So it's $588 a month.


00:57:14.970 — 00:57:16.010 · Becca
Should we just.


00:57:16.210 — 00:57:39.020 · Ramit
Assume you're going to pay it off today. Okay. So if if you paid it off with money from your savings, that'll be 13,600, which is negligible because you have 124,000 in savings, you paid it off. That makes this monthly debt payment. What? Zero zero. Watch what happens to the CSP. Whoa. It just went from 73 to 66%.


00:57:39.060 — 00:57:44.020 · Ramit
Yeah. Big jump I love that. So pay it off. Yeah, fine. Great.


00:57:44.060 — 00:58:11.940 · Ramit
I'm. I'm kind of like jokingly being a bit flippant about it, but let me tell you why. So you know why you have $124,000 in savings? Liquid savings. That means you have more than 12 months. You're done. Your emergency fund is filled up. You're good. So yes, I would like for you to save for more stuff because you like to spend money on trips and stuff like.

So we'll do that. But you all do not need to be putting more money in your emergency fund, which is.


00:58:11.980 — 00:58:12.900 · Becca
$1,000.


00:58:12.940 — 00:58:26.510 · Ramit
$1,000 a month. So look at how it's cascading you. You paid off the debt. You paid off the debt because you have enough in your emergency fund. Now, you don't have to pay any debt now. You don't have to put money to your emergency fund. It starts to really work together. Like a puzzle.


00:58:26.550 — 00:58:26.950 · Ramit
Sure.


00:58:26.990 — 00:58:29.230 · Ramit
Okay. What else should we do here?


00:58:29.270 — 00:58:30.390 · Becca
The miscellaneous.


00:58:30.430 — 00:58:30.870 · Becca
Yeah.


00:58:30.910 — 00:58:31.990 · Becca
Needs to go.


00:58:32.390 — 00:58:32.790 · Becca
Yeah.


00:58:32.790 — 00:58:39.710 · Ramit
It can't go all the way. Sure, but it probably needs to get under control. How would you get it under control?


00:58:40.310 — 00:58:47.150 · Becca
One, I think we need to actually look at what we're spending. Yes. And really finding those hidden costs that we probably didn't think about.


00:58:47.190 — 00:58:47.670 · Becca
Yes.


00:58:47.670 — 00:58:53.030 · Becca
Um, and then looking at certain things that we're doing. And do we actually need it?


00:58:53.070 — 00:58:59.910 · Ramit
So let's pick an example. What is a very likely sizable cost that you're not thinking of here?


00:58:59.950 — 00:59:01.070 · Becca
Like the hair.


00:59:01.510 — 00:59:02.350 · Becca
Hair costs.


00:59:02.590 — 00:59:07.710 · Ramit
How much? Just like let's approximate how many times a month or year do you get a haircut?


00:59:07.750 — 00:59:10.150 · Becca
I will go get my hair done about every six weeks.


00:59:10.150 — 00:59:14.630 · Ramit
Every six weeks. And that's like whatever relating to haircut, color, style.


00:59:14.630 — 00:59:14.830 · Ramit
All.


00:59:14.830 — 00:59:17.310 · Ramit
That. Yeah. Okay. Every six weeks. How about for you, Mason?


00:59:17.590 — 00:59:23.520 · Mason
Um, if I can, every two weeks, me and my son, that's about $65. So we can call it 12128.


00:59:23.560 — 00:59:25.520 · Ramit
Okay. Got it. And then how about for you?


00:59:25.680 — 00:59:28.040 · Becca
Uh, about $300 every six weeks.


00:59:28.080 — 01:00:01.160 · Ramit
Got it. Okay. So we're talking thousands of dollars per year. Right. It's a lot. Yep. Knowing that. Worth it? Yeah. Knowing how much you spend on bell peppers. Yep. Whatever. It rolls into the grocery store. Sure. Sure. Okay. So, yeah, I can tell you have thousands and thousands of unaccounted for dollars.

Yes. Get that tracking. Okay. So you might be like, hey, here's important to me every six weeks. Cool. But then what are we not doing? Maybe it means we're not doing as frequent of a date night. Sure. It's up to you.


01:00:01.640 — 01:00:13.280 · Mason
What is the actual function of that? Do you set aside from a paycheck? You deposit $100 into a separate account, and then that's now groceries account and $100 or something else. And now that's closed.


01:00:13.320 — 01:01:00.440 · Ramit
Good question. So the automation part and the CSP work really nicely together. Here's the way I do it, so we know how much we have set aside for groceries every month. Okay, let's just say for easy math is 500 bucks. We don't need a grocery account. We just have the money in our paycheck, which goes to our checking, which then the money's automatically dispersed.

We know that when we go to the grocery store, we're swiping on our credit card, and that credit card gets paid off by the checking. So we make sure that we have enough money in that checking account to cover the groceries and other bills. So you work backwards. How much are we going to be spending every month?

Those things are mostly coming out of checking. Let's make sure that we have enough in checking.


01:01:00.480 — 01:01:02.200 · Mason
Be bringing focus to it would help a lot.


01:01:02.240 — 01:02:06.690 · Ramit
Yeah, I think right now what I'm hearing, it's better than it used to be for the two of you used to just swipe. But now to get to the next level, you have to first identify all the major categories. And then second you have to actually put numbers around them And those numbers are your fingerprint. It tells me what's important to you.

So, like, right now when I look at this, your fixed costs look a bit generic. They look like everybody else. But actually, like when I see you all walk in here and you look very nice, like, oh, they like clothes. Clothes should be dialed in, self care should be down. That's actually nothing to apologize for.

If you saw ours, you could instantly tell what kind of people we are. We love traveling. We don't care about a car. You would instantly be able to tell. I want that level of bespoke nature for your CSP. All right. That okay. All right. You said you want to bring the number down. Let's approximate it. So right now your miscellaneous is $917 a month.

