{"id":118829,"date":"2025-02-04T19:52:46","date_gmt":"2025-02-04T23:52:46","guid":{"rendered":"https:\/\/www.iwillteachyoutoberich.com\/?p=118829"},"modified":"2026-02-18T15:44:57","modified_gmt":"2026-02-18T19:44:57","slug":"194-lakiesha-james-2","status":"publish","type":"post","link":"https:\/\/www.iwillteachyoutoberich.com\/194-lakiesha-james-2\/","title":{"rendered":"Episode 194. \u201c$0 savings, $0 investments. Is it too late for us?\u201d (Part 2)"},"content":{"rendered":"<p><iframe title=\"\u201c$0 savings, $0 investments\u2026 Is it too late for us?\u201d\" src=\"https:\/\/www.youtube.com\/embed\/z4yUm-SycJ4\" width=\"100%\" height=\"400\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p><iframe style=\"border-radius: 12px;\" src=\"https:\/\/open.spotify.com\/embed\/episode\/6dk06eO1Fx2HTMkXgxrZf6?utm_source=generator\" width=\"100%\" height=\"352\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p>On last week\u2019s episode, we met 38-year-old LaKiesha and 45-year-old James, a couple struggling to get on the same page financially. With no savings, no investments, and deep-rooted money fears, they\u2019re stuck in a cycle of mindless spending. Today, we\u2019re digging back into their CSP\u2014and the numbers are more shocking than they expected. Can they finally break old habits and build their Rich Life together?<\/p>\n<p><strong>This episode is brought to you by:<\/strong><\/p>\n<p>Rocket Money | Stop throwing your money away. Cancel unwanted subscriptions \u2013 and manage your expenses the easy way \u2013 by going to\u00a0<strong><a href=\"https:\/\/rocketmoney.com\/ramit\">https:\/\/rocketmoney.com\/ramit<\/a><\/strong><\/p>\n<p>Netsuite | Get visibility to everything in your business in one place. Sign up and defer payments, with no interest, for six months at\u00a0<strong><a href=\"https:\/\/iwt.com\/netsuite\">https:\/\/iwt.com\/netsuite<\/a><\/strong><\/p>\n<p>Thrive Market | Head to\u00a0<strong><a href=\"https:\/\/thrivemarket.com\/RAMIT\">https:\/\/thrivemarket.com\/RAMIT<\/a><\/strong>\u00a0and get 30% off your first order\u2014plus a FREE $60 gift!<\/p>\n<p>Trust &amp; Will | Secure your assets and protect your loved ones. Get 10% off plus free shipping on your estate plan documents by visiting\u00a0<strong><a href=\"https:\/\/trustandwill.com\/ramit\">https:\/\/trustandwill.com\/ramit<\/a><\/strong><\/p>\n<p>Next Level Wardrobe | Take the free styling quiz and elevate your style at\u00a0<strong><a href=\"https:\/\/nextlevelwardrobe.com\/ramit\">https:\/\/nextlevelwardrobe.com\/ramit<\/a><\/strong><\/p>\n<h2><strong>Links mentioned in this episode<\/strong><\/h2>\n<ul>\n<li><a href=\"https:\/\/iwt.com\/moneyforcouples\">Order my new book: Money for Couples<\/a><\/li>\n<li><a href=\"https:\/\/iwillteachyoutoberich.com\/193-lakiesha-james-1\">Episode 193. \u201cI\u2019ve filed for bankruptcy twice. Will I ever stop spending?\u201d (Part 1)<\/a><\/li>\n<\/ul>\n<h2><strong>Show Transcript<\/strong><\/h2>\n<p>[00:00:01]\u00a0<strong>Ramit:<\/strong>\u00a0On last week\u2019s episode, we met 38-year-old\u00a0LaKiesha\u00a0and 45-year-old James.<\/p>\n<p>[00:00:05]\u00a0<strong>LaKiesha:<\/strong>\u00a0We\u2019ve talked about money, but it\u2019s come more from a lack of. I want to get on the other side of that.<\/p>\n<p>[00:00:11]\u00a0<strong>Ramit:<\/strong>\u00a0The couple recently moved in together and they\u2019re trying to get on the same page about their finances, but it\u2019s a challenge.<\/p>\n<p>[00:00:17]\u00a0<strong>James:<\/strong>\u00a0I had a repossessed car, credit cards, and some loaned.<\/p>\n<p>[00:00:21]\u00a0<strong>LaKiesha:<\/strong>\u00a0I have not considered my future self at all. In fact, I\u2019ve pretty much set that person up for failure in a lot of ways.<\/p>\n<p>[00:00:31]\u00a0<strong>Ramit:<\/strong>\u00a0They have no savings, no investments, and they both struggle with the money messages they received growing up.<\/p>\n<p>[00:00:39]\u00a0<strong>James:<\/strong>\u00a0I\u2019m scared to do things, so I guess that\u2019s why I didn\u2019t accumulate a lot.<\/p>\n<p>[00:00:42]\u00a0<strong>Ramit:<\/strong>\u00a0Today we\u2019re digging back into their conscious spending plan or CSP.<\/p>\n<p>[00:00:47]\u00a0<strong>James:<\/strong>\u00a0The numbers are more shocking. We have to do something.<\/p>\n<p>[00:00:51]\u00a0<strong>LaKiesha:<\/strong>\u00a0Okay, guilt-free spending.<\/p>\n<p>[00:00:54]\u00a0<strong>James:<\/strong><strong>\u00a0<\/strong>I always got guilt about that.<\/p>\n<p>[00:00:56]\u00a0<strong>Ramit:<\/strong>\u00a0Are\u00a0LaKiesha\u00a0and James willing to change the way that they mindlessly spend money and get focused on their\u00a0Rich Life?<\/p>\n<p>[00:01:02]\u00a0<strong>James:<\/strong>\u00a0We want to be better for each other so we can have a better future.<\/p>\n<p>[00:01:05]\u00a0<strong>Ramit:<\/strong>\u00a0Now let\u2019s get back to our conversation with\u00a0LaKiesha\u00a0and James.<\/p>\n<p>[Narration]<\/p>\n<p>[00:01:16]\u00a0<strong>Ramit:<\/strong>\u00a0When we left\u00a0LaKiesha\u00a0and James last week, we had just learned they have zero savings, zero investments, and $190,000 of debt between the two of them. Let\u2019s dig back into the numbers,\u00a0and we\u2019ll see if they\u2019re ready to make a change.<\/p>\n<p>[Interview]<\/p>\n<p>[00:01:34]\u00a0<strong>LaKiesha:<\/strong>\u00a0If something were to happen, we have nothing. We would have to borrow money in order to mitigate whatever that something is.<\/p>\n<p>[00:01:44]\u00a0<strong>Ramit:<\/strong>\u00a0And have you ever gotten in that situation, LaKiesha, like, zero savings, maybe you got sick or lost your job or anything like that?<\/p>\n<p>[00:01:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0Fortunately, no, I have not.<\/p>\n<p>[00:01:54]\u00a0<strong>Ramit:<\/strong>\u00a0You\u2019re basically driving without a seatbelt.\u00a0Most of the time you\u2019re\u00a0going to\u00a0be fine. The one time,\u00a0you\u2019re not,\u00a0and it\u2019s over.<\/p>\n<p>[00:02:02]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:02:02]\u00a0<strong>Ramit:<\/strong>\u00a0And nobody can tell you, no, I\u2019m not a parent here to nag you. Put your seatbelt on, build a savings account. I can\u2019t do it. Only you can. But when I see this, I feel extreme fear. I\u2019m not afraid of a lot. I\u2019m afraid of teenage girls because they\u2019re mean, and I\u2019m afraid of big, old insects that fly, maybe roller coasters. But I\u2019m afraid of this.<\/p>\n<p>[00:02:27]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:02:28]\u00a0<strong>Ramit:<\/strong>\u00a0Because I know what can happen. I know that you\u2019re skating really close to the edge, and if something bad happens, especially with kids, you\u2019re in a loop, and it is really hard to get out of it. So that\u2019s how I feel. Let\u2019s talk about the debt for you, LaKiesha. You have $165,000 of debt. What is that?<\/p>\n<p>[00:02:45]\u00a0<strong>LaKiesha:<\/strong>\u00a0Student loans.<\/p>\n<p>[00:02:47]\u00a0<strong>Ramit:<\/strong>\u00a0Couldn\u2019t discharge those in bankruptcy. Okay. We know that. Thanks to Republicans. Anyway, how much is your interest rate on 165k?<\/p>\n<p>[00:02:56]\u00a0<strong>LaKiesha:<\/strong>\u00a0I\u2019m going to be honest, I have no idea. I haven\u2019t even bothered to look. I\u2019m in one of those income-based repayment plans. After seven more years, it\u2019ll all go away anyway.<\/p>\n<p>[00:03:07]\u00a0<strong>Ramit:<\/strong>\u00a0Oh. All right. That\u2019s actually really helpful to know. And that explains why you\u2019re paying almost nothing towards it.<\/p>\n<p>[00:03:14]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:03:15]\u00a0<strong>Ramit:<\/strong>\u00a0Thank God. Because I was looking at these numbers like, what the hell is happening here?<\/p>\n<p>[00:03:20]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:03:22]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Good to know.\u00a0Shall we continue moving along?<\/p>\n<p>[00:03:26]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:03:27]\u00a0<strong>Ramit:<\/strong>\u00a0Income. James, break it down for me. Let\u2019s get the combined monthly income.<\/p>\n<p>[00:03:33]\u00a0<strong>James:<\/strong>\u00a0Gross monthly income combined is 12,453.<\/p>\n<p>[00:03:38]\u00a0<strong>Ramit:<\/strong>\u00a0James, did you know that you make $60,732 per year?<\/p>\n<p>[00:03:44]\u00a0<strong>James:<\/strong>\u00a0That\u2019s horrible. Yes.<\/p>\n<p>[00:03:46]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s an interesting response. We can work on that. And then,\u00a0LaKiesha, did you know you make $88,704 a year?<\/p>\n<p>[00:03:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:03:53]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, both of you knew your income. Great. Combine you make 150k. That\u2019s a lot, right?<\/p>\n<p>[00:03:57]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:03:59]\u00a0<strong>LaKiesha:<\/strong>\u00a0I think it\u2019s good.<\/p>\n<p>[00:04:01]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s keep going. It doesn\u2019t look like either of you\u2019re doing too much pre-tax, like 401K investments. Is that correct?<\/p>\n<p>[00:04:07]\u00a0<strong>LaKiesha:<\/strong>\u00a0That is correct. The place that I worked for, they were just recently integrated, so it\u2019s going to be a new company where I have benefits. So now starting 2025, we\u2019ll have 401K. I have the option of getting the HSA.<\/p>\n<p>[00:04:21]\u00a0And so I wanted to max it out from the beginning. I told him as I was doing open enrollment, with insurance, taxes, everything, it was going to be like $900 out of my check. And he was like, \u201cWhat? No.\u201d And so I still opened the account, but I put it as zero because I was told from the person that I could change that amount later. Can I just say, I want to? And I had a conversation with James about that recently and he was like, \u201cLet\u2019s wait.\u201d<\/p>\n<p>[00:04:57]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s wait till what? James, why did you react the way you did?<\/p>\n<p>[00:05:01]\u00a0<strong>James:<\/strong>\u00a0First of all, it was the amount that she was trying to put away. Wait till later until we get out of this hole that we\u2019re in, was basically the message that I was trying to convey to her.<\/p>\n<p>[00:05:12]\u00a0<strong>Ramit:<\/strong>\u00a0Wait till, what? James, you\u2019re 45 years old and you have zero savings and zero investments. How long do you want to wait?<\/p>\n<p>[00:05:18]\u00a0<strong>James:<\/strong>\u00a0I wasn\u2019t saying like, don\u2019t ever do it, or, let\u2019s wait forever. It was just a large chunk. But at that point, we were not living together yet as well. You know what I mean?<\/p>\n<p>[00:05:28]\u00a0<strong>Ramit:<\/strong>\u00a0Wasn\u2019t it her money?<\/p>\n<p>[00:05:29]\u00a0<strong>James:<\/strong>\u00a0It was.<\/p>\n<p>[00:05:30]\u00a0<strong>Ramit:<\/strong>\u00a0So what does your opinion really matter about her money anyway?<\/p>\n<p>[00:05:33]\u00a0<strong>James:<\/strong>\u00a0It sure don\u2019t. You\u2019re right.<\/p>\n<p>[00:05:35]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s correct. But do you all understand the dynamic that\u2019s at play right here?<\/p>\n<p>[00:05:40]\u00a0<strong>LaKiesha:<\/strong>\u00a0First of all, I even brought it to him and asked him what he thought about it instead of just doing it.<\/p>\n<p>[00:05:45]\u00a0<strong>Ramit:<\/strong>\u00a0Correct. Like a child.<\/p>\n<p>[00:05:47]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:05:48]\u00a0<strong>Ramit:<\/strong>\u00a0And then James thrust into this role, which he shouldn\u2019t be in. James has $26,000 of debt and zero savings too. What\u2019s he talking about? And then he naturally just assumes the role. Oh, I think you should wait. What do you have to do with his decision? It\u2019s your money,\u200a LaKiesha. You don\u2019t even live together at that point, but both of you are playing this dynamic\u2013 parent-child. Makes no sense. It\u2019s keeping you in a poor financial situation. Do you understand this?<\/p>\n<p>[00:06:16]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[00:06:16]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[Narration]<\/p>\n<p>[00:06:18]\u00a0<strong>Ramit:<\/strong>\u00a0Let me break down why the parent-child money dynamic is absolutely toxic to relationships.\u00a0First, your partner\u2019s not a child, and you\u2019re not going to get them to act like an adult by treating them like a child. Number two, this dynamic is sexual kryptonite. Often the parent figure feels repulsed as a result of taking on the authority role.\u00a0And this is not good for any relationship.<\/p>\n<p>[00:06:44]\u00a0The good news is there\u2019s a way to change the dynamic. When you treat an adult like an adult, you tell them what you expect and you set clear boundaries,\u00a0you may be surprised how often they rise to the expectation.\u00a0More on this in my new book,\u00a0Money for Couples.<\/p>\n<p>[00:07:02]\u00a0We\u2019ll be right back after a short break.<\/p>\n<p>[00:07:05]\u00a0Welcome back. Let\u2019s keep going with our CSP.