Episode 246. “We’re drowning in debt, but bought another house”

Ramit Sethi of I Will Teach You To Be Rich talks to Melissa and Tony, a couple who immigrated from Mexico with big dreams and an even bigger work ethic. In less than a decade, they've built a net worth of nearly $900,000. But beneath the surface of their impressive paper wealth, they’re carrying almost $1 million in debt and are completely misaligned on their financial goals. With their second child due any day, Ramit helps them uncover the root of their money woes, from differing money styles to the profound impact of their upbringing. Can they finally get on the same page, create a financial system that works, and build a sustainable rich life?

 

In this episode we uncover:

• How Melissa and Tony built a nearly $900K net worth in 8 years
• The "rollercoaster" of their financial decision-making
• Why their credit card debt is actually due to real estate
• Tony’s “paycheck to paycheck” feeling with a $189k household income
• Melissa’s childhood money lessons from her dad, Mr. No
• How they navigate financial planning with a baby due this month
• Why they avoid combining their high incomes
• The cultural influences shaping their financial narratives
• What happens when Tony is “comfortable” and avoids change
• The deeper reasons behind their ongoing money disagreements
• Ramit’s advice on how to communicate about money effectively
• A surprising agreement that might change their future

 

Chapters:

(00:00:00) Introduction

(00:02:28) Their chaotic financial situation

(00:07:07) Melissa and Tony’s real estate struggles

(00:13:07) Melissa's real estate ambitions vs. Tony’s pessimism

(00:20:58) The cycles of making and losing money

(00:26:59) The ineffective communication about debt

(00:33:57) The danger of making emotional money decisions

(00:37:35) Diving deep into their income and debt

(00:46:01) Their unspoken rules about money and spending

(00:51:56) The painful truth behind being "house poor"

(01:00:43) Impact of childhood money lessons on their current finances

(01:10:29) The parent-child dynamic in their financial relationship

 

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Transcript 

Download the full transcript PDF 

[00:00:00] Ramit: How much debt are you guys in right now?

[00:00:01] Melissa: 924,000.

[00:00:03] Ramit: How's it feel to you to be in debt?

[00:00:05] Tony: It feels like we're never gonna get out of it.

[00:00:07] Melissa: Tony didn't wanna buy another property 'cause he doesn't like real estate investments that much. I was like, no, let's buy this short till and then we bought it.

[00:00:15] Tony: It feels like I live paycheck to paycheck.

[00:00:18] I don't feel like I'm making any money.

[00:00:19] Ramit: I can't even figure out what page anybody's on right now. It's like a kid wanting to buy a toy. I want this toy. No, I want that toy. You're talking about a million plus dollars here, guys.

[00:00:28] Melissa: Feel like I'm in the rollercoaster again, trying to see what he's going to say next.

[00:00:32] Ramit: If we end this call right now, I suspect you will go the rest of your life getting into debt, making a little bit of money over here, paying it off, going into debt and doing it over and over until one day. It's like you're in the ocean and it just engulfs you. Do you know anybody who's done that?

[00:00:47] Melissa: Their parents, they lost their houses.

[00:00:49] 50

[00:00:50] Ramit: and now you're both repeating the same pattern. Today I am speaking with Melissa and Tony, a couple who immigrated from Mexico to the US in their early twenties. They didn't have a lot of money, but they were willing to work long hours to build a successful life together, and it worked. Eight years later, they've built a net worth of nearly $900,000.

[00:01:11] So in less than a decade, they're almost millionaires on paper, but beneath their paper wealth, Melissa and Tony are overwhelmed. They're carrying massive real estate debt and they are misaligned on their financial goals and with their second child due any day. Now, they really need to get all of their houses in order.

[00:01:30] That's right. They currently own three properties. I'm gonna pull up their conscious spending plan, which is the exact system I use to see how someone earns, spends, saves, and invests. If you want help navigating your own csp, join my money coaching program at iwt.com/money coaching. Here's where they stand.

[00:01:50] Assets, $1.58 million. Investments, 190,000 savings, 30,000 debt, 899,000 net worth. 899,000. Fixed costs, 68% investments, zero savings, 23% in guilt-free spending 9%. You can see how much is revealed once you look beneath those top line numbers. Like from the outside it might look like they are building serious wealth, but under the surface, they have created a system with very little safety net, no investments, very little cash, basically no room for error.

[00:02:28] So today I wanna know, can Melissa and Tony stop chasing the next deal and start building a sustainable rich life? Let's find out. Melissa, in your application, you wrote something that caught my eye. You said, our new baby will be born this month. I would like my husband to understand financials, set up a plan with me and act on it.

[00:02:56] Not just ignore the fact that we have debt and keep spending. Do you remember where you were, what you were doing when you were those words?

[00:03:06] Melissa: To me, it was a month ago and it was like a throwback from my first pregnancy. When I had my first child. I stopped working for two months, so Tony was coming to me saying like, Mel, what are we gonna do?

[00:03:20] What's the plan? And they're like, oh my God, I cannot think about that.

[00:03:24] Ramit: You said that the baby's gonna be born this month, right?

[00:03:27] Melissa: Yes. I'm three nine weeks right now.

[00:03:29] Ramit: Oh my gosh. Okay. Wait, so do you have a plan for your finances right now?

[00:03:34] Tony: No, I don't think we have a plan because everything is up in the air.

[00:03:38] We either have some investments, but we don't know where to put it. We don't have an emergency fund. It is. We had debts and we don't know what to pay off first.

[00:03:49] Melissa: So it's been really hard to set up a plan and really follow through. Sometimes Tony's like a rollercoaster. Like sometimes he is like, that's a great idea, and then next week he's like, that's a terrible idea.

[00:04:03] So it makes me feel like, can we just set up a plan and just follow through.

[00:04:08] Ramit: How long has this been an issue between the two of you that you don't see money the same way?

[00:04:13] Melissa: I think since we got married, we have a very hard start. My parents got divorced, so then I took care of my three brother siblings. So the sudden, like we had to grow up and just be like in survival mode for everybody.

[00:04:30] So then it was like from being just girlfriend, boyfriend to be like parents of my siblings. Mm. And I think that's what the problem start.

[00:04:39] Ramit: Okay. Tony, do you agree that. You and Melissa have not been on the same page with money since you got together?

[00:04:48] Tony: Yeah. I think that we kind of have not be like a married couple.

[00:04:55] I guess everybody was like on their own with their finances.

[00:04:59] Ramit: How long have you been married?

[00:05:00] Tony: Seven years.

[00:05:01] Ramit: How come you didn't like combine money or talk about money together?

[00:05:05] Melissa: Because my siblings were at my house, so I felt like I didn't want him to be like the dad. But it was hard for me because it was like, I want him to be my husband, but also I want him to, I didn't want him to be the dad of my siblings.

[00:05:22] Tony: Mm-hmm.

[00:05:23] Melissa: Um, so I didn't wanna put that responsibility on him. But still, I think that it was affecting us putting together like. A plan. Now they're outside the house. It was very hard time. So it was like six years or 5, 5,

[00:05:40] Ramit: 6 years of taking care of them. You taking care of them. I wanna know a little bit more about that, but first I need to ask a few more questions about your money, if that's okay.

[00:05:49] I understand that you're in debt. How's it feel to you to be in debt?

[00:05:52] Tony: It feels like we're

[00:05:53] never

[00:05:53] Melissa: gonna

[00:05:53] Tony: get out of it.

[00:05:54] Ramit: Did you know how much debt you were in Tony?

[00:05:56] Tony: Yeah. I always kind of look into, you know, the credit cards and I'm always kind of like on top of, of the numbers.

[00:06:04] Ramit: Wait, you, you're on top of the numbers, but you're in debt.

[00:06:08] Why? That doesn't mean you're on top of the numbers.

[00:06:10] Tony: Well, I guess I know how much, how much money I have owe. That's what I mean.

[00:06:17] Ramit: Alright. How long have you been in debt?

[00:06:19] Melissa: Since 2023.

[00:06:21] Ramit: Okay. Couple of years. What about before then?

[00:06:26] Melissa: No debt at all.

[00:06:27] Ramit: Oh,

[00:06:27] Tony: we didn't have money to invest or. As a down payment for a new house or,

[00:06:33] Ramit: okay.

[00:06:34] So you had extra money before two years ago. What happened two years ago that put you into debt?

[00:06:40] Melissa: We thought that it was gonna be a good idea to build a house.

[00:06:46] Ramit: Okay.

[00:06:47] Tony: A dream home.

[00:06:48] Melissa: And then we bought the lot in Cabo at the same time

[00:06:51] Ramit: you were building a house and you bought a lot in Cabo at the same time?

[00:06:55] Melissa: Yeah, and then we were over budget on the house.

[00:06:57] Ramit: How many properties do you own now?

[00:06:59] Tony: Two.

[00:06:59] Melissa: And the land in Cabo, but it's under contract, so hopefully it'll close.

[00:07:04] Ramit: So you own one house, the one that you live in, you own another house. Do you rent that out?

[00:07:10] Melissa: Yes.

[00:07:10] Ramit: Okay. And then you have the lot which you, it sounds like you're trying to sell right now.

[00:07:15] Melissa: Yes.

[00:07:15] Ramit: Okay. Alright. I wanna jump in here quickly to acknowledge there are a lot of confusing layers here, so let me just cut through the noise. Here's what you need to know. Melissa and Tony have not created a shared system for their money. As Melissa explained, she and Tony became responsible for her three siblings after her parents divorced.

[00:07:34] And so they were thrust into this parental role before they were able to make that decision for themselves. Now, keep in mind, this all happened shortly after they immigrated to the us. So they were suddenly caring for three teenage kids while also navigating a completely different culture with language barriers and new marriage.

[00:07:53] And I want you to remember that because if you were thrust into a new country with different cultural norms and expectations, having to suddenly take care of three teenagers, how would you handle it? I remember in my twenties when I was getting ready to move from San Francisco to New York, I was worried.

[00:08:09] I was like, how do I find somebody to cut my hair and I'm an able-bodied, educated guy? And just the idea of finding new people to cut my hair or places to eat, that felt overwhelming. Now imagine moving to a different country and having to figure out everything for the first time she had her young siblings to take care of.

[00:08:28] Where do they go to school? How do you shop for groceries when you don't know the language that well? How do you fill out forms to get healthcare in America? Damn, it's hard enough for Americans to even understand what a deductible is. Now imagine you're doing that in a second language. On top of that, when they immigrated, like many of us, they never took the time to have a series of conversations around their money, and now they're expecting their second child in just a few weeks, and they're panicking about paying down hundreds of thousands of dollars of debt.

[00:08:57] Which they largely built up because of their decision to purchase a bunch of real estate. So far they've mentioned owning two homes, one which they rent out, plus an undeveloped lot in Cabo. This actually sounds like a lot of people's American dream. Let's keep going. Tell me a little bit more. Exactly how did you get into debt?

[00:09:15] Tony: Well, I think we got into that pretty quickly because when we first started building our dream home, um, everything went out of our budget. Melissa is an architect, so she likes to design and, and do cool things with the house. So,

[00:09:31] Melissa: but it was right after COVID when the lumber was like three times more and things like that.

[00:09:36] Ramit: Alright, so you got into debt, you had the mortgage, what else?

[00:09:41] Melissa: The $80,000 sober budget.

[00:09:44] Ramit: 80. Okay.

[00:09:45] Tony: Not only that, we also had two new vehicles.

[00:09:49] Ramit: Why did you do that?

[00:09:50] Tony: Well, first we needed an SUV for a kid. Oh no. And then,

[00:09:53] Ramit: hold on, hold on, hold on. We have to do this. You had a little baby. How? How old was your kid when you bought the SUV?

[00:10:00] Tony: He was about to be born.

[00:10:01] Ramit: Okay. So we have a not yet born baby. And you said, say the magic words for me please. Winning an SUVA new SUV. Why? Finish the sentence please.

[00:10:15] Tony: So we could all fit

[00:10:16] Ramit: for the kids. This little baby. That is what, what do I even have in my room? That's the size of a baby. I have nothing.

[00:10:26] This little baby needs an SUV. Okay. What kind of SUV did you get?

[00:10:31] Tony: It was a three row Kia.

[00:10:33] Ramit: Oh no. Uh, I spoke to another couple that spent $62,000 on a Kia. SUV. How much was yours?

[00:10:38] Melissa: It was a lease.

[00:10:39] Ramit: How much per month?

[00:10:40] Tony: 500.

[00:10:41] Ramit: 500 a month. Okay. And then you had another car?

[00:10:43] Tony: Then we had a truck because since she works in construction, we needed a truck for the supplies and stuff.

[00:10:51] Ramit: Alright, you still have the truck?