I feel that's pretty high. What would you like to bring that number down to?


01:02:07.170 — 01:02:08.250 · Becca
Let's say 500.


01:02:08.290 — 01:02:14.450 · Ramit
Okay. We're going to just eliminate this. You're at 523. You're down to 63%.


01:02:14.490 — 01:02:15.010 · Becca
Nice.


01:02:15.090 — 01:02:15.730 · Mason
Closer.


01:02:15.890 — 01:02:19.100 · Becca
I think we could get the groceries down.


01:02:19.300 — 01:02:23.220 · Ramit
Mhm. Shall we bring it down a hundred. I don't want to be too crazy.


01:02:23.260 — 01:02:26.980 · Mason
You think $100 I think would be a good start. And you could always adjust that down.


01:02:27.180 — 01:02:31.620 · Becca
Because we have a mail service too. So I really think we could bring it down to 600.


01:02:31.660 — 01:02:33.100 · Mason
Yeah. Let's cut our lunch, shall we?


01:02:33.340 — 01:02:40.220 · Ramit
Yes. Okay. I love the aggression. This is just the energy I like to see. Okay. Let's look. Whoa! We're at 61%.


01:02:40.260 — 01:02:40.700 · Mason
We're close.


01:02:40.940 — 01:03:00.900 · Ramit
Honestly? Amazing. Do you want to just get to 60? Yes. I'll make a couple suggestions from what you told me. Okay. You told me about your subscriptions. You have the Disney thing. It sounds like that's important to you. Let's keep it. But, um, you mentioned, like, audible. Amazon. Da da da da da da. Could there be one where you just go like, hey, we got plenty of others.

Not for us.


01:03:00.940 — 01:03:01.500 · Becca
I think so.


01:03:01.540 — 01:03:02.100 · Mason
I totally think.


01:03:02.100 — 01:03:04.180 · Becca
So. I think audible can definitely go.


01:03:04.220 — 01:03:07.100 · Mason
I don't think we could easily cut down, like, 40 bucks. 50 bucks on that.


01:03:07.140 — 01:03:38.710 · Ramit
Okay, let's take it to 125. Okay. All right. There we go. All right. Round of applause. Yo! This is actually amazing. What's most amazing to me is not just the numbers. It is the approach that you're both taking. Like, you know how you told me you hype each other up to spend. I'm actually seeing you do the same thing, but in the opposite direction.

You're aligned. This is the energy you bring that a wealthy couple brings together. It's not you against me. It's. This is what we want for our life. Let's figure it out together. You are a true team.


01:03:39.270 — 01:03:41.710 · Becca
That's what we always strive to be.


01:03:41.710 — 01:06:08.690 · Ramit
So I love it. Okay, so according to this, you have $2,634 a month, or 25% of take home pay that you could currently spend on guilt free spending. Now, I typically recommend 20 to 35%. I'm going to tell you why I think you should be somewhat towards the lower end of that. I think that in the last five years, you have displayed a very rare ability to completely change the trajectory of your lives.

money and otherwise. And to me, when someone has that skill, I'm like, let's go, let's double down, let's triple down, because you can clearly do it. You clearly want a big, rich life and the the age you are now young, upwardly mobile with your income. I'm like, take advantage of it. Later in life you may have, um, more heavier burdens, expenses, things may come up, family, etc. but right now it's like a golden age.

So for me, whenever I see the golden age, I double down. Yes, I still go out and I have a nice time, but I take my money and I invest it. So you have $2,634 extra per month, and we know that it's a bit high right now to just be getting spent on stuff. So where would you reallocate this money for your rich life goals investments?

Hmm. Let's pick an amount and see what happens. $1,000, okay. $1,000 a month. I'm going to put it right here under stocks. $1,000 takes your number from 2% investments to 11%. This is post-tax. And let's go down and look at your guilt free spending. You're now at what number? 1,515%. That's that's pretty healthy.

I'll tell you why. Especially because you like nice things. Well, y'all are spending $3,000 a year on Disney. So that is we can call that guilt free spending. That's like pretty nice. Sure. So if I'm in your position, I'm going like, hmm, I sure would like to be able to do, let's just say four date nights a month.

How come we can't? Why? Because we decided as a couple we're going to cut down the amount of date nights and instead be able to go to Disney all the time. That's how we think about it. Nobody's chopping my arm off. Nobody's forcing me to not have date nights. We chose. Yeah. And this is what we decided as a couple.

Sure. And if at the end of the year you go, we want to change our decision. There you go. Don't get the Disney pass. Cool.


01:06:08.690 — 01:06:09.570 · Becca
It makes total sense.


01:06:09.610 — 01:06:21.300 · Ramit
Okay, I like seeing people take ownership of their decisions. I like that, and I can tell that you two are into that. Yes. Can we talk about your health savings account for a second? How much do you have in that account?


01:06:21.380 — 01:06:22.580 · Mason
Just about $3,000.


01:06:22.580 — 01:06:25.580 · Ramit
3000. And how long have you had the HSA?


01:06:25.620 — 01:06:37.540 · Mason
Oh, man. Probably 7 or 8 years. But the thing is, I've always used it as just literally health money, so I don't I didn't let it invest. I didn't let it grow. I didn't learn about those options until six months to a year ago.


01:06:37.580 — 01:06:47.820 · Ramit
It's a bit obscure, but it is an amazing account. Do you think that you will use the money in that health savings account for health related expenses?


01:06:48.060 — 01:06:50.940 · Becca
Occasionally. I don't think that amount.


01:06:50.980 — 01:07:07.820 · Mason
Yeah. I now don't want to because our I mean, our health costs are only going to be more expensive later in life. Okay. So if I actually have a after tax or tax advantaged account to pull from. Yeah. Separate from retirement, separate from Social Security. I'd like to do that.