<\/p>\n<p>[Interview]<\/p>\n<p>[00:07:08]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s continue moving along here.\u00a0Let\u2019s look at your fixed costs. So what number do I typically recommend your fixed costs\u00a0be?<\/p>\n<p>[00:07:15]\u00a0<strong>LaKiesha:<\/strong>\u00a0Between\u00a050 and 60.<\/p>\n<p>[00:07:17]\u00a0<strong>Ramit:<\/strong>\u00a0Correct. James, did you know that?<\/p>\n<p>[00:07:19]\u00a0<strong>James:<\/strong>\u00a0She did tell me,\u00a0yes.<\/p>\n<p>[00:07:20]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, great.\u00a0So at 68, it\u2019s higher than I would like to see it.\u00a0But it\u2019s not 89.\u00a0All\u00a0right.\u00a0We got some stuff we can play with.\u00a0Let\u2019s just work our way down and then we\u2019ll go into the line items. Investments, 0. So\u00a0y\u2019all know the way you\u2019re going. If you currently change nothing,\u00a0you will be living on social security.\u00a0You guys want to do that?<\/p>\n<p>[00:07:44]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:07:45]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s not good. Savings are at zero.\u00a0Not good. And then this is really interesting. Your guilt-free spending is 33%. Now, I don\u2019t believe these numbers, but I do believe they are a lot. Do you track your guilt-free spending carefully? Yes or no?<\/p>\n<p>[00:08:01]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:08:02]\u00a0<strong>James:<\/strong>\u00a0No. Wouldn\u2019t do that.<\/p>\n<p>[00:08:03]\u00a0<strong>Ramit:<\/strong>\u00a0All right. At the end of the month, is there any extra money?<\/p>\n<p>[00:08:05]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:08:06]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:08:06]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. So it\u2019s going somewhere. What\u2019s it going towards? Amazon stuff. What else?<\/p>\n<p>[00:08:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0\u200aEating out.<\/p>\n<p>[00:08:12]\u00a0<strong>Ramit:<\/strong>\u00a0Eating out. Where do you guys eat out?<\/p>\n<p>[00:08:14]\u00a0<strong>James:<\/strong>\u00a0It depended on the week.<\/p>\n<p>[00:08:17]\u00a0<strong>LaKiesha:<\/strong>\u00a0We have pizza every Friday.<\/p>\n<p>[00:08:19]\u00a0<strong>Ramit:<\/strong>\u00a0Please don\u2019t say Domino\u2019s. I [Bleep] hate them.<\/p>\n<p>[00:08:21]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, no, no, no, no, no. A local place. Bob\u2019s Pizza. We like to try different pizza places every Friday.<\/p>\n<p>[00:08:28]\u00a0<strong>Ramit:<\/strong>\u00a0You go there. All right.<\/p>\n<p>[00:08:29]\u00a0<strong>LaKiesha:<\/strong>\u00a0When we\u2019re in between paychecks, we\u2019ll go get a large pizza at Whole Foods.<\/p>\n<p>[00:08:34]\u00a0<strong>Ramit:<\/strong>\u00a0Hold on. Was that supposed to be like, we\u2019re so frugal, we got a pizza from Whole Foods? What the hell\u2019s happening right now? Okay, this is amazing. Let me just tell you. My family, when we were eating out, which was not that often\u2013 once every six weeks\u2013 we\u2019re going to the pizza place with a coupon.<\/p>\n<p>[00:08:52]\u00a0And Whole Foods, I never walked in a Whole Foods till I went to college. And I walked right back out. I\u2019m like, \u201cThis place isn\u2019t for me. Bye-bye. I\u2019ll come back here in about 15 years.\u201d All right. Wow. We only get our pizza at Whole Foods. Amazing. Where else do you eat out? Pizza. What else?<\/p>\n<p>[00:09:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0We said we were going to start going to LongHorn once a month.<\/p>\n<p>[00:09:14]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s interesting. So the two of you talked about it and said, we want to do this once a month. That\u2019s the first time I\u2019ve heard of planning. I like that.<\/p>\n<p>[00:09:22]\u00a0<strong>James:<\/strong>\u00a0On a Wednesday we might go to Culver\u2019s. You know what I mean?<\/p>\n<p>[00:09:25]\u00a0<strong>Ramit:<\/strong>\u00a0What\u2019s that?<\/p>\n<p>[00:09:26]\u00a0<strong>James:<\/strong>\u00a0Hamburger place.<\/p>\n<p>[00:09:26]\u00a0<strong>LaKiesha:<\/strong>\u00a0Burger place.<\/p>\n<p>[00:09:27]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. How much, total bill\u2013 bill, tip, tax, delivery, everything?<\/p>\n<p>[00:09:33]\u00a0<strong>James:<\/strong>\u00a0We get the kids\u2019 meals. So it is about $24.<\/p>\n<p>[00:09:36]\u00a0<strong>Ramit:<\/strong>\u00a0She\u2019s laughing and covering her mouth. Hold on. There\u2019s definitely a lie happening right now. LaKiesha?<\/p>\n<p>[00:09:40]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, I just laugh because we definitely do get the kids\u2019 meal. All three of us will get a kids\u2019 meal because it comes with a free custard. We try to think about money.<\/p>\n<p>[00:09:51]\u00a0<strong>Ramit:<\/strong>\u00a0Please don\u2019t do this right now. Please don\u2019t try to justify the financial part of it. We\u2019ve gotten two days out of a seven-day week, and I\u2019m getting your life history about LongHorns and the custard. Just tell me where you eat out. That\u2019s all I want to know.<\/p>\n<p>[00:10:05]\u00a0<strong>James:<\/strong>\u00a0Oh, okay. Culver\u2019s, Harold\u2019s Chicken. If it\u2019s all of us, man, we spending a good 40 to $50.<\/p>\n<p>[00:10:13]\u00a0<strong>Ramit:<\/strong>\u00a0This is for how many people?<\/p>\n<p>[00:10:16]\u00a0<strong>James:<\/strong>\u00a0If my daughter\u2019s here, four, and if she\u2019s not, three. So three to four people.<\/p>\n<p>[00:10:20]\u00a0<strong>Ramit:<\/strong>\u00a0How are you only spending $40 for four people eating out, tax, tip? There\u2019s no way. Can we just reset because something is not right. I don\u2019t mind if you\u2019re overspending. I can help you with that, but I can\u2019t help if you guys are lying to me or if you\u2019re lying to yourself.<\/p>\n<p>[00:10:36]\u00a0<strong>James:<\/strong>\u00a0If we\u2019re going to the restaurant for pizza, last week I spent $140-something.<\/p>\n<p>[00:10:41]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. That\u2019s reasonable.<\/p>\n<p>[00:10:44]\u00a0<strong>LaKiesha:<\/strong>\u00a0On a weekly basis, I would say we probably spend at least $250 on eating out.<\/p>\n<p>[00:10:49]\u00a0<strong>Ramit:<\/strong>\u00a0How many times a week do you eat out?<\/p>\n<p>[00:10:52]\u00a0<strong>James:<\/strong>\u00a0Three or four times a week.<\/p>\n<p>[00:10:53]\u00a0<strong>LaKiesha:<\/strong>\u00a0I was going to say the exact same number, three to four times a week.<\/p>\n<p>[00:10:58]\u00a0<strong>Ramit:<\/strong>\u00a0Do a little exercise with me. It\u2019s Sunday morning. We\u2019re going to go through the entire week. Anybody eating out Sunday? I\u2019m talking coffee, lunch, brunch.<\/p>\n<p>[00:11:07]\u00a0<strong>James:<\/strong>\u00a0Sunday we eat breakfast at home.<\/p>\n<p>[00:11:09]\u00a0<strong>Ramit:<\/strong>\u00a0How many times you eat out on Sunday? Give me a number.<\/p>\n<p>[00:11:12]\u00a0<strong>James:<\/strong>\u00a0Probably once, right?<\/p>\n<p>[00:11:13]\u00a0<strong>LaKiesha:<\/strong>\u00a0Once or twice, because he always brings lunch home. And then dinner, depending on if we have groceries or not, we\u2019ll eat out again on Sunday.<\/p>\n<p>[00:11:21]\u00a0<strong>Ramit:<\/strong>\u00a0Great. So is that two or three times on Sunday?<\/p>\n<p>[00:11:24]\u00a0<strong>LaKiesha:<\/strong>\u00a0At least two.<\/p>\n<p>[00:11:25]\u00a0<strong>Ramit:<\/strong>\u00a0Two times. Great. Monday, what do we got?<\/p>\n<p>[00:11:30]\u00a0<strong>James:<\/strong>\u00a0We don\u2019t usually eat out on Monday.<\/p>\n<p>[00:11:32]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:11:32]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:11:33]\u00a0<strong>Ramit:<\/strong>\u00a0None?<\/p>\n<p>[00:11:33]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:11:34]\u00a0<strong>Ramit:<\/strong>\u00a0Coffee, croissant, whatever. None of it? Okay, great. Tuesday?<\/p>\n<p>[00:11:40]\u00a0<strong>James:<\/strong>\u00a0Tuesday, if we have leftovers, we eat that.<\/p>\n<p>[00:11:44]\u00a0<strong>Ramit:<\/strong>\u00a0How about if you don\u2019t?<\/p>\n<p>[00:11:46]\u00a0<strong>James:<\/strong>\u00a0If we don\u2019t have leftovers, at least once.<\/p>\n<p>[00:11:49]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s say. Once. All right. Wednesday?<\/p>\n<p>[00:11:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0I would say once.<\/p>\n<p>[00:11:54]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, great. Thursday, breakfast, lunch, dinner, snack.<\/p>\n<p>[00:11:57]\u00a0<strong>LaKiesha:<\/strong>\u00a0I would say zero. I would say zero.<\/p>\n<p>[00:11:59]\u00a0<strong>Ramit:<\/strong>\u00a0Friday.<\/p>\n<p>[00:12:00]\u00a0<strong>James:<\/strong>\u00a0Friday, probably twice.<\/p>\n<p>[00:12:03]\u00a0<strong>Ramit:<\/strong>\u00a0Twice. All right. Saturday. Saturday, how much?<\/p>\n<p>[00:12:06]\u00a0<strong>James:<\/strong>\u00a0Saturday, probably twice.<\/p>\n<p>[00:12:07]\u00a0<strong>Ramit:<\/strong>\u00a0Twice? Anybody want to say three times? LaKiesha, what\u2019s that big smile on your face?<\/p>\n<p>[00:12:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0Just to pay a week, maybe three times.<\/p>\n<p>[00:12:14]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s say three. All right. Now, I don\u2019t know if you\u2019ve ever heard of Ramit Sethi\u2019s magic number of eating out. Have you ever heard this number?<\/p>\n<p>[00:12:22]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:12:23]\u00a0<strong>Ramit:<\/strong>\u00a0The number goes like this. Take whatever a couple tells you and triple it and you will get the real number. And guess what your number happens to be.<\/p>\n<p>[00:12:31]\u00a0<strong>James:<\/strong>\u00a0Six or eight.<\/p>\n<p>[00:12:32]\u00a0<strong>LaKiesha:<\/strong>\u00a0Nine.<\/p>\n<p>[00:12:33]\u00a0<strong>Ramit:<\/strong>\u00a0Nine. Exactly three times what you told me. What do you make of that? First of all, am I getting a round of applause for this? I freaking invented this. I\u2019ll take the win for myself. It\u2019s my podcast. That\u2019s pretty amazing, don\u2019t you think?<\/p>\n<p>[00:12:48]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah, it is. It is.<\/p>\n<p>[00:12:50]\u00a0<strong>Ramit:<\/strong>\u00a0And are you a little surprised? You thought it was three times and it\u2019s nine times a week.<\/p>\n<p>[00:12:55]\u00a0<strong>James:<\/strong>\u00a0This is true.<\/p>\n<p>[00:12:55]\u00a0<strong>LaKiesha:<\/strong>\u00a0I\u2019m shocked. I am.<\/p>\n<p>[00:12:57]\u00a0<strong>Ramit:<\/strong>\u00a0So whatever number you told me, we spent 250 a week, you better triple that right away. What does this tell you if we zoom out about your entire financial picture?<\/p>\n<p>[00:13:07]\u00a0<strong>LaKiesha:<\/strong>\u00a0We don\u2019t know where our money is going.<\/p>\n<p>[00:13:09]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s correct. What else?<\/p>\n<p>[00:13:10]\u00a0<strong>James:<\/strong>\u00a0We need to plan.<\/p>\n<p>[00:13:12]\u00a0<strong>Ramit:<\/strong>\u00a0Yes. Love that. James, I love your answer, but I notice, again, you go towards the future. We need to change. James, you\u2019re not going to change unless you actually can diagnose and analyze what is happening today. You cannot move forward unless you stick with the present and understand it. So give me that answer.<\/p>\n<p>[00:13:33]\u00a0<strong>James:<\/strong>\u00a0We don\u2019t plan.<\/p>\n<p>[00:13:34]\u00a0<strong>Ramit:<\/strong>\u00a0We don\u2019t plan. Agreed. Would you say that you are impulsive with your spending?<\/p>\n<p>[00:13:39]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[00:13:40]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, good. And do you have some good stories that you tell yourselves about why we need to go out tonight?<\/p>\n<p>[00:13:48]\u00a0<strong>James:<\/strong>\u00a0Of course.<\/p>\n<p>[00:13:49]\u00a0<strong>Ramit:<\/strong>\u00a0We\u2019re busy. If you went into this whole thing about time management, I don\u2019t believe it. So do you see that, if we ended the call right now, what do you think would happen with your money?<\/p>\n<p>[00:13:59]\u00a0<strong>James:<\/strong>\u00a0It will continue to be the same old, same old.<\/p>\n<p>[00:14:01]\u00a0<strong>Ramit:<\/strong>\u00a0I agree. LaKiesha?<\/p>\n<p>[00:14:03]\u00a0<strong>LaKiesha:<\/strong>\u00a0We would continue to live in the way that we are and feel like we don\u2019t know where it\u2019s going or why we don\u2019t have enough for our future selves when the answer is there.<\/p>\n<p>[00:14:16]\u00a0<strong>Ramit:<\/strong>\u00a0What is the answer?<\/p>\n<p>[00:14:17]\u00a0<strong>LaKiesha:<\/strong>\u00a0We\u2019re spending it now.<\/p>\n<p>[00:14:19]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah, what are you spending it on?<\/p>\n<p>[00:14:21]\u00a0<strong>James:<\/strong>\u00a0Things we don\u2019t need to.<\/p>\n<p>[00:14:22]\u00a0<strong>Ramit:<\/strong>\u00a0Yes, that\u2019s true, but I don\u2019t love that answer. I would say you\u2019re spending your money unconsciously. You\u2019re not spending it on your Rich Life. If I asked the two of you, what is your Rich Life, would you have told me eating out nine times a week is in our Rich Life?