[00:10:53] Tony: We sold both of it with the loss and we paid a car cash. So that's what we, we share the The car now. Just one. Just one car,

[00:11:02] Ramit: okay. I, I like that. I did not expect that. What kind of car did you get?

[00:11:07] Tony: We have a 2018 Expedition.

[00:11:09] Ramit: Ford Expedition?

[00:11:11] Tony: Yes.

[00:11:12] Ramit: Alright. I'm pleasantly surprised you took the loss and sold the car.

[00:11:15] Most people find that very difficult. Alright, so you had a bunch of debt. Let's go back to the debt. How much debt did you rack up in 2023?

[00:11:22] Tony: Like 140,000.

[00:11:24] Ramit: How about the mortgages, the loans, all that?

[00:11:27] Melissa: Oh, the mortgage was 540.

[00:11:30] Ramit: 540 plus one 40 Starting to add up here. What else?

[00:11:34] Melissa: I think that's, so

[00:11:36] Ramit: was there a point where you were like, this is too much, like something is wrong here.

[00:11:42] Melissa: Yes, because at that time I lost my job. So then we're like, wow, we are in a real mess. I had still like three more projects to finish through my company. So I finished those. Then I got some cash. We paid off half of the 80,000. So then we just did like a payment plan with Amex for the remaining 40.

[00:12:04] Ramit: Okay.

[00:12:04] Melissa: And then I found a job and then I saved like 50,000. And now we are like, should we sell that house? 'cause it's worth like a million. 1,000,100. Mm-hmm. And our mortgage is only five 40.

[00:12:19] Ramit: Okay. This can be the shortest call on the planet, but in debt we have a house that's worth a lot of money. Should we sell it?

[00:12:26] Melissa: Yeah, I guess. Yes.

[00:12:30] Ramit: I know I'm supposed to like understand more and I want to ask you a lot of questions, but like, did we just find the answer here? Like why would you not sell a house when you owe all this money in debt?

[00:12:41] Melissa: Our vision was to live, um, older with rentals and things like that. One cousin we have does that

[00:12:49] Ramit: one cousin.

[00:12:49] Okay. You have a cousin who bought a bunch of houses and rents them out?

[00:12:52] Melissa: Yeah.

[00:12:53] Ramit: Do you notice that they contradict each other and they contradict themselves? For example, Tony said they went over budget on building their dream home because of Melissa's architectural design. But then Melissa said, well, actually it's because lumber was more expensive.

[00:13:07] During COVID, Melissa says, maybe we should sell this house and in the next breath our vision is to retire with a bunch of rental properties. It's very confusing. It's very contradictory. Watch as I ask them about how they decided to purchase their last property, you're gonna see that they go back and forth.

[00:13:26] What do you notice in this exchange? Let's talk about the conversation regarding the latest property.

[00:13:33] Melissa: So, Tony didn't wanna buy another property, of course. 'cause he doesn't like real. Investments that much, stress him out. But I felt like if we were to sell that house, I didn't wanna be just like, without any property at all.

[00:13:49] And two kids. And the rents were very expensive here in Florida. So then, uh, I was like, Tony, we're gonna sell the house. I want another house. And he's like, no, we don't even know if it's gonna sell. He's a, an pessimist, like negative. So then I was like, no, let's buy this short sale, because it was like 60, $70,000 less than the actual value.

[00:14:19] Ramit: Mm-hmm.

[00:14:20] Melissa: And I was like, Tony's close to work. It's a smaller, it's a lot smaller. But I was like, we don't need more. And then, um, we bought it.

[00:14:29] Ramit: So you, you said, we have this one house. I wanna get another house. He said no. And then you said, no, we're gonna do it anyway. And then you bought the house.

[00:14:40] Melissa: Well, he's, he said it was a good idea and then the next week it's a bad idea.

[00:14:44] And then the following week was like, no, I think it's a good idea. So that's what I mean when it's like, are we doing it or not? I don't know.

[00:14:53] Ramit: I see. Tony. Is that true? You go back and forth with your opinion?

[00:14:57] Tony: At the beginning, I didn't want to do it, but then I guess she convinced me we should get this new house and just rent the other one out.

[00:15:04] And the original thing was that it was closer to, to our work.

[00:15:09] Ramit: What does that have to do with it,

[00:15:10] Tony: with drive like 40 minutes to get to work? So,

[00:15:13] Ramit: wait, how does that, I'm trying to understand. What kind of food do you guys hate?

[00:15:18] Tony: Well, I, I hate French. I don't like ch uh, cheese.

[00:15:21] Ramit: Oh, you hate all French food?

[00:15:24] Tony: Yeah,

[00:15:24] Ramit: my man Indians don't like French food either.

[00:15:27] It's too bland for us. Freaking rosemary. That's not the spice. Alright, so let, lemme put it this way. Hey, Tony. Let's go spend $65,000 on a French meal. You're like, no, that sounds horrible, but Tony, it's close to your work. Would you do it?

[00:15:48] Tony: No.

[00:15:49] Ramit: So how come you got this house just 'cause it's close to your work?

[00:15:51] Tony: Because I wanted to make her happy.

[00:15:55] Ramit: Oh, so did it work?

[00:15:57] Tony: She is pretty happy. Yeah. But now we're stressed because we don't, we have too much debt.

[00:16:02] Ramit: Okay. What's happening right now in this conversation? Does anyone feel like the energy's a little weird. Am I the only one?

[00:16:08] Melissa: I feel like I'm in the rollercoaster again, trying to see what he's going to say next.

[00:16:12] Ramit: Why do you feel that way?

[00:16:14] Melissa: Because we talked about this and now he's saying he never wanted to buy it. But I feel like sometimes he doesn't say or set up a plan so he doesn't get the blame. He's like, you decided that, so then he's like, not taking the responsibility of No, I said no, and then I said yes.

[00:16:34] And they are, we're in this mess together.

[00:16:36] Ramit: I see. Okay. That's, that's an interesting theory, Tony. You think that's true?

[00:16:41] Tony: I don't know if, if this, I can't really say if this was a good idea or not to buy this house because we haven't sold it and we haven't made any money on it.

[00:16:49] Ramit: How much debt are you guys in right now?

[00:16:50] Melissa: 105,000

[00:16:52] Tony: including?

[00:16:52] Melissa: Oh, no, I mean 924,000.

[00:16:57] Ramit: Wait,

[00:16:57] Melissa: including the mortgages.

[00:16:59] Ramit: Why? Why did you just gimme two different numbers that are almost a million dollars apart?

[00:17:02] Melissa: Because I don't, I mean, I don't count the mortgages

[00:17:06] Ramit: why a mortgage is debt. It's literally debt.

[00:17:09] Melissa: I know

[00:17:10] Ramit: what's happening right now. Why do you not count a mortgage as debt?

[00:17:13] Tony: Because in her mind we're gonna make profit.

[00:17:16] Ramit: Is that true?

[00:17:17] Melissa: Yeah. 'cause I wanted to sell the other house in next year.

[00:17:21] Ramit: I don't think you guys are on the same page with money. I can't even figure out what page anybody's on right now. Like, was it a good idea or not a good idea? It's very unclear. Do you have debt?

[00:17:31] Might might be 105 k, might be 820 4K. Don't know. Did one person agree? Not sure. It's all very confusing to me. Are do you feel the same way?

[00:17:41] Melissa: Yes. I think we contradict each other's.

[00:17:45] Ramit: Yes. And I think sometimes you both contradict yourselves as well.

[00:17:49] Melissa: Yeah.

[00:17:50] Ramit: Why do you think you do that?

[00:17:51] Melissa: Like we don't have a, like a real concept of what we're doing.

[00:17:55] Ramit: Yeah.

[00:17:56] Melissa: I, we wanna do a shift. That's why I think we're here. 'cause there's other types of investments. Yeah. And we wanna get out of real estate because it's not liquid at all. So it's just makes us go rounds of depth. So we wanna stop.

[00:18:12] Ramit: Is that true? You wanna stop being involved in real estate?

[00:18:16] Melissa: I want to, yeah.

[00:18:17] Ramit: Okay. And Tony?

[00:18:18] Tony: Yes.

[00:18:19] Ramit: Oh, why don't you say that at the beginning. Knock this out in 15 minutes. Is it true? You really, do you really wanna be outta real estate? Because you just told me five minutes ago, we don't want to be without a house. We need a house for the kids and, and on and on and on.

[00:18:32] Melissa: Well, I think at least we want to own a home.

[00:18:35] That's why we bought this small house.

[00:18:37] Ramit: Okay.

[00:18:37] Melissa: So, 'cause we don't, we don't wanna retire here in United States. Mm-hmm. But at least I think we need a physical address in case something happens. We all can always come back.

[00:18:48] Tony: Mm-hmm.

[00:18:48] Melissa: But like, we don't have to have like four properties or three properties.

[00:18:52] Tony: I would like to have, uh, one house and be paid off.

[00:18:56] Okay. That's my, that's my goal.

[00:18:58] Ramit: That sounds that similar. The two of you seem like that goal could work together, right? They say they want the same thing, one house, and to pay off debt, but agreeing on that outcome doesn't actually mean they're on the same page. I'm picking up on some big clues. Like, here's what I noticed earlier.

[00:19:16] Tony told me, he's quote always on top of the numbers. That sounds responsible, but in my opinion, all he's really doing is monitoring problems, not solving them. Just knowing your debt balance doesn't mean you're managing your money. That's like someone who knows that their body fat percentage is high.

[00:19:34] They've got their lab results, they track it every week, but they're still eating at Dairy Queen four times a week. Yeah, you might be aware, but that doesn't mean you are making changes. And then there's Melissa. She said their goal is to retire with rental income. When I asked her why, she said, my cousin does it.

[00:19:53] She's following someone else's playbook without really knowing the rules. And I see this constantly, especially in immigrant families. In fact, it happened in mine. My dad was set to study petroleum engineering. He got into a great school. Days before leaving, a random family friend stopped by for dinner and asked my dad, what does he plan to major in?

[00:20:14] My dad told him, and the guy goes, not a good field. There aren't that many jobs. You shouldn't do it. So my dad changed everything. He changed his major. He didn't even go to that school, and he became a mechanical engineer. Instead, he made a life-changing decision because of one offhand opinion from a guy at dinner.

[00:20:32] Even he admits, I don't know why I did that, but this is how so many major decisions get made. Real estate, careers, college, even marriage from random comments we hear from people that we trust often without interrogating if their opinion is right for us. I'm curious in the comments below, have you ever made a major life decision because of what somebody else said to you?

[00:20:58] Leave a comment below. I wanna read it. When we come back. I wanna dig into why Melissa and Tony are so emotionally attached to real estate. Let's take it back a little bit. Why did you initially decide to buy and sell houses?

[00:21:14] Melissa: Because we are in a growing area, so we bought a lot for 70,000.

[00:21:20] Ramit: Mm-hmm.

[00:21:21] Melissa: And I knew we could sell that, uh, and build a house and sell it for a million.

[00:21:25] So I was like, let's do it.

[00:21:27] Ramit: How did you know that?

[00:21:28] Melissa: Well, I'm, I'm a realtor and architect and a gc, so that's my work.

[00:21:33] Ramit: Okay. Oh, that's good. Alright, so you, you saw an opportunity and did you tell me the numbers correctly? You can buy it for 70 k and sell it for a million

[00:21:43] Melissa: with a house in the land.

[00:21:45] Ramit: Alright,

[00:21:46] Melissa: so the land was 70, the construction 540 plus the 80,000 over budget.

[00:21:54] It was

[00:21:55] Ramit: Okay. Let's just say 700 to round up.

[00:21:58] Melissa: Yeah. Yeah.

[00:21:59] Ramit: And you, and have you sold it yet?

[00:22:01] Melissa: No. 'cause we need to wait for 2026.

[00:22:04] Ramit: Ah, what's the market looking like over there?

[00:22:06] Melissa: It's going down, so that's why I think a million.

[00:22:10] Ramit: Okay. But you can't sell it until next year.

[00:22:12] Melissa: If we want the capital gain tax of the 500,000.

[00:22:16] Ramit: So that's why you originally got into buying and selling houses. 'cause you said, I see an opportunity. I'm a realtor, I'm a gc, I'm an architect. I can make this thing happen, bought the house, put money into it, several hundred thousand dollars. You're constrained right now 'cause you can't sell it. But hopefully you can sell it for about a million bucks next year.

[00:22:36] If you sell it for a million, what will your profit be?

[00:22:39] Melissa: Probably like 400,000. Three 50.

[00:22:42] Ramit: Three 50. Okay. When did you buy this? $70,000 lot.

[00:22:46] Melissa: Oh, in 2022.

[00:22:48] Ramit: So four years for maybe like 300. Three 50, $400,000 of profit?

