Episode 62. Why are we waiting for payday if we make $140k?

Amy and Andre are 42 and 34 respectively. They make $140k a year, but they admit they’re often waiting for payday. They’re buried in debt and can’t seem to make any progress, which is bringing serious anxiety and stress into their lives.

Their biggest issue? Their fixed costs sit at 92% of their total income. We uncover all kinds of solutions as to how they might address this problem, but they struggle to grasp the reality of it all. 

What’s worse, they submitted their Conscious Spending Plan showing a -2% for guilt-free spending. They not only have no joy tied to their money, but on paper, they show it as a detractor on their lives. This is a serious problem—let’s see if we can get them on the right track.

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Amy: [00:00:00] We’ve buckled down to as far as we can buckle down. We don’t even have cable anymore. And it’s not the most fun thing in the world.

Andre: [00:00:09] Yeah, I constantly feel buckled down.

Amy: [00:00:13] I don’t want to throw Andre under the bus, but if I try to talk about money or get a partner and things, it glazes over and disassociates.

Andre: [00:00:26] The debt is the mountain and we’re at the bottom and it’s always looking up. It’s almost like the Sisyphus of pushing the rock up the hill and then it just tumbles down the other side, and we’re still pushing. But it seems like the daily conversation is stress and the things we can’t do, and the things we have to wait till Friday for payday.

Ramit Sethi: [00:00:45] Can I tell you something very candid?

Amy: [00:00:48] Mm-hmm.

Andre: [00:00:48] At $140,000 a year, you should not be thinking about payday.

Amy: [00:00:53] No, it’s not at all healthy.

Ramit Sethi: [00:00:55] Have you ever felt good about money?

Amy: [00:00:59] No.


Ramit Sethi: [00:01:02] How would you feel if you made $140,000 a year and you were still counting down the days until payday? That’s where Andre and Amy are. They’re 42 and 34 years old and they feel hopelessly buried in debt. As I go through today’s conversation, I’m going to ask them what options they think they have. And even though I see lots of options, they don’t. They truly feel stuck. 

Now, I want to point something out to you. Their fixed costs are 92% of their income. Let me say that again. Their fixed costs are 92% of their income. If you’ve used my conscious spending plan, you know that that number should be around 50 to 60%. So it suddenly explains a lot of what you’re going to hear in today’s conversation. To get your own copy of the conscious spending plan and work through it together with Andre and Amy in today’s conversation, get it from iwt.com/episode62. Now let’s get started.


Ramit Sethi: [00:02:09] Amy, can you remember a time in the last month or two where you and Andre were stressed out about money?

Amy: [00:02:17] Yes. I feel like that’s every single day. I think yesterday was probably the most recent thing, the most recent conversation we had, one of my siblings was getting married and we have to buy a suit for Andre. I need a dress, a gift, other wedding participation thing, a bachelor party, that sort of thing. So we were stressing about that because we don’t really know how we’re going to be able to afford the things we need to afford in order to participate as much as we’d like. 

It really feels like we don’t have anything ext to set aside. And for fun things like this, I wouldn’t say it requires our emergency fund, but the same goes for any sort of emergency that pops up. We just try really hard to save as much as we can, but towards the end of the month, there’s maybe 100 bucks set aside.

Ramit Sethi: [00:03:24] What is your household income?

Andre: [00:03:25] That’s a little over 140, I think.

Ramit Sethi: [00:03:28] Should you feel stressed out about $100 purchase at 140,000 a year?

Andre: [00:03:34] No. We shouldn’t feel stressed out. Not at all.

Ramit Sethi: [00:03:37] So what do you think’s going on?

Amy: [00:03:40] I think that we have–

Andre: [00:03:44] A lot of debt.

Amy: [00:03:45] Yeah, overcommitted ourselves financially to things. And I think we have some debt from the past that is still an issue for us. And we’ve been really working hard, I will say, for the past three years, we haven’t used the credit card for anything. We’ve only been making payments. And that is a big win for us. But now we’re getting to a point where, okay, now it’s time for the next step. What can we do to have– I don’t know, just to feel better about our financial situation.

Ramit Sethi: [00:04:27] What do you think would make you feel better?

Amy: [00:04:29] Oh. I honestly have no idea. I want to say something as simple as getting rid of our debt, but I don’t know if that’s actually even true. I think this will always be a little bit stressful for me and I needed to figure out why that is.


Ramit Sethi: [00:04:51] Big clues here. Amy thinks that, “Only making payments is a big win.” And do you notice her audible sighs. She big sighs, she has no idea what could make her feel better or why money is stressful for her. Lots of questions right now. Not many answers yet. That’s fun. Let’s get to know Amy a little bit more to see if we can start clearing things up. 


Ramit Sethi: [00:05:18] If you had to describe your own relationship with money, how would you describe it?

Amy: [00:05:22] It’s definitely complicated. I think that I have been kind of– if I reflect back, I feel like I’ve been grinding my whole life to be in a better position than I was growing up and to do more and do things like be able to travel and that sort of thing. But I keep waiting for like, “Oh, we made it,” part and it never happens. It never feels like I’m working enough or making enough or doing enough. 

And then the flip side of that, it’s also this thought of, well, you can’t wait to enjoy life when you’re old. You can’t wait until you’re older. You never know what’s going to happen. So spend the money, go to your sister’s bachelorette party and have a good time and stress about it later.

Ramit Sethi: [00:06:26] And would you describe that as a healthy relationship with money or no?

Amy: [00:06:29] No, no. It’s not at all healthy.

Ramit Sethi: [00:06:32] Have you ever felt good about money?

Amy: [00:06:36] No.

Ramit Sethi: [00:06:38] What’s the first memory you have of money?

Amy: [00:06:45] I mean, mostly just growing up, being told no a lot, not being able to afford a lot of things. I started working when I was 14 years old so that I could go to a movie with my friend because my mom couldn’t afford it.

Ramit Sethi: [00:06:59] What did you do at 14?

Amy: [00:07:01] I worked for my friend’s dad. He was a lawyer and I cleaned his office two days a week.

Ramit Sethi: [00:07:06] Nice. What did you make?

Amy: [00:07:08] Oh, golly. I can’t even remember. I think it was maybe $10 an hour.

Ramit Sethi: [00:07:13] Were you middle class? Poor? How would you describe yourself?

Amy: [00:07:17] That one is hard because I– Middle class, I think. But my mom personally was very poor. My grandparents sent us to private school, but there were months where my mom couldn’t put food in the fridge. So it’s a little bit strange. So I guess poor, but my grandpa bought me braces.

Ramit Sethi: [00:07:44] What do you learn from that looking back?

Amy: [00:07:47] Well, I can see a lot of different things from that. I overstock our fridge and our cupboards with food.


Ramit Sethi: [00:07:57] Classic, classic, classic. Whenever you see someone making peculiar decisions with their money, or certainly having peculiar behaviors with their money, there’s almost always a reason why. For example, if you see someone, an adult using a debit card, it is very likely that they have credit card debt and they are therefore using a debit card because they don’t want to add on to their credit card debt. It’s a very interesting way that people manage a credit card debt situation.