<\/p>\n<p>[00:14:35]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:14:36]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:14:37]\u00a0<strong>James:<\/strong>\u00a0Absolutely not.<\/p>\n<p>[00:14:38]\u00a0<strong>Ramit:<\/strong>\u00a0What would you have said instead as it relates to eating out?<\/p>\n<p>[00:14:40]\u00a0<strong>LaKiesha:<\/strong>\u00a0Getting a chef once a month?<\/p>\n<p>[00:14:42]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, that would be nice. Probably not in the financial position to do that today. So what is your Rich Life today as it relates to eating out??<\/p>\n<p>[00:14:49]\u00a0<strong>James:<\/strong>\u00a0Keeping it to maybe once or twice a month.<\/p>\n<p>[00:14:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0If we could hold on to a specific place that we know we want to eat out at, then I think that would make it more meaningful.<\/p>\n<p>[00:15:01]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. I like the idea of a meaningful meal together. If I were in your situation, I might say our Rich Life is having one day each month where we all go out as a family and have a great meal, and we all share a dessert together and we appreciate it. What do you notice about that?<\/p>\n<p>[00:15:27]\u00a0<strong>James:<\/strong>\u00a0It\u2019s goal-oriented.<\/p>\n<p>[00:15:28]\u00a0<strong>LaKiesha:<\/strong>\u00a0If we tried to go outside of that one time, it would make us go back to that, like, this isn\u2019t the one time that we\u2019re supposed to go. It would give us something to hold ourselves accountable to if we\u2019re waiting for that.<\/p>\n<p>[00:15:43]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. It\u2019s slowing down and creating the life you want. It\u2019s not life happening to you. Oh, we\u2019re busy. So we stopped at this place and, oh, we got that thing. And it\u2019s around the family. So the whole thing about we\u2019re going to do one time with our family, that\u2019s so beautiful because it allows the family to talk about it. Maybe one of your kids gets to choose this month and the other gets to choose the next month.<\/p>\n<p>[00:16:07]\u00a0It becomes a whole thing. And the thing about sharing a dessert, like when I was a kid, we never got dessert. So forget about that. But okay. It\u2019s hard to go from 36 times to one time. We\u2019re going to have to talk about that. But the fact of being able to share this and appreciate it, this is what we can do right now. I hope that in the future we can each have our own dessert, we can each do more. Basically, there\u2019s a way to create meaning out of restraint. Do you see that?<\/p>\n<p>[00:16:36]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:16:37]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:16:38]\u00a0<strong>Ramit:<\/strong>\u00a0Do you ever say no to spending money?<\/p>\n<p>[00:16:40]\u00a0<strong>James:<\/strong>\u00a0I feel guilty about it sometimes, so I absolutely do. Yeah.<\/p>\n<p>[00:16:44]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. You say no, and then what do you do with the money that you didn\u2019t spend?<\/p>\n<p>[00:16:48]\u00a0<strong>James:<\/strong>\u00a0Find something else to spend\u2013<\/p>\n<p>[00:16:49]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s not great.<\/p>\n<p>[00:16:50]\u00a0<strong>James:<\/strong>\u00a0I know. Right.<\/p>\n<p>[00:16:51]\u00a0<strong>Ramit:<\/strong>\u00a0You feel guilty about spending it, but then you just spend it anyway. What\u2019s that about?<\/p>\n<p>[00:16:55]\u00a0<strong>James:<\/strong>\u00a0I probably spin on something that I say I need. If we don\u2019t have nothing to eat in the house, I go get something to eat or something like that or put gas in the car.<\/p>\n<p>[00:17:03]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. LaKiesha, what about you?<\/p>\n<p>[00:17:05]\u00a0<strong>LaKiesha:<\/strong>\u00a0If I say no to spending, it\u2019s because it\u2019s not fair. You know how, parents will say, no, we don\u2019t have money for that, or whatever? It will be a legit, like, no, we really don\u2019t have it. So if I say no, it\u2019s because it\u2019s not there usually, as opposed to, I don\u2019t want to spend it on whatever that thing is.<\/p>\n<p>[00:17:27]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, so can I ask again? When was the last time you told your daughter no when it came to spending money?<\/p>\n<p>[00:17:33]\u00a0<strong>LaKiesha:<\/strong>\u00a0She doesn\u2019t ask for things a lot. Like yesterday when we went to Target, I feel like that\u2019s why I was more compelled to say okay. It was an 11-dollar sweatshirt. It was cute. She doesn\u2019t ask for things a lot, so I said yes.<\/p>\n<p>[00:17:48]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. What do you spend your money on, LaKiesha? 88,000 bucks a year.<\/p>\n<p>[00:17:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0Stuff. That\u2019s the best word I can think of to describe what I spend my money on.<\/p>\n<p>[00:17:57]\u00a0<strong>Ramit:<\/strong>\u00a0What are we talking about?<\/p>\n<p>[00:17:59]\u00a0<strong>LaKiesha:<\/strong>\u00a0I like buying things for the home a lot, so decor. And I love to DIY stuff, like make t-shirts or sew things. So I have a lot of craft items as well. That\u2019s what I like spending on.<\/p>\n<p>[00:18:19]\u00a0<strong>Ramit:<\/strong>\u00a0All\u00a0right. Shall we look at the fixed costs and go through\u00a0the line items?<\/p>\n<p>[00:18:23]\u00a0<strong>LaKiesha:<\/strong>\u00a0Let\u2019s do it.<\/p>\n<p>[00:18:24]\u00a0<strong>Ramit:<\/strong>\u00a0All right. Let\u2019s take a look. So your rent is 16% if we combine it. How are you splitting your money now that you are living together?<\/p>\n<p>[00:18:33]\u00a0<strong>James:<\/strong>\u00a0The\u00a0$1,000\u00a0is what I give her towards rent.<\/p>\n<p>[00:18:38]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. And why is that?<\/p>\n<p>[00:18:41]\u00a0<strong>James:<\/strong>\u00a0It is a number she came up with. Well, came up with together.\u00a0Since she does make a little bit more than me, we thought that would be a fair amount.<\/p>\n<p>[00:18:49]\u00a0<strong>Ramit:<\/strong>\u00a0Wait, she makes more than you, but you\u2019re paying more for rent. How does that make sense?<\/p>\n<p>[00:18:53]\u00a0<strong>LaKiesha:<\/strong>\u00a0Let me tell you how this conversation went. I\u2019m\u00a0going to\u00a0tell you exactly how it went. He asked what number would I like for him to contribute and I said,\u00a0\u201cHow much can you?\u201d\u00a0And he said,\u00a0\u201cI don\u2019t know. I was thinking what if I give you\u00a0500 each paycheck?\u00a0And that could go towards rent or card on utilities or whatever. And then\u00a0everything else we\u2019ll figure out as time goes, stuff like groceries and gas and stuff like that.\u201d\u00a0So that\u2019s how that conversation went,\u00a0almost verbatim.<\/p>\n<p>[00:19:28]\u00a0<strong>Ramit:<\/strong>\u00a0And do you all feel good about this?<\/p>\n<p>[00:19:31]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.\u00a0I\u2019m good with the number. I don\u2019t feel good about how it happened because I feel like there was nothing we did or looked at in order to come to that conclusion. It was just an abstract number.<\/p>\n<p>[00:19:45]\u00a0<strong>Ramit:<\/strong>\u00a0But that\u2019s the way that both of you\u2019re living your financial lives, right?<\/p>\n<p>[00:19:49]\u00a0<strong>LaKiesha:<\/strong>\u00a0I\u00a0don\u2019t\u00a0want to.<\/p>\n<p>[00:19:51]\u00a0<strong>Ramit:<\/strong>\u00a0I agree. I don\u2019t want that either. I\u00a0want to\u00a0show you how to start using numbers effectively.\u00a0But what you just did,\u00a0it\u2019s such a common conversation that couples have. It\u2019s like, what do you\u00a0want to\u00a0do? Here\u2019s what I feel comfortable with. I\u2019m like, feelings. Why are we talking about feelings right now? I\u00a0want to\u00a0talk about cold hard numbers. Talk to me about ratios. Talk to me about percentages. This is the stuff I need right now. And it\u2019s a lot of like, I don\u2019t know. How about you? This is so common. So let me show you a different way.<\/p>\n<p>[Narration]<\/p>\n<p>[00:20:37]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, I get it. When you move in with a partner and you try to divide costs for the first time,\u00a0it can feel overwhelming, but it doesn\u2019t have to be. Up next, I\u2019m\u00a0going to\u00a0show\u00a0LaKiesha\u00a0and James what to consider when making this decision. Before we do that, I need a quick favor from you.\u00a0If you\u2019re enjoying this show, please hit the Subscribe button. It really helps by team and me.<\/p>\n<p>[00:20:52]\u00a0We\u2019ll be back after a short break.<\/p>\n<p>[00:20:55]\u00a0Let\u2019s get back to the conversation now.<\/p>\n<p>[Interview]<\/p>\n<p>[00:20:57]\u00a0<strong>Ramit:<\/strong>\u00a0Right now, if you break down your money,\u00a0you have lots of ways to do it.\u00a0You could just combine everything, which married couples often do. And I think in general it\u2019s a good idea. You could split it 50-50, which would make no sense, but some people just think that 50-50 is fair.\u00a0Or you could do it proportionally.<\/p>\n<p>[00:21:16]\u00a0Now, proportionally actually works out really well because,\u00a0LaKiesha,\u00a0you make 60% and he makes 40%\u00a0if you break down the numbers. So the way that that works is,\u00a0basically,\u00a0for any joint expenses, James pays 40% and\u00a0LaKiesha\u00a0pays 60%. How does everybody\u00a0feel about that?<\/p>\n<p>[00:21:34]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[00:21:35]\u00a0<strong>LaKiesha:<\/strong>\u00a0I feel great about that.<\/p>\n<p>[00:21:37]\u00a0<strong>Ramit:<\/strong>\u00a0Okay,\u00a0let\u2019s make a couple changes here. So let\u2019s take your rent,\u00a0and that would mean,\u00a0you,\u00a0LaKiesha,\u00a0paid 1,050. And let\u2019s just watch what happens here. That means, James, you pay 700. Wow. Big changes happening already. So already what we can see is that the\u2013\u00a0look at the fixed cost for each person.\u00a0They went 57% for James, but now\u00a0LaKiesha\u2019s at 75%.\u200a LaKiesha, what were you doing before James was contributing to the rent?<\/p>\n<p>[00:22:08]\u00a0<strong>LaKiesha:<\/strong>\u00a0Drowning.<\/p>\n<p>[00:22:09]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:22:10]\u00a0<strong>LaKiesha:<\/strong>\u00a0I filled this out alone months ago and sent it to him. My CSP, I think my number for fixed costs was in the 90s.<\/p>\n<p>[00:22:20]\u00a0<strong>Ramit:<\/strong>\u00a0You\u2019re spending too much. We\u2019re about to see that. How\u00a0are y\u2019all only spending $400 a month on groceries?\u00a0This is way lower than I normally see, especially for a family with kids. Right?<\/p>\n<p>[00:22:30]\u00a0<strong>James:<\/strong>\u00a0Okay.<\/p>\n<p>[00:22:31]\u00a0<strong>Ramit:<\/strong>\u00a0Normally I would see like 800 to 1,200 bucks.<\/p>\n<p>[00:22:34]\u00a0<strong>LaKiesha:<\/strong>\u00a0Oh no, we\u2019re definitely not spending that much. I am a coupon shopper. Our total at the grocery store yesterday went from 231 to\u00a0190 after coupons.<\/p>\n<p>[00:22:47]\u00a0<strong>Ramit:<\/strong>\u00a0I don\u2019t think that groceries are\u00a0going to\u00a0stay at 400. I don\u2019t think it\u2019s possible,\u00a0candidly.\u00a0I\u2019d like to adjust up because I hear a couple of times the two of you mention like,\u00a0we didn\u2019t have food,\u00a0so we went out. That\u2019s just not acceptable.\u00a0It\u2019s not. When you have high fixed costs, there will never be a day where you\u00a0\u201crun out of food\u201d\u00a0and go and have to get restaurant food.\u00a0It just makes no sense,\u00a0especially not making $150,000 joint.<\/p>\n<p>[00:23:15]\u00a0<strong>James:<\/strong>\u00a0Okay.<\/p>\n<p>[00:23:16]\u00a0<strong>Ramit:<\/strong>\u00a0So one of the things I talk about in my book,\u00a0Money for Couples, I\u00a0want to\u00a0show you\u2013\u00a0it\u2019s coming out\u2013\u00a0is creating a family culture. In our family we, \u2026\u00a0For example, in our family, we have a no debt policy. That\u2019s part of our culture.\u00a0What would it be for you?<\/p>\n<p>[00:23:36]\u00a0<strong>James:<\/strong>\u00a0Our family only eats out once a month.<\/p>\n<p>[00:23:40]\u00a0<strong>Ramit:<\/strong>\u00a0I love that. But give it to me with a little bit more meaning behind it because right now it feels a little bit dreary. Give it to me in a way that\u2019s meaningful for your family.<\/p>\n<p>[00:23:50]\u00a0<strong>James:<\/strong>\u00a0Our family only eats out once a month.<\/p>\n<p>[00:23:54]\u00a0<strong>Ramit:<\/strong>\u00a0I like it. It was theatrical, but give\u00a0me something else.\u00a0LaKiesha, you\u00a0want to\u00a0help\u00a0him\u00a0out?<\/p>\n<p>[00:23:58]\u00a0<strong>LaKiesha:<\/strong>\u00a0In our family,\u00a0if we can\u2019t pay for it outright, we don\u2019t buy it.<\/p>\n<p>[00:24:03]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s good.