01:07:07.820 — 01:07:24.270 · Ramit
I love it. You could invest that money in typical low cost index funds. It's quite amazing. You get a triple tax advantage and then you can use that later in life. You can cash it out if you want to use it in a year. Whatever you want. It's incredible.


01:07:24.310 — 01:07:25.830 · Mason
I kind of want to up that to the maximum.


01:07:26.110 — 01:08:09.560 · Ramit
Very good. That's what I would do. So let's do this. Let's take the 380. I'm going to just move this entire. I'm just going to zero this out here. And I'm going to add 380 here because that HSA we're going to consider it an investment. Sure okay okay. You're now investing $1,580 a month plus $845 a month. So you're in the 2007 800 range per month.

That's pretty good. We have $1,000 a month going to an emergency fund. We don't need that. But I do think you need savings to be built up for certain things. Sure. What are the big expenses that You foresee coming up.


01:08:09.680 — 01:08:17.880 · Mason
The car payment is actually a lease. Ah, so we like the Honda though. We like the car. So we kind of want to keep it.


01:08:17.920 — 01:08:20.680 · Ramit
You want to buy a buy out the lease? Yeah probably. How much?


01:08:20.759 — 01:08:23.040 · Mason
I think at the end of that is going to be about 25,000.


01:08:23.080 — 01:08:27.080 · Ramit
I would create a savings account called Lease Buyout.


01:08:27.120 — 01:08:27.480 · Becca
Okay.


01:08:27.520 — 01:08:32.160 · Ramit
And if you decide to buy it, you go right into that account and there you go.


01:08:32.400 — 01:08:33.520 · Becca
Nice I like it.


01:08:33.560 — 01:08:34.000 · Mason
I do like.


01:08:34.000 — 01:09:31.970 · Ramit
That. That's how you do it for all major purchases. And this is where you get to take control. If you go, we want to go. What's a dream vacation spot? You want to go to Bali? Beautiful Bali. So like you do the calculation, you go, all right, we want to take this trip. It's going to be like, um, 10,000 right now.

We can afford to put $600 a month. So it's going to take us a year and a half, and then you go, oh, I don't want to wait a year and a half. So what are our options? We could cut spending elsewhere and redirect to here. We could shrink the trip down. So instead of 10,000, it's 5000. Or we can just extend the time period and settle for 18 months, 24 months.

What we don't do is just swipe it and then deal with it later. Right. We as a couple, we never do that. That's the kind of energy you bring, right? For sure. All right. 18,000. We are now calling this car buyout. And then don't you need more money for something? Didn't you talk about a house? Yeah. Where's that?


01:09:33.130 — 01:09:34.089 · Becca
Not in there.


01:09:34.770 — 01:09:35.770 · Ramit
What does that tell you?


01:09:35.810 — 01:09:38.170 · Becca
We need to do something about it. Okay.


01:09:38.370 — 01:09:43.690 · Ramit
So, what are your options? Let's be super creative before we start putting money aside. Your options are what?


01:09:43.730 — 01:09:47.049 · Becca
Either say for it or get a huge loan for it.


01:09:47.049 — 01:09:52.410 · Ramit
Even if you got a huge loan, you would still have to put down tens of thousands of times.


01:09:52.450 — 01:09:59.690 · Mason
Yeah. Is there an option to, I don't know, just save over years and years and outright buy?


01:09:59.730 — 01:10:02.250 · Ramit
That's another option I like that good.


01:10:02.290 — 01:10:04.100 · Becca
Not by not buy it.


01:10:04.380 — 01:10:08.500 · Mason
That's an option because that also gives you a lot of freedom to choose and explore different places and areas.


01:10:08.540 — 01:10:12.540 · Ramit
Again, we don't have to commit to any of these. I just want to put all the options out on the table.


01:10:13.580 — 01:11:47.340 · Ramit
I love the vision, but because at least one of them is a dreamer, I need to ground this rich life vision and create a plan where they can make concrete trade offs. Like you can't have it all on their income today. They cannot take for vacations, they cannot go to Disneyland. They cannot have all these clothes and eat out.

They've got to prioritize, especially with big purchases like a house. When I say prioritize, I mean some of the things they may want to do right now, they're like, this is important to us. We're going to do it right now. Other things they may say we can delay that for 18 months or even five years, ten years.

Some of the things they may realize when I'm looking at the numbers, that's actually not that important to us. So kick it off the vision. That is how you go from fantasy to an actual plan, and that is what helps bring a dreamer down to reality. If I just let them fantasize about what their rich life is without an actual plan, they would walk out of here and go right back to the way they used to be.

So the rich life that you told me was a powerful vision. A house with a pool, multiple vacations, date night self-care. We have a very functioning CSP. For your baseline, you're saving a bunch of money. You're investing a good amount of money. You have some money left over. Now we got to make some trade offs.

So I want you to tell me what changes you would like to make. Because as it stands, there's no house, right? There's no vacation.


01:11:47.540 — 01:11:58.180 · Becca
I mean, I think we can definitely cut down the guilt free spending. We can. We did it before we made sacrifices and what we were spending. So if we want to save up for the house, we can do that.


01:11:58.220 — 01:11:59.100 · Ramit
Tell me how much.


01:11:59.100 — 01:12:05.950 · Becca
I think if we were going full rich life, I'd probably go more like a 800,008 house. Mhm.


01:12:06.070 — 01:12:07.390 · Ramit
Where would the money come from?


01:12:07.430 — 01:12:09.630 · Becca
It's a great question right now.


01:12:09.750 — 01:12:18.990 · Mason
It would be draining savings, maybe doing some kind of loan, something off of current retirement which I don't want to touch anymore. Okay.


01:12:18.990 — 01:12:25.190 · Becca
Um, that's the main reason why we passed on getting a house now. Because I don't want to drain my savings.