[00:22:54] Tony: Yes.

[00:22:55] Ramit: Okay. Melissa, you mentioned earlier that you want Tony to take action around your debt. What do you mean by that?

[00:23:03] Melissa: I feel like he feels like I'm the one. Renovating and building. And so it's my responsibility to cover and set up a plan for it.

[00:23:17] Ramit: Mm-hmm.

[00:23:18] Melissa: But when the profits come, then it's our money.

[00:23:21] Ramit: Oh.

[00:23:21] Melissa: So I feel like, no, like it's our plan. Like that's why I feel like he doesn't say anything, so he doesn't get the blame.

[00:23:32] But if things go right, then he is like, oh great, you're so smart. But I'm like, you are also in this. But I think sometimes he's scared that if he does something wrong, I'll be just blaming him or something.

[00:23:46] Ramit: What do you think, Tony?

[00:23:47] Tony: I'm more of a, I've always lived like in fear of what's gonna happen. Like if, like I'm always more of a negative side, like for example, the house.

[00:23:57] I mean, what happens if it doesn't sell? What happen if we, you know, lose it all? And she's more of a risk taker,

[00:24:05] Ramit: so how do you fix it

[00:24:06] Tony: if, if we. Plan together and talk about it and just have a plan.

[00:24:11] Ramit: What's the plan?

[00:24:12] Tony: Not do any more risky investments. What do you say, Melissa?

[00:24:18] Melissa: Yes. I think that's why when I lost my job I was like, okay, I don't want anything of this a little.

[00:24:26] That's why we start selling the houses and the land and,

[00:24:30] Ramit: and did they sell?

[00:24:31] Melissa: Yeah. The first house sold in five days.

[00:24:34] Ramit: How much did you make on that?

[00:24:35] Melissa: $280,000.

[00:24:38] Ramit: Okay. That's good. What'd you do with the money?

[00:24:41] Melissa: Uh, I think we did some mistakes because we bought the land in Cabo.

[00:24:47] Ramit: She took all the money and put it into another piece of land

[00:24:50] Melissa: from the two eighty, a hundred twenty, went to the land.

[00:24:53] Ramit: What about the rest?

[00:24:54] Melissa: We owe Tony's mother 30,000 and then we invested. In Charles for the first time.

[00:25:02] Tony: Mm-hmm.

[00:25:03] Melissa: And then we, the nine months I didn't work then we just, just some of the money.

[00:25:08] Tony: And also when we returned the vehicles, we had to pay the negative equities and we bought the car cash.

[00:25:14] Ramit: Do you notice the cycle that you're in?

[00:25:16] Tony: Yes.

[00:25:16] Ramit: What is it?

[00:25:17] Tony: Make money, then pay off debt and then figure another way of how to make money.

[00:25:22] Ramit: What about you, Melissa? What do you notice about the cycle that you're in?

[00:25:25] Melissa: Yes, big purchases, big expenses,

[00:25:28] Ramit: and like $280,000. A lot of money to make, but where is it? But did it help you get ahead kind of a little, you have this land you, but like what do I get all this work all this time, all this risk you took?

[00:25:46] Like where is it?

[00:25:47] Melissa: Yeah, I think we jumped from one project to the other and then the other project and it is like. Too soon. We don't let even the money grow or,

[00:25:55] Ramit: yes. Why do you do that?

[00:25:57] Melissa: Because I feel I'm, we're running out of time.

[00:26:00] Ramit: That's a very common thing. Whenever people say that, they almost always make really bad decisions.

[00:26:05] They'll say either we're running out of time or I feel like we're behind. And then they immediately start making really, really ultra risky decisions. But when you ask them running outta time for what? What are you basing that on? They really have no idea. Do you enjoy this cycle that you're in?

[00:26:23] Melissa: No. That's why I wanna change

[00:26:25] Ramit: Tony.

[00:26:25] Tony: No, not at all. I mean, original plan was to retire by the age of 50.

[00:26:31] Ramit: Oh, you're running out of time for an arbitrary deadline that you set. That's like me saying, I'm running out of time to fly to space. And then you go, what wh when do you need to go to spa? I go 45 years old. But why 45? I don't know. Just 45.

[00:26:45] I'm running out of time. Arbitrary. Can we do a example conversation, like a role play between the two of you on what your last conversation about paying off your debt went like who was the one who started the conversation?

[00:27:01] Tony: I think it was me.

[00:27:02] Ramit: Okay. Go ahead. Like, just as if you're having the conversation, I'll just observe, have that conversation again so I can listen please.

[00:27:09] Tony: So Mel, I think that, um, when we are able to sell the house, that is worth a million dollars if, if it sells, I'm not sure if it's gonna sell for that much. We should take the profits and pay off our current home where we live and the rest just put into a retirement account, um, put it into our kids' 5 29 plans, which we haven't done yet, and just keep working and saving money and try to avoid any more debt.

[00:27:43] And also pay the credit cards.

[00:27:45] Melissa: Do you really think we should spend 280 paying off the house?

[00:27:49] Tony: Yeah, because we always gonna be in disciple, whether it is, you know, we're gonna have the smart idea of what to do with, with the money, and we're gonna end up with the not such a good investment. And either we lose it all or it's finally gonna be very bad for our family.

[00:28:07] I don't, I don't want to be worried about how we're gonna make what happens if I, if you lose your job, like what happened the first time and I'm the only one paying all the bills, you know, we can't afford the lifestyle that we live.

[00:28:21] Melissa: I think we should sit down and explore all our options.

[00:28:25] Ramit: Hold on. Is that how the conversation really goes?

[00:28:27] Melissa: Yeah. Uh, yes.

[00:28:29] Ramit: Really? And then what happens?

[00:28:31] Melissa: I mean, I think we'd never follow up and be like. What are all our options and what's best?

[00:28:37] Ramit: Why don't you follow up?

[00:28:38] Tony: She, she thinks it's just words and now we're not gonna, or at least I'm not gonna follow through. I don't know. Maybe she doesn't believe I can do it.

[00:28:49] Ramit: Do you, do you trust Melissa, that Tony will follow through?

[00:28:52] Melissa: Yes. I just feel like if we don't have savings either because we paid off a house, then I think we need to find something in the middle.

[00:29:03] Ramit: I don't believe you right now, you're telling me that you both have this very pleasant conversation and you agree, let's sit down and then you just don't sit down.

[00:29:13] Why?

[00:29:14] Melissa: I think that it's because then when I'm really like, okay, let's sit down, um, we just get distracted or

[00:29:22] Ramit: with what

[00:29:22] Melissa: the key

[00:29:24] Tony: maybe we just try to avoid the conversation and let's see what happens.

[00:29:28] Ramit: Isn't one of the things you told me both today, you said you wanna plan.

[00:29:32] Melissa: Yes.

[00:29:33] Ramit: Both of you said we want a plan that we can follow through.

[00:29:35] You've been married for seven years. You never made a plan about money, right?

[00:29:38] Tony: No.

[00:29:39] Ramit: So I don't think it's your kid that's distracting you. Y'all make a lot of money. You could hire a babysitter for an hour or two. There's a lot of ways to do it. I, I I'm finding it hard to believe that you haven't had time to sit down for a couple of hours and make a plan.

[00:29:53] What's really behind it?

[00:29:54] Melissa: When we sit down, I feel like we go in circles like again and again.

[00:29:59] Ramit: Yeah. I feel like that's happening right now. I wanna try to understand like how much debt, who wants the debt? Do you both wanna change or do one of you wanna keep it this way? And I'm still not sure what's going on here.

[00:30:12] Do you guys wanna get real with me?

[00:30:14] Melissa: Yes.

[00:30:15] Ramit: Who wants to lay out what's going on right now? Put it all out on the table for me.

[00:30:19] Tony: Our plan is to. Settle down, not make any risky investments, um, not have all the debt that we are accumulating and just focus on our kids and our retirement.

[00:30:36] Melissa: I want that too.

[00:30:37] Ramit: Okay.

[00:30:38] Where do you disagree so far? Sounds good. Sounds like you both agree.

[00:30:41] Tony: Well, we disagree because it's hard for us, for me to convince her that it's the best idea to sell the house, get the profits, and pay off our mortgage and just live in one house.

[00:30:53] Melissa: Okay. Can we build more of our savings too?

[00:30:59] Ramit: Yeah.

[00:30:59] Tony: With whatever's left, we can start with

[00:31:03] Ramit: playing of our home

[00:31:04] Melissa: and another car.

[00:31:05] Tony: I think we're okay with one car because our jobs are very close to each other and I don't see a way of us

[00:31:11] Ramit: getting ahead if we. Pay another vehicle.

[00:31:15] Melissa: I feel we need two vehicles.

[00:31:17] Tony: I mean, so far it's probably, probably one of the best decisions we, we have done is to not have any, any debt as far as the cars and just share a vehicle for the last six months.

[00:31:28] That's like the best thing we have done, but we can, we can discuss that when we have more, more money to talk about.

[00:31:35] Melissa: Yeah, I just feel like with an emergency of if one car breaks then we need it. It could be a cheap car.

[00:31:42] Tony: Okay. I can probably do that.

[00:31:44] Ramit: How did that conversation compare to the normal conversations you have about money?

[00:31:48] Tony: We ended up agreeing with the decision.

[00:31:52] Ramit: Most of your conversations, you don't make a decision by the end, do you? No.

[00:31:56] Tony: No.

[00:31:57] Ramit: So did you make a decision in that conversation you just had?

[00:32:01] Tony: Yes.

[00:32:01] Ramit: What was the conclusion?

[00:32:03] Melissa: Pay off the house and probably buy another car. A cheap car.

[00:32:07] Tony: A cheap car.

[00:32:08] Ramit: Okay. You both agree on that?

[00:32:10] Tony: Yes.

[00:32:11] Melissa: I hope yes. If he doesn't change his mind next week,

[00:32:14] Ramit: why would he change his mind next week?

[00:32:16] Melissa: Because sometimes he does, he then says like, actually, we are good with one car. Mm-hmm. Or things like that. And then I'm like, but we just decided that it was a good idea to have two cars. So that's what I mean with the rollercoaster.

[00:32:33] Ramit: That can't feel good. You know, you thought you agreed on something and then a week later your partner's changing his mind. Can I ask a question? This is a major decision with hundreds of thousands of dollars at stake. How did you just make that decision?

[00:32:48] Melissa: I think we try to run the numbers on our minds. If everything goes well,

[00:32:52] Ramit: come on.

[00:32:53] Nobody ran the numbers just now. Can anyone tell me one number you ran? No. There was not one number in that conversation. Did you notice? I think you both just decided randomly. I feel this. No, I feel that. Okay, fine. We'll sell the house and pay off this, but I want a car. Oh, I don't know about the car. Uh, no.

[00:33:15] I really want a car. Okay, fine. We'll get a car. Is that not how you pretty much made the decision just now?

[00:33:20] Tony: Yes.

[00:33:21] Ramit: Do you think maybe that's how you've made a lot of decisions in the past? We're gonna buy a house, we're gonna buy land, we're gonna sell a house. We're over budget. Like just, this is what I think, this is what I feel.

[00:33:30] And then try to convince my partner. What do you think? Does that sound familiar?

[00:33:34] Melissa: Yes. Yes.

[00:33:35] Ramit: How do you think other people make big decisions like this?

[00:33:38] Tony: I really don't. No.

[00:33:40] Ramit: Okay. Melissa?

[00:33:42] Melissa: Well, I think they, um, run the numbers and really analyze everything and, uh, all the different possibilities.

[00:33:51] Ramit: Mm-hmm. When was the last time the two of you did that?

[00:33:54] Tony: When we sat down to do the CSP.

[00:33:56] Ramit: Okay. What about before that?

[00:33:58] Melissa: Before that, we never really did it.

[00:34:01] Ramit: Thank you. Here we have a couple who owns multiple properties, is in hundreds of thousands of dollars of debt, has never run the numbers. Melissa, you've heard this podcast before, right?

[00:34:15] Melissa: Yes.

[00:34:15] Ramit: You heard me say run the numbers like a thousand times.

[00:34:18] Melissa: Yes.

[00:34:19] Ramit: What did you think when I was saying it?

[00:34:20] Melissa: To really sit down and understand where you are right now.

[00:34:24] Ramit: Okay, but you, you didn't do that. How come?

[00:34:27] Melissa: I think we really never sit down.

[00:34:29] Ramit: Guys, can I tell you something straight? You gotta stop saying this phrase. Sit down. We're sit. We're all literally sitting down right now.

[00:34:38] What does it mean we're not sitting down? Tell me what that means.

[00:34:41] Melissa: Um, both putting our a hundred percent attention into it.