<\/p>\n<p>[00:24:04]\u00a0<strong>LaKiesha:<\/strong>\u00a0Even though it\u2019s\u00a0not something we\u2019re doing.<\/p>\n<p>[00:24:05]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Can we stick with the dining thing? I just\u00a0want to\u00a0show you an example of actually making something fun and not dreary. So it\u2019d be like, in\u00a0our family,\u00a0a\u00a0special family dinner once a month.\u00a0We rotate who chooses,\u00a0and we all share\u00a0one dessert\u00a0which we appreciate.\u00a0That\u2019s how I would say it.\u00a0But your family\u2019s got your own culture, so you\u2019d say something a little different.<\/p>\n<p>[00:24:31]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah. I got it.\u00a0In our family,\u00a0we have one evening that we are all together and we share a meal and a dessert and conversation.<\/p>\n<p>[00:24:46]\u00a0<strong>Ramit:<\/strong>\u00a0Love it. Beautiful. That\u2019s a\u00a0Rich Life. I love that. Let\u2019s keep going.\u00a0I\u2019m moving your groceries up to 800 because you\u2019re\u00a0going to\u00a0need groceries. There\u2019s a line on here, row 20. Now, I believe I invented the conscious vending plan, and I don\u2019t recall putting in a line, row 20, called Cigars and Alcohol. What the [Bleep] is this?<\/p>\n<p>[00:25:07]\u00a0<strong>James:<\/strong>\u00a0That was\u00a0[Bleep].\u00a0[Bleep]\u00a0did that.<\/p>\n<p>[00:25:09]\u00a0<strong>Ramit:<\/strong>\u00a0200 bucks from one person and 250 from another? Is this a joke?<\/p>\n<p>[00:25:13]\u00a0<strong>James:<\/strong>\u00a0I think that\u2019s a roundabout amount.<\/p>\n<p>[00:25:17]\u00a0<strong>Ramit:<\/strong>\u00a0Oh. Is it higher?<\/p>\n<p>[00:25:29]\u00a0<strong>James:<\/strong>\u00a0No. I\u2019ve definitely have not spent as much as I usually would spend on cigars.<\/p>\n<p>[00:25:25]\u00a0<strong>Ramit:<\/strong>\u00a0How much do you usually spend?<\/p>\n<p>[00:25:26]\u00a0<strong>James:<\/strong>\u00a0Six months ago, I was probably at least $300 a month for cigars. But that\u2019s just cigars. With alcohol, I would say probably about $500 a month.<\/p>\n<p>[00:25:36]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. What are you drinking?<\/p>\n<p>[00:25:39]\u00a0<strong>James:<\/strong>\u00a0Bourbon.<\/p>\n<p>[00:25:40]\u00a0<strong>Ramit:<\/strong>\u00a0All right. And LaKiesha\u2019s over here smiling like I\u2019m not going to call on her next. LaKiesha, what about you?<\/p>\n<p>[00:25:47]\u00a0<strong>LaKiesha:<\/strong>\u00a0I like wine.<\/p>\n<p>[00:25:49]\u00a0<strong>Ramit:<\/strong>\u00a0Are you in the cigars thing too?<\/p>\n<p>[00:25:50]\u00a0<strong>LaKiesha:<\/strong>\u00a0No. That\u2019s all him.<\/p>\n<p>[00:25:52]\u00a0<strong>Ramit:<\/strong>\u00a0So what do y\u2019all think? I know what you think is like Ramit\u2019s about to come down and drop the [Bleep] hammer. If you want to do it, you could do it. Can I be very honest with both of you right now?<\/p>\n<p>[00:26:01]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:26:01]\u00a0<strong>Ramit:<\/strong>\u00a0I think you came to me because you want help, and I respect you. I respect your time, and I am going to raise my expectations for both of you.<\/p>\n<p>[00:26:12]\u00a0<strong>LaKiesha:<\/strong>\u00a0All right.<\/p>\n<p>[00:26:13]\u00a0<strong>Ramit:<\/strong>\u00a0You have $0 in savings. You have kids. You have $0 in investments. Right now you\u2019re at 73% on your fixed costs. There\u2019s just no world where it\u2019s okay and where I\u2019m going to buy any of these stories about we\u2019re actually doing better. I just need to be more conscious. This is all BS, and you know it. The thing is, you want me to make the change for you. You want me to come in here and be like, \u201cStop it, guys.\u201d<\/p>\n<p>[00:26:39]\u00a0And then you can be like, \u201cI know. We should try better. We have been trying better.\u201d I\u2019m not going to play that game. That\u2019s what both of you want. I\u2019m not going to do it. If you want to keep doing it, you could do it. It\u2019s your money. It\u2019s your Rich Life. The fact is you have no savings and no investment. One illness, one problem with your kids, one car accident, and you are out of the game. And at 38 and 45, very hard to get back in it. So I guess what I\u2019m asking you is, are you ready to take this seriously? What do you want to do?<\/p>\n<p>[00:27:07]\u00a0<strong>LaKiesha:<\/strong>\u00a0I want to do the best, and we\u2019re not doing our best.<\/p>\n<p>[00:27:11]\u00a0<strong>Ramit:<\/strong>\u00a0All right. Let\u2019s do it then. But it\u2019s going to be you doing it, not me. So here\u2019s what I\u2019m doing. I\u2019m turning over control of the CSP to you. Your goal is to get this number down to 60%. Tell me how you want to do it. I\u2019ll make any changes you tell me. I\u2019m just the executor. But the only rule is you have to each do one thing and toss the ball back to each other. Go ahead.<\/p>\n<p>[00:27:30]\u00a0<strong>James:<\/strong>\u00a0I guess that line for cigars and alcohol, we can change it to $100 each.<\/p>\n<p>[00:27:35]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Can I ask you a question, James? Do you think you should be spending money on alcohol and cigars when you are in $26,000 of debt?<\/p>\n<p>[00:27:42]\u00a0<strong>James:<\/strong>\u00a0No. Okay.<\/p>\n<p>[00:27:46]\u00a0<strong>Ramit:<\/strong>\u00a0What\u2019s happening right now? You\u2019re a grown man. Why do I have to tell you this? You already know it. Is it that you are waiting like your dad looked over your shoulder and he was like, \u201cAre you sure you need that?\u201d And you allowed yourself to be put in that child position that you\u2019re now waiting for me to do that.<\/p>\n<p>[00:28:00]\u00a0<strong>James:<\/strong>\u00a0When we talked, you said that sometimes you feel like if I work hard, if I do this, I deserve at least one cigar every other day or something like that. So that\u2019s what\u2019s in my mind.<\/p>\n<p>[00:28:15]\u00a0<strong>Ramit:<\/strong>\u00a0Has that approach worked for you?<\/p>\n<p>[00:28:17]\u00a0<strong>James:<\/strong>\u00a0It has not, no.<\/p>\n<p>[00:28:18]\u00a0<strong>Ramit:<\/strong>\u00a0So do you want to keep the same approach and hope that it magically changes?<\/p>\n<p>[00:28:23]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:28:23]\u00a0<strong>Ramit:<\/strong>\u00a0I think before we go into all these numbers, you all need to decide like, how do we want to show up right now? Imagine here I am trying to run track or something. I\u2019m running the 400. And every time I go out there, I\u2019m like, \u201cOh, I\u2019m so tired. Life sucks. It\u2019s so hot. My shoe lace is\u2013\u201d And I just keep losing.<\/p>\n<p>[00:28:40]\u00a0And then my coach pulls me aside and says, \u201cListen, you actually have pretty good skills. How have you been showing up?\u201d I\u2019m like, \u201cI\u2019m a downer. I\u2019m always complaining.\u201d And he goes, \u201cHow do you want to show up?\u201d How would I answer him?<\/p>\n<p>[00:28:56]\u00a0<strong>LaKiesha:<\/strong>\u00a0You want to show up to win.<\/p>\n<p>[00:28:58]\u00a0<strong>Ramit:<\/strong>\u00a0Show up to win. What\u2019s my attitude going to be like?<\/p>\n<p>[00:29:00]\u00a0<strong>James:<\/strong>\u00a0Let\u2019s do this.<\/p>\n<p>[00:29:02]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s [Bleep] do this. That\u2019s right.<\/p>\n<p>[00:29:04]\u00a0<strong>LaKiesha:<\/strong>\u00a0Motivated.<\/p>\n<p>[00:29:05]\u00a0<strong>Ramit:<\/strong>\u00a0Exactly. And all the stories I used to tell myself, if only this one guy wasn\u2019t here, I\u2019d win. Those stories are gone. I got a new story for myself. I deserve to win. So how do you guys want to show up as we\u2019re about to get into this CSP?<\/p>\n<p>[00:29:16]\u00a0<strong>LaKiesha:<\/strong>\u00a0Motivated, pumped.<\/p>\n<p>[00:29:18]\u00a0<strong>Ramit:<\/strong>\u00a0Love it. Let\u2019s do it. Here we go. James first. What do you want to do?<\/p>\n<p>[00:29:23]\u00a0<strong>James:<\/strong>\u00a0Take out the alcohol and cigars.<\/p>\n<p>[00:29:25]\u00a0<strong>Ramit:<\/strong>\u00a0All\u00a0right, take it out. I\u2019m zeroing out alcohol and cigars. I want you to look at this number as I go down the list. This is your fixed cost number. It\u2019s at 73%. Our goal is to get it to 60. Here we go. Cigars,\u00a00\u00a0and\u00a00. What do we see that number change to?<\/p>\n<p>[00:29:44]\u00a0<strong>LaKiesha:<\/strong>\u00a067%.<\/p>\n<p>[00:29:45]\u00a0<strong>Ramit:<\/strong>\u00a067%.\u00a0All right. We\u2019re going in the right direction. What else?<\/p>\n<p>[00:29:50]\u00a0<strong>LaKiesha:<\/strong>\u00a0I would like to change the child support college students to zero for right now.<\/p>\n<p>[00:29:56]\u00a0<strong>Ramit:<\/strong>\u00a0Explain this to me. What is this category?<\/p>\n<p>[00:29:58]\u00a0<strong>LaKiesha:<\/strong>\u00a0I was sending my niece and my daughter $50 every two weeks.\u00a0But they\u2019re both employed. They don\u2019t necessarily need it. They never ask for it. I just wanted to do something, so that\u2019s what I was doing.<\/p>\n<p>[00:30:13]\u00a0<strong>Ramit:<\/strong>\u00a0I love your niece and kids and everything. Give\u00a0them\u00a0a big hug next time you see\u00a0them. But the checks have stopped. All\u00a0right. 200 bucks, that\u2019s zero. And what\u2019s this child support for 600? That\u2019s James, right?<\/p>\n<p>[00:30:25]\u00a0<strong>James:<\/strong>\u00a0Yeah,\u00a0that\u2019s legal. I have to\u00a0pay that.<\/p>\n<p>[00:30:27]\u00a0<strong>Ramit:<\/strong>\u00a0Legal. We\u2019re keeping that. Okay,\u00a0great. Let\u2019s keep it. The number is 65%. Oh my God. We\u2019re making better progress than I thought. Toss the ball back, LaKiesha. Toss it to him.<\/p>\n<p>[00:30:38]\u00a0<strong>James:<\/strong>\u00a0I guess miscellaneous can change to $100 for each.<\/p>\n<p>[00:30:41]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. Can I tell you what is in that category? So I include miscellaneous. It\u2019s 15% of all your other stuff. I found another magic number, which 15% is typically how much people don\u2019t think about for their fixed costs. That would be things like something breaks in your house or a car repaired you didn\u2019t plan for. So I add in 15%.<\/p>\n<p>[00:31:05]\u00a0Now, here\u2019s the thing. When you have a very financially healthy position, you should actually be putting that money aside and then at the end of the year you can make a little rule. Oh, we didn\u2019t spend it. Let\u2019s invest most of it, spend it, whatever. The fact is, you can\u2019t have $793 a month in miscellaneous costs. It\u2019s just out of control for your abilities right now. That means you got to be tighter, more intentional. So we\u2019re going to reduce it, but what are the implications for the two of you?<\/p>\n<p>[00:31:39]\u00a0<strong>LaKiesha:<\/strong>\u00a0If we reduce it, to your point, when you scroll down, then we need to plan for those miscellaneous things happening and being more proactive instead of reactive.<\/p>\n<p>[00:31:53]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s exactly right. Boom. You nailed it.\u00a0So let\u2019s do it. Watch what happens to the number. It\u2019s\u00a0going to\u00a0be quite amazing. We\u2019re changing the $300 to $100 miscellaneous, and we\u2019re changing the 493 to 100. What\u2019s that number?<\/p>\n<p>[00:32:07]\u00a0<strong>James:<\/strong>\u00a0Wow.<\/p>\n<p>[00:32:08]\u00a0<strong>LaKiesha:<\/strong>\u00a059%.<\/p>\n<p>[00:32:09]\u00a0<strong>James:<\/strong>\u00a059%.<\/p>\n<p>[00:32:10]\u00a0<strong>Ramit:<\/strong>\u00a059%.\u00a0Give yourselves a round of applause. That\u2019s really good. Well done. Honestly, I\u2019m amazed.\u00a0This is incredible. Keep in mind, we have increased your grocery spend by a lot. By double. That\u2019s amazing. Now let me ask you this. Who cooks at home?<\/p>\n<p>[00:32:27]\u00a0<strong>LaKiesha:<\/strong>\u00a0If food gets cooked, I usually cook it.<\/p>\n<p>[00:32:29]\u00a0<strong>Ramit:<\/strong>\u00a0Wow, wow. Okay. How often does food get cooked?<\/p>\n<p>[00:32:32]\u00a0<strong>LaKiesha:<\/strong>\u00a0Probably three to four times a week.<\/p>\n<p>[00:32:36]\u00a0<strong>Ramit:<\/strong>\u00a0That actually seems to me like a pretty big deal. Let\u2019s round down on this one. Let\u2019s say it gets cooked twice a week. So let\u2019s say one night everybody comes home, they\u2019re tired, and there\u2019s no food cooked, what\u2019s everybody going to end up doing immediately?<\/p>\n<p>[00:32:48]\u00a0<strong>LaKiesha:<\/strong>\u00a0If we\u2019re spending this much on groceries, there\u2019s going to always be food here. And me personally, if there\u2019s food here, I\u2019m going to make something. I\u2019m not going to buy something. It\u2019s going to be, by the time I place an order and go pick up or before it\u2019s delivered, I could have made something already. So if there\u2019s food here, then I\u2019m going to go to see what I could throw together.