Now, 90% of those same people do not have a debt payoff plan. They do not know when their debt will be paid off, but they do what they know, which is lock that credit card away and instead use a debit card. What we are hearing here is that Amy has a family history of how she grew up learning about money, and now she does things like overstocking their fridge. I bet you if we talked a little bit more, we’d find out lots of other peculiar behaviors she has. I did notice one thing I’m really curious about. That sigh that she keeps giving me any time I ask her a question about money, it’s interesting to me. I have to probe a little bit and figure out where that sigh is coming from. 


Ramit Sethi: [00:09:15] Amy, virtually every money question I’ve asked you, you’ve answered it with a very large sigh. I don’t even think you know you do it.

Amy: [00:09:22] Yeah, probably not. I just feel like there is an answer you want, but in our realistic life, it’s just not always the way it will be.

Ramit Sethi: [00:09:40] Is your realistic life working for you?

Amy: [00:09:44] I mean, as far as our relationship?

Ramit Sethi: [00:09:46] No, financially.

Amy: [00:09:47] Oh, no. I thought you meant like the way you want us to talk to each other in a relationship.

Ramit Sethi: [00:09:51] Well, also that. Is the way that you communicate about money working for you?

Amy: [00:09:59] No, but it’s not because we’re being mean to each other.

Ramit Sethi: [00:10:05] Yeah. I don’t think you’re being mean. I think you two are very loving to each other. I really enjoy talking to you. It’s just that money has a very odd power in your relationship. And I’m not trying to feed you lines. I’m trying to let the love that you both clearly have for each other come through with money too. That’s all I’m trying to do. So when I point out that you let out a big sigh, it’s interesting to me because you don’t do that with anything else. I’ve asked you a lot of questions on today’s call, a lot. It’s only the money questions that cause you to react like that, which tells me I would like to help you identify that and then re-frame it.

Amy: [00:10:48] Yeah. I’m a little stressed out.

Ramit Sethi: [00:10:50] Because of this call?

Andre: [00:10:52] The more time we spend together, I think she’ll get more comfortable. I think it’s just an anxiety thing.

Amy: [00:10:57] My mom also stresses me out, so that’s okay.

Ramit Sethi: [00:11:01] Got you. Got you. Okay, good. Let me file that away. Okay, so you grew up without too much money, but yet you went to private school, you had braces. And if somebody from the outside had to describe your relationship with money, what would they say?

Amy: [00:11:23] I don’t necessarily know if anyone from the outside could describe my relationship with money because it’s not something that I talk about.

Ramit Sethi: [00:11:33] Why not?

Amy: [00:11:34] I just was raised to not talk about that kind of thing.

Ramit Sethi: [00:11:37] What do they say?

Amy: [00:11:40] You just don’t talk to other people about your personal finances.

Ramit Sethi: [00:11:43] And yet you’re on a podcast talking to a lot of people. That’s interesting.

Amy: [00:11:47] Hence the stress.

Ramit Sethi: [00:11:50] Oh, got you. Well, in a way, I think it’s very courageous what you’re doing. To be taught not to talk about money, which is a very common thing, and then to say, “You know what, I need help”. And if it means that I’m going to have to open up like I’d never opened up before. Wow. I think it’s very courageous of you. There are plenty of things in life we have to agonize over. I don’t believe money should be one of them.


Ramit Sethi: [00:12:15] Amy strikes me as being very authentic in this exchange. She’s being real. Have you ever considered applying to be on this show? Can you imagine what it would feel like to open up? Know that millions of people are listening to you talking about one of the most intimate things in your life. People get nervous. And I don’t think Amy’s giving me some false bravado. I don’t think she’s fighting me to make a point. I think that she’s honestly nervous about talking about that, and I respect her. I think it’s very courageous for her to come on the show and open up.


Ramit Sethi: [00:12:50] Do you have an example of someone in your life who does have a healthy relationship with money?

Amy: [00:12:56] No, not that I can think of off the top of my head now.

Ramit Sethi: [00:13:00] Have you ever realized that before?

Amy: [00:13:03] No.

Ramit Sethi: [00:13:05] What do you think it means?

Amy: [00:13:11] Oh. I don’t know. I don’t know what it means. I don’t know if– just the people in my life find money to be a taboo thing, because even the people I know who have money or have savings or have investments, I don’t think that their relationship to their money is healthy. They’re afraid to spend or they don’t want to talk about it, that sort of thing.

Ramit Sethi: [00:13:36] Andre, I’m curious about you. You make $10,000 a month.

Andre: [00:13:42] Yes, sir.

Ramit Sethi: [00:13:42] That’s that’s a very good salary. And when you describe your relationship with money, what would you say?

Andre: [00:13:52] My history with money, my relationship with money, I’m pretty loose with it. Coming into this relationship, I definitely wasn’t the saver. I didn’t have a ton of savings. I had some cash in the bank, not a ton invested. And every time anything had a retirement, catch it out when I was very young, I really didn’t think about it and the industry I was in didn’t really have a retirement savings plan necessarily. I would have to set it up myself. And yeah, I’ve always lived a little bit freer with money, more in the moment, with money. Since being in a relationship, we’ve definitely tightened down and my relationship has changed since we’ve combined forces and all that.

Ramit Sethi: [00:14:41] Changed to what?

Andre: [00:14:43] Changed to being more stressed about money. Money is now a source of stress.

Ramit Sethi: [00:14:47] And is that because Amy’s stress rubbed off on you, or did you bring your own stress to it as well?

Andre: [00:14:54] Well, I would be silly if I pointed the finger at my wife and said it was her fault. But it’s definitely part of it. It’s stressful. It’s a daily subject. It’s something that comes up. I feel like our debt can’t be taken down with the amount that we make each year. We shouldn’t be just putting so much towards an empty bucket and paying these credit cards and this debt that we have. 

It just seems we’re throwing our money away. And I haven’t made this money forever. This is within the last five years. And before that, I was making decent money, but it was not like incredible money. But it seems like I’ve worked really hard to get to this point. And every milestone of a new job, pay rise, promotion rise. Nothing’s changed. It’s still the stress, it’s still the insurmountable. It’s still the same things are happening even though we’re making more and it feels like it shouldn’t be that way. It feels like we should have turned a corner.

Ramit Sethi: [00:15:58] Can I just play something out?

Amy: [00:15:59] Yeah.

Ramit Sethi: [00:16:00] It doesn’t sound really fun the way you talk about your money.

Amy: [00:16:03] No, it’s not fun.

Ramit Sethi: [00:16:05] Do you think that money can be fun?

Amy: [00:16:07] Yes. Yeah, I think it can be fun.

Ramit Sethi: [00:16:09] Who has fun with it?

Amy: [00:16:11] People who have money.

Ramit Sethi: [00:16:12] That is true. That is true. But I’ve had a lot of people on the show who are in $300,000 of debt and they still sound like they have more fun than you do.

Amy: [00:16:23] Yeah, I mean, they probably do. I feel very guilty all the time.

Andre: [00:16:28] The theme is stressed out and overwhelmed. I hear that daily. Amy’s theme is, “Babe, I am stressed out and overwhelmed about money,” everyday.