[00:34:46] Ramit: I feel like that's not even happening right now. We're talking about what, $500,000 or something? Like a lot of money. This is a lot of money. You worked really hard for it and the way that you're talking about what to do with it is just like, oh, I think we should do that.

[00:34:59] No, I think we should do that. Alright, I'll do this. You do that? Okay, cool. There's not a single number being used. Do you see how that is probably what got you into this financial situation that you're in? The way that other couples would make this decision is they would know their numbers. They would have a CSP, they would know their interest rates.

[00:35:21] They would know what is our strategy, are we trying to build three houses? How much. Do we have for a budget? Why are we using real estate as an investment? And they would be very, very careful to know when we buy this house, this is how much we plan to sell it for. If we sell it for more, this is what we're gonna do with the money.

[00:35:40] If we sell it for less, we're gonna do this with the money. Right now the way you're talking about is just like, it's like a kid wanting to buy a toy. I want this toy. No, I want that toy. Okay. Like I'll get this toy. You get that toy, you're talking about a million plus dollars here. We need to be talking about it in a very different way.

[00:35:59] Most of the time, I don't care if someone makes a different financial decision than I would you wanna go buy a house instead of renting? Alright, as long as you ran the numbers. You wanna go to a French restaurant, spend $55 on P. All it has is on top of it is black pepper. Alright, fine. We're just not gonna eat together.

[00:36:13] What drives me crazy though is when people make decisions out of fear, like take the SUV example, people love to say, whoa, of course we need an SUV. We had kids, but is that really the reason? Deep down, are they thinking, well, I've carefully maximized safety of the family as well as convenience. I ran several split analyses.

[00:36:34] No. A lot of times we are thinking that's what other people do and what will people think of us if we don't have the biggest, safest car as well. When you make decisions based on only what other people are doing, when you are constantly reacting instead of being proactive, it's really hard to learn how to make good decisions for you.

[00:36:56] And that's a problem because money is a long game. If you don't learn how to make the right decisions for your vision, for your relationship now, then what happens when there's real money on the line? This is why I tell people to start investing early, even if you've only got 20 or 50 bucks a month. The amounts don't matter.

[00:37:14] It's about getting that process right. It's about building those habits and becoming strong enough to deal with the market going up and down. Because when you do have 2000 or 3000 or $4,000 a month to invest, you're gonna know exactly what to do. Now we are gonna take a look at the numbers right after this.

[00:37:35] What was it like to go through the CSP?

[00:37:38] Tony: Well, I think it was, um, very surprising that we make good money, but I frankly never, I, I don't feel like I'm making anything at all.

[00:37:48] Ramit: And Melissa,

[00:37:49] Melissa: we realize we had, um, more investments that we thought, uh, we also had multiple bank accounts, so then we consolidate that into one bank.

[00:38:03] Okay. So that was good. Mm-hmm. Because then we could see how much more savings. We have and how much debt to, so it helped us because at least we paid off $28,000 in the last couple of weeks.

[00:38:21] Ramit: That's great.

[00:38:23] Melissa: So it was like a good starting point.

[00:38:25] Ramit: Yeah. That's great. Did you both do the CSP together?

[00:38:30] Melissa: Yes.

[00:38:30] Ramit: Okay.

[00:38:32] All right. Let's take a look on screen here.

[00:38:34] Melissa: Probably it's a little messy 'cause

[00:38:35] Ramit: Okay. Whoa. What, so I'm gonna describe what I see on screen. I see a lot of numbers. So there's a massive breakdown next to the net worth section. What are all these numbers?

[00:38:48] Melissa: That was like when we were going through each account,

[00:38:51] Ramit: just so everybody knows the file name on this is called IWT, conscious Spending Plan Revision oh three.

[00:38:58] First of all, I don't mind multiple revisions. That's totally fine. Usually the first time people do A CSP, it's all wrong anyway, but at least it's a good start. It's just like drawing it in pencil and then they go back and they. Like fill in the colors and the lines. It's no problem. But now that we have this CSP with a lot of numbers, what are all these numbers?

[00:39:15] I'm looking at

[00:39:16] Melissa: just the different accounts or properties.

[00:39:19] Ramit: So your assets, you broke 'em down by car,

[00:39:22] Melissa: rental house, primary house, and the land.

[00:39:25] Ramit: All right, let, let's go through it line by line. So Melissa, can you read the word in bold and then the number in full next to each item, all the way down for this box.

[00:39:38] Please go ahead.

[00:39:39] Melissa: Assets 1,585,000 investment 190,244. Savings 30,485 theft 899,776.

[00:39:55] Ramit: Total net worth

[00:39:56] Melissa: 906,053.

[00:40:00] Ramit: 900, $6,000 in total net worth. Alright. What do you think about that number?

[00:40:03] Melissa: It looks good on paper.

[00:40:04] Ramit: Is there something else?

[00:40:06] Melissa: Sometimes we hear the term of like house poor.

[00:40:10] Ramit: Are you house poor?

[00:40:11] Melissa: Uh, I think after we sell one property we will be better.

[00:40:15] Ramit: Can I ask you to gimme a direct answer? I noticed that this is a tendency you have. I ask you a question and then you tell me why it's going to be better later. How was it doing a CSP? Well, we paid off $28,000 of debt, so it was good. Are you house poor? Well, we need to pay off a house and then we'll be positive.

[00:40:32] I'm just asking you to answer the question directly. Are you house poor?

[00:40:37] Melissa: I think we are right now, yes.

[00:40:39] Ramit: Okay. Do you find that sometimes you are always trying to look for the positive spin on something?

[00:40:47] Melissa: Yes.

[00:40:48] Ramit: How do you think that that affects your money?

[00:40:50] Melissa: Um,

[00:40:51] Ramit: hold on. I, I could tell this is hard to think about.

[00:40:54] Right? Okay. Take a second. We're in no rush. This is a tough question. Take all the time you need. The question was, do you often find yourself trying to put a positive spin on things? And the second I asked that, I could see he started to cry. Why do you think that That was such a difficult question to hear?

[00:41:17] Melissa: When we were taking care of my siblings, I couldn't go back to like my parents to for help. So I felt like we have to be strong. And I just realized, I always try to tell my story like a positive way.

[00:41:33] Ramit: I can understand why you do it. The idea that we can't even think about something negative, there's too much going on.

[00:41:42] We just have to focus on the positive. But I also noticed that in order to be able to fix our money problems, we actually have to be honest, like are we in a bad situation because we have. $899,000 of debt. We need to be honest about that. Are we house poor? We need to be honest about that. It, it doesn't mean you're a bad person if you're honest about the situation that you are in, but I can tell you it's very difficult to move ahead if you are always spinning something to be positive.

[00:42:22] What do you think?

[00:42:23] Melissa: Yes, I think this is helping me trying to be more realistic.

[00:42:26] Ramit: Great. That's a good word. Realistic. Realistic doesn't mean good or bad. Realistic just means we accept reality and then we can decide if we wanna keep it or change it. I like that word. Okay, so are you house poor?

[00:42:43] Melissa: Yes.

[00:42:43] Ramit: Alright.

[00:42:44] So you have $906,000 of net worth in your thirties, but you are house poor. Tony, what do you think about these numbers? The net worth number

[00:42:54] Tony: I think it is. Uh. It's a good, good number.

[00:42:58] Ramit: I

[00:42:58] Tony: think if, if we focus on our plan, that could take us a long way. I feel like the years that we have worked so hard, it's, it's paid off.

[00:43:09] Ramit: Alright. Is it good or bad? 900, $6,000 net worth.

[00:43:16] Melissa: Good.

[00:43:17] Ramit: Okay. What do you say, Tony?

[00:43:19] Tony: For me, it is amazing.

[00:43:21] Ramit: Oh, alright. That's good. Let's keep going to the income this time. Tony, I'm gonna ask you if you can read off your combined gross monthly income. What is that number?

[00:43:32] Tony: $15,830.

[00:43:35] Ramit: $15,830. Which means combine?

[00:43:38] The two of you make $189,000 a year. Did you know that?

[00:43:43] Melissa: I knew my part. I think Tony's part is still wrong.

[00:43:48] Ramit: Should we figure it out? Alright, who makes $9,630 a month?

[00:43:52] Melissa: Me.

[00:43:53] Ramit: That's you. Okay. And who makes 6,200 a month? That's Tony, right?

[00:43:58] Tony: Yes.

[00:43:58] Ramit: Alright. Tony, is that number right or wrong?

[00:44:00] Tony: It's correct.

[00:44:02] Ramit: What do you do for a living, Tony?

[00:44:04] Tony: I manage a dental office.

[00:44:06] Ramit: Okay. Alright. Melissa, why do you think that number is wrong?

[00:44:09] Melissa: Because he just showed me his pissed up today and it was smart.

[00:44:13] Ramit: Great. Get the pay stub. Tony, I love to roll on this.

[00:44:18] Tony: Okay, so gross pay for the last couple weeks was $3,408 net pay 2,895.

[00:44:28] Ramit: I'm sorry to say Melissa wins this one.

[00:44:32] Tony, your numbers are wrong.

[00:44:34] Tony: I don't know if if you average it out it's probably a little less. This was a good, good paycheck.

[00:44:40] Ramit: Oh, it's, you get extra sometimes.

[00:44:42] Tony: Yeah, if, if I work more hours,

[00:44:45] Ramit: it's not that far off. We're like. 600 bucks off gross. So you probably worked some extra hours, alright. Yes. And normally you'd get a little bit less fine.

[00:44:59] Melissa, are you okay with that? Putting 6,200?

[00:45:01] Melissa: Yeah.

[00:45:02] Ramit: Alright. I think the number is probably correct. I stand corrected. Tony, you're right, you might have made a little bit of extra money, but in general for just pure what we're gonna assume, 6,200 a month gross. Fine. Do you combine your money or no?

[00:45:20] Tony: No, we haven't.

[00:45:21] Not currently, no.

[00:45:23] Ramit: Let me guess, you haven't sat down to do it together?

[00:45:28] Tony: Never.

[00:45:29] Ramit: Never. Why not? Out of curiosity,

[00:45:32] Tony: I guess we just got used to the idea of, you know, you take some part of the bills and you pay the other half and then whatever.

[00:45:41] Ramit: Let me guess, without even looking. Let me just guess. Tony pays the.

[00:45:47] Um, rent or the mortgage. Um, Tony pays car. Melissa pays everything for the kids groceries. Amazon. How am I doing so far?

[00:46:01] Tony: Pretty art Crit.

[00:46:02] Ramit: Why is it that every man and woman breaks down their expenses the same way? Why? And all of you are wrong. Like, watch this. You're about to have a second kid, right?

[00:46:12] Tony: Yeah.

[00:46:12] Ramit: It's happening like in a matter of weeks. Who's gonna pay for all the kids stuff now? Still mom. Mom's expenses are gonna go way up. Formula or food? All kinds of clothes, all gadgets, everything. Childcare. But you're not gonna adjust for it 'cause you don't sit down and talk about your expenses. Is that fair?

[00:46:37] It's obviously not fair. No. Do you Venmo money back and forth to each other? It

[00:46:42] Tony: is a, it is a sale payment. So we just really, if, if I'm running outta money, I just tell her, oh, I need a thousand dollars.

[00:46:48] Ramit: You literally Zelle request her a thousand dollars. And then what do you do, Melissa?

[00:46:53] Melissa: Uh, transfer a thousand bucks.

[00:46:54] Ramit: Alright. How, how often do you do this On a given week?

[00:46:58] Melissa: Every first of the month, all the bills arrive at the same time.

[00:47:04] Ramit: Wait a minute, hold on. Maybe this is just my automation brain thinking. 'cause like, I don't like doing work and I definitely hate logging into my bank. If it's always a thousand dollars on the first of the month, why not just set that up to do it automatically

[00:47:19] Tony: because, uh, some months I, I could pay it and, and if I don't need to ask for money, I don't do it because I'd rather not.

[00:47:27] Ramit: You guys like this, the asking for money transferred back and forth?

[00:47:31] Melissa: No, because like the renters give me the money and I've been telling Tony, if you ask them to give you the money, then. You have the rent, but I mean, we're trying to merge.

[00:47:46] Ramit: Why? Why are you trying to merge now?

[00:47:48] Melissa: Because it has been very unorganized.

[00:47:51] Ramit: Yeah.

[00:47:53] Melissa: And then when we realized we had even more investments that we thought, and then when we realized we had $4,000 that we didn't even knew we had, then it's like we need to put everything into one basket.

[00:48:07] Ramit: Okay. It's kind of funny to me that couples will have a baby together, but they won't combine their money.