01:12:25.230 — 01:12:26.510 · Mason
Okay? I don't want to be house poor.


01:12:26.550 — 01:12:29.190 · Ramit
For sure. You don't want to be house. But I love seeing that in your application.


01:12:29.230 — 01:12:29.870 · Becca
Yes.


01:12:29.910 — 01:12:38.750 · Ramit
Great. Okay. So, wood. So you don't want to use $110,000 of your savings for a down payment, right? Do you want to use part of it?


01:12:38.750 — 01:12:46.470 · Becca
I'd like to see what other options we could do when it comes to maybe investments. Is there anything we could ever do to get the down payment there?


01:12:46.590 — 01:13:13.480 · Ramit
You know, if you. So when my wife and I were in our mid 30s, we asked each other, do we plan to buy a house anytime soon? The answer was no. We didn't want to. So I had some money for a down payment. Invested it. Okay. And just said, look, we're not going to get a house in the next five years. Probably not ten years.

So let the money grow. And if one day we decide to buy a house, we will have more. We can either get a nicer house or put a bigger down payment down.


01:13:13.520 — 01:13:15.759 · Becca
I would feel fine with that. You know, I think


01:13:16.960 — 01:13:26.400 · Becca
realizing now house costs and what that really looks like. I think a five year goal would be a really good pinpoint minimum. Goal. Minimum? Yes.


01:13:26.440 — 01:13:29.600 · Ramit
Okay. So where would the money come from for the down payment?


01:13:29.640 — 01:13:33.160 · Becca
We could take more money out of the guilt free spending.


01:13:33.200 — 01:13:41.360 · Ramit
Let's say you could take 500 bucks out. Yes. All right. And we could put it in investments. And we will call this house.


01:13:41.800 — 01:13:47.160 · Mason
Does there need to be a specific account or a separate account for something for my son?


01:13:47.240 — 01:13:54.680 · Ramit
If you had to choose which one is more important, buying the house or putting money aside for your son, which would it be?


01:13:55.120 — 01:13:58.170 · Mason
I personally think the the set aside account.


01:13:58.890 — 01:13:59.650 · Ramit
Both.


01:13:59.690 — 01:14:00.490 · Becca
I agree.


01:14:00.490 — 01:14:13.650 · Ramit
So if that's the case then we are now making trade offs because we can't have it. All right. Right now. So that house might not work. You might put the money aside for him instead. Right.


01:14:13.690 — 01:14:22.810 · Mason
Or split the difference. Is there a way of doing a 800 towards an account for us and 200 for some kind of custodial or specific Roth?


01:14:22.850 — 01:14:28.290 · Ramit
You could. You could. How do you know if you can afford to save for your son? Mm.


01:14:30.130 — 01:15:37.820 · Ramit
Stupid of a it's a provocative question, right. Because I think from your reaction, you never thought about that. You just assumed this is what we do. Yeah. But how many other things have you deconstructed? Like maybe we do. Maybe not. What's going on underneath? So let's walk through it for a second. Most parents, um, they want to do something for their kids.

Obviously, financially, I get a ton of panicked messages every week on my Instagram DMs. Hey roomie, I love your stuff. I'm 38 years old. We just had a son. He's one and a half. What account should I have for him? Is a 529 the right one? And they're just, like, frazzled. And I go, hey, congratulations. And before we talk about your son or your daughter.

Tell me about your finances. And you know what they always say. Well, um, you know, like, I actually, like, started pretty late, so I don't really have much. And what they're doing, in essence, is saying I've lost the game of money for myself, but I won't allow that to happen for my son. Any of this sound familiar?


01:15:37.820 — 01:15:45.420 · Becca
I just think that's very accurate. So super. You know, I think we're really big on not him not having to live the life that we did.


01:15:45.940 — 01:17:23.720 · Ramit
Can I tell you what I see? I see a couple that takes their kid to Disneyland a lot. So already you have put your son in a different position than you both ever were already. In addition, if you are talking to your son about money, if you are sharing things like saving, investing, hey, we flew across the country to learn more about money because it's important to both of us and we want you to understand.

Help us pay this bill. Click this link. We're going to go to the grocery store. We only have ten bucks. And we need to get these three things. Can you help me do it? He is going to grow up with 100 times more knowledge than either of you ever did. So I don't see a risk of him growing up like you. I would take that fear and set it aside.

Y'all already won that battle. Okay, sure. Now, do you need to give him a bunch of money? I don't know, maybe if you want to, we can find it. But I also want you all to think about your overall vision? Yeah. It will be nice to hand him $50,000. Fine. I don't mind that. Maybe we can make it happen. But when I think about, like, generational wealth and stuff like that, like, my parents didn't give us a check.

They didn't have it. But they taught us what investing is. They helped me open up a custodial account, encouraged me to get jobs, say, let me play, do all this stuff. And so they gave me way more than any check ever could. They gave me knowledge and my siblings as well, so that we knew what good money management is.


01:17:24.000 — 01:17:31.280 · Mason
Oh, I like those lessons way better. Yeah, I don't I don't know many 18 year olds that would be responsible if you had a $50,000 check. No way.


01:17:31.840 — 01:17:56.010 · Ramit
No way. But they might know philosophy that their parents have. Like in our household, we are a no debt household. That's a philosophy. You could choose it or not. Once a month, we all sit down and we do a formal presentation where we talk about money, lessons, learn, and what we're going to do and what we are not going to do.

You could learn that and he could walk away with those lessons which are worth infinitely more than any amount of choke. You could write him.


01:17:56.010 — 01:18:06.890 · Becca
Sure, saving for a house could benefit all three of us. The end of the day, you know. And as we grow in our careers and make more money, there's still that opportunity to save for him.