Ramit Sethi: [00:16:39] Amy, if we solved all of your financial problems today and your debt free tomorrow, how would you feel?

Amy: [00:16:48] To be honest, I have no idea how I will feel. I’ve never been debt free. I have no idea how it feels. I think I would feel a little bit lighter. If I’m being honest, I would. But then I would probably be stressed out that I didn’t know what to do next.

Ramit Sethi: [00:17:03] That’s an honest answer. That is an honest answer. The way you feel about money is highly uncorrelated with how much you have in the bank. So right now, when do you talk about money?

Andre: [00:17:21] I mean, in conversation just about daily.

Ramit Sethi: [00:17:24] What the hell? What? Like what? Well, that’s a lot. I do it for a living. I don’t even talk about it every day.

Andre: [00:17:32] It’s a constant conversation.

Ramit Sethi: [00:17:36] All right. That’s clue number one. Let me guess. It’s usually something negative. It’s like, we’ve got to do this or how are we going to do that? What’s the tenor of the conversation?

Amy: [00:17:44] It’s definitely we talk more about what we’re worried about because we don’t see each other a lot during the day. So it’s the bullet points at the end of the night. I will say we have both been very excited about our car. The new car has been a fun, exciting money thing for us.

Andre: [00:18:05] I do get an intense, almost like a press conference about money, though, it’s like a storm is coming. Better go get some water and batteries. It’s going to be bad till Friday.

Amy: [00:18:19] Wow. Really?

Ramit Sethi: [00:18:20] Until Friday because what happens on Friday?

Amy: [00:18:25] Friday’s payday.

Andre: [00:18:27] I get paid every other Friday. She gets paid every other Friday. And it happens that we get paid every Friday.

Ramit Sethi: [00:18:32] So can I tell you something very candid? At $140,000 a year, you should not be thinking about payday.

Amy: [00:18:42] I don’t want to throw Andre under the bus, but if I try to talk about money or get a partner and things, it’s glazes over and disassociates. So I’ve felt fairly alone in a lot of the decisions and a lot of the– and then I feel a little bit of guilt again because I’m the one in charge, so it’s my fault we’re here.

Ramit Sethi: [00:19:17] It’s got to be frustrating.

Andre: [00:19:18] It’s just tough because she does have reign over the finances as far as paying the bills and everything. And it’s tough because when we talk about finances, it’s all doom and gloom. It’s never a positivity. It’s never so, of course, I’m going to glaze over.


Ramit Sethi: [00:19:39] This was a really interesting comment from Andre. He points out that she manages the daily money and because she feels so stressed out, of course, he wants to avoid that. So what happens is, they fall into the pursuer-pursuee dynamic where she wants to talk about what’s going on with their money, why she feels stressed, what they need to change in order to get control of it. And of course, he wants to avoid it. This is common among couples and not just with money. This is where talking to someone, especially a therapist, over a long period of time can really help.


Andre: [00:20:16] Why would I? I don’t. I dread talking about money because it’s always negative and the same perception is stressed out and overwhelmed about everything. And sometimes I just don’t want to feel that way. So I don’t want to hear it. So I just zone out. Sometimes I really try to be involved, I really try to. But it’s I don’t live at that frequency of stress. I don’t function well at that. So it’s tough for me to participate when that’s the theme.

Amy: [00:20:47] We’ve had this conversation before. So all of our bills are in this app that we can both access and when they’re due and how much they are, so that the doom and gloom talk can be  taken out of the equation. But he can still be involved, but that doesn’t even really get paid attention to.

Andre: [00:21:08] I do see the app that she’s talking about. I see the bills getting paid. I know that the diligence is there, and she pays the bills. And I could say that I want to participate more. I’m being lazy about it. If I’m calling myself out, I’m definitely lazy about it. Because she does do such a diligent job at paying those bills and ringing the bell and doing the things, when it’s talked about, it’s like it’s always the debt is the mountain and we’re at the bottom and it’s always looking up. 

It’s almost like the Sisyphus of pushing the rock up the hill and then it just tumbles down the other side. And we’re still pushing. I believe in finish lines and bright spots and it’s like financially we talk about finish lines and bright spots, but it seems like the daily conversation is stress and the things we can’t do and the things we have to wait till Friday for payday for, or this and that, or do we have to pay this or this credit card?

Ramit Sethi: [00:22:14] Okay. That’s got to be frustrating. The mountain example is a really good one. Just you’re always at the bottom looking up. And does it ever feel like you made it partway up the mountain?

Andre: [00:22:24] Sometimes, yeah. My personal credit card doesn’t have the debt on it. But I know our overall debt, which we share is pretty big. So without a big windfall, without a big move, without a big plan, it just seems with the way that we attack it and approach it and talk about it daily, it feels– I don’t want to say hopeless, but it feels very bleak. It’s never like, oh, man, we’re going to get to here. We’re saving for this. It’s always like what we can’t do and what we don’t have. 

And it’s just frustrating at the like you said, the salary and everything we shouldn’t be stressing over much. But she needs help. And I don’t feel like I’m any help at all because this is not my world. And she is right. I do glaze over and when she looks for support, it’s like sometimes when I don’t have an answer.

Ramit Sethi: [00:23:22] I don’t like seeing people playing a game where they have no chance of winning. It’s one thing if we go into a casino and we all know we’re going to lose, but at least people go there, they get a drink, and they have some fun. Okay, whatever. But you have set yourself up to lose. And yet every day you wake up and you think, okay, I’ve got to figure out some way to win. But you are structurally set up to lose. 

So there is something you can do. Of course, you have options. But right now you both could buckle down and try harder and stop buying all this canned food or whatever. It’s not going to change anything. It can be frustrating to hear, but I see it as a relief. It’s like, okay, our strategy is not working, so what else can we do because this thing doesn’t work. How do you feel hearing this?

Amy: [00:24:17] We’ve buckled down to about as far as we can buckle down. We don’t even have cable anymore. And it’s not the most fun thing in the world.

Andre: [00:24:28] Yeah. I constantly feel buckled down and she is the one that runs the finances, so there’s nothing more. I don’t want to have to ask for things, but I also don’t want to be like, hey, I want this, like a kid at the same time, because I know money stresses her out and I don’t want her to do those things, but I don’t want her to be stressed out. But if we do have money, I feel hesitant and spending it sometimes. And I feel like sometimes Amy can feel a little freer spending the money sometimes because she doesn’t have to have that kind of stress associated with it. So she in control of it.

Ramit Sethi: [00:25:15] Well, feeling in control and being in control are two different things. You can feel in control because you pay the bills on time. That’s a lot of suburban parents in America. I ask them, what does managing money mean to you? Well, let me ask you, Amy, what does managing money mean to you?

Amy: [00:25:39] Yeah. I mean, paying the bills on time, making sure that you have the basic things you have, and then the rest is a luxury.

Ramit Sethi: [00:25:52] I don’t think that’s what managing money means. I think that’s what a lot of people think. But your view on managing money is what leads to being underwater. Because guess what? You can make sure that bills are paid on time, but you’re still losing the overall war. Managing money, in my opinion, is about creating a vision for a rich life and then using your money to get there. 