[00:48:13] Combining money into a checking account. Oh, no, no. That's too intimate. I go, huh, let's just put this together. We live together. We got a baby together. We got 20 houses together, but not combining income. My goal by the end of our call today is to convince you both to show you a reason why it makes so much more sense to put your money together.

[00:48:38] Would you be open to that?

[00:48:39] Melissa: Yes.

[00:48:40] Tony: Yes.

[00:48:40] Ramit: Okay, great. Let's continue down the list here, by the way, $189,000 of household income. What do you think about that income? Is that good, bad? What?

[00:48:49] Melissa: Very good.

[00:48:50] Ramit: Yeah, Tony.

[00:48:52] Tony: Great. Yeah, it's, it's, it's, it's pretty high.

[00:48:56] Ramit: It's a lot of money. $189,000 and you're in your early thirties?

[00:49:03] Melissa: Yeah. I mean, we started working eight years ago,

[00:49:07] Ramit: really

[00:49:07] Melissa: working three week, three jobs a day. Yeah.

[00:49:10] Ramit: What the, how did you do it? How did you make $189,000? And I have these Twitter commenters leaving me these rabid comments, and then they're telling me all these reasons they can't succeed in life and blah, blah, blah.

[00:49:23] Meanwhile, the two of you making almost $200,000 in eight years, how did you do it?

[00:49:29] Melissa: Uh, we are very disciplined.

[00:49:31] Tony: Yes. I woodwork in the morning and then at night.

[00:49:36] Ramit: I love it. I wish every person watching this and listening to this understands what it's like to really work hard. I really wish, you know, I, I, no, I don't actually think everyone should have to work seven days a week.

[00:49:51] I don't want that kind of life for everybody, but I think there's a time and a place where you just say, damn, we gotta work. Oh, it's Saturday and we're going to work. Oh, it's Sunday. Okay. Maybe we'll go an hour later, but we're going to work. I wish everybody could see what it takes to work really hard, and I, I honestly, it's quite inspirational to see eight years and you're making $189,000 a year.

[00:50:19] It's really impressive.

[00:50:20] Tony: Thank you.

[00:50:22] Ramit: Can we just acknowledge the dangerous narrative in America right now around immigrants? The idea that they're committing tons of crimes and they're taking our jobs and draining our resources. Not only is it wrong, it's just stupid. The truth is immigrants are the reason that this country continues to grow.

[00:50:38] Over the past decade, nearly all job growth in the United States has come from immigrants, and right now we are the only developed country that has managed to keep growing. Not because we're special, but because we are a country where immigrants are woven into our country's very origin. Until this administration, American's views of immigrants, were the highest on record and we actually have an amazing infrastructure to welcome immigrants from around the world.

[00:51:04] Do you know that other countries are not so lucky? Japan, Korea, China, they are facing serious demographic collapse. Their birth rates are falling, their populations are aging fast and without young workers to support them, their economies are in serious trouble. They're actually no easy solutions for those countries.

[00:51:24] But America has been able to avoid that and thrive because of immigration. So when someone complains about immigrants, they either don't know the facts. For example, they don't know that immigrants commit less crime than native born Americans. Or maybe just maybe they're deeply uncomfortable with people who don't look like them.

[00:51:43] I am unapologetically pro-immigration. We need far more immigration because immigrants are one of the main drivers that make America a thriving country. I wanna share that with you because this is not a show merely about someone's freaking conscious spending plan. This is a show about living a rich life, and you cannot ignore the context of how we talk about money and immigration and politics in this country.

[00:52:10] Melissa: After this, we'll get back to the numbers.

[00:52:15] Ramit: Can we continue on with the rest of the numbers here? I'm very curious to look at them. A couple, making 189 K. What does the rest of their CSP look like? We're about to find out. Your fixed costs are 68%. That's kind of high. It's not the worst, but I'd like to see that number below 60%.

[00:52:35] And I'm a bit alarmed because with such a high income, your fixed cost should not probably be 68%. So we'll dive into that. Your investments are zero. Oh God. That's not good. Savings are 23%. It says that you are saving $3,000 a month for vacations, but then next to it it says not saving using credit cards.

[00:52:57] What does that mean? Why do you both smiling like that?

[00:53:01] Melissa: I think we were trying to say we spend that

[00:53:03] Ramit: you spend $3,000 a month on vacations A year. A year. Oh, and then you put it in savings. Why did you do that?

[00:53:12] Melissa: Yes. I think we were just very confused.

[00:53:16] Ramit: Alright, let's fix it. It's okay. Like I said, nobody gets it right the first time.

[00:53:19] It's no problem. So you're not spending $3,000 a month on vacations, you're spending 300 a month on vacations. Is that right?

[00:53:27] Tony: Yeah. If you're divided, yeah.

[00:53:29] Ramit: Yeah. Alright, that's good. That actually changes things a lot. So then that means you got zero going to savings and 32% going to guilt-free spending, or $4,100 a month.

[00:53:45] I don't believe that number either.

[00:53:47] Tony: No.

[00:53:47] Ramit: Where's the money?

[00:53:48] Tony: Well, I pay my credit card every month.

[00:53:51] Ramit: How much?

[00:53:52] Tony: Pretty much my whole paycheck, so 4,000.

[00:53:58] Ramit: Oh, so you basically take all the extra money and put it towards the credit card?

[00:54:02] Tony: Yes.

[00:54:03] Ramit: Alright. What about you, Melissa? What do you do with your extra money?

[00:54:07] Melissa: Well, we've been trying to, paying off the credit cards.

[00:54:10] Ramit: If we look at your CSP, it says to me, under debt payments, it says that Melissa is paying $1,405 per month towards credit cards. Is that right or wrong?

[00:54:24] Melissa: That's one of them. And it's the, the one from the new construction, the remaining $40,000 from 2023.

[00:54:33] Ramit: Okay, so the $4,100 a month roughly, you're putting it all towards credit card debt?

[00:54:39] Melissa: Yes.

[00:54:39] Ramit: Alright. Let's take a look at the debt just so I understand it. So your debt of $899,000, I'm gonna read off what it's broken down into. So you have lows at $5,827, you have a mortgage at 520,000. Primary house at 278,000, Amex at 38,000. Bank of America at 45,000. And then it just says Tony at 12,000.

[00:55:07] What is that? A personal loan

[00:55:08] Tony: Chase's credit card.

[00:55:09] Ramit: Okay. Credit cards. In red it says 101,776. You have $101,000 in credit card debt.

[00:55:19] Tony: Yes.

[00:55:20] Ramit: What do you think about that number?

[00:55:21] Tony: It's really high.

[00:55:22] Ramit: Melissa?

[00:55:23] Melissa: Yes.

[00:55:24] Ramit: What? What do you think?

[00:55:25] Melissa: Extremely high, not necessary.

[00:55:29] Ramit: How'd you get the debt so high on your credit cards?

[00:55:31] Melissa: Everything is construction.

[00:55:33] Ramit: So are these good investments?

[00:55:35] Tony: Well, if you look at it from having to pay credit card debt and interest, no. What

[00:55:43] Ramit: do you say, Melissa?

[00:55:44] Melissa: That's why we wanna just get rid of real estate properties.

[00:55:48] Ramit: Well, you have a lot in Cabo. You have a primary house and a rental house. The total of those is about $1.5 million.

[00:56:01] And if you have $899,000 of debt, could you not just technically just sell one or two or three things you own and then just pay off the debt and be debt free? That's what I want. Yes. That's what Tony wants. Melissa, what do you say?

[00:56:17] Melissa: I mean, I think it's a good start to. To make that shift and don't plan anymore projects.

[00:56:25] Ramit: Alright, this all seems a little too easy, doesn't it? Oh no. We have all this debt. Hey, let's reach into our back pocket and pull out one of our multiple properties and just sell it. Abracadabra. Problem solved. Alright, that was a little convenient, but let's consider how they got here and what that means for you.

[00:56:41] Melissa and Tony haven't ever agreed on what the next logical financial step is. In fact, Melissa will say that they've made a decision and then that next week Tony will backtrack and change his mind. If I ended this call right now, I can guarantee. Nothing would change. That's because the debt is not actually their problem.

[00:57:01] Their individual relationships with money are. If you keep finding yourself in a similar pattern with your partner, you're constantly spinning in circles, you're making decisions only to have nothing change, then I want you to check out my money coaching program. It is frustrating to be stuck with money, but you can get unstuck in money coaching.

[00:57:22] I'll help you learn the skills to figure out how to make a plan, how to talk about money, how to build a system that makes you move forward. Go to iwt.com/money coaching to join. Now, back to Melissa and Tony. Remember, they haven't even combined their money yet. Listen to how disproportionate their fixed costs are.

[00:57:44] A couple of things I wanna note on your CSP, uh, Tony, your fixed costs are at 97%. So what that means is, Tony, you're paying. 97% of your take home pay is going towards fixed costs. You take home 5,800, you're paying all the mortgage, 2,600, you're paying utilities, seven 30, you're paying all this stuff. So you have basically no money left over at all.

[00:58:10] Tony: Right? Basically, I just keep a couple hundred dollars in my checking in account.

[00:58:16] Ramit: What does that feel like?

[00:58:17] Tony: It feels like I'm live paycheck. A paycheck if I don't feel like I'm making any money.

[00:58:22] Ramit: Okay. Melissa, what do you think about that?

[00:58:24] Melissa: I think that's why we should have merged our finances. Mm-hmm.

[00:58:28] Ramit: I agree.

[00:58:29] Daycare is $960 a month. Is that gonna go up with the new baby?

[00:58:33] Tony: Yes. Double. It'll double.

[00:58:38] Ramit: How are you gonna pay for that?

[00:58:39] Tony: We haven't thought about that yet.

[00:58:40] Ramit: Wait, when are you gonna think about the baby's coming? Sometimes I talk to parents and they're like, yeah, we're gonna have a baby in like five years.

[00:58:47] Sometimes I talk to them, they're like, oh, we just found out we're pregnant. Oh, congratulations. This baby's coming. This baby's knocking on the door. Hello world. Where's my daycare

[00:58:57] Melissa: right now? We don't have to worry about that until like January.

[00:59:01] Ramit: Alright. How often do you think far ahead with your money?

[00:59:07] Like over one year?

[00:59:09] Tony: I never think about a year in advance. I always, you know, as soon as the money comes in, I just worry about paying the bills and I don't even have time to, to make a, a plan or a strategy. Okay.

[00:59:22] Melissa: Melissa? I think it is just when we had like life changing events or

[00:59:28] Ramit: having a baby, uh, siblings move out, that kind of thing.

[00:59:32] The reason I ask is that like, if you are not planning for what to do about childcare and the baby's really coming soon, that to me is a big clue that you probably don't think about money down the road. If you're not even thinking about childcare for a baby, which is definitely gonna affect your finances in a big way, then it's probably unlikely that you're thinking about things like retirement or putting money aside for an emergency fund or a vacation, things like that.

[01:00:02] And from what I'm hearing from you, that's probably true. Okay. So we probably need to change that because if we end this call right now, I suspect you will go the rest of your life just getting into debt, making a little bit of money over here, paying it off, going into debt, and doing it over and over until one day.

[01:00:22] It's like you're in the ocean and it just engulfs you. That's it. Do you know anybody who's done that? They just go their whole life just trying to pay off one thing and fix another and make some money and then keep doing it forever.

[01:00:34] Tony: My mother,

[01:00:35] Melissa: her parents, until they lost their houses at 50,

[01:00:39] Ramit: and now you're both repeating the same pattern

[01:00:42] Melissa: we wanna change.

[01:00:43] Ramit: Okay. Tony, what do you remember about. Growing up with money, what did your family say about money when you were young?

[01:00:52] Tony: My dad was never around, so my mother took care of me and she always, you know, tried to her best to provide for me, pay for my education, spoil me when, whenever she could, you know, buy me gifts.

[01:01:08] There was no really knowledge of this is the money you can use to save. There was always like, almost leaving paycheck, a paycheck, um, running outta money and then just working again to, to, to make more.

[01:01:23] Ramit: What did she say about money? What phrases did she use?

[01:01:27] Tony: I've never really talked about money with her.

[01:01:30] Ramit: She's still alive.

[01:01:31] Tony: Yes.

[01:01:32] Ramit: How's she doing with money now?

[01:01:34] Tony: Struggling? She lives with, um, one of her friends, they share a, a house, so they just. Split the rent.

[01:01:43] Ramit: You ever talk to her about money now?

[01:01:45] Tony: No, because I know there's, I mean, if, if she lived her whole life like this, why would she gimme advice now?

[01:01:53] Ramit: Right.

[01:01:53] What message do you think you learned from your mom about money?

[01:01:57] Tony: I think I just learned, you know, you gotta work and figure out a way of, of, you know, surviving.

[01:02:08] Ramit: Melissa, what do you remember about your family saying about money when you were young?