01:18:07.090 — 01:18:47.370 · Ramit
Yes, totally. That's a good way of looking at it. You don't have to make decisions for the rest of your lives today, just for today. And then any upside? You can always adjust where your money goes. Yeah. I would like for you to get to the point where you got so much money in investments. ET cetera, that you're like, oh, I already hit those goals extra.

Let's put it aside for him now. Mhm. That's the way you think about it. Your son has time. You have far less. He could take a loan out. It's not the worst thing in the world. You all cannot take a loan out for retirement. So we got to prioritize the two of you first. Okay. We've decided for now, it sounds like no money for him.

Okay, put the money towards the house.


01:18:48.450 — 01:19:06.180 · Ramit
So we're at 500 bucks a month, which will be $6,000 a year, which over five years will be 30 K, but it will grow a little bit, probably because of investment. So maybe it turns into I can't do the math off the top of my head 50 K whatever. What do you think?


01:19:06.500 — 01:19:12.140 · Mason
It's still not enough, I think, for the house and lifestyle that you've or that we've chosen. Correct.


01:19:12.180 — 01:19:13.380 · Ramit
So what would you do about that?


01:19:13.420 — 01:19:15.100 · Becca
Figure out how to save some more.


01:19:15.140 — 01:19:15.660 · Ramit
Yeah.


01:19:16.340 — 01:19:18.260 · Mason
Save more, make more, make more.


01:19:18.300 — 01:19:36.820 · Ramit
Let's talk about that for a second because I think there's a limit. Now we're kind of reaching it. And I think it's starting to get a bit unrealistic. I don't really think the two of you can function the way you want to on $1,000 a month of guilt free spending, because all the money is pretty much spoken for, right?

So there's only one real area to focus on, which is what?


01:19:37.220 — 01:19:37.780 · Mason
Income.


01:19:37.820 — 01:19:51.670 · Ramit
Income. So can we talk about this for a second? Sure. Remember the lifestyle you told me how much you'd approximately need to make? Mhm. Like, what would we say? 300. 350 something. Double. Yeah. How can you get there?


01:19:51.870 — 01:19:57.910 · Becca
My goal is to excel in my career. Um, I was looking at going back to school.


01:19:57.950 — 01:19:58.510 · Ramit
Mhm.


01:19:58.670 — 01:20:02.150 · Becca
Um, to get some higher level roles than I am right now.


01:20:02.190 — 01:20:03.390 · Ramit
Okay. How about for.


01:20:03.390 — 01:20:08.950 · Mason
You? My company is pretty stock standard. 3% year over year every year. So.


01:20:08.990 — 01:20:09.790 · Ramit
Got it. Okay.


01:20:09.830 — 01:20:25.630 · Mason
Okay. I think I do have some opportunities when they do open up as far as different kind of supervisor roles. There's also sales positions that while I'm not immediately equipped for, I'm not against learning. So I think there are opportunities moving up within the corporate ladder.


01:20:25.870 — 01:20:51.080 · Ramit
Here's a couple of things I want to draw your attention towards. Because now that we've got a CSP that is somewhat standardized, rationalized, now I'm thinking about what kind of lifestyle you're going to have ongoing. What do you think would be the worst case for the two of you? Worst case, you walk out of here, you got this plan, and then what derails it?


01:20:51.120 — 01:20:56.560 · Becca
Uh, not following it? Yep. And just going back to our bad habits of spending.


01:20:56.600 — 01:20:59.480 · Ramit
Just spending. Swiping without tracking it. Yep. What else?


01:20:59.600 — 01:21:01.080 · Mason
Like a job loss?


01:21:01.120 — 01:21:48.730 · Ramit
Yep. That would be huge. That would be tough. You could sustain it for for a long time. I will say with your savings, that's really nice to have that you could sustain that, but that would potentially derail you. Sure, sure. So when I hear you describe your money, especially where you came from, there are a few red flags I want to draw your attention towards.

So the non tracking was just like, okay, we swiped. I feel you have a pretty good handle on that now, but I do think the miscellaneous thing is a bit of a red flag and you have to get control of that. Each of you has got to own a couple of numbers, and you both report on those at a monthly money meeting. Like it should be a formal thing, like you do it at work.

Take it seriously. The other thing is I hear a bit of dreamer tendency, I think, from you, Mason. You agree?


01:21:48.770 — 01:21:56.570 · Mason
Oh, I totally agree. So on the plane right over here. Yeah. I told you Becca was reading your book and calling me a dreamer. And I think with this.


01:21:57.170 — 01:21:58.330 · Ramit
You're reading money for couples.


01:21:58.330 — 01:21:59.250 · Becca
I've started reading.


01:21:59.250 — 01:22:00.890 · Ramit
It. Okay. Why did you say that?


01:22:01.050 — 01:22:10.570 · Becca
Um, because he says he very much just talks about things he knows, uh, like, in his head. Like, I would love to get here, but there's no action to it.


01:22:10.610 — 01:22:11.970 · Ramit
Mhm. What's an example?


01:22:11.970 — 01:22:22.330 · Becca
I would say one like he dreams all the time about starting businesses all the time. He comes up with all these ideas and he'll ruminate on it for months and then nothing happens.


01:22:22.690 — 01:22:24.610 · Ramit
Hmm. What do you think about that?


01:22:24.650 — 01:22:39.090 · Mason
Accurate. I mean, it's it's it's something I would like to start. I don't think I always want to work for a corporate ladder, but, um, getting to the next point and either owning a small business or investments are starting to pay for themselves. I don't know that it's very unknown for me.


01:22:39.130 — 01:23:54.740 · Ramit
Yeah, yeah. Dreamer tendencies are very dangerous because they kind of exist in La-La land, and it's because often they are subsidized by somebody else in this case. You're an interesting dreamer because you've transitioned to making some concrete plans. You've changed your spending behavior. So I would say you're like a dreamer, but dreamer adjacent, you're willing to change.