I’m not sure that you both have a vision for your rich life, which I’d like to talk about, but I certainly know that you’re not using your money to get there because right now you’re underwater. And at $140,000, you shouldn’t be that way. So paying bills on time is sort of the bare minimum. It’s not even really the point. I wouldn’t even mind if you miss a couple of payments. I don’t want you to. Don’t do that. Your credit score will not be good. But like, that’s not winning. 

What’s really winning is having a vision and then making some decisions with your money to get there. You’re not doing her any favors by being negligent and being absent with money. It doesn’t matter that you’re not a financial expert. Most people in this country, they don’t know anything about money. In fact, they believe they need to invest in whole life insurance and all this scam bullshit. They don’t know anything. So the fact is, the two of you just being on this call right now already are way ahead of most people.


Ramit Sethi: [00:27:18] Now that we have some background on their money dynamic, let’s take a look at the numbers. Let’s see how their feelings match up with the actual spending. And when I take one look at their conscious spending plan, it is immediately obvious what is going on. One huge line item jumps out at me. You can follow along, even plug in your own numbers on the conscious spending plan, which you can get for free at iwt.com/episode62.


Ramit Sethi: [00:27:48] Your fixed costs– 

Amy: [00:27:50] Are high.

Amy: [00:27:51] Why are they so high?

Amy: [00:27:54] I do know. I’m sure it’s the house and probably the car. Those are the big pieces of the puzzle.

Ramit Sethi: [00:28:04] So right now you spend 92% of your take home on fixed costs. And you know my recommendation is 50 to 60%.

Amy: [00:28:17] Yes.

Ramit Sethi: [00:28:18] And you know where most people overspend. There’s two things within fixed costs that they overspend on. What are they, Amy?

Amy: [00:28:24] House and car.

Ramit Sethi: [00:28:25] Exactly. So right there, if we zoom in, that is exactly why you feel overwhelmed. It has nothing to do with the groceries. Well, a little bit to do with the groceries, but it’s this. It is this category, which to me is an immense relief because now I go, okay, out of a million different things, buying paper towels, buying a car, buying this, buying that, vacation, wedding. We can zoom in on this and we can try to see if we can make it work. This is the reason. Virtually every person who feels overwhelmed with money is overspending in the fixed cost area. So what’s this $30,000 of credit card debt from?

Amy: [00:29:18] This one’s hard. I have a lot of responsibility for my family, and I also had a dog with a lot of health problems.

Ramit Sethi: [00:29:31] I’m sorry to hear that.

Amy: [00:29:33] So it is not new and it is not– I’m not going to say all of it’s like 100% serious. I’m sure there were some nights I went out and I was just like, I need to blow off some steam. But a lot of it that I brought to the table was like, it felt to me like a necessity. And then when Andre and I got married, we did put some of our wedding on the cards.

Ramit Sethi: [00:30:04] What was the thinking there when you did that?

Amy: [00:30:11] We wanted a nice wedding. And I mean, it wasn’t an extravagant wedding by any means at all, but it was a wedding where we could have the people we love in one room and give them a pretty decent meal and enjoy their company.

Ramit Sethi: [00:30:32] Are you concerned that I’m about to tell you you were all wrong about your wedding and stuff like that? Is that what you think that I’m going to do on this call?

Amy: [00:30:40] I mean, I think I feel it’s the way about anyone talking to me about this. So it’s not just like directly you, but, yes.

Ramit Sethi: [00:30:46] Yeah. I mean, I don’t really do that and I don’t find it’s useful. This is your money. It’s not mine. And what I’m here to do is to help you understand some options you have. And I’m here to help you elevate from the day to day decisions that so consume us to help you get a bird’s eye view. It’s like if you’re driving on the street, you can pretty much only see like 100 feet ahead of you versus if you’re up in a drone or airplane or something, you can see the whole area. That’s what I can help you do. And then you can decide which direction you want to go.


Ramit Sethi: [00:31:25] People who overspend are stressed, overwhelmed, and anxious every day of their lives. But the one thing they are absolutely petrified of is someone telling them they have to change. Most people will do anything to avoid that. It’s like saying the devil you know is better than the devil you don’t. Sure, they may be overwhelmed and anxious, but at least they know what that feels like. 

Change is scary. I found that most people are comfortable continuing to fail at something rather than entertaining the possibility of making a change which might fail but also might change their lives. It is a fascinating wrinkle in human psychology. As for the wedding, you want a nice wedding? Go for it. My wife and I did. The only difference is I’d been saving for a wedding since I was 24 years old. 

So with Amy and Andre, I want to get them to look at money differently. And it’s hard because when you finally get honest with money, one of the first things you feel is shame. Why didn’t I learn this earlier? Why have I been making the kind of decisions I’ve been making for 20, 30, 40 years? But ultimately, that’s just a small road bump on the way to turning the page on your rich life and going into the next chapter.


Ramit Sethi: [00:32:56] All right. You have a payment of $920 a month for debt. Is that your credit card debt?

Amy: [00:33:02] Yeah. That’s all the minimum.

Ramit Sethi: [00:33:05] That’s the minimum. Whoa. And what’s the interest on that credit card?

Amy: [00:33:12] Oh, there’s quite a few of them.

Ramit Sethi: [00:33:13] Average. 20? 

Amy: [00:33:16] 20.

Ramit Sethi: [00:33:16] So are you aware of how long it’ll take you to pay that off?

Amy: [00:33:20] I do a debt payment calculator. It has a schedule of what payments you are supposed to make every month on what cards. But it was about five years.

Ramit Sethi: [00:33:34] Okay. And what do you think about that?

Amy: [00:33:37] I think that’s too long. But that’s what it takes. That’s what it takes.

Ramit Sethi: [00:33:45] Well, you choose how long it takes?

Amy: [00:33:47] Yeah.

Ramit Sethi: [00:33:49] The credit card, they just do the math. And, of course, they want to extend it out as long as possible. You know why?

Amy: [00:33:56] Interest.

Ramit Sethi: [00:33:56] Yeah. 20% interest. They make a ton of money off you. They’re going to make roughly a third of what you owe in interest.

Amy: [00:34:06] Yep.

Ramit Sethi: [00:34:07] You owe $30,000, they’ll make roughly 12 to $14,000 in interest. Andre is not happy about that.


Ramit Sethi: [00:34:20] This is crazy. Paying the minimum payments and feeling stressed out go hand in hand. You are stressed out because you are making the minimum payments, not the other way around. And so you can keep making the minimum payments. You’ll keep feeling stressed out, but ultimately, it’s not working. That’s why they’re here talking to me. So what I want to get them to do is to start seeing they need to make a change. And as we get deeper into these numbers together, I notice another thing, which is that Amy and Andre use debt in all the wrong ways. Knowing what you now know about their debt, I think this next part will really surprise you.


Ramit Sethi: [00:35:07] Okay. Let’s look at some of the other numbers here. Your income, Amy, $2600 bucks. Tell me about that. I know you run your own business. What do you expect that number to be at?