<\/p>\n<p>[00:33:12]\u00a0<strong>Ramit:<\/strong>\u00a0I love your answer and I love the attitude you had when you answered that. Just like, I\u2019m going to make it. When there\u2019s food here, I\u2019m known for it. That\u2019s amazing. That\u2019s the attitude that I want to bring to the money. I\u2019ll tell you my example. When there\u2019s extra money, I\u2019m going to invest it. I\u2019m known for investing extra money. We can bring that same attitude to different parts of our life.<\/p>\n<p>[00:33:38]\u00a0I just wanted to point out, I\u2019m struck by how awesome that attitude was right there and that energy. So you have it in you. I just want to see us bring it to other parts of life. Anything else on fixed cost? We got this phone bill. Y\u2019all paying for your kids\u2019 phone bills here?<\/p>\n<p>[00:33:56]\u00a0<strong>LaKiesha:<\/strong>\u00a0I am, yeah. So there\u2019s four lines. My line, my two daughters, and my niece. So I raised my niece from seventh grade through high school.<\/p>\n<p>[00:34:04]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s awesome. Do you want to keep paying for her phone?<\/p>\n<p>[00:34:07]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes, I do.<\/p>\n<p>[00:34:08]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, fine. James, what about you? 125 a month. What\u2019s that?<\/p>\n<p>[00:34:13]\u00a0<strong>James:<\/strong>\u00a0That\u2019s just me. I got this phone on there right now. Paying on this phone.<\/p>\n<p>[00:34:17]\u00a0<strong>Ramit:<\/strong>\u00a0Subscriptions are at 110. Any duplicates y\u2019all can cancel since you\u2019re living together?<\/p>\n<p>[00:34:22]\u00a0<strong>James:<\/strong>\u00a0Absolutely. We could definitely do that.<\/p>\n<p>[00:34:24]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s make a change right now. How much?<\/p>\n<p>[00:34:27]\u00a0<strong>LaKiesha:<\/strong>\u00a0What\u2019s your gym membership?<\/p>\n<p>[00:34:39]\u00a0<strong>James:<\/strong>\u00a033 a month. And so I have Peacock and things like that, but I can get rid of that.\u00a0So for mine, you\u00a0probably can just change that to 33 for my gym membership.<\/p>\n<p>[00:34:40]\u00a0<strong>Ramit:<\/strong>\u00a033. Love it. And for you,\u00a0LaKiesha?<\/p>\n<p>[00:34:44]\u00a0<strong>LaKiesha:<\/strong>\u00a0I\u00a0think you should leave it at 60.<\/p>\n<p>[00:34:46]\u00a0<strong>Ramit:<\/strong>\u00a0All\u00a0right.\u00a0Fine. So you have 58%, which is within the 50 to 60% for fixed costs. I think that part is good. But now we need to get pretty aggressive because you are 38 and 45. You have zero savings and zero investments. You all can live a Rich Life, but it\u2019s up to you how hard you want to push it. And I want to show you an example so you really start to understand the numbers here.<\/p>\n<p>[Narration]<\/p>\n<p>[00:35:13]\u00a0<strong>Ramit:<\/strong>\u00a0LaKiesha\u00a0and James have said they want to plan to move forward, which I love to hear,\u00a0and that\u2019s what I\u2019m about to give them. But as you heard James say earlier, he\u2019s scared when it comes to investing, and this is common for people who don\u2019t understand how investing works.\u00a0I\u2019m about to show them how easy investing can be and how impactful it can be.<\/p>\n<p>[00:35:35]\u00a0We\u2019ll get to that after a quick pause to support our sponsors.<\/p>\n<p>[00:35:40]\u00a0Let\u2019s get back to the conversation.<\/p>\n<p>[Interview]<\/p>\n<p>[00:35:52]\u00a0<strong>Ramit:<\/strong>\u00a0Pick a number. How much do y\u2019all think that you should invest every month?<\/p>\n<p>[00:35:47]\u00a0<strong>James:<\/strong>\u00a020% of our income.<\/p>\n<p>[00:35:49]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, cool. So 20% of your, shall we say gross income or net income?<\/p>\n<p>[00:35:55]\u00a0<strong>LaKiesha:<\/strong>\u00a0Gross.<\/p>\n<p>[00:35:55]\u00a0<strong>Ramit:<\/strong>\u00a0Gross. Okay, love it. Wow. Aggressive. So that\u2019s $1,478 a month for you, LaKiesha. So let\u2019s just put it right here. Okay. Wow. Good. That\u2019s 27% of net or 20% of gross. Cool. What about for you, James? Pick a number.<\/p>\n<p>[00:36:14]\u00a0<strong>James:<\/strong>\u00a0I guess I\u2019ll match hers to 20% of gross.<\/p>\n<p>[00:36:18]\u00a0<strong>Ramit:<\/strong>\u00a0All right. Let\u2019s go ahead and do the same thing just to see what happens. That\u2019s going to be about 1,000 bucks a month. All right. So right now you basically dropped your amount that you can spend a lot every month. Your guilt-free spending, you actually don\u2019t have that much money left over. So the more we put here in your savings, you know where that money\u2019s coming from? From here.<\/p>\n<p>[00:36:42]\u00a0<strong>LaKiesha:<\/strong>\u00a0The money we spend out.<\/p>\n<p>[00:36:43]\u00a0<strong>Ramit:<\/strong>\u00a0The money you spend eating out and what else?<\/p>\n<p>[00:36:46]\u00a0<strong>LaKiesha:<\/strong>\u00a0Shopping.<\/p>\n<p>[00:36:47]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. Y\u2019all can save money. I\u2019ll show you how much you\u2019re going to have, but that money comes from somewhere. And it would come from eating out and shopping. Is that a surprise to you, or is that something you expected?<\/p>\n<p>[00:36:59]\u00a0<strong>James:<\/strong>\u00a0No. I know that it is going to take some type of sacrifice to get to where we need to get to.<\/p>\n<p>[00:37:04]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. How come you haven\u2019t done it before?<\/p>\n<p>[00:37:07]\u00a0<strong>James:<\/strong>\u00a0It goes back to a lot of the things. Like you said, we wasn\u2019t thinking about our future selves. Not only that, but since, we\u2019ve met each other, I think we want to be better for each other so we can have a better future.<\/p>\n<p>[00:37:17]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. What do you think, LaKiesha?<\/p>\n<p>[00:37:19]\u00a0<strong>LaKiesha:<\/strong>\u00a0It just feels different to be doing this with someone else that has the same main goal in mind. That\u2019s what makes this feel different. So you don\u2019t feel like you\u2019re sacrificing alone.<\/p>\n<p>[00:37:32]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s really difficult to be the only person in a relationship who\u2019s carrying the weight. And sometimes your partner is unengaged or sometimes they\u2019re actively working against you. It\u2019s like, I\u2019m trying to save money and then my partner\u2019s like, \u201cHey, come on. It\u2019s Friday. Let\u2019s go out.\u201d How are you supposed to deal with that? It\u2019s like constant temptation in the house.<\/p>\n<p>[00:37:51]\u00a0But on the other hand, if the two of you have a bigger vision than what are we doing this week, becomes very powerful. So let\u2019s take a look at the compound interest, how much you\u2019re going to have. Right now you have zero. Your annual addition, if we were to do just the number we picked out, it\u2019s an aggressive goal, but let\u2019s just see what happens. $29,736 a year. Years to grow, how many years should we say?<\/p>\n<p>[00:38:16]\u00a0<strong>LaKiesha:<\/strong>\u00a025.<\/p>\n<p>[00:38:17]\u00a0<strong>Ramit:<\/strong>\u00a0James, you\u2019re 45, right?<\/p>\n<p>[00:38:20]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[00:38:21]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s say 20 first and then we can see what happens if we wait five more years.<\/p>\n<p>[00:38:24]\u00a0<strong>LaKiesha:<\/strong>\u00a0Okay.<\/p>\n<p>[00:38:25]\u00a0<strong>Ramit:<\/strong>\u00a0Interest rate is 7%. Let\u2019s just go ahead. Anybody want to guess how much you\u2019re going to have?<\/p>\n<p>[00:38:29]\u00a0<strong>LaKiesha:<\/strong>\u00a01.3 million.<\/p>\n<p>[00:38:31]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. James?<\/p>\n<p>[00:38:35]\u00a0<strong>James:<\/strong>\u00a0Let\u2019s go with 1 million.<\/p>\n<p>[00:38:35]\u00a0<strong>Ramit:<\/strong>\u00a01.3 million. Damn. LaKiesha, that was an excellent guess. Okay. So what does 1.3 million mean to you?<\/p>\n<p>[00:38:46]\u00a0<strong>James:<\/strong>\u00a0I won\u2019t be broke when I retire. And not only won\u2019t be broke, I just will be able to enjoy retirement.<\/p>\n<p>[00:38:52]\u00a0<strong>Ramit:<\/strong>\u00a0How much will you be able to enjoy your retirement? Give me a number. How much will you be living on?<\/p>\n<p>[00:38:57]\u00a0<strong>James:<\/strong>\u00a065k, maybe.<\/p>\n<p>[00:38:59]\u00a0<strong>Ramit:<\/strong>\u00a0All right. Not a bad guess. So we\u2019re going to use something called the 4% rule. It\u2019s not perfect. It\u2019s good back of the napkin. We\u2019re going to take that number, multiply it by 0.04. That means you\u2019ll have about $52,000 per year. There might be some benefits. You might have some social security. I think that\u2019s for sure. And do y\u2019all own or rent?<\/p>\n<p>[00:39:19]\u00a0<strong>James:<\/strong>\u00a0Rent.<\/p>\n<p>[00:39:20]\u00a0<strong>LaKiesha:<\/strong>\u00a0Rent.<\/p>\n<p>[00:39:21]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. So you\u2019re going to have housing costs at that time and they will likely continue going up. We\u2019ll see. So how do y\u2019all feel about living on $52,000 a year?<\/p>\n<p>[00:39:29]\u00a0<strong>James:<\/strong>\u00a0That\u2019s not going to get it.<\/p>\n<p>[00:39:30]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s not going to do it. Oh. What about LongHorns? You see, the choices we make today directly affect what we do tomorrow. So if you really consider it and you break it down, the nine meals a week out, literally costing tens and tens of thousands of dollars. Now if you can afford it, I got no problem. You love good food. I love it too.<\/p>\n<p>[00:39:50]\u00a0But the problem is right now you\u2019re not on a sustainable path. And this assumes nothing bad happens. No layoffs, no injuries, everything\u2019s perfect. Let\u2019s keep looking. There\u2019s another thing I want to point out. If we wait 25 years, because something really powerful happens then. Well, James might have to work long. I would hate to put James in that position, but let\u2019s just take a look. At 25 years, instead of 1.3 million, you\u2019re at 2 million.<\/p>\n<p>[00:40:17]\u00a0<strong>LaKiesha:<\/strong>\u00a0What?<\/p>\n<p>[00:40:18]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s crazy, right?<\/p>\n<p>[00:40:20]\u00a0<strong>LaKiesha:<\/strong>\u00a0I understand compound interest, but I did not think it would go up that much just from five years.<\/p>\n<p>[00:40:27]\u00a0<strong>Ramit:<\/strong>\u00a0Oh, you don\u2019t think so? You want to see what happens at 30? Watch this. This is just five more years. 3 million. Do you understand that it took roughly 18 or so years to get to a million, then it took a few more years to get to 2 million, and then five years to get to 3 million? What does this tell you?<\/p>\n<p>[00:40:42]\u00a0<strong>LaKiesha:<\/strong>\u00a0We can\u2019t do anything about the past. That\u2019s hindsight. But we should have started years ago.<\/p>\n<p>[00:40:47]\u00a0<strong>Ramit:<\/strong>\u00a0Yes. And what should we talk about right now?<\/p>\n<p>[00:40:50]\u00a0<strong>LaKiesha:<\/strong>\u00a0We need to start today, like today.<\/p>\n<p>[00:40:53]\u00a0<strong>Ramit:<\/strong>\u00a0Exactly. Do you see why I was so alarmed at this $900, like, oh, let\u2019s talk about it? Let me ask for permission. Why put yourself in that role, asking somebody who candidly does not know about investing? You got to decide each of you for yourself what kind of life you\u2019re going to live. We could talk about the marriage, staying together, living together, all that stuff. But regardless, each of you is getting older. You have to take action regardless of what the other person does. Do you see that directly in the math?<\/p>\n<p>[00:41:24]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:41:25]\u00a0<strong>Ramit:<\/strong>\u00a0LaKiesha, you see it. James, what\u2019s going on with you? What are you feeling right now? I just want to check in with you.<\/p>\n<p>[00:41:29]\u00a0<strong>James:<\/strong>\u00a0The numbers are more shocking. We have to do something.<\/p>\n<p>[00:41:32]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s a good answer. We have to do something. I love that. We have to make a change. Now, I want to point out, I want to caveat some of this because if you all were investing $29,000 a year for 25 years, you could get to 2 million bucks. And if we take that number and run the 4% on that, that\u2019s $80,500 a year. That\u2019s good. That\u2019s nice. Solid. That\u2019s accounting for inflation, by the way. Plus, we add on however much for social security. That\u2019s nice. Okay, cool. The problem is you really can\u2019t afford to invest $30,000 a year. Do you know why?<\/p>\n<p>[00:42:16]\u00a0<strong>LaKiesha:<\/strong>\u00a0Why?<\/p>\n<p>[00:42:17]\u00a0<strong>Ramit:<\/strong>\u00a0Anybody tell me what\u2019s completely blank on the CSP?<\/p>\n<p>[00:42:19]\u00a0<strong>LaKiesha:<\/strong>\u00a0Savings.<\/p>\n<p>[00:42:20]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. What\u2019s savings for?<\/p>\n<p>[00:42:22]\u00a0<strong>LaKiesha:<\/strong>\u00a0Emergencies.<\/p>\n<p>[00:42:24]\u00a0<strong>Ramit:<\/strong>\u00a0Mm-hmm. And right now you have no emergency fund.