It's very rare like that. Okay. But you cannot be a dreamer if you want to live the kind of rich life the two of you describe, it simply can't happen. So I. I hear things in your application about a solar business. I hear about the arcade day trading. All of them fit the dreamer dynamic. And that is a huge red flag because one, it's hard for you because you go, you're spending months coming up with these ideas.

But two, it's hard for the two of you because the place you're going where you've described with vacations and house and this and that, you actually both need to be rowing exactly the same direction. There cannot be any misalignment. Power couple. That's what you need to be. So if one of you is dragging behind, that's a problem.

If one of you is rowing the opposite direction. Impossible to get where you're going. You see what I mean?


01:23:54.780 — 01:23:55.500 · Mason
Totally.


01:23:55.540 — 01:23:59.940 · Ramit
Okay. Wow. I don't get the chance to talk to dreamers a lot because they don't come on the show.


01:24:01.020 — 01:24:13.980 · Ramit
So I feel very honored right now. Can I give you some projections from your retirement? We have some projections just so you understand what the numbers look like. So when you walked in here, do you know how much you would have in retirement?


01:24:13.980 — 01:24:19.500 · Becca
From what I did calculate, I think it was around, like 1.5 million.


01:24:19.540 — 01:24:20.940 · Ramit
1.5 million total?


01:24:20.980 — 01:24:24.500 · Becca
Yes. Well, I don't think that included the pension. Right.


01:24:24.540 — 01:24:25.780 · Ramit
Yeah. Oh, you have a pension?


01:24:25.820 — 01:24:26.900 · Becca
He has a pension.


01:24:26.940 — 01:24:28.380 · Ramit
What? How much?


01:24:28.460 — 01:24:31.580 · Mason
I think it's supposed to be, like $800,000 at the end.


01:24:31.580 — 01:24:34.460 · Ramit
Of the $800,000. How the fuck did I not know about this?


01:24:34.500 — 01:24:36.340 · Mason
I was to retire with that company.


01:24:36.340 — 01:24:38.300 · Ramit
Oh, okay. Yeah. And, like, how much would that have?


01:24:38.340 — 01:24:40.190 · Mason
Either a lump sum or a payout, or.


01:24:40.190 — 01:25:04.390 · Ramit
I love finding $800,000 in the couch cushions. All right, well, putting aside the pension, we calculate that you would have about $3.1 million when Mason turns 65. So 3.1 million is a lot of money. That's about $126,000 of safe withdrawal income that you could make per year.


01:25:04.550 — 01:25:09.070 · Becca
That was it's a lot more comforting than I thought it would be.


01:25:09.110 — 01:25:12.149 · Ramit
I like it 126 is good, but


01:25:13.870 — 01:25:53.120 · Ramit
you wouldn't own a house. And so. But on the other hand, you wouldn't need to invest anymore. You wouldn't really need to save anymore. So those costs would go down. You'd have Social Security in addition to that. It's not bad. Honestly, it's not bad. Mhm. The new strategy that we did where we cut some of your spending got more aggressive on investments That would yield you $4.7 million.

It's a big difference from a few small changes, and the safe withdrawal income is $188,000 a year more than you earn today.


01:25:53.160 — 01:25:56.040 · Mason
Yeah, yeah, yeah, definitely. Definitely a better goal.


01:25:56.040 — 01:25:59.880 · Becca
More comfortable for our lifestyle. I think so.


01:25:59.920 — 01:26:09.680 · Ramit
Yeah. What do you think? What's going through your head now about the decisions regarding vacations, saving for your son and a house? When you hear these numbers.


01:26:09.720 — 01:26:16.800 · Becca
There's a good chance in that this time period, we want to up our lifestyle, and then that won't be enough.


01:26:16.840 — 01:26:33.960 · Ramit
Agree? If I'm you, I'm trying to live a cooler lifestyle. I'm not trying to stay at this level or worse, go down. No way. Yeah, okay. You don't want to go down. You don't even want to stay here stable. You want to elevate your lifestyle. Okay, so how are you going to do it?


01:26:34.000 — 01:26:35.000 · Becca
Make more money?


01:26:35.240 — 01:26:41.770 · Ramit
Yes, yes. How will you do it specifically? So you've mentioned Becca going back to school? Yes. How much more are you going to make?


01:26:41.810 — 01:26:51.050 · Becca
From my projection, I could eventually get up to 245,000 a year. Really? Yeah, with certain levels of roles. If I stayed with the same company.


01:26:51.090 — 01:26:53.370 · Ramit
No kidding. What's the job title that makes them.


01:26:53.370 — 01:26:54.730 · Becca
A VP of HR?


01:26:54.810 — 01:26:56.690 · Ramit
Is it required that you have the degree?


01:26:56.810 — 01:27:04.370 · Becca
Um, not necessarily with this company. Um, if I ever wanted to look at other companies, though, it would make me a lot more competitive.


01:27:04.410 — 01:27:08.810 · Ramit
Mhm. Okay. All right. Noted. What about for you, Mason?


01:27:08.890 — 01:27:28.490 · Mason
Right now I'm comfortable in the position I'm in, but I know it doesn't. It's not as fulfilling. It's not it's not going to give me the pay scale that I would like. Um, you could absolutely put energy in the corporate ladder. I like my coworkers, my upper management team. I can join them being the dreamer.

I also like the idea of


01:27:29.730 — 01:27:47.660 · Mason
a potential day trading opportunity. I have Seen someone make my salary in a day. I've also seen a ton of people opening businesses. And those owners start somewhere. Yeah. So I don't know. I think those I like the opportunities. I always see the successful side of it.


01:27:47.700 — 01:27:52.540 · Ramit
Well, that's by design, you see successful because the ones who lose their money disappear don't. Yeah.