Amy: [00:35:20] Well, honestly, right now we are very, very new. We opened a year and a half ago. We opened in the middle of COVID. I have a business partner, 50/50. The fact that we are even able to take home paychecks consistently is a big win in book. But we are actually building out a new location. So it’s like we’re starting over again.

Ramit Sethi: [00:35:48] You’re taking on debt to do that location?

Amy: [00:35:52] We are.

Ramit Sethi: [00:35:53] How much debt?

Amy: [00:35:55] We are taking out a large loan. It’s about 375.

Ramit Sethi: [00:36:01] Where’s it coming out of? What are you securing it against?

Amy: [00:36:06] Our home and my partner’s home.


Ramit Sethi: [00:36:12] This part terrifies me. Amy is buried in debt, and she has taken on even more debt for an unproven business. This is one of those things where it’s difficult to even know where to begin. My job is not to fix everything on this call. My job is to help them start to see money in a different way and start to make a few key changes that will allow them to make the next few key changes. 

I will point something out. One of the reasons that they feel so stressed out by money, it’s not simply their debt. Well, their debt definitely contributes to it. But it’s not just that. It is also that they have given themselves no money for guilt free spending. None. That means they’re simply not realistic. And so when they get stressed out, where do they go spend money? It would be better for them to be reasonable, to be honest, and say, we are going to eat out twice a week. Let’s put it in our conscious spending plan under guilt free spending. At least then we can acknowledge it. 

What we see here is a lot of guilt, a lot of denying reality. We’re not going to spend anything. And also, perhaps most damningly, using debt in a way that is not good. Frankly, most people should not be using debt as a sophisticated instrument. Most people should be focused on the basics of personal finance. And Amy and Andre have gotten in way over their heads.


Ramit Sethi: [00:37:55] One of the reasons you both feel stressed out about money is that you actually haven’t allocated enough money for guilt free spending. So guilt free spending should not be negative. It should not be. It actually needs to be– I encourage 20 to 35%. But if you were like, hey, we’re in debt, we want to be lower than– We want it to be 15%. Okay, fine. Right now it’s negative 2%. 

No wonder you order all this food for convenience. No wonder that you have these unexpected things come up because you haven’t actually planned for it. So I would rather you both just get honest. You go, you know what? We’re going to eat out once a week. We like it. So let’s put that down here. Now, that means we’ve got to cut something else and it’s going to become a joint project. You know what? We’ve got to do better about our groceries. What dime? Who’s going to own that? 

But that’s going to allow you to make progress on your fixed costs because you already know all your options, but also live a life. I’m not asking you to live like monks for the next ten years. I don’t want that. Go out, if you want to do that. But get the fixed costs all adjusted. Your fixed costs are too high, which leaves you no other room to handle emergencies, to go out to dinner, or any fun stuff and forget about investing. It doesn’t leave you any money because it’s all going towards these fixed costs. Essentially, all your money is gone the minute it comes in.

Amy: [00:39:29] If I’m being honest with you, I don’t see any way to change any of the fixed costs that we have. Yeah, if I’m being honest, I really don’t know. I don’t know.

Ramit Sethi: [00:39:42] Maybe you don’t know. You don’t know. Do you have the conscious spending plan open in front of you right now?

Amy: [00:39:47] Yes, I do. I’ve talked about getting a job for myself, but I’m also working a lot of hours a week on my business. And it’s a very physical job. And Andre, the overtime isn’t guaranteed. I don’t know what we would cut besides selling the house if that’s even a good option at this point.

Andre: [00:40:11] That’s tough because just working more for her doesn’t mean more money because she’s an owner. It’s like it doesn’t make sense for her to get another job and put her time into that. But putting her time into the business doesn’t always reap financial benefits right away because she just has to put time in being an owner.

Ramit Sethi: [00:40:26] So I understand all the problems. I’m looking for solutions. You guys are both very good at telling me all the reasons you can’t change. Well, we got this car, but we can’t get rid of it. Well, we have this house, but we can’t get rid of. We have these tools, but we can’t get rid of it. We have this. We can’t do that. I understand all the reasons you’ve laid out are quite rational. However, as one of my mentors told me, they are not leading you to the outcomes that you want.


Ramit Sethi: [00:41:02] This is one reason why you should be careful about increasing your lifestyle if you truly cannot afford it, because it is incredibly hard to downsize. And in America, the ultimate shame is having to downsize because you can’t afford something anymore. Listen to Amy and Andre. They genuinely have no idea what they can do. That’s because- well, there are a lot of reasons, but one major reason is that people simply cannot fathom downsizing. They have reasons for everything. 

In many ways, that car has become part of Amy’s identity. She even said it’s the one moment that gives her joy in her day. Well, change is hard. But they need to start visualizing these changes and they need to start making them now. If they don’t make them on their own, the changes will get made to them. 


Ramit Sethi: [00:42:03] So right now, if I’m looking at your fixed costs and I’m just ballpark in it, you would need to essentially cut roughly $2,000 off your fixed costs every month. That’s a ballpark. We can play with it. There’s a lot of things we can do. But I share that number not to scare you, but to get you thinking how big of changes we need to be making. So, sure, by all means, cancel some subscription that you’re not using anymore. You should probably cut the grocery spend. Sure. But that’s not going to solve the problem, is it? So if we start off by saying our goal is to cut our fixed cost by 2,000 bucks, or we could also make more money, then you tell me, what are the options.

Andre: [00:42:59] I have a truck and I have a car, her old car. I use as a commuter now. So I technically have two vehicles. Her old commuter is an absolute beater, so we couldn’t really get anything for that. But my truck it’s got a lot of miles, but it’s a Toyota truck and it’s a certain Toyota truck. So I could sell it for a certain amount of money but that’s one of those weirdos that dream is a hot rod. I’ve kept my truck forever.

Ramit Sethi: [00:43:29] How much can you get for that truck?

Andre: [00:43:33] This without me fixing it up, working on it and doing the couple of things it needs I could probably sell it for maybe, maybe nine or 10.

Ramit Sethi: [00:43:43] Okay. 10,000 bucks. Fine. All right. Back to you, Amy. Options?

Amy: [00:43:49] We could stop putting so much in Andre’s retirement every month.

Ramit Sethi: [00:43:58] Okay. You’re currently putting 600 bucks a month. You could. You’re right. You could stop that. That’s not a good option, but that is an option. I’ll take any options at this point.

Amy: [00:44:11] So [Inaudible 00:44:15].

Ramit Sethi: [00:44:13] Okay, Andre, go ahead.

Andre: [00:44:17] Well, the next obvious one is the Telluride. It’s a new car. It’s her. She loves it. But it is something that is a fixed cost that could be salable, but it’s not going to happen. She would sell the house before she sold the car. She loves it.

Ramit Sethi: [00:44:40] So that’s not really an option, I guess. What else? 

Andre: [00:44:51] I have, I guess my tools.

Ramit Sethi: [00:44:56] How much?

Andre: [00:44:58] How much did you say it was worth, babe? It was like 15 grand?

Amy: [00:45:03] Yeah, something like that.