[01:02:14] Melissa: We didn't talk about money, but when we start like 11 years old, every time my dad will sit us down and make this lease, why we don't have money and why we couldn't afford these things.

[01:02:25] It was weird because like we never had any extra money, but we went to good schools with scholarships. But even if I asked for shoes, it was like a big explanation or analysis of we're gonna get them next month because these are my expenses this month and kind of thing.

[01:02:47] Ramit: Ah, so he would tell you all the things that he had to spend money on for the family, and that's why you can't get your shoes right now.

[01:02:55] So was he using his explanations to teach you about money or was it a way to, to not spend money that he didn't have? What was it?

[01:03:07] Melissa: I mean, at that time I was young, like 11, 12. Mm-hmm. So I felt like it was just, the bottom line was you're not get, not get the tennis until next month, or we cannot afford that, or it's your sister's turn or

[01:03:22] Ramit: is that a good lesson or a bad lesson?

[01:03:24] What do you think

[01:03:25] Melissa: he could have? Teach me different things.

[01:03:27] Ramit: Uhhuh.

[01:03:28] Melissa: Maybe that's why sometimes I didn't even ask him. I start selling things like I would sell in high school accessories for the hair.

[01:03:39] Ramit: Mm-hmm.

[01:03:40] Melissa: And then every day I run out of them. So then I bought more and then sell them and then I could not ask for money.

[01:03:46] Ramit: That's pretty resourceful.

[01:03:48] Melissa: And then like the university, it was like he didn't wanna pay for it, but then I got a swimming scholarship, like 80%. Mm-hmm. So then I was like, okay, 80% like, can I go? I end up going and graduating.

[01:04:06] Ramit: Did he pay the 20%?

[01:04:09] Melissa: Yes.

[01:04:09] Ramit: Okay. That's interesting. What happened then?

[01:04:13] Melissa: So then, uh, in Mexico, the pay was very low.

[01:04:17] Ramit: Mm-hmm.

[01:04:18] Melissa: And that's when I met Tony and he was moving to the United States and then. I was like, well, I have a green card. I can work there too. And then we moved together. When we move here, it's just seems so easy to make money.

[01:04:32] Ramit: Uhhuh,

[01:04:33] Melissa: like in our countries, you make $500 a month. Mm-hmm. And then here is like, we could be waitress and make that in three days.

[01:04:45] Ramit: Yeah. Hold on. Here in this country you're making $9,630 in a month. That's a great lesson. What else did you learn?

[01:04:53] Melissa: Well, I felt like maybe this is wrong, but sitting down and running numbers with my dad was sometimes on my perspective pointless. Because it was more like, so this is why we cannot do that.

[01:05:08] Ramit: Right. Yes. That's a very good insight. So your dad was basically Mr. No, he's saying no all the time. When you ask him for something, you start to be like, ah, God, he's gonna get put me through this rigamarole of listening to all these numbers. So I don't wanna run the numbers. And who is Mr. No in this relationship?

[01:05:27] Melissa: Don you.

[01:05:28] Ramit: Yeah. And so neither of you wants to run the numbers, Tony. You're not actually talking about the numbers, Melissa. You're like, ah, I want this. It's gonna be good. Tony's like, no, that feels bad. And that's the extent of that conversation. Do you notice the thing that happened with your dad around college?

[01:05:49] You asked him to pay for college. He said no. Then you got a scholarship and you tried to persuade him to pay that last 20%. I think you do the same thing with Tony. Hey, here's this project. I think we should do it. It's gonna be great. We're gonna make a lot of money. Tony's like, no. You're like, ah, Mr. No, I don't care what he says.

[01:06:09] Let me just convince him. Finally. He goes, alright. Like I don't make as much money as you, so fine. And then the two of you are not actually connected with money. Is that accurate or not?

[01:06:21] Melissa: Yes.

[01:06:22] Ramit: Yes.

[01:06:23] Melissa: It also get me into this situation where I need to stop making all these projects because the way I show him is like, I can work more too.

[01:06:37] Ramit: Keep going. You're onto something.

[01:06:40] Melissa: Um, but now we to keep, I don't wanna keep working. Mm-hmm.

[01:06:46] Ramit: That hard. Mm-hmm. Both of you are used to working a lot of hours. Oh, we're short on money. We're gonna go work. That's what you do five days a week, seven days a week. That's what you do. Who cares if it destroys your body?

[01:06:56] That's what you do. You now have a second child coming and you're doing all these projects and it's actually unclear if these projects are making money or not. When you factor in the credit card debt and the all this other stuff, some might make money, some might not, but it's all locked up. But this idea of just let's just grind and let's just hustle more, it works until it doesn't work.

[01:07:21] Melissa: Yes.

[01:07:21] Ramit: Kind of interesting. What do you both notice about your stories about childhood versus how you treat money today?

[01:07:29] Tony: Well, I feel like she picked up this role of kind of being my parent.

[01:07:35] Ramit: Yeah. How would you describe, like what's an example where she feels like the parent when it comes to the finances?

[01:07:41] Tony: Since she makes more money than me, she kind of has the right to make the big decisions.

[01:07:48] Ramit: Yeah. I think that's one way. And even transferring you money every month you have to ask her, please, can I have some extra money please. And then she always does it. So it's not that that's not the issue, but just having to ask as an adult when both of you are making money.

[01:08:06] It doesn't feel good. Melissa, do you agree there's a parent child dynamic here?

[01:08:12] Melissa: Yes, probably. But I feel like I wanted to merge our finances a long time ago, but then he doesn't do it

[01:08:22] Ramit: really now. I like it. This is dramatic. I didn't expect that. What happened?

[01:08:27] Melissa: I think he procrastinates a lot.

[01:08:30] Ramit: Okay.

[01:08:31] Melissa: Like he could be, yeah, let's do it.

[01:08:33] But then it's like a week half passed by. Uh, then we just never end up doing it.

[01:08:43] Tony: Why is that, Tony? I'm just comfortable. I don't like changes. Like if I have one bank account, that's where the money's coming out from and I don't want to go through all the process, I guess just Right. Just. Procrastination.

[01:08:58] Ramit: I mean, if you don't wanna change, then I can't help you do it.

[01:09:01] There's no magic abracadabra thing I can say that's gonna make either of you wanna change, doesn't exist. If you are comfortable and you like it, what am I gonna do? If you wanna change, I can help. If you're unsatisfied with the way money is working in your household, I can help. But if you can't open up an account that you yourself agreed to do, there's nothing I can do about it.

[01:09:28] Tony: Yeah. That's why I want to, to make this change and, and follow through and, and just make it happen.

[01:09:36] Ramit: What's an example of a recent money change that you have made and followed through with?

[01:09:44] Tony: On my end, I haven't done anything.

[01:09:47] Ramit: So what, why would we expect that you're going to do anything and follow through?

[01:09:52] Tony: Because I want to do what's right for our marriage and. And our life together.

[01:09:59] Ramit: What do you think, Melissa?

[01:10:01] Melissa: I feel like sometimes it's easy things that he just make it sound so difficult to change the auto payments or the bills and like, I think that it's just easier than what he thinks in his mind is so difficult to change.

[01:10:15] Ramit: Yeah. Makes a lot of sense. So how do we get through this? Because truthfully, I don't love lecturing people. What do you think is really going on here? If the two of you zoomed up and you looked at the two of you right there down there, you're floating above yourselves and you looked at the two of you talking to each other and this conversation, what would you notice about this conversation?

[01:10:37] Tony: That we can come up with, with an agreement?

[01:10:42] Melissa: Mm-hmm.

[01:10:43] Tony: And that I always think of ways to try to get out of it.

[01:10:46] Ramit: Yep.

[01:10:47] Tony: Just to avoid the conversation and, and just don't do it.

[01:10:51] Ramit: What about you Melissa? What do you notice?

[01:10:52] Melissa: Things that could be fixed. If we can just like really do it or follow the plan, like even the bank accounts, like I close all my bank accounts and just leave the one we're gonna merge.

[01:11:08] So I feel like I do my part. Then I just need him to do his part to like merge that. Change your direct deposit. I already did mine. I already transfer everything to savings. So then you do that setup too.

[01:11:24] Ramit: What if he doesn't do his part?

[01:11:25] Melissa: Well then I'm alone with one checking

[01:11:28] Ramit: what's gonna happen to him if he doesn't do his part.

[01:11:30] Why would he change?

[01:11:31] Melissa: I mean, it is gonna avoid him asking. Every month

[01:11:35] Tony: he comes. Every month he goes, Hey, can you transfer me a thousand dollars? And then what do you do?

[01:11:38] Melissa: I transfer him.

[01:11:39] Tony: Yeah. What's the problem?

[01:11:41] Melissa: Yeah, I don't know what else I could do.

[01:11:42] Ramit: Ask him.

[01:11:43] Melissa: Tony, can you finish to set up a merch accounts and change your direct deposit?

[01:11:51] Tony: Yeah. I actually want to. To commit to doing what's right and and making the change and not thinking twice about things.

[01:12:06] Ramit: I don't find it very convincing, you know, why you've been married seven years, you haven't even gotten around to combining your income. Come on. This idea of like, we need to sit down and commit.

[01:12:15] It's just words and that's actually not really the problem. There are people who are like, I need to work harder. You guys work harder. If somebody asks you, how do you work harder, how do you motivate yourself to get up in the morning and go to work? What would your answer be?

[01:12:28] Melissa: Discipline.

[01:12:29] Ramit: Obviously you are very disciplined.

[01:12:30] I totally agree. Financially, maybe not so disciplined,

[01:12:36] Melissa: right?

[01:12:37] Ramit: So how, if somebody asked you, how do you get motivated to go to work every day? You seem so disciplined. How do you do it? What would your answer be?

[01:12:44] Melissa: Just do it.

[01:12:45] Ramit: Exactly. It's like, if I were you, I'd be like, that's kind of a dumb question. What do you mean how do you get up and go to work?

[01:12:51] Just go to work. That's what you would do. It's a weird question, and so the same thing is true for money. If you're here saying like, oh, I just need to finally buckle down and do my money. This is just weird words. There's actually something much deeper going on here. Perhaps the idea that Tony likes to avoid money.

[01:13:16] Melissa wants to be in charge because ever since she was a kid, she felt like she had to be in charge of money. Now, especially added on with the consideration that she earns more money than Tony keeping money separate. Melissa has these big plans. I need to do this deal and that deal, and I always need to have something positive going on.

[01:13:34] And we can't talk about the debt, but let's just focus on the next gig and the next deal. And Tony, uh, I know you're gonna say no 'cause you always say no, you're the no guy, but I'm gonna convince you anyway. So just keep the money coming and I'll pay you the $1,000 to figure it out. But like, you know, it's fine.

[01:13:50] Like, this house is gonna sell and then that land is gonna sell and then we're gonna be all fine. How much of that's going on here?

[01:13:56] Tony: Everything's true.

[01:13:57] Ramit: Melissa, what do you notice about what I just said?

[01:13:59] Melissa: That everything is a good idea, but it's not like it's on the air.

[01:14:05] Ramit: It's in the air. Yes. There's no, there's no, um, uh, numbers guiding it.

[01:14:10] It's just like, oh, I think we should do this. I feel we should do that. Yes. What else? Who's in charge? I

[01:14:17] Melissa: think neither of us.

[01:14:19] Ramit: Huh? That's an interesting comment. What do you think, Tony?

[01:14:22] Tony: Yeah, I think we just leave everything to, we'll see what happens and nobody's in charge.

[01:14:29] Ramit: Wow. I, I kind of would've guessed Melissa's in charge, but I actually think your answer was better.

[01:14:33] Melissa. I agree. No one is really in charge. Melissa, you persuade Tony to do the things you wanna do. Even when you get $80,000 over budget, Tony, because you're kind of like, oh, I, whatever you wanna do, Melissa, whatever. Then when things go wrong, you're like, well, I didn't, I didn't even wanna do it in the first place.

[01:14:56] But the fact is, neither of you are actually creating a vision, and you are certainly not bringing the other person on board. Like it would actually be easier if one of you was just the boss. You're just like, do these things, employee. I don't want that. But that would actually at least be a little more logical.

[01:15:13] Right now it's like, I don't know, maybe we should do this, but then if it goes bad, I'm not involved, et cetera. The way we learn about money does not disappear just because we move to a new country. What's interesting to me is that Melissa and Tony have managed to do quite well financially. They have a high income and a solid net worth, but in my opinion, they have gotten here despite how they manage money.

[01:15:34] They don't talk about money. They don't run the numbers on these huge purchases of buying and flipping and selling. With no clear plan. There hasn't really been any strategy. There's been a lot of hard work, but also candidly, they've also gotten lucky. You know, there's this phrase, I would rather be lucky than good, not me.