<\/p>\n<p>[00:42:26]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:42:27]\u00a0<strong>Ramit:<\/strong>\u00a0You also have no money set aside for a new car, a vacation, somebody graduating, none of it. So we need to build that money up, and we need to do it fast. Because if one of you gets in financial trouble, you are in really, really bad trouble. So we have a limited amount of money here. How do we want to allocate it?<\/p>\n<p>[00:42:48]\u00a0<strong>LaKiesha:<\/strong>\u00a0Maybe if we did 20% net as opposed to gross.<\/p>\n<p>[00:42:52]\u00a0<strong>Ramit:<\/strong>\u00a0What\u2019s my recommendation for the conscious spending plan for savings? It\u2019s 5 to 10%.<\/p>\n<p>[00:42:57]\u00a0<strong>LaKiesha:<\/strong>\u00a0Okay.<\/p>\n<p>[00:42:57]\u00a0<strong>Ramit:<\/strong>\u00a0Why don\u2019t we start there? Notice I just typed in 500 just to see. That\u2019s 13% of James\u2019s net income, so that\u2019s too high. So James can afford to do 200 bucks a month. Do you all see why I was so alarmed with the cigars and alcohol and the negotiation? It\u2019s like, what are we even talking about? We have nothing in savings.<\/p>\n<p>[00:43:19]\u00a0We can\u2019t be talking about cigars. What this shows is that, James, you currently have $517 per month to spend guilt-free spending. And LaKiesha, you have $385 per month to spend guilt-free spending. Now, what do you think of these numbers?<\/p>\n<p>[00:43:36]\u00a0<strong>James:<\/strong>\u00a0That\u2019s better than probably what we were doing.<\/p>\n<p>[00:43:40]\u00a0<strong>Ramit:<\/strong>\u00a0No. You were spending thousands per month.<\/p>\n<p>[00:43:42]\u00a0<strong>James:<\/strong>\u00a0Right. So that\u2019s way better then.<\/p>\n<p>[00:43:44]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s stop using better and worse. Let\u2019s stop putting moral judgments on spending money. That\u2019s an old way of thinking. Because, think about it, what you\u2019re saying, James\u2013 and LaKiesha, you\u2019ve also said this. You\u2019ve both said like, \u201cI\u2019ve been bad.\u201d Have you noticed that? As in spending money is bad.<\/p>\n<p>[00:44:01]\u00a0That\u2019s something that people tell their kids. That\u2019s bad. Put that back. The thing is you both have said like, \u201cI\u2019ve been bad.\u201d But you\u2019re spending all your money. You\u2019re literally spending more than you make. You\u2019re spending thousands eating out. So it\u2019s not even working by telling yourselves, I\u2019ve been bad. Let\u2019s stop talking about money like that and let\u2019s instead start talking about, what is our Rich Life?<\/p>\n<p>[00:44:25]\u00a0So no more good and bad. Spending more or less has nothing to do with that. It\u2019s all about, here are the numbers. How do we want to allocate our money within those numbers? LaKiesha, what does it feel like to see that you have $385 a month to spend guilt-free?<\/p>\n<p>[00:44:39]\u00a0<strong>LaKiesha:<\/strong>\u00a0While the amount doesn\u2019t feel good, it feels good to know that that\u2019s what I\u2019m working with, and that\u2019s what I can work out of. It\u2019s almost like an allowance. When you were a child and you had an allowance, once you spent it, that was it. You didn\u2019t have a credit card or anything to fall back on. Once it was gone, it was gone. So if I feel like that\u2019s my allowance, then I know that. I have a number that I can go back to as opposed to thinking that this whole check is at my disposal and I could do with it what I want.<\/p>\n<p>[00:45:11]\u00a0<strong>Ramit:<\/strong>\u00a0I think it\u2019s good to set boundaries for yourself. And I think at this stage it\u2019s good to have these bumper lanes. You need some guidance right now because obviously just having that entire check just sit in your checking account is not working for you.<\/p>\n<p>[00:45:25]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:45:26]\u00a0<strong>Ramit:<\/strong>\u00a0How are you going to deal with the eating out if the two of you only have 500 and 300 bucks a month?<\/p>\n<p>[00:45:34]\u00a0<strong>James:<\/strong>\u00a0We definitely got to reduce that.<\/p>\n<p>[00:45:36]\u00a0<strong>Ramit:<\/strong>\u00a0Do you all see how it works together?<\/p>\n<p>[00:45:38]\u00a0<strong>James:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:45:39]\u00a0<strong>Ramit:<\/strong>\u00a0You can\u2019t actually go out to eat nine times a week anymore or 36 times a month.<\/p>\n<p>[00:45:45]\u00a0<strong>LaKiesha:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:45:45]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s funny when you put it that way, right? It\u2019s like you were eating out more than once per day. So there\u2019s just no money for it. You don\u2019t have to try. There\u2019s just no money for it.<\/p>\n<p>[00:45:54]\u00a0<strong>LaKiesha:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:45:55]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s it. The money\u2019s gone. It\u2019s moved to a savings account. It\u2019s gone to an investment account. It\u2019s just not there anymore. So now what happens if somebody\u2019s tired on a Thursday night and they\u2019re like, I don\u2019t want to eat this raw celery. Let\u2019s go to Ben\u2019s pizza. What are y\u2019all going to say?<\/p>\n<p>[00:46:11]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[00:46:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:46:12]\u00a0<strong>Ramit:<\/strong>\u00a0And then what if one person goes, I\u2019ll pick it up.<\/p>\n<p>[00:46:14]\u00a0<strong>LaKiesha:<\/strong>\u00a0If I don\u2019t have room out of my 387, then I\u2019m not going to do it.<\/p>\n<p>[00:46:19]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. All right. I like it. That was a pretty good answer. I like that. I think probably just watch out for becoming the police of the other person\u2019s finances. You don\u2019t want that. I think you probably need to recalibrate your relationship. I talk a lot about money dynamics in Money for Couples, and parent-child is one that we notice here, and that\u2019s going to have to be changed.<\/p>\n<p>[00:46:43]\u00a0Even asking for permission for your own 401K, it makes no sense. Looking over someone\u2019s shoulder and saying like, \u201cDo you need that?\u201d That also makes no sense. It also strips the other person of their own individuality. We don\u2019t want that. We need each of you to stand up on your own before you can effectively be a team. So have you thought about that? Have you thought about the role of money in your relationship moving forward?<\/p>\n<p>[00:47:11]\u00a0<strong>James:<\/strong>\u00a0That\u2019s one of the biggest reasons we wanted to get on with you.<\/p>\n<p>[00:47:14]\u00a0<strong>LaKiesha:<\/strong>\u00a0I\u2019m so inexperienced with dealing with or even having a role of money in a relationship, and he has had some bad experience. And so I feel like given those perspectives, we knew that we needed help outside of ourselves.<\/p>\n<p>[00:47:33]\u00a0<strong>Ramit:<\/strong>\u00a0I\u2019m so glad you reached out. Here\u2019s my observation. I think that because I look at the two of you at 38 and 45 with no savings and no investments, it\u2019s clear that there\u2019s a lot of love. And I love the compromises that the two of you\u2019re talking about. I love that I\u2019m challenging you. I\u2019m pushing you on the eating out and the cigars and the rolls, and you\u2019re with me. This is hard stuff. You\u2019re staying with me. I appreciate that.<\/p>\n<p>[00:47:59]\u00a0If I were in your shoes, what I would want to see for both of you would be for each of you to become financially skilled before you were to move forward and combine anything. That would be my own personal opinion. Why do I say that? Because right now your finances are not in great shape. You\u2019ve started hopefully this proportional combination, which I think will be much more fair for joint expenses.<\/p>\n<p>[00:48:27]\u00a0<strong>LaKiesha:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:48:28]\u00a0<strong>Ramit:<\/strong>\u00a0But if you were to get married and combine everything, I think it would probably be a bad situation right now. Do you agree?<\/p>\n<p>[00:48:34]\u00a0<strong>LaKiesha:<\/strong>\u00a0I would agree 100%.<\/p>\n<p>[00:48:35]\u00a0<strong>Ramit:<\/strong>\u00a0And James?<\/p>\n<p>[00:48:36]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[00:48:38]\u00a0<strong>Ramit:<\/strong>\u00a0Oh, amazing. Okay, we\u2019re all on the same page. That is because each of you doesn\u2019t yet individually have the skills to manage money. As you start this journey, you\u2019re going to realize some things are going to come up like, oh my gosh, one of us is sticking to the plan and the other one is looser. How are we going to navigate that? One of us can\u2019t get things paid on time. The other can, etc.<\/p>\n<p>[00:48:59]\u00a0And that\u2019s okay. Not everyone\u2019s going to be perfect the first time, but you\u2019ve got to get on solid foundation. And I would be specific. I would say, \u201cLook, before we get married, I want each of us to have X thousand dollars in our savings account. I want X thousand dollars in our investment account.\u201d<\/p>\n<p>[00:49:16]\u00a0Pick a number that\u2019s reasonable based on what we have decided here. It shows a commitment to excellence. And I don\u2019t know about you. I want excellence for myself. My wife wants it. We want it for each other, to have savings and investments. Seems pretty straightforward. It doesn\u2019t seem too crazy to me. What do y\u2019all think?<\/p>\n<p>[00:49:33]\u00a0<strong>LaKiesha:<\/strong>\u00a0I agree.<\/p>\n<p>[00:49:33]\u00a0<strong>James:<\/strong>\u00a0That that\u2019s [Inaudible]. Yeah.<\/p>\n<p>[Narration]<\/p>\n<p>[00:49:36]\u00a0<strong>Ramit:<\/strong>\u00a0I\u00a0want to\u00a0revisit something\u00a0LaKiesha\u00a0said in the previous episode, which is important to acknowledge now knowing that the two of them are creating a new path.\u00a0LaKiesha\u00a0said that she has wanted to fire her therapist for over a year, but she hasn\u2019t done it. I\u00a0want to\u00a0know why she\u2019s dragged out this decision that is seemingly straightforward.<\/p>\n<p>[Interview]<\/p>\n<p>[00:50:01]\u00a0<strong>Ramit:<\/strong>\u00a0Can we talk about this therapist for a second? LaKiesha, is this a different therapist than James?<\/p>\n<p>[00:50:05]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes, different therapist.<\/p>\n<p>[00:50:06]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. And you want to fire them? How come you haven\u2019t?<\/p>\n<p>[00:50:09]\u00a0<strong>LaKiesha:<\/strong>\u00a0I don\u2019t know. I\u2019ve been working with her for a while, and so I just feel weird.<\/p>\n<p>[00:50:16]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. So it\u2019s just an uncomfortable conversation?<\/p>\n<p>[00:50:18]\u00a0<strong>LaKiesha:<\/strong>\u00a0It is. It\u2019s an uncomfortable conversation. To be honest with you, until you said it, I never thought about just sending an email saying like, \u201cHey, I don\u2019t want to do this anymore,\u201d or, \u201cI\u2019m firing you.\u201d I don\u2019t even know how to begin having that conversation to be honest.<\/p>\n<p>[00:50:31]\u00a0<strong>Ramit:<\/strong>\u00a0I don\u2019t mind that. But can I ask you, like, how do you think your inability to switch therapists is affecting your finances?<\/p>\n<p>[00:50:39]\u00a0<strong>LaKiesha:<\/strong>\u00a0I have no idea. I never even thought of it. I never made a connection between the two at all.<\/p>\n<p>[00:50:45]\u00a0<strong>Ramit:<\/strong>\u00a0What do you think it means that you cannot fire a free therapist, free to you? What does it mean? What does it say about you?<\/p>\n<p>[00:50:53]\u00a0<strong>LaKiesha:<\/strong>\u00a0I avoid conflict.<\/p>\n<p>[00:50:55]\u00a0<strong>Ramit:<\/strong>\u00a0Yes, you avoid conflict. And so how do you avoid conflict with your money?<\/p>\n<p>[00:50:59]\u00a0<strong>LaKiesha:<\/strong>\u00a0File for bankruptcy.<\/p>\n<p>[00:51:01]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:51:01]\u00a0<strong>LaKiesha:<\/strong>\u00a0Which I\u2019ve done.<\/p>\n<p>[00:51:02]\u00a0<strong>Ramit:<\/strong>\u00a0Which you\u2019ve done.<\/p>\n<p>[00:51:03]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:51:03]\u00a0<strong>Ramit:<\/strong>\u00a0Didn\u2019t change anything with your spending, did it?<\/p>\n<p>[00:51:06]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:51:07]\u00a0<strong>Ramit:<\/strong>\u00a0You avoid being decisive with your money. Instead, you try to get buy-in from everybody and ask people who should have no business telling you what to do with your money. You ask them for their advice. Right?<\/p>\n<p>[00:51:17]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:51:18]\u00a0<strong>Ramit:<\/strong>\u00a0Conflict, avoid it at all costs. When I say all costs, I mean literally it\u2019s costing you hundreds of thousands of dollars. Same thing. Inability to be decisive and make a decision for your own wellbeing, for your own mental health is the same way you are not prioritizing your own financial wellbeing. This is why having uncomfortable conversations is not an optional skill.