Ramit Sethi: [00:45:05] What the hell is going on? You guys are sitting on $30,000 worth of saleable stuff? What else you got in that garage? A garage full of stuff to sell is a step in the right direction. Let’s do that and let’s aim a little bigger.


Ramit Sethi: [00:45:20] You have to realize the dynamics here. To Amy and Andre, the tools are part of their life. The Telluride is part of their life. Me coming in and saying, “Hey, maybe you should sell these things” feels deeply personal. It’s not quite like me telling them to sell a dog, which, by the way, I am not saying– so pet owners, please do not come after me. But in this culture, we associate things with success, and eventually those things become part of our identity.

But here’s my perspective. 10 years from now, looking back on this moment, Amy and Andre won’t even remember the tools or that car. 10 years from now, they can be debt free. They can have a substantial portfolio. They can feel free and light and have a beautiful, rich life. But to get there, they have to make changes and they have to do it now.


Amy: [00:46:19] I think selling the house is probably the best option.

Ramit Sethi: [00:46:26] What do you think about that, Andre?

Andre: [00:46:30] This is the first house I’ve bought. It’s not Amy’s first house. This is the first house I’ve had, so it’s a tough thought to sell, but at the same time, it’s not our forever home. It’s not where I picture us settling down and having the family life and all that stuff. It’s a great home. I love it, I love the area, but I’m not attached at the hip to it. I could sell the house.

Ramit Sethi: [00:46:56] If you sold the house, it sounds like you’d probably break even. Is that about right?

Andre: [00:47:02] Yeah, if we paid everything off, yeah, we would make a little bit, but not a lot.

Ramit Sethi: [00:47:08] Okay. And you’ve factored in things like transaction costs, 6, 8, 9, 10%, all that stuff?

Amy: [00:47:18] Mm-hmm.

Ramit Sethi: [00:47:18] Okay, good. I’m not telling you you should or should not. But here’s what matters most. If you sold the house, then what you currently pay for housing, which is roughly 3,200 bucks a month, probably a little more when you factor in maintenance and stuff like that, let’s just say 3,400. Would that be reasonable?

Andre: [00:47:45] Sure, yeah.

Ramit Sethi: [00:47:45] Okay. What that would tell me is that I would want to be looking for a place to rent that would be substantially less. And I would take all the difference and I would put it towards these other parts of my life, paying off the debt faster, building up the emergency fund, investing, etc. That’s how I think about it, because just selling it doesn’t do anything. You break even, you might even lose money, whatever. It’s some moderate amount. But what matters is the decision you make after as to where to live. So you have two given any consideration to what would it look like to rent a place that was, say, $1,800, $1,900, $2,000? What kind of lifestyle is that?

Amy: [00:48:35] I’m not trying to make excuses. I don’t even think that exists where we live.

Ramit Sethi: [00:48:41] Yeah. You might have to move farther away.

Andre: [00:48:46] I know we could find something.

Amy: [00:48:49] We could live like two hours away.

Ramit Sethi: [00:48:52] I’m not telling you to do it. What I am saying is you have to give consideration to the real financial decision. It’s not about selling the house. It’s about lowering your monthly fixed price. How much would you pay in rent?

Amy: [00:49:05] We would pay the same, if not more, in rent than we pay now.

Ramit Sethi: [00:49:12] Wait a minute. How much would you pay for whatever place you would rent?

Amy: [00:49:17] It would be about $2,500 a month.

Ramit Sethi: [00:49:20] Well, right now you’re paying about $3,200 a month for all your stuff.

Amy: [00:49:26] Yeah. So, I mean, honestly, it just depends on where we could find a place, because if it’s a house for rent, then we’ll be in charge of garbage, utilities, all that sort of thing. If it’s an apartment that we’ll take our dog, then maybe something will be included. So we’ve looked at apartments. We’ve we have done our research.


Ramit Sethi: [00:49:51] I’m not sure if I buy it. They say they’ve researched and that rent would cost them more than their current house. Yet they just told me a rental would be about 2,500 and their current housing is 3,200. Let’s keep digging.


Andre: [00:50:07] And the one thing that curbed it for me, too, was talking to the parents, my parents are older. And when I rent or buy, I’m like because we have, like I said, this plan to possibly one day– and they’re excited about it too, they want to get a house with us and all the things. And I told them, hey, what if we paid off this debt using the money? And they’re like, no, just stay the course, stay this and that and just keep chopping the tree. And it was just like, you’ve got to take your parent’s advice seriously. But also I got sour to the whole situation because it’s like we wanted to sell. We didn’t hear the number we wanted to hear and then on top of it, my parents pooh poohed it.

Ramit Sethi: [00:50:48] With your parents you would spending 92% of your take home on your fixed costs. Do they even know what that means?

Andre: [00:50:55] Yeah, they would.

Ramit Sethi: [00:50:57] Amy is shaking her head. No.

Andre: [00:50:59] You don’t think so?

Amy: [00:51:00] No, I don’t think your parents have the best track record with money.

Ramit Sethi: [00:51:04] One thing I love, I just have to tell you, I love this. The spouse always knows the family dynamics of the other spouse’s family. It is so funny.


Ramit Sethi: [00:51:22] I want to summarize what just happened because it is so important. Amy and Andre can sell their house, but it’s not really the sale that matters. What matters is that they would take the money that they are currently paying for all of their housing costs, and they would instead rent a cheaper place and redirect the savings towards their debt and towards investments. 

If they don’t do that, they will be like so many other people. This is a mistake that many people make. They make a one time change, like selling a house or a car, but they forget that what really matters is taking the monthly savings and redirecting it where it needs to go. If you don’t intentionally redirect it, it will simply vanish into your monthly spending and you will have no idea where it went. 

That’s how people start giving up on personal finance. They go, I sold this car and I thought I’d have a lot more money, but I don’t have anything. So forget this thing. It doesn’t work. I got a raise. I’m making $5,000 more a year. But where’s the money? Well, you didn’t take the time to use a conscious spending plan and redirect it. That’s the only thing that matters. Now, if you’re curious about how to do this, you can see chapters four and five from, I Will Teach You to Be Rich.


Andre: [00:52:42] The one big looming thing is like the newer car. But it’s like, the amount of research that we put into it, the the knowledge that I have being an ex mechanic, working at a car dealership, selling cars, knowing all those things, the car itself that we purchased, the reason we purchased it, the reason we waited for it, it was like a full year decision. We had to wait for this thing and pay when we got it and everything. We had to order it. It was not a light decision. 

And we vetted even looking at similar cars that were used in smaller and none of them– they all seemed just compromise. And this seemed like something that we had the opportunity to not compromise in. So I feel like I don’t know why the new car would be such a such a coveted thing, but it feels like something that we both really actually enjoy more than the house and more than, oh, god, I love my truck.

Ramit Sethi: [00:53:41] In my philosophy, you spend extravagantly on the things you love and you cut costs mercilessly on the things you don’t. But you have to be able to afford it.

Andre: [00:53:51] Right.

Ramit Sethi: [00:53:52] You can’t afford it.