[01:15:54] Luck is nice, but I never wanna depend on luck for the important things in life, like money. So I think it's great that they've gotten lucky, but luck doesn't last. I need them to understand a simple way of looking at money. And that's gonna start with them understanding the risk that they have put themselves in.

[01:16:15] If nothing changes for you in the next 90 days, what will happen?

[01:16:21] Tony: We'll probably run outta savings and have no money for an emergency fund and then keep living paycheck to paycheck and

[01:16:33] Melissa: run out of investments. And hopefully we don't lose our jobs.

[01:16:36] Ramit: And if you do,

[01:16:37] Tony: we'll

[01:16:37] Ramit: lose the house.

[01:16:38] Melissa: We just trash eight years of work.

[01:16:40] Ramit: Why would you let yourself get in this position?

[01:16:43] Tony: I guess 'cause we thought we were doing the, the, the right things. Making the right decisions.

[01:16:48] Melissa: Yeah. I think it was my positive, like everything's gonna go as planned and not really seeing the risk.

[01:16:57] Ramit: Yeah.

[01:16:57] Melissa: But now that, that I'm tired 'cause I'm gonna have another kid, then it's like, this is not working like.

[01:17:05] We need to sell and start over with a new plan.

[01:17:10] Ramit: I think the new plan has to involve both of you. It has to involve serious numbers, not just feelings, and it has to be something that is sustainable. It cannot be one hustle after another. The hustle and the grinding that works. When you're in your twenties, you're single.

[01:17:31] You can work extra. No big deal. We need to be smart now and not just count on working an extra 10, 20, 30 hours. That does not scale. It doesn't work after a certain point. Tony, are you okay with that?

[01:17:44] Tony: Yes.

[01:17:44] Ramit: What would each of you need to change in your role with each other?

[01:17:50] Tony: Well, I think my mentality is staying more positive and just follow through.

[01:17:57] Ramit: Maybe not. I'm gonna give you a little bit of suggestion. I think one of the reasons that you go back and forth, back and forth is that you're actually not really making a decision. You're just arbitrarily being like, yeah, we should do that. Or, no, we should do that. So when you just pick something based on how you feel based on where the sun is in the sky today, then the next day you're gonna feel differently about it.

[01:18:16] Maybe you slept poorly or maybe you drank a can of Coke. It doesn't matter. Real decisions for money are made based on numbers. So if the person comes back and they start doubting you, you go, well, hey, maybe you're right, but let's take a look at the numbers. We made this decision based on these numbers.

[01:18:32] Have the numbers changed? Is there something that's changed differently? If not, why would we keep changing our mind? We already made a good decision based on the numbers. That's how you make effective decisions. So I think Tony, you're gonna have to become proactive. Meaning not wait for Melissa to come up with an idea.

[01:18:49] You need to be an equal partner in this and you need to actually start using numbers. Have you read my book?

[01:18:54] Tony: No.

[01:18:55] Ramit: So how could you be a partner if you haven't read my book?

[01:18:57] Tony: Well, I want, I want to now I want to get involved.

[01:19:01] Ramit: Good. Melissa, how will your role have to change with Tony?

[01:19:07] Melissa: I think I need to let him be more proactive and do these ideas to me instead of me trying to convince him of my ideas.

[01:19:17] Maybe just listen more

[01:19:18] Ramit: mm-hmm.

[01:19:19] Melissa: Of his side of view. Stop this, um, real estate things.

[01:19:25] Ramit: Yes.

[01:19:26] Melissa: And let him like really just take care of everything.

[01:19:32] Ramit: Maybe be more involved. Not let, no one's taking care of everything. Both of you're gonna be involved, but he should take care of some of the things. I agree.

[01:19:39] Melissa: Yeah. I guess more involved,

[01:19:41] Ramit: yes.

[01:19:41] Melissa: But in a active way, not in a. Yeah, we'll see if it sells.

[01:19:47] Ramit: No, no, no, no, no. I don't allow indecision in my financial relationship with my wife. Never like, lemme put it this way. What's this phrase? Some, there's some phrase about wealthy people touch once, deal with once or some, I don't know it. The idea is basically if we're gonna talk about something, we're gonna talk about it once.

[01:20:12] And unless it's something really important, it's done. Like, Hey, do we need to wash this towel? 'cause we have some guests coming over. Talk about it once, deal with it. Once it's over, that's it. We're not gonna let string this thing out 'cause we got more important things to deal with. Same thing with money.

[01:20:31] Oh, we need to open up a separate account. Okay. Whose decision is it? Oh, Tony, you're gonna be the one in charge of it. Okay, Tony, when's it gonna be done? Tony says it's gonna be done by next Tuesday. Okay. Make sure you update the document. We're not talking about it again. And you make sure that the next time you talk about money, you can check in on those things.

[01:20:47] So you are monitoring. But Melissa, I can see you getting a little nervous, like, how do I know he's gonna do it? Do I trust him? He never did it in the past, et cetera. Tony, how do you wanna respond to that?

[01:20:58] Tony: Well, I wanna show her that I can do it and, and I will do it.

[01:21:03] Ramit: Cool. Maybe some good suggestions might be that each week you each put an hour on your calendar to work through the money items that you need to work on, and then during that time, at the last five minutes, you can update a little document for each other, or you can even just sit next to each other and tell each other what you accomplished.

[01:21:23] Right now you need to start with baby steps. Over time, you can expand your level of trust, knowing that Tony has shown you he will follow through. And Melissa, same thing for you, knowing that you will follow through as well and show Tony that. How does that sound?

[01:21:37] Melissa: Right. Yeah.

[01:21:39] Tony: That's like a plan.

[01:21:40] Ramit: Alright.

[01:21:40] What's the rich life vision for the two of you for the next five years? What does a rich life look like?

[01:21:46] Tony: My idea is to travel at least once a year to different country with my family. Okay.

[01:21:55] Melissa: So I would like to not have any projects. And also I wanna optimize all these monthly like savings investments. So it's automatic and we don't have to and calibrate like every six months, but just optimize everything.

[01:22:16] Ramit: Great. So you wanna automate everything you want to, um,

[01:22:22] Melissa: pay off the small house, this house.

[01:22:24] Ramit: Oh, okay.

[01:22:24] Melissa: If possible.

[01:22:25] Ramit: Alright. What, what about these babies? Anyone want to include them in the rich life? These babies are just sitting alone for the next five years. You, you're like, ah, they're more fun when they're five.

[01:22:36] I'll pick 'em up then. What about them?

[01:22:39] Melissa: I mean, they're part of us. That's the way I see it. Like they'll go, I don't know, with us.

[01:22:46] Ramit: Okay. That's, that's actually a pretty good answer. Just so everybody knows, there's like a lot of cultural nuance in, in what Melissa just said, the idea that they are part of us, they come with us.

[01:22:56] There's a lot of cultures where the adults do what they're gonna do and the kids come with the adults, like the kids are gonna fit into the adult's lifestyle. In America, it's like quite the opposite. The idea is, oh my God, we had a kid, now we need to spend every waking hour entertaining them and doing what they want to do.

[01:23:14] We're gonna go to all the kids' shops, et cetera, and no, we can't take them to an adult restaurant because that's not for kids. That's quite interesting. Is that how it is, Melissa? The way you think about your kids?

[01:23:28] Melissa: Yeah, I just take them with me everywhere I go. Or it's easy for me to take care of the kids.

[01:23:34] Ramit: Yeah.

[01:23:35] Melissa: It was harder to raise teenagers than babies.

[01:23:39] Ramit: Yeah. Okay, cool. I love that. I love the sometimes just a subtle cultural differences that come out when people talk. I just love it. It's so, um, it's just this a phrase you said, but it's so profound in the way that I am guessing that you relate to your kids.

[01:23:55] It's really cool to be able to share a little bit of that. Alright, so you're gonna bring your kids wherever you go, traveling, working, et cetera. Is there anything about the debt in this rich life?

[01:24:07] Melissa: Uh, we don't want any debt.

[01:24:09] Ramit: You wanna pay off your debt within five years?

[01:24:12] Melissa: Yes. If it's not sooner, like I wish next year, 'cause we never had debt until we decided to build.

[01:24:21] Ramit: Should we take a look at the CSP? I am going to ask you, now that you have both described your rich life to me, I'm gonna ask you what changes you wanna make on the conscious spending plan.

[01:24:32] Melissa: So we wanna pay off all credit cards, lows.

[01:24:36] Ramit: Okay.

[01:24:37] Melissa: Amex, bank of America and Tony's. Okay,

[01:24:41] Ramit: that's $101,000. Where's the money coming from?

[01:24:43] Melissa: From Cabo.

[01:24:44] Ramit: Okay. That's 240 K. Is that how much you're gonna make?

[01:24:48] Melissa: Yes.

[01:24:49] Ramit: And you're gonna have that soon, right? It's on the market now.

[01:24:52] Melissa: We're closing this month.

[01:24:54] Ramit: Great. Alright, so you're going to walk away after all fees, taxes, everything with $240,000?

[01:25:01] Melissa: Yes.

[01:25:02] Ramit: Great. Alright. So you're gonna pay off the credit cards.

[01:25:06] That's amazing. How much do you have left in debt after that?

[01:25:10] Tony: 800,000.

[01:25:11] Ramit: Okay. $800,000. So what gonna do with the extra 100 and however much thousand from your lot?

[01:25:19] Tony: Well, I, I would like to start an emergency fund.

[01:25:22] Ramit: Good. Why? Just so Melissa knows, I want to see how the two of you talk about this money.

[01:25:29] Tony: Well, I wanna start an emergency fund because anything could happen if, if you lose your job and I'm stuck with me being the only, you know, head of household.

[01:25:42] We need to have at least six months to be prepared and see where we're gonna, where the next step is gonna be. And now that we're gonna be for the family, we need to take care of our two sons.

[01:25:53] Ramit: Wait, Tony, one of the things that happens with the two of you when you talk about money is each of you just says something and then you just stop talking.

[01:26:02] Like it's not actually a conversation. Have you noticed it? Tony's just like, I wanna have this because this, yeah. And it's like very unclear what is supposed to happen next. Are you asking me a question? Are you telling me something? Am I supposed to cry? What the hell is happening right now? So I need you to continue and then like a conversation.

[01:26:22] What would you say on a first date? Oh, so what do you think? That's how I need you two to talk about money. Look at this. Look at the way that you're both sitting when it comes to money. Look, look. Hello everybody. I'm nervous about money. I need you both to sit up straight, lean forward and get in the game.

[01:26:41] Let's do this. Go ahead Tony. Tell her what you wanna do and then get her involved.

[01:26:47] Tony: Okay. I want to open an emergency fund for at least to have at least six months worth of expenses, and I want to not have any credit card debt and the rest of the money invested long term and not touch it, and not worry about if it's going up or down.

[01:27:10] And just be consistent with the monthly investments. What do you think?

[01:27:17] Melissa: I agree because we don't know what's gonna happen next year.

[01:27:21] Ramit: Wow. Good. Okay. I love it. I don't know why I'm getting so mad, as I'm saying I love it, but I love it. That was really good. Do we all just agree on what to do with $140,000?

[01:27:34] That sounds pretty good to me.

[01:27:36] Melissa: Yes.

[01:27:37] Ramit: Damn. I think I'm just like, I think I'm shocked right now. This is working. Okay. The debt's getting wiped. The credit card debt. Alright. Goodbye. The mortgages are still going to be there for 800, uh, roughly $800,000. In terms of the extra 140 k that's going into savings.

[01:28:00] That's a lot of money, my friends. That's more than six months. Six months would be like 48 K. You're still gonna have like $115,000 or something on top of that. You could invest, you could keep a little extra money in the savings account. You go, Hey, our jobs are volatile. Or you know, who knows? We, we want a little extra, it doesn't have to be six months, make it 12.

[01:28:21] If you want, that's fine, but you could also pay off your mortgage depending on your interest rates. You could invest it. There's lots of options, but it's good to really think about the entire gamut. What do you think?

[01:28:34] Tony: Yes. I I would like to, to separate some of the savings.

[01:28:36] Melissa: Like if we put 50 or 80 towards the mortgage, would it make a difference?

[01:28:42] I don't know. We can research that.

[01:28:44] Tony: I mean, anything would help.

[01:28:46] Ramit: No, that's not how we talk about $50,000 decisions. No way. I like what you said, Melissa. We can research it. Tony, how come when she said you can, we can research it. Your answer was, oh yeah, it actually sounds pretty good. Let's do it. Research.

[01:29:00] Yes. Making random decisions for $80,000. No, we're not gonna do that. Try that conversation again. Please.