01:27:54.220 — 01:29:19.710 · Ramit
That's survivorship bias. Um, okay. Let me give you a little bit of, uh, stuff you can find in chapter six of my book where I talk about day traders, etc. they almost all lose their money. Like almost all of them. And I'm talking in the 98 plus percent range. So you are seeing some of the folks kind of like seeing Michael Jordan playing basketball, being like, oh, I'd like to be like him.

Well, yeah, me too, but I'm not. And so we're seeing these freak aberrations. And day trading sadly, has a lot of lies because almost everybody loses money. They it's notorious that they will go in a race. Their previous bets. They don't show you the things they've done. It's basically gambling. It is.

So I don't mind that you had, you know, 500 bucks or something that you're playing with. I think people can have a little bit of fun with their money. It could be self-care. It could be freaking day trading. The problem is that people who do that, they usually do not have containment. They go 500, then turns 2000.

It turns into recurring, turns into 5000. And they really believe if I get this strategy, I'll do it. You will lose. Your money is simply a matter of time. If the two of you want to live a rich life, then you all need to focus on increasing your income, like directly and dramatically. It is a priority because you can't get the other things you want.

There's no real way to get the house right now based on the income you have. Sure, sure. So the income has got to go way up.


01:29:20.150 — 01:29:35.520 · Mason
I can definitely work with my management team and letting them know that I'm interested in an exposition. There was another opportunity for a supervisor role that came up and hours didn't work, and the time frame didn't work for me, so I couldn't take it. But they do come up and instead of watching the opportunity to pass by, I can take it.


01:29:35.560 — 01:30:20.320 · Ramit
I like that, and whether it is at this company, hopefully it is or another company. The two of you having a mission, which is like, hey, we want to live this awesome life, but we never want to go back to where we were. Never. I don't want to wait 30 years to be living there. So what do we need to do? The only thing now beyond following through that matters is income.

Yes, sure. It's got to go up. And if it's me, I'm taking any dreamer stuff and I'm putting it aside. Keep doubling down on what works until you have literally scraped the meat off the bone. Which means you basically are CEO. And if at a certain point you got so much money and so much free time, you go, I really want to start a business.

Okay, try it then. But right now I just see way too much upside in your careers.


01:30:20.360 — 01:30:20.960 · Mason
Sure.


01:30:21.320 — 01:30:23.800 · Becca
I think that's very accurate for sure.


01:30:24.080 — 01:30:30.090 · Ramit
I'll just show you something. I'm gonna put your CSP up on screen. What might we increase your income to? Let's say, five years from now.


01:30:30.810 — 01:30:33.530 · Becca
Hopefully it would be at 10,000 a month.


01:30:33.570 — 01:30:34.130 · Ramit
Double?


01:30:34.170 — 01:30:34.690 · Becca
Yes.


01:30:35.130 — 01:30:41.570 · Ramit
Amazing. Watch what happens to the rest of your numbers. You're at 60% fixed costs. What just happened.


01:30:41.610 — 01:30:42.570 · Becca
Went down a lot.


01:30:42.610 — 01:31:08.930 · Ramit
Fixed costs dropped to 43%. If we go all the way down, you have $5,000 a month. Five years from now, you will have hundreds of thousands of dollars invested. You'll have a fat savings account. You will have gone to Disney. You'll have taken a couple of vacations. Great. And you will be able to start putting money aside for a house.

Yeah. ET cetera. You want to do yours? Mason. Five years from now, ballpark it.


01:31:08.970 — 01:31:11.210 · Mason
Realistically. Probably like 65.


01:31:11.250 — 01:31:23.890 · Ramit
Love it. That sounds reasonable. You're at 4800. Going to 6500 if you stayed in the same place. You're at 39% fixed cost. Could you guys stay in the same place for five years?


01:31:24.010 — 01:31:26.610 · Mason
Could we? Sure. Do we want to?


01:31:27.210 — 01:31:27.610 · Becca
I like.


01:31:27.610 — 01:31:34.100 · Mason
Probably not. I think there are better opportunities. Fair enough? Yeah. Fair enough. Without. Without varying that number too much. I mean, maybe by 4 or 500 bucks.


01:31:34.140 — 01:32:14.220 · Ramit
I don't think you need to have fixed costs at 39%. I frankly think that's ridiculous. Right. And I think if you're making this kind of money, which is a huge amount of money, you probably want to be spending more than 25, 50 a month. Fine. Sure. But if I'm you and I'm like, hey, I want this curve, steady growth that's gonna go up and up and up and up, and I do not want to go up and down and up and down in debt.

Then I'm like, cool. Once we get a big raise, let's build up our savings for a few months. And then once we hit these milestones, then we will increase our rent just a little bit and take the extra and put it aside for buying a house. Sure. So you're living for today and for a bigger tomorrow?


01:32:14.260 — 01:32:14.780 · Mason
Yep. I like.


01:32:14.780 — 01:32:15.660 · Becca
That. I love that.


01:32:15.700 — 01:32:26.430 · Ramit
When you first came in, there was a timeline difference on buying a house. It was a year. It was 2 to 3 years or five years. What do we know now about your timeline.


01:32:26.470 — 01:32:31.110 · Becca
A ten year timeline seems a little bit more doable. Yeah, for a dream home.


01:32:31.150 — 01:32:51.550 · Ramit
Good. So no sooner than ten years. You'd be, what, in your early 40s? Mhm. Yeah. What's the problem? Freaking great. I rent I'm in my early 40s and if I wanted to go buy a house I would not feel like I missed anything. Sure. Yeah, but you can't wait until you're 42 to start saving for a house. So what's the key?


01:32:51.590 — 01:32:52.790 · Becca
Let's start saving now.


01:32:52.830 — 01:33:02.070 · Ramit
Yeah. What could you do specifically to build a healthier mindset with money? Not to let the old mindset that you grew up with control.