Andre: [00:53:54] Yeah, we bought it out of love. We bought it because more than anything, she loves it. Just to be brutally honest, she loves it more than anything. The color, the everything, the car itself, everything about it she loves it.

Ramit Sethi: [00:54:06] I don’t mind people loving stuff. I have a lot of things that I love, like tangible items. We all have our money, dials and the things that we love. Cool. But the thing is, we spend most of this call talking about how both of you are stressed about money, especially you, Amy. And so if we were to get really candid and say, okay, you love the car, I hear you on that, that looks cool from what I saw, but right now, you feel stressed every single day of your life about money. And right now, it’s not getting better. It’s actually getting worse. Is it worth it? What would your answer be?

Amy: [00:54:45] Oh, God. It is ridiculous as it sounds. Yes, the car is the one piece of joy in my day.

Andre: [00:54:56] I really would agree with her to it.

Amy: [00:54:59] That sounds so silly because we did purchase the car or plan to purchase the car after Andre received a raise at work and it at the time made sense.

Ramit Sethi: [00:55:11] I can tell that you like it. I’m more interested in what you just said about how you made the decision to buy this car. How did you decide how much you could afford?

Amy: [00:55:23] Based on the monthly payment.

Ramit Sethi: [00:55:27] What do you think about that?

Amy: [00:55:29] I mean, now that I have found you, I understand that that is incorrect.

Ramit Sethi: [00:55:36] And now I want you to connect that to the rest of your fixed costs. What do you see when you make that connection?

Amy: [00:55:44] Well, that’s what it is. Everything’s just what’s the monthly payment other than the bigger picture.

Ramit Sethi: [00:55:49] And that’s why you’re drowning?

Amy: [00:55:51] Yeah.

Ramit Sethi: [00:55:52] Individually, everything makes sense. Of course, we need this car. Of course, we need these cans. Of course, we need this X,YZ,, of course. But it’s all focused on the monthly payment. And then one day you wake up and that day is today. Well, it’s not today. You’ve been stressed out about this for a while because deep down, you know something’s not right. But individually, you’d never be able to see that. 

Now, as I said at the beginning of this call, we’re elevating and looking at the bird’s eye view, and you can see that you’ve locked yourself into too many expenses. And the problem with making these purchases is that once you do, it is really hard to go backwards. That is your resistance to even thinking about selling the car or to even thinking about selling the house or cutting back on anything. Once you’ve established a certain standard of living, it is very difficult in this culture to go backwards. If you don’t already notice, you have a very split way of handling money.

Andre: [00:56:59] Her hybrid diligence and my aloofness has not worked for sure.

Ramit Sethi: [00:57:04] Andre, you make the bulk of the money, but you don’t pay any attention to it whatsoever. Amy, you manage the money, but you were taught since you were young that you don’t talk about money. You have no role models with a healthy relationship with money. And right now you’re drowning. So the system you’ve set up is not working. And I know often couples feel like, well, one person handles the dishwasher and I handle the laundry, but money’s not like that. It cuts across everything. And that is why there’s feelings of overwhelm and even resentment. One partner might take the lead on certain things. But it’s got to be a partnership. 

Andre I think you can see the implications of you not participating in the financial discussions. I can understand why. I don’t want doom and gloom anymore when you talk about money. I’m going to give you some tools so that you can have a more positive conversation. But by leaving Amy to feel alone with money, then naturally she shrinks to focus on just checking the box to make sure the bare minimum is done. 

And I’m sure she’s doing a very good job of making sure the bills are paid on time. But you both need to work together to accomplish something bigger than that. Amy, does that sound about right?

Amy: [00:58:32] Yeah.

Ramit Sethi: [00:58:33] And would you be open to his support, even though he may not be a financial expert?

Amy: [00:58:37] Yeah, yeah. I would love fresh eyes on things or some even devil’s advocate for trying to figure things out. That’s why I talk to him about it.

Ramit Sethi: [00:58:53] Listen to that, Andre. That’s why she talks to you. I know that the way she talks to you, you might be receiving it as like, oh, no, it’s doom and gloom. And she’s like, what’s the worst case? And that might be the case. But really deep down, I think Amy wants a partner. And the two of you, even though neither of you are financial experts, that’s okay. You actually don’t have to be to get the basics right. You just need to make a few key decisions and get those right. The rest of the stuff, it works itself out. So, Andre, from you I want to know what do you want to use your money for?

Andre: [00:59:31] I’m a simple pleasures guy. Of the two of us, I live in the moment. If I had to put a reference to it, I’m Chewbacca, she’s Han Solo. She makes the plan. I’m the action. She’s the one that comes up with the formulation and the planning and the long term thinking. And I’m the one that’s in the moment living.

Ramit Sethi: [00:59:56] Let me pause you. What’s on your bucket list for the next 10 years?

Andre: [01:00:01] 10 years, for sure, I’ve wanted to get another hot rod, fast car, classic car. Not much more than that. We’ve talked about getting possibly a family compound with my parents, investing in something where we both have two homes on a property or a split level on a lake, something where because they’re getting older and it’d be nice to have them in our lives and Amy gets along with them really well. So it’d be a good thing. Possibly kids. We are a little bit older, but possibly children in the future, having the wherewithal to take care of those kids, to be able to take care of the dog without thinking about it, to be able to have a future.

Ramit Sethi: [01:00:37] Okay, cool. Thank you. In your rich life with Amy, what’s the vision? What do you see the two of you doing?

Andre: [01:00:48] I see a lot of travel as we get older and try to get into a position where we can make memories together because we have the things together. We have the house, we have the car, we have the stuff, I have the job, she has the business. We have the life. But I want to be able to live with her. I want to be able to enjoy that life and go travel and do the things that I picture somebody that makes the amount of money that we make doing.

Ramit Sethi: [01:01:15] Nice. I don’t mind that you first answered with this stuff that’s in your rich life. I actually think that everyone has an individual rich life. And in a relationship you have a joint rich life. But I’ve got stuff that I want to do my wife has no interest in it. That’s okay. Same for her. But then we have the things that we both want to do. Cool. What my dream is for both of you is that you can have a crystal clear vision of what your rich life is. So when you say a hot rod, I bet you, you know the year of that car and you know the color you want to paint it and the renovation. Look at that smile. Am I right?

Andre: [01:01:55] I got top five, there’s things, there’s options. I love this.

Ramit Sethi: [01:02:01] That’s a rich life. A rich life is vivid, and it’s meaningful. So you want a hot rod, and I love that. I don’t know anything about a hot rod. It’s not a thing for me. But that doesn’t matter. Your rich life is yours. So my dream for you is that you both have these vivid, specific things you want to do. We want to travel. Specifically, we want to travel for two and a half weeks on this tour or to this place. And we want to take our dog with us. That level of specificity is what actually makes money exciting. And it gives you a reason to change the way you treat money. 

If it’s just words like we want to travel or even worse, we want to stop feeling overwhelmed with money, think about what happens tomorrow morning after this conversation. You wake up and are you going to leap out of bed and go, “Yeah, I want to stop feeling overwhelmed about money” No, it’s not motivational, it’s not vivid, but oh, my gosh, we have decided we want to take that trip or we want to get that car or whatever. That is a reason to stick with a system. 