[01:29:08] Melissa: Maybe we should research how we can put like 80 or $50,000 towards the mortgage to see if it will help make a difference. We can research that. 'cause I don't know how it works.

[01:29:21] Tony: Yes, I think that's a good idea and, uh, hopeful.

[01:29:24] I mean, I'm sure it will help us, you know, paying out the mortgage faster, so thank That's a great idea.

[01:29:31] Ramit: Good job. Who's doing the research together?

[01:29:34] Tony: Together? Both.

[01:29:36] Ramit: Okay, cool. Um, one thing that couples unconsciously do is, um, when they're not used to being decisive, they use we when they don't want to assign anyone to do it.

[01:29:47] Don't I like we, when we're talking about we are making a decision together, that's great, but we, the grand we who doesn't actually do anything, we're not allowed to use that anymore. It's either you or I will do it. Pick one.

[01:30:00] Melissa: I would like Tony to do it. Okay. Because he ask the hard questions and I feel like I don't think about that negative arts.

[01:30:08] Ramit: Nice. So, okay. That's cool. So Tony, are you cool with doing the initial research on what would happen if you put $50,000 extra towards one of your mortgages?

[01:30:17] Tony: Yes, I think that's a great idea. Um, I'm gonna research and I'm gonna go through all the details and that would help us pay down the house and we're gonna make it happen.

[01:30:31] Ramit: Good. Alright. You know, I will say, if you didn't have this Cabo sale, how would you plan to pay off $101,000 in credit card debt?

[01:30:43] Melissa: We were willing to sell, um, the other house earlier this year. Even if we had to pay taxes,

[01:30:50] Ramit: you know, the way you're currently paying it off just month by month, you would actually never pay it off.

[01:30:57] Did you know that?

[01:30:58] Melissa: Yes. I realized that when it seems like nothing changed.

[01:31:02] Ramit: Yeah, that's because interest on credit cards is really high. Even if you put an extra $900 a month towards that credit card debt. Do you know how long it would take you to pay it off? Guess

[01:31:17] Tony: 20 years?

[01:31:18] Melissa: I was gonna say eight or seven.

[01:31:20] Ramit: It's almost 19 years.

[01:31:22] Melissa: Oh, wow.

[01:31:23] Ramit: And you would pay over $400,000 in interest. It really speaks to the idea like going and making these decisions without actually knowing your numbers going $80,000 over budget. All of the work you've been doing for a decade. Actually for the next 20 years would just vanish because you did not sit down and run some basic calculations when you make huge decisions just based on what you're feeling and just what you want today, trust me, somebody is making money and a lot of the time it's not you.

[01:32:01] You don't want that. You are so lucky that you bought this land and these houses when you did, but probab some of it seems like it's very good decisions and you're a GC and all that stuff is great, but it's also a lot of luck and you cannot count on luck for the long term.

[01:32:18] Tony: I think we were really lucky and that's why we, you know, when we sat down and thought about the whole process of us for the past seven years, it was, it was like, um, eye opener that.

[01:32:33] That we were able to do this money. But what happens if, if it would've gone a different way,

[01:32:38] Ramit: yes,

[01:32:39] Tony: we probably would've been bankrupt. To be honest,

[01:32:43] Ramit: that's exactly the right lesson to take away is like hold. We got really lucky. We got lucky. Despite a series of questionable decisions, we are so lucky we should exit this as quickly as possible and completely change our strategy.

[01:33:03] 'cause if you did this today, you would be broke. Dead broke. So I think it's awesome that you have the opportunity to sell this land. I think that's great. I think the question of, you know, what do you do with this rental house? That's something you should actually consider and run the numbers. You might choose to keep it.

[01:33:21] You should probably run your numbers more carefully. How much is it costing us every single month? How much profit are we making after all fees? Even the roof repair 12 years from now, all fees. Compare that to, would we make more just putting it in the s and p 500, what would make us more, within five years, 20 years, 30 years?

[01:33:43] Don't let the tail wag the dog. Meaning don't feel like, just 'cause you had this vision of having multiple properties that you have to, you might, a lot of people can do it, but I can tell you that if you choose to go the real estate route, you'll need to become way more quantitative, way more buying it just based on arbitrary decision.

[01:34:06] Or like, I see a value, but I don't know my number. You'll get washed out one way or another.

[01:34:10] Melissa: You don't wanna be a landlord.

[01:34:12] Ramit: You don't. Then why do you even have this rental property?

[01:34:15] Melissa: Well, I realize that after renting it,

[01:34:17] Ramit: so what are you gonna do with this property?

[01:34:20] Melissa: I would like to, to sell it next year.

[01:34:23] Ramit: Okay, fine.

[01:34:25] How do you feel about that, Tony?

[01:34:26] Tony: Oh yeah, a hundred percent. Wanna get rid of it?

[01:34:29] Ramit: All right. And then what are you gonna do, Melissa? Oh God. What are you gonna do after you sell it?

[01:34:36] Melissa: Um, invest it. Oh.

[01:34:40] Ramit: Oh, I thought you were gonna buy another property.

[01:34:42] Melissa: No, that's, I wanna stop.

[01:34:44] Ramit: You're out. Alright. I learned in my business, I always modeled out like bad, medium, good.

[01:34:51] And then when my business went down, it was so bad it went way below what I thought bad was. So my lesson was, no matter how bad it gets, it can always get worse. This like, such a horrifying lesson in life. But it's actually a good lesson too. 'cause no matter what you think you can get, it might be 50% lower or 50% lower than that, which would be horrifying.

[01:35:19] So I say that not just as a joke, but something to consider. Timing matters, especially when you are selling. Keep it in mind. I would like for the two of you to read both of my books. One start with, I will teach you to be rich. I want you to do a book club where the two of you, each week, you alternate on who is in charge of the chapter and you re, you both read it and you take notes and then you discuss.

[01:35:46] That will help you set up your money. It will help you make sense of these numbers. And because you're gonna be paying off your credit card debt, et cetera, you're actually gonna have some extra money every single month. Well, you're also gonna have some extra expenses like childcare, but you actually have the money to cover it.

[01:36:03] You actually have the money, but you need to start using your money much more effectively because you're gonna sell the lot. You're gonna fill up your emergency fund, so you're not gonna need to save more money for that. That's amazing. You will want to put some money aside for certain things. I want you to read my book and redo your conscious spending plan.

[01:36:21] Okay. The second thing I want you to read is Money for Couples. The new book I wrote for couples to talk about money. This is going to help you actually communicate about money much more clearly. You know how we talked about how you spin a lot, like there's no decisions that get made that's out the door from now on crystal clear, it tells you the exact words to say and then y'all can make it happen.

[01:36:46] Would you be willing to do that?

[01:36:48] Melissa: Yes.

[01:36:48] Ramit: Yes.

[01:36:50] Melissa: I feel like a relationship will be better because sometimes I feel like this is important topic. Uh, Tony will take some leadership. I love that too.

[01:37:03] Ramit: Beautiful. Tony, how about you?

[01:37:06] Tony: Well, I feel like, uh, for the first time we're a team and sorry, I really wanna hug my boyfriend.

[01:37:17] Ramit: Go ahead Tony. We got all the time in the world.

[01:37:23] Tony: So, yeah, I feel like we, a team and, uh, together, we gonna get through this and we're gonna move forward and, and actually being more comfortable talking about our finances and our, our future goals and, and family plans.

[01:37:46] Ramit: I love that. I do think there is power in doing this together. Definitely.

[01:37:53] Melissa: Tony never cries.

[01:37:54] Never.

[01:37:55] Ramit: Wow. I really appreciate the two of you, you know, connecting over money. You have some things to fix, there's no doubt about that. Some debt, some decisions that were maybe a little bit sloppy. We also have some stuff that's really good. High income, ability to pay stuff off. Most people would love to be in that situation.

[01:38:16] The thing is, you gotta do it together. That changed the way that you talk about money. It's especially important to do it now as you go into this new chapter with the new baby. Think about what got you here all the last eight years. Hustling, working seven days a week, grinding it out. You actually accomplished some pretty amazing things.

[01:38:38] Was that the kind of life you want in this new chapter?

[01:38:42] Melissa: No, I think we need to focus on our family,

[01:38:44] Ramit: and that will require change. It'll require talking about money differently, behaving with money differently, changing the way you feel about money. So that's why getting on the same page, reading some books together.

[01:39:00] Sharing some of the work that you do is gonna be a big, big difference. We're gonna get to their follow ups in just a second. But I first wanna acknowledge the courage that it takes for any couple to come on this show and speak publicly about these things. And it is incredibly intimidating for Native English speakers.

[01:39:17] Melissa and Tony did it in their second language, so massive compliments to them. Now I have to admit that this conversation was also hard for me. There are a lot of cultural differences that I'm not privy to. I don't know what it's like to grow up in Mexico. I don't know what it's like to grow up in the socioeconomic class that they did.

[01:39:35] I don't know what it's like to be a first generation immigrant who's responsible caring for young siblings. So this is one of those conversations where we had a gap among all of us. I'm still glad that we talked. It gives me a lot of empathy for what my guests experience on this podcast. I don't wanna pick the easiest conversations.

[01:39:54] I don't wanna pick the ones that are just guaranteed to go viral on social media. I want to pick the most meaningful ones, and sometimes those conversations are really hard. They're messy, but I try to challenge myself. That's why I do live tours where I bring couples on stage, not knowing what they're going to say in front of a thousand people, or having conversations with couples where I don't fully understand their cultural context.

[01:40:19] Probably I'm getting 15% of the things that I said today wrong. That's okay. I accept that. I hope my couples do as well. Despite those challenges, Melissa and Tony made real progress today. They finally saw that hustling. The skill that got them here and got them new footing in a new country can be a strength, but at a certain point you've got to go beyond hustling with a new baby arriving any day.

[01:40:45] Now they have the chance to build a calmer, steadier kind of life. Obviously they have the drive, now they have the chance to give their family the stability that they have been chasing all along. Let's check their follow ups.

[01:40:59] Melissa: Hi Ramit. Um, thank you for having us on your podcast. It really helped us a lot.

[01:41:05] Reading the books have also opened our minds, and every time it's easier to talk about money. So I just wanna say that my biggest surprise during our conversation was that I really had these mixed feelings and it was very hard for me to look at the real numbers. And I always wanted to do like a next step and biggest plan and taking risk.

[01:41:30] So I'm gonna stop, that's my takeaway. And Tony's gonna take, um, the leadership now, but we are also gonna talk about our future goals without making new projects or crazy investments.

[01:41:47] Tony: Yeah, I think for me, uh, was that before it was very stressful and I had, you know, fear of talking about money because I didn't have a plan.

[01:41:56] But now that we have the CSP and we have something, a, a goal to, to work towards, I feel more comfortable. It's very, you know, it's very nice to talk with my wife, you know, after reading the book. And we have our, our goals for the future. And my biggest takeaway is, uh, I know you mentioned I needed to be more, more proactive and.

[01:42:20] The first thing we did is actually opened up our joint checking account. So I don't feel anymore like I'm, you know, not having any money on my account. Now. We both have, and we can use, you know, the same account to set up the recurrent payments for our investments for our kids, uh, college fund, um, you know, retirement account and, and savings.

[01:42:48] Melissa: Uh, we are closing our lot in covering 15 days, so we're gonna pay off all debt. Uh, we did, um, the new CSP how it will look like and our fixed costs, it's at 49% and our free guild is 24%. Um, so we have a remaining of 5,500

[01:43:13] Tony: right.

[01:43:13] Melissa: That we're gonna do.

[01:43:14] Tony: So we're doing 500 towards, um. Our kids college. We put in a thousand dollars towards retirement combined and $1,500 towards stocks and $500 setting aside for vacation each month.

[01:43:31] Melissa: We also were able to cut a thousand dollars from our fixed cost by cutting 130 on phone. I post my gym membership of 175. Uh, stop spending The clothes allowance of 200 and groceries are needing out another 500. So I think we're in a good track. Uh, we hope next year we're gonna sell the big house to pay off the small house.

[01:44:01] Um, so I think we'll be in a next chapter next year. So this is very exciting. I don't feel stressed about having the baby anymore, and I think this has been great for our relationship too.

[01:44:18] Tony: Yeah, it, it, it is really very, it's more like couples therapy also. So, you know, I've, like I said on the podcast, I feel like we're a team.

[01:44:29] We're working towards, you know, our mutual goal and we are gonna make it happen. So thank you again so much. It really changed my mindset moving forward.

[01:44:41] Melissa: And we have your book here, so we have homework still to do.

[01:44:46] Tony: Yeah, we still have some homework to do, but we appreciate all your help. Thank you.

[01:44:51] Melissa: Thank you.

[01:44:52] Tony: Bye-Bye.