<\/p>\n<p>[00:51:40]\u00a0It is required in this world\u2013 required. You can\u2019t get by. You can\u2019t be successful if you can\u2019t have uncomfortable conversations. You can try to say, can I get out of it? Which you have. Okay. Any surprises about that conversation we just had about your therapist?<\/p>\n<p>[00:51:57]\u00a0<strong>LaKiesha:<\/strong>\u00a0Never made a connection between the avoidant behavior there and here.<\/p>\n<p>[00:52:03]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. A lot. And I actually think a really good therapist will help you make those connections. I don\u2019t know this therapist. I\u2019m not qualified to make a judgment about them, but sometimes people are great. They\u2019re just not a good fit for you. I\u2019ve had that.<\/p>\n<p>[00:52:20]\u00a0I probably had people who said like, \u201cRamit seems like he knows what he\u2019s talking about, but I just don\u2019t like the guy.\u201d That\u2019s okay. There\u2019s lots of other likable people out there. But I want you to put yourself first, your financial health, mental health, relationship health. You can see that it\u2019s not all firing on all cylinders because I can see it on the CSP. Now, we got to talk about the bankruptcy.<\/p>\n<p>[Narration]<\/p>\n<p>[00:52:44]\u00a0<strong>Ramit:<\/strong>\u00a0We\u2019ve mentioned\u00a0LaKiesha\u2019s bankruptcy a few times now, but we haven\u2019t gotten into detail.\u00a0Now that we\u2019ve identified that\u00a0LaKiesha\u00a0avoids conflict,\u00a0I\u00a0want to\u00a0talk about how she made the decision to file for bankruptcy.<\/p>\n<p>[Interview]<\/p>\n<p>[00:52:57]\u00a0<strong>Ramit:<\/strong>\u00a0What happened? You charged a bunch of stuff up?<\/p>\n<p>[00:53:01]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes, basically. Had a lot of different debt, credit cards, loans, all of it. And I did this money coaching program.<\/p>\n<p>[00:53:12]\u00a0<strong>Ramit:<\/strong>\u00a0Hold on. It wasn\u2019t iwt.com\/moneycoaching?<\/p>\n<p>[00:53:15]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, no, no. It was not.<\/p>\n<p>[00:53:17]\u00a0<strong>Ramit:<\/strong>\u00a0Money Coaching by Ramit Sethi.<\/p>\n<p>[00:53:19]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:53:20]\u00a0<strong>Ramit:<\/strong>\u00a0Who was it by?<\/p>\n<p>[00:53:21]\u00a0<strong>LaKiesha:<\/strong>\u00a0I hate to put them out there like this. It\u2019s called Thrivent.<\/p>\n<p>[00:53:24]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s just look at their website together. Wow, that\u2019s a friendly looking man on there. Financial advice with purpose. We believe everyone deserves a financial plan. Oh [Bleep]. All right. Hold on. First thing we want to look at is our solutions. Uh-oh. Uh-oh. I see a word that\u2019s a big red flag. On the right it says explore multi-year guarantee annuities. Oh [Bleep]. Let\u2019s just click over to annuities, which are kryptonite for most people. Not all, but most.<\/p>\n<p>[00:53:54]\u00a0What is an annuity? Blah blah. Variable annuity. You\u2019re [\u200aBleep]. Right here I would be like, \u201cI\u2019m out.\u201d I don\u2019t want to talk to somebody who\u2019s selling a variable annuity because it\u2019s a [\u200aBleep] investment. It\u2019s horrible. The only person that benefits from this is the salesperson. All right. I\u2019m going to look at this later. So what, this per\u2013 this was offered for free through your workplace?<\/p>\n<p>[00:54:14]\u00a0<strong>LaKiesha:<\/strong>\u00a0Not through my workplace. I think it was something that maybe was like an ad or something that popped up when I was scrolling on Instagram or something.<\/p>\n<p>[00:54:22]\u00a0<strong>Ramit:<\/strong>\u00a0Did you get taken to this page, which is the biggest red flag of all? Look at the insurance.<\/p>\n<p>[00:54:26]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:54:27]\u00a0<strong>Ramit:<\/strong>\u00a0All life, universal, and variable. There\u2019s so many red flags on this page. But again, how would the average person know? They don\u2019t know what these red flags are. They go, \u201cSounds good to me.\u201d All right. So you signed up with them and they told you what? Declare bankruptcy?<\/p>\n<p>[00:54:42]\u00a0<strong>LaKiesha:<\/strong>\u00a0In talking about debt and where my money was going, I feel like in a lot of ways it was like, okay, so what can you do to change this? Basically, what can you do to get out of this situation?<\/p>\n<p>[00:54:55]\u00a0<strong>Ramit:<\/strong>\u00a0Hold on. Who said that? They said that to you or you said that to them?<\/p>\n<p>[00:54:59]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, they said that to me and I said, \u201cI don\u2019t know. That\u2019s pretty much why I\u2019m here. I\u2019m trying to figure it out.\u201d And I did not see a path forward as a result of that conversation to pay off the debt. When I said bankruptcy, the person said, well, I don\u2019t see what other choices you have. And shortly after that conversation, I filed.<\/p>\n<p>[00:55:23]\u00a0<strong>Ramit:<\/strong>\u00a0Do you remember how much debt you had at the time?<\/p>\n<p>[00:55:25]\u00a0<strong>LaKiesha:<\/strong>\u00a0Somewhere between 20, 30,000.<\/p>\n<p>[00:55:28]\u00a0<strong>Ramit:<\/strong>\u00a0You had $30,000 in debt and you declared bankruptcy? Was it accepted?<\/p>\n<p>[00:55:32]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:55:33]\u00a0<strong>Ramit:<\/strong>\u00a030k? We could knock that out so fast. Do you realize that now?<\/p>\n<p>[00:55:38]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes. I realized that while we were going through it. I even said to James, I was like, \u201cI don\u2019t even know why I did this.\u201d From the moment I filed and started the process to it actually being discharged, it was months in between. And so at multiple times I felt silly about doing it.<\/p>\n<p>[00:55:56]\u00a0<strong>Ramit:<\/strong>\u00a0Why didn\u2019t you speak up? Do you know why?<\/p>\n<p>[00:55:59]\u00a0<strong>LaKiesha:<\/strong>\u00a0I had already started it. Avoiding conflict. Didn\u2019t want to\u2013<\/p>\n<p>[00:56:03]\u00a0<strong>Ramit:<\/strong>\u00a0Yes, yes. Wait, stay there with me. Avoiding conflict, putting some sales rep ahead of your own self. Do you see that?<\/p>\n<p>[00:56:14]\u00a0<strong>LaKiesha:<\/strong>\u00a0I do.<\/p>\n<p>[00:56:15]\u00a0<strong>Ramit:<\/strong>\u00a0Do you see how that has affected you to the tune of hundreds of thousands of dollars, and it is intertwined with the inability to get rid of this therapist, which could be knocked out by tonight, which has affected so many other things, including your own investments. Do you see that?<\/p>\n<p>[00:56:32]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:56:33]\u00a0<strong>Ramit:<\/strong>\u00a0What is your conclusion from that?<\/p>\n<p>[00:56:34]\u00a0<strong>LaKiesha:<\/strong>\u00a0I need to face conflict and learn how to have difficult conversations.<\/p>\n<p>[00:56:41]\u00a0<strong>Ramit:<\/strong>\u00a0Yes. And what about yourself and your finances?<\/p>\n<p>[00:56:45]\u00a0<strong>LaKiesha:<\/strong>\u00a0That I have to face it. I can\u2019t avoid it. I can\u2019t run from it. I have to deal with my finances head on.<\/p>\n<p>[00:56:53]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah, I agree. If I asked your kids what they have learned about money from their mom? What would they say?<\/p>\n<p>[00:57:02]\u00a0<strong>LaKiesha:<\/strong>\u00a0Two things come to mind, which are both not great. How to spend it or nothing.<\/p>\n<p>[00:57:09]\u00a0<strong>Ramit:<\/strong>\u00a0And let\u2019s say I asked them, what do you mean how to spend it? What would they say?<\/p>\n<p>[00:57:13]\u00a0<strong>LaKiesha:<\/strong>\u00a0They both think that I shop a lot, so if you want something, buy it. I do think that they think and feel like I work hard. So work hard, get money, and then spend it on the things you like or want to do. I think that they feel like that\u2019s how I live and treat money.<\/p>\n<p>[00:57:33]\u00a0<strong>Ramit:<\/strong>\u00a0Do they know that you have no savings and no investments?<\/p>\n<p>[00:57:36]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:57:36]\u00a0<strong>Ramit:<\/strong>\u00a0What do you think they\u2019re going to think when they hear this?<\/p>\n<p>[00:57:40]\u00a0<strong>LaKiesha:<\/strong>\u00a0They\u2019re probably going to be surprised. Fortunately and unfortunately, I do feel like for my youngest daughter, she might feel a sense of urgency as it relates to having to rely on a scholarship or something to go to college. Luckily, my oldest daughter, she was able to get a full ride, so I think in a lot of ways they will feel like there\u2019s no safety net. They got to figure it out.<\/p>\n<p>[00:58:06]\u00a0<strong>Ramit:<\/strong>\u00a0I think that\u2019s true. Do you accept that? There is no safety net for them.<\/p>\n<p>[00:58:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, I don\u2019t want it to be like that. I didn\u2019t have one. I don\u2019t want that for them.<\/p>\n<p>[00:58:15]\u00a0<strong>Ramit:<\/strong>\u00a0But that is the case. That is reality right now. And if we\u2019re talking about investing aggressively and saving, there is not a safety net for your 14-year-old or 11-year-old in the near future. It\u2019s just not there. I\u2019m sharing this because I often say, in order to live a Rich Life, you have to be honest, honest with yourself and honest with the people around you. This is avoiding the tough conversations, in your case, with yourself. Can you accept that there will be no safety net for them?<\/p>\n<p>[00:58:48]\u00a0<strong>LaKiesha:<\/strong>\u00a0No.<\/p>\n<p>[00:58:48]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Then what are you willing to do about it?<\/p>\n<p>[00:58:52]\u00a0<strong>LaKiesha:<\/strong>\u00a0Whatever I need to. Just like I would do whatever I need to right now today for them, I have to do that for them in the future as opposed to just today.<\/p>\n<p>[00:59:07]\u00a0<strong>Ramit:<\/strong>\u00a024 hours ago you spent $50 unnecessary at Target.<\/p>\n<p>[00:59:11]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yes.<\/p>\n<p>[00:59:12]\u00a0<strong>Ramit:<\/strong>\u00a0So I hear you saying it, but I don\u2019t see the behavior matching it. What could you do to have your behavior match the very powerful message you just shared with me about willing to do anything for your kids?<\/p>\n<p>[00:59:26]\u00a0<strong>LaKiesha:<\/strong>\u00a0Change my behavior and be transparent about those changes with them.<\/p>\n<p>[00:59:30]\u00a0<strong>Ramit:<\/strong>\u00a0Love it.\u00a0What about the shopping?<\/p>\n<p>[00:59:33]\u00a0<strong>LaKiesha:<\/strong>\u00a0Stop. I don\u2019t need any more clothes. Even what I bought yesterday, I don\u2019t need that.<\/p>\n<p>[00:59:39]\u00a0<strong>Ramit:<\/strong>\u00a0What are you going to do with those?<\/p>\n<p>[00:59:40]\u00a0<strong>LaKiesha:<\/strong>\u00a0I don\u2019t even know.<\/p>\n<p>[00:59:41]\u00a0<strong>Ramit:<\/strong>\u00a0No. What are you going to do with it?<\/p>\n<p>[00:59:43]\u00a0<strong>LaKiesha:<\/strong>\u00a0Return it.<\/p>\n<p>[00:59:44]\u00a0<strong>Ramit:<\/strong>\u00a0Are you? Wow, this is interesting.<\/p>\n<p>[00:59:47]\u00a0<strong>LaKiesha:<\/strong>\u00a0No, I\u2019m just thinking. I guess because in my mind I thought if I returned it, I would get, what, 25 bucks back? Where would I put that? In the grand scheme of things, what would that help? And I don\u2019t know the answer to that question.<\/p>\n<p>[01:00:02]\u00a0<strong>Ramit:<\/strong>\u00a0How would I approach it?<\/p>\n<p>[01:00:04]\u00a0<strong>LaKiesha:<\/strong>\u00a0Put it in your investment account.<\/p>\n<p>[01:00:05]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. I would have a rule. When I have unexpected money, here\u2019s how the money flows. And because I\u2019m behind on investing, I would put the majority of it towards investing. I\u2019ll put the second part of it towards savings. And I might keep 5% for guilt-free spending. But I don\u2019t have time for uncertainty.<\/p>\n<p>[01:00:24]\u00a0I don\u2019t have time to be indecisive. And 25 bucks actually starts to add up to a lot. Considering the amount of clothes you\u2019ve talked about, I\u2019m candidly shocked that you\u2019re not willing to be decisive about returning clothes that you bought last night. James, any thoughts?<\/p>\n<p>[01:00:42]\u00a0<strong>James:<\/strong>\u00a0No, I totally agree with you.<\/p>\n<p>[01:00:44]\u00a0<strong>Ramit:<\/strong>\u00a0This is where a partner can be really strong, where a partner can say, \u201cYou know what? I see you. I know that\u2019s hard for you. I think $25 goes a long way, and I\u2019m inspired by seeing you take these small steps. Gosh, you\u2019re getting me to think about taking small steps with my money. Maybe I can return something from my closet.\u201d<\/p>\n<p>[01:01:02]\u00a0<strong>James:<\/strong>\u00a0Yeah, definitely.<\/p>\n<p>[01:01:03]\u00a0<strong>Ramit:<\/strong>\u00a0Do you see how partners can make each other bigger and better?