Sometimes I talk about investment strategies or compound interest, and we do some cool calculations. But in this conversation, Amy and Andre just need a little positive momentum. They need a lifeline to dig themselves out of this financial and emotional hole that they find themselves in. So I want to start talking about a healthy relationship with money. 

Either you decide to make a change, which you can, but it’s up to you or you go on like this and you essentially hope that something changes, a lot of hope. It’s hope that Amy’s business starts paying you more, but it has to be a lot more because you’re going to have to pay off the debt that you now incurred like 200 grand of debt. It’s hoping that maybe, Andre, you get promoted or you can keep working overtime, things like that. It’s hope that you can eventually pay this credit card off and then somehow magically use that money for something else. It’s a lot of hope. You guys want to hope or you want to make a plan?

Amy: [01:04:34] No, I mean, I want to make a plan.

Ramit Sethi: [01:04:37] What would be a good time to talk about money for the two of you?

Amy: [01:04:43] I think Friday nights would be good.

Ramit Sethi: [01:04:45] Love it. And are you both rested and alert on a Friday night?

Amy: [01:04:52] No, but I don’t think there is a day of the week that will get us both rested and alert, if I’m being honest.

Ramit Sethi: [01:05:00] That’s a deeper issue. You’ll have to think about that in terms of lifestyle. But let’s take what we’ve got, Friday night. Okay. So what would you like to talk about on this conversation? Let’s start with the first 60 seconds of this conversation. What do you want it to be?

Amy: [01:05:17] I think for me, I’m not talking about the basic every day to day stuff. I’m not worried about paying the basic everyday day bills. It’s the things that come up.

Ramit Sethi: [01:05:27] Hold on, hold on, hold on. What do you want the first 60 seconds of the conversation to be? You get a chance to design this conversation. 

Amy: [01:05:37] I don’t know what’s on the task?

Ramit Sethi: [01:05:43] What are the options?

Amy: [01:05:44]  For the Friday?

Ramit Sethi: [01:05:45] Okay, but did you notice? Don’t you think it’s just, Amy. I’m trying to show you how to have a different relationship with money. Do you notice what you’re naturally jumped into, what your instinct took you to?

Amy: [01:05:56] No.

Ramit Sethi: [01:05:57] Your answer was, we talk about things that have come up, which is really code for things that are going wrong with our money.

Amy: [01:06:04] Okay.

Ramit Sethi: [01:06:06] So can you see why Andre is like, I don’t want to talk about this?

Amy: [01:06:09] Yeah.

Ramit Sethi: [01:06:10] Okay, so let’s flip it. You get a chance to set the tone in these conversations. How do you want to begin the first 60 seconds?

Amy: [01:06:21] I don’t know. I have no idea.

Ramit Sethi: [01:06:24] Let’s look to Andre for a cue. Is there a way to have a conversation about money that starts with positivity?

Amy: [01:06:31] Yeah.

Amy: [01:06:35] I mean, I don’t know.

Ramit Sethi: [01:06:36] It never occurred to you. Huh?

Amy: [01:06:37] No. And I don’t know what even that looks like because I don’t know.

Ramit Sethi: [01:06:44] “I might start off by saying, I want to start off by sharing something I really appreciate about you. You always make sure that we have garbage bags for the garbage. Amazing. Or I really appreciate that you helped me think through the conscious spending plan before we talked to Ramit. I was nervous about it, but it really helped to have you partner with me.”

And then Andre might say to you, “Well, I really appreciate that you set up that app for us, and I know I haven’t done a great job of logging in, but it means a lot that you did it, and I would love it if you could walk me through it another time.” A little moment of appreciation for each other. How do you think that would change the tenor of the conversation?

Andre: [01:07:28] I would enjoy it. I’m into positive affirmation when it comes to things.

Ramit Sethi: [01:07:34] Love it. Okay. So what we’re doing right now is we are totally re conceptualizing the concept of talking about money. Talking about money is not only meant to talk about what’s bad and the problems. Talking about money is not even only meant to talk about status updates. Talking about money is meant for what?

Amy: [01:07:56] More positivity.

Ramit Sethi: [01:08:00] What else?

Andre: [01:08:02] For planning for our future and thinking of the things we want to do with our money rather than what we can do with our money.

Ramit Sethi: [01:08:10] There you go. It’s about connection. It’s about coming together. And that connection can be appreciating each other. That connection can be creating a vision together. That connection could be asking for help. Hey, I don’t know how to calculate this thing or we open up an investment account. I don’t understand. Or even I really need your help because we both agreed that we were going to cut our groceries. But I’m looking at something last week and seem to be a little bit over. Can you help me understand it because I need your help? All of that is connection, but it’s totally different way of talking about money than you’ve been doing so far, isn’t it?

Amy: [01:08:50] Mm-hmm. 

Ramit Sethi: [01:08:51] Way more caring, way more connected. The two of you working together because you’ve both clarified a vision, and now it’s just like we’re in this together. Let’s figure out how to make it work. It’s okay if you got problems. It’s okay if you got ext debt or somebody overspent or late fee. Okay. Hey, I got to admit, I messed up on this one. I’m sorry. I’ve got to take responsibility. I’m going to work a little ext, but it won’t happen again. 

On the other hand, I want to recognize you. You did an amazing job. Oh, my God, I feel so good knowing that you’re my partner in this. And I know even if we’ve got some debt, we’re going to be able to get through this together. Wow. It feels good just to say it. It’s got to feel even better to receive it. You both clearly love each other. 

I’ve learned that, Amy, you didn’t really have financial role models, and it’s challenging for you sometimes when I ask you, like, give me a hypothetical. And you know what? I don’t mind it. Eventually, guess what? You get to be your own healthy financial role model. So I feel very confident that. 

Andre, hearing the way that you were very candid about, I have admittedly not really participated in the money, I think the two of you have a really strong relationship. And if you can go into it and say, we are going to come up with a vision together and then we are going to figure out what decisions to make, oh, my God, all of a sudden it’s not his tools and her car. It’s our money. 


Ramit Sethi: [01:10:31] This is normally where I would share a follow up letter from Amy and Andre. But I did not hear from them, despite reaching out multiple times to get an update. Usually when this happens, it means that the couple is not taking my advice. I truly wish Amy and Andre the best, and I hope they make a change because one way or another they will have to. The question is whether they want to make the change on their own or they want to let circumstances unfold so their backs are against the wall.

I think it’s a tragedy to take the negative money messages you grew up with and despite living in a completely different socioeconomic status, to still carry those forward. But Amy and Andre, if you are listening, I wish you the best. I would love to hear your follow up. And for everyone else, you can get the conscious spending plan that Amy and Andre at iwt.com/pisode62. 

Thanks for listening to I Will You to Be Rich. I am Ramit Sethi. Please follow the show on Apple, Spotify or wherever you listen to podcasts. If you haven’t read, I Will Teach You to Be Rich, my book, pick up a copy. You can get it at any bookstore or any library and it will show you the specific tactics for how to build the I Will Teach You to Be Rich system into your personal finances.