01:33:02.070 — 01:33:07.910 · Becca
You start better habits and unlearning those mindsets that we have.


01:33:07.950 — 01:33:08.510 · Ramit
How?


01:33:08.910 — 01:33:18.990 · Becca
I think for me, actually having the confidence to know that I actually don't have to live that way and that I can be rich, but.


01:33:19.110 — 01:33:21.630 · Ramit
You are going to be rich. You already know your numbers.


01:33:21.630 — 01:33:22.870 · Becca
I am gonna be rich.


01:33:23.710 — 01:33:24.670 · Ramit
Yeah, I actually think you all.


01:33:24.670 — 01:33:25.710 · Becca
Are well ourselves.


01:33:25.750 — 01:33:33.750 · Ramit
Yeah. Aren't you living a rich life today? Now that I think about it. After today, by the end of today, you're debt free. Yeah. Do you realize that?


01:33:33.790 — 01:33:41.710 · Mason
Yeah. No. That's. We we we we were tumbling the idea back and forth up into the show, and we're just like, let's not do it yet. Let's ask for me. Let's see what's going on.


01:33:42.070 — 01:33:45.470 · Becca
That's exciting. We've not been debt free since I was a teenager.


01:33:46.310 — 01:33:47.870 · Ramit
Okay, round of applause. It's like,


01:33:49.670 — 01:35:26.330 · Ramit
will you send me your screenshot when you pay the debt off? Yeah, like that's amazing. And you do that and, like, celebrate it. You know, we're never going back. And whatever celebration is meaningful to you, you just turned a major corner. Also, I love that it didn't happen by accident. You made a lot of lifestyle changes, too.

And the crowning moment is when you bring your son in on it and you start repeating it. You basically are building family values. That's when you know you have true wealth, true rich life. Oh my God, Just got a text. Student loan is officially paid off. $0 left. Paid in full. Amazing work. I have a lot of confidence in Mason and Becca.

The fact that they have demonstrated excellence with their money for the last few years tells me that they have a very, very good shot at making amazing major changes with their finances. Honestly, they are a high performing couple that simply did not have access to people teaching them about money and the fact that they came out here raise their hand to ask for help.

That tells me they're going to be very successful. I already know they're going to pay off their debt because they just did it. So boom, they are now a debt free couple. Their identity has changed. Within minutes, I think they're going to start investing more. I think they're going to start saving more.

I do think they're probably going to constantly entertain the idea of buying a house, but I hope they continue making clear trade offs with their finances, because if they just save and invest aggressively for a few years, They will be in an amazing financial position. And now let's take a look at their follow ups.


01:35:27.010 — 01:35:44.050 · Mason
Hey roommate, thanks for having us on the show. It's a really great experience. Biggest surprises you know. Biggest surprises for us is we were in a decent spot financially. We're in a better spot than we. We thought with the conscious spending plan. We just have to sort out and had to sort out where to fit the pieces and our financial puzzle.


01:35:44.210 — 01:35:49.170 · Becca
Yeah. And our biggest takeaway overall really positive for us. We talked after.


01:35:49.170 — 01:36:07.370 · Becca
Our family and really realized that we are living a version of a rich life currently, especially when we can hear ourselves from this time last year to now, we've really hit some of our money goals, as well as some of our goals of where we want to be with our money, and then we're going to continue to reach additional goals that we see for our vision in our rich life.


01:36:08.010 — 01:36:15.770 · Mason
Now, some of the specific changes. Um, you know, we walk out of the studio and immediately paid off our debt. Like we said, we wanted.


01:36:15.770 — 01:36:16.170 · Mason
To get that.


01:36:16.170 — 01:36:30.020 · Mason
Free immediately. Debt free. Great feeling. Um, also, we've created accounts I've started and maxed out a Roth. I also have created a brokerage accounts to do monthly investments and to continue to grow that for our future.


01:36:30.460 — 01:36:45.380 · Becca
Yes, and we've also decided to start meeting weekly about money. This is really just getting some more confidence and communicating about it, and also really seeing where our miscellaneous spending is going and ensuring our guilt free spending is more mindful versus mindless.


01:36:45.860 — 01:37:01.700 · Mason
Thanks a lot, Mike. Hey, roommate. So it's been three weeks since our podcast. We wanted to do a follow up. Um, one of my biggest takeaways is something that you said is your household is a no debt and a note debt in household, and I would like to make that ours now that we are officially debt free.


01:37:02.300 — 01:37:05.860 · Becca
Yep. And my biggest takeaway is definitely not getting back into bad.


01:37:05.860 — 01:37:06.220 · Becca
Debt.


01:37:06.220 — 01:37:18.110 · Becca
And getting back into those bad habits and really starting to make really good habits for us and spending our money, um, smartly investing our money and putting our money to work.


01:37:18.390 — 01:37:33.550 · Mason
One of the biggest changes that I've done is, of course, contributing to the Roth to max that out, as well as putting a several thousand dollars into a brokerage account for investments. And I have an automated plan of deposits going toward that every month now.


01:37:33.590 — 01:37:34.670 · Becca
And we've been having.


01:37:34.670 — 01:37:56.550 · Becca
A lot of really good, confident conversations about money really being positive. And it's not a bad thing for us anymore. I think it's more exciting for us now when we are talking about our money. Um, and still really looking at how we're spending it, what changes we need to make and how we can still use it and have fun.


01:37:56.670 — 01:37:59.310 · Mason
So thanks a lot. We really appreciate it. Bye.


01:37:59.950 — 01:38:13.910 · Ramit
If you want to know the exact month and year that you will have $100,000 in your investment portfolio, sign up for my new program, road to 100 K. I'll help you hit that number fast. Go to


01:38:15.310 — 01:38:17.150 · Ramit
100 K to sign up.