<\/p>\n<p>[01:01:06]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[01:01:06]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s pretty cool. It\u2019s a cool opportunity. One partner is struggling. The other steps up. Hey, I love you. You could do this. We got a vision together.<\/p>\n<p>[01:01:13]\u00a0<strong>James:<\/strong>\u00a0Absolutely.<\/p>\n<p>[01:01:14]\u00a0<strong>Ramit:<\/strong>\u00a0What do you think, LaKiesha?<\/p>\n<p>[01:01:16]\u00a0<strong>LaKiesha:<\/strong>\u00a0Honestly, now I do want to return it, like tonight. Go back to Target.<\/p>\n<p>[01:01:23]\u00a0<strong>Ramit:<\/strong>\u00a0Maybe send James in.<\/p>\n<p>[01:01:24]\u00a0<strong>LaKiesha:<\/strong>\u00a0Yeah, I\u2019ll send him with the receipt. But yeah, I feel that.<\/p>\n<p>[01:01:29]\u00a0<strong>Ramit:<\/strong>\u00a0James, what would your kids say about you as it relates to money? What lessons have they learned?<\/p>\n<p>[01:01:35]\u00a0<strong>James:<\/strong>\u00a0Maybe since she doesn\u2019t live with me, she sees me spend on her when she\u2019s with me and when she asks me for things. So maybe I need to change and tell her no.<\/p>\n<p>[01:01:48]\u00a0<strong>Ramit:<\/strong>\u00a0When was the last time you told her no?<\/p>\n<p>[01:01:49]\u00a0<strong>James:<\/strong>\u00a0I told them no last week. Matter of fact, this year, maybe Friday, she had called me and asked me for some money. It was more of, I just sent your mom some child support, so I not giving you money.<\/p>\n<p>[01:02:01]\u00a0<strong>Ramit:<\/strong>\u00a0Can I make a suggestion?<\/p>\n<p>[01:02:03]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[01:02:04]\u00a0<strong>Ramit:<\/strong>\u00a0Maybe there\u2019s a better way of talking to her about money.<\/p>\n<p>[01:02:06]\u00a0<strong>James:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[01:02:07]\u00a0<strong>Ramit:<\/strong>\u00a0Because, I just sent your mom child support, so the answer is no\u2013<\/p>\n<p>[01:02:15]\u00a0<strong>James:<\/strong>\u00a0You are right.<\/p>\n<p>[01:02:16]\u00a0<strong>Ramit:<\/strong>\u00a0I think there\u2019s probably a better way. What do you say?<\/p>\n<p>[01:02:18]\u00a0<strong>James:<\/strong>\u00a0Absolutely. Absolutely.<\/p>\n<p>[01:02:21]\u00a0<strong>Ramit:<\/strong>\u00a0We\u2019re talking about an 11-year-old. She\u2019s pretty old. She\u2019s pretty smart. She\u2019s picking up on that. Let\u2019s say she keeps going. She ends up talking to me in 20 years. What\u2019s she going to tell me? What\u2019s her relationship with money going to be?<\/p>\n<p>[01:02:33]\u00a0<strong>James:<\/strong>\u00a0Oh, wow. Spend.<\/p>\n<p>[01:02:35]\u00a0<strong>Ramit:<\/strong>\u00a0Really?<\/p>\n<p>[01:02:36]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[01:02:37]\u00a0<strong>Ramit:<\/strong>\u00a0And then?<\/p>\n<p>[01:02:38]\u00a0<strong>James:<\/strong>\u00a0That would be my fault. Just like we talked about some of the things that happened with us, our parents, she\u2019s going to be talking about it with us.<\/p>\n<p>[01:02:46]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s right. She\u2019s going to be talking about you. I can\u2019t wait till I speak to one of the kids of one of my guests. That\u2019s going to be the day that I feel proud. But I\u2019ll tell you something. You have the chance to change that.<\/p>\n<p>[01:03:02]\u00a0<strong>James:<\/strong>\u00a0Yes.<\/p>\n<p>[01:03:03]\u00a0<strong>Ramit:<\/strong>\u00a0Right now, though, don\u2019t treat her like 11-year-old as little. They\u2019re not. 11-year-old is really smart. How do you want to show up when it comes to money and your daughter? She calls you, she asks for something, and you say what you previously said. I think there\u2019s a better way. How do you want to show up with her?<\/p>\n<p>[01:03:19]\u00a0<strong>James:<\/strong>\u00a0One, ask her what does she need it for, and then just try to get her to think about, do you really need that? Not only that, but teach her how to save some money. And I think that\u2019s one of the biggest parts.<\/p>\n<p>[01:03:34]\u00a0<strong>Ramit:<\/strong>\u00a0How are you going to do that? Do I need to pop up the CSP on the screen right now again?<\/p>\n<p>[01:03:39]\u00a0<strong>James:<\/strong>\u00a0No.<\/p>\n<p>[01:03:40]\u00a0<strong>Ramit:<\/strong>\u00a0Because what am I going to see if I look at your savings?<\/p>\n<p>[01:03:43]\u00a0<strong>James:<\/strong>\u00a0Zero. Right. So I have to show her.<\/p>\n<p>[01:03:45]\u00a0<strong>Ramit:<\/strong>\u00a0Yes. How are you going to show her?<\/p>\n<p>[01:03:47]\u00a0<strong>James:<\/strong>\u00a0I start saving money.<\/p>\n<p>[01:03:49]\u00a0<strong>Ramit:<\/strong>\u00a0Hell yes. And tell her. So this is how it goes. Next time she calls you. What does an 11-year-old ask for anyway? I don\u2019t even know.<\/p>\n<p>[01:03:56]\u00a0<strong>James:<\/strong>\u00a0Everything. Roblox, cards, all type of things.<\/p>\n<p>[01:04:01]\u00a0<strong>Ramit:<\/strong>\u00a0First of all, I wish I hadn\u2019t asked that question because I\u2019m going to get 5,000 people commenting and telling me, \u201cOh my God, Ramit\u2019s so out of touch.\u201d I don\u2019t want to know what 11-year-olds want. Don\u2019t email me. Don\u2019t comment. Don\u2019t message. I wish I never said this.<\/p>\n<p>[01:04:15]\u00a0Anyway, here we are. She texts you. She calls you. Dad, give me this gift certificate for whatever. You say, \u201cYou know what? I\u2019m so glad you asked because I had this conversation the other day that I\u2019ve been wanting to tell you about.\u201d Right there, I\u2019m going to pause. What have you already seen in my response to her?<\/p>\n<p>[01:04:38]\u00a0<strong>James:<\/strong>\u00a0Taken the opportunity to teach her the value of money.<\/p>\n<p>[01:04:42]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. And actually just excitement, right? I\u2019m so glad you asked because I had this thing that happened and I\u2019ve been wanting to talk to you about it. Oh my God. Amazing. Okay, great. So then you say, \u201cI realized I haven\u2019t been as responsible as I could be with my money. And here I am. I want to teach you lessons, but I\u2019m learning my own lessons. I took a honest look in the mirror, and I realized\u2013\u201d what? Finish the sentence for me.<\/p>\n<p>[01:05:10]\u00a0<strong>James:<\/strong>\u00a0That I need to do better with my money.<\/p>\n<p>[01:05:14]\u00a0<strong>Ramit:<\/strong>\u00a0I haven\u2019t saved as much as I want, so I\u2019m going to be saving money for myself. I\u2019m building my own discipline just like I want you to do. Every month I\u2019m putting money aside for my own savings, for my own investments. At this point, she\u2019s like, \u201cOkay, what do I care? Do I get my gift certificate or not?\u201d And then you say to her, \u201cI love you. You know I want to get you everything in the world, but it\u2019s not possible. Right now I have to prioritize my savings. So unfortunately, I can\u2019t get you that game. But I love you. What do you think about that?<\/p>\n<p>[01:05:54]\u00a0<strong>James:<\/strong>\u00a0It\u2019s pretty good. I think that\u2019s definitely something that I\u2019m going to have to do.<\/p>\n<p>[01:06:00]\u00a0<strong>Ramit:<\/strong>\u00a0You can make it your own. Change it to what feels right for you. But just the key points of that was like, oh, I\u2019m so glad. I\u2019m so excited you brought that up. Totally different way of reacting.<\/p>\n<p>[01:06:12]\u00a0<strong>James:<\/strong>\u00a0Yeah.<\/p>\n<p>[01:06:12]\u00a0<strong>Ramit:<\/strong>\u00a0Sharing a lot of vulnerable stuff. When was the last time you told her, as a dad, I haven\u2019t done the best I could. That\u2019s new, right?<\/p>\n<p>[01:06:22]\u00a0<strong>James:<\/strong>\u00a0Yeah, absolutely.<\/p>\n<p>[01:06:22]\u00a0<strong>Ramit:<\/strong>\u00a0I don\u2019t know. I found that really hard to admit until my 30s that I had these things that I was struggling with that I wasn\u2019t perfect at. And to admit that to a kid is 100 times harder. Any parent knows that. But you can do it because you\u2019ve done it all night long tonight with me.<\/p>\n<p>[01:06:42]\u00a0<strong>James:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[01:06:42]\u00a0<strong>Ramit:<\/strong>\u00a0But it\u2019s so much more powerful to admit it to a kid because kids never hear their parents say, I messed up, I\u2019m sorry, I\u2019m working on improving myself. Holy [Bleep]. They\u2019re going to hang up and they\u2019re going to remember that call for the rest of their lives.<\/p>\n<p>[Narration]<\/p>\n<p>[01:06:59]\u00a0<strong>Ramit:<\/strong>\u00a0I have to say, I\u2019m impressed with the progress\u00a0LaKiesha\u00a0and James made in the short time we spent together.\u00a0They had breakthroughs around their past and how those experiences have shaped their behavior with money today.\u00a0Most importantly, they realize that some of these deeply rooted behaviors around money aren\u2019t even serving them.<\/p>\n<p>[01:07:18]\u00a0And even though we\u2019ve mapped out a plan to help them build up their savings and create a healthy retirement, I\u00a0want to\u00a0remind you that it\u2019s easy to make a plan, but the magic is in actually doing it.\u00a0I\u2019ve given\u00a0LaKiesha\u00a0and James some new tools to build their\u00a0Rich Life, but the rest is up to them. I have a lot of confidence in them.\u00a0LaKiesha\u00a0and James, I believe you can do it, and I\u00a0want to\u00a0wish you the best.<\/p>\n<p>[01:07:43]\u00a0Let\u2019s listen now to James\u2019 follow-up video.<\/p>\n<p>[01:07:46]\u00a0<strong>James:<\/strong>\u00a0I think one of the biggest surprises, out of the conversation was the fact that Kiesha and I had some type of parent and child dynamic going on when it comes to our finances, and I didn\u2019t like that. That\u2019s not the type of guy I am. So we\u2019re working on that. I think one of the biggest takeaways is the fact that, even through the fact that I was embarrassed about my situation, Ramit let us know that it is actually a possibility that we actually can get out of the situation just with a little of the hard work. And so I\u2019m working on that.<\/p>\n<p>[01:08:18]\u00a0It\u2019s definitely a challenge. Not only a challenge, but it\u2019s also a work in progress. What specific changes we have made? This weekend I canceled the lion\u2019s share of the subscriptions that I had. That was tough, I found, because I like watching my videos and things of that nature. So we\u2019re working on it. Hopefully, we\u2019ll be one of your biggest success stories. And that is a goal of mine, that the next time we talk to James and Kiesha, we\u2019ll be in a lot better place.<\/p>\n<p>[01:08:53]\u00a0<strong>Ramit:<\/strong>\u00a0And now\u00a0LaKiesha\u2019s follow-up.<\/p>\n<p>[01:08:56]\u00a0<strong>LaKiesha:<\/strong>\u00a0My biggest surprise was just that the connection that was made between my spending habits and that of my mother\u2019s. I never, ever thought that there was connection between my spending and her spending. So to make that connection and bring to my attention was pretty crazy.<\/p>\n<p>[01:09:14]\u00a0Some takeaways that I had, one was the fact that we were eating out as much as we were. I did not consider that. And then one that actually leads into one of the changes that we have made since is not eating out as much. So we actually spent a little bit more on the grocery bill and have made all meals at home as a result. And we\u2019ll continue to do so.<\/p>\n<p>[01:09:38]\u00a0We\u2019ve already planned the one eating out meal and when that\u2019s going to be. And looking forward to spending that time with family as my daughter and my niece would be home for the holidays and from college. And so looking forward to sharing that meal and experience with them. Thank you so much for your help. Appreciate it.<\/p>\n<p><strong>\u00a0<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>On last week\u2019s episode, we met 38-year-old LaKiesha and 45-year-old James, a couple struggling to get on the same page financially. With no savings, no investments, and deep-rooted money fears, they\u2019re stuck in a cycle of mindless spending. Today, we\u2019re digging back into their CSP\u2014and the numbers are more shocking than they expected. Can they [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","om_disable_all_campaigns":false,"_lmt_disableupdate":"no","_lmt_disable":"","_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[290],"class_list":["post-118829","post","type-post","status-publish","format-standard","hentry","category-podcast-episodes"],"acf":[],"aioseo_notices":[],"modified_by":"Nasrin","_links":{"self":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/posts\/118829","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/comments?post=118829"}],"version-history":[{"count":0,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/posts\/118829\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/media?parent=118829"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/categories?post=118829"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}