{"id":118949,"date":"2023-10-17T17:27:27","date_gmt":"2023-10-17T21:27:27","guid":{"rendered":"https:\/\/www.iwillteachyoutoberich.com\/?p=118949"},"modified":"2025-04-07T10:04:34","modified_gmt":"2025-04-07T14:04:34","slug":"126-cristina-ron","status":"publish","type":"post","link":"https:\/\/www.iwillteachyoutoberich.com\/126-cristina-ron\/","title":{"rendered":"Episode 126. \u201cWe have $30k of CC debt. Why did we buy a $10k timeshare?\u201d (Part 2)"},"content":{"rendered":"<p><iframe title=\"\u201cWe\u2019re in $30k of debt\u2026and just bought a timeshare\u201d\" src=\"https:\/\/www.youtube.com\/embed\/RdrOncM1Qok\" width=\"100%\" height=\"400\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p><iframe style=\"border-radius: 12px;\" src=\"https:\/\/open.spotify.com\/embed\/episode\/6cckoKTOrYPU25ShIgDXBr\" width=\"100%\" height=\"352\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p>It\u2019s time to get tactical in this energetic follow-up episode with Cristina and Ron. Building on their story, we unpack their three most glaring money mistakes\u2014a percentage-based financial advisor, whole and term life insurance, and a $10,000 timeshare vacation plan.<\/p>\n<p><strong>This episode is brought to you by:<\/strong><\/p>\n<p>Inside Tracker | Get 20% off by going to\u00a0<strong><a href=\"https:\/\/insidetracker.com\/ramit\">https:\/\/insidetracker.com\/ramit<\/a><\/strong>.<\/p>\n<p>Mint mobile | To get your new wireless plan for just $15 a month, go to\u00a0<strong><a href=\"https:\/\/mintmobile.com\/ramit\">https:\/\/mintmobile.com\/ramit<\/a><\/strong>.<\/p>\n<p>Long Angle | If you\u2019ve made a lot of money and you\u2019re looking for a community of peers to turn to for advice, go to\u00a0<strong><a href=\"https:\/\/www.longangle.com\/\">https:\/\/www.longangle.com\/<\/a><\/strong>\u00a0to learn more.<\/p>\n<p>BetterHelp | Visit\u00a0<strong><a href=\"https:\/\/betterhelp.com\/ramit\">https:\/\/betterhelp.com\/ramit<\/a><\/strong>\u00a0today to get 10% off your first month.<\/p>\n<h2><strong>Tools mentioned in this episode<\/strong><\/h2>\n<ul>\n<li><a href=\"https:\/\/www.iwillteachyoutoberich.com\/l-money-made-easy\/\">Money Made Easy Mini Course<\/a><\/li>\n<li><a href=\"https:\/\/www.iwillteachyoutoberich.com\/landing-conscious-spending\/\">Conscious Spending Plan<\/a><\/li>\n<\/ul>\n<h2><strong>Show Transcript<\/strong><\/h2>\n<p><a href=\"https:\/\/drive.google.com\/file\/d\/1VUqBzvjU_WOEWOjFUrjoRP2Ghi5Fy2pz\/view?usp=sharing\">Download the full transcript PDF.<\/a><\/p>\n<p>[00:00:00]\u00a0<strong>Ron:<\/strong>\u00a0When we were down in Jamaica\u2013<\/p>\n<p>[00:00:02]\u00a0<strong>Ramit:<\/strong>\u00a0You went to a fucking timeshare presentation.<\/p>\n<p>[00:00:05]\u00a0<strong>Ron:<\/strong>\u00a0We did.<\/p>\n<p>[00:00:06]\u00a0<strong>Ramit:<\/strong>\u00a0Is this a joke right now?<\/p>\n<p>[00:00:08]\u00a0<strong>Ron:<\/strong>\u00a0So it\u2019s a 15-year\u2013<\/p>\n<p>[00:00:09]\u00a0<strong>Cristina:<\/strong>\u00a0Vacation club membership.<\/p>\n<p>[00:00:11]\u00a0<strong>Ron:<\/strong>\u00a0It\u2019s not a timeshare per se. It\u2019s a vacation club.<\/p>\n<p>[00:00:14]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s a timeshare.<\/p>\n<p>[00:00:14]\u00a0<strong>Ron:<\/strong>\u00a0They did start the package off at 36,000, and because I kept saying, no, no, no, no, no, no, no, no, no, I got them down to 10,000 for it.<\/p>\n<p>[00:00:24]\u00a0<strong>Ramit:<\/strong>\u00a0Wow. Bravo. You put down 5,000 while you had tens of thousands of dollars of credit card debt. Do you think that\u2019s a good decision now that I\u2019m saying it out loud?<\/p>\n<p>[00:00:34]\u00a0<strong>Ron:<\/strong>\u00a0No.<\/p>\n<p>[00:00:34]\u00a0<strong>Cristina:<\/strong>\u00a0No.<\/p>\n<p>[00:00:35]\u00a0<strong>Ron:<\/strong>\u00a0So we have this club for 15 years. Prime deals on everything that Hyatt owns, I think. Premiere everything. So VIP and concierge services, better rooms, and then we get a crazy amount off of them.<\/p>\n<p>[00:00:55]\u00a0<strong>Ramit:<\/strong>\u00a0Oh, the stuff you already paid $10,000 for, you get a little discount on it. Wow.<\/p>\n<p>[00:00:59]\u00a0<strong>Ron:<\/strong>\u00a0Yeah, pretty much.<\/p>\n<p>[00:01:00] We said yes to go into a free breakfast. That\u2019s what it was.<\/p>\n<p>[00:01:03]\u00a0<strong>Cristina:<\/strong>\u00a0I wanted free breakfast. I didn\u2019t know that that was going to be a timeshare presentation.<\/p>\n<p>[00:01:08]\u00a0<strong>Ramit:<\/strong>\u00a0That free breakfast cost you $10,000.<\/p>\n<p>[00:01:10]\u00a0<strong>Cristina:<\/strong>\u00a0I know but I think I just didn\u2019t know how to get out of it. I felt very uncomfortable in that situation.<\/p>\n<p>[00:01:17]\u00a0<strong>Ramit:<\/strong>\u00a0Oh my God. There are suckers. You two are the suckers.<\/p>\n<p>[Narration]<\/p>\n<p>[00:01:22]\u00a0<strong>Ramit:<\/strong>\u00a0Welcome to part 2 of my conversation with Cristina and Ron. You can check out last week\u2019s episode for a lot of important background information on these two, but let me give you a quick recap. She\u2019s 30. He\u2019s 45, and she\u2019s frustrated that she\u2019s the one who manages money in their relationship.<\/p>\n<p>[00:01:39] I thought that was the major problem, but as I started looking at their numbers, including their net worth of negative $47,000, I discovered they have a ton of big red flags in how they spend their money, including a timeshare, which we are going to talk about today. Now, some of you love to talk about the things that you enjoy spending money on.<\/p>\n<p>[00:02:04] For me, I have an Amex Platinum card. I like it for the lounges. Doesn\u2019t make any financial sense, but I love it. This coming Saturday, in my newsletter, I\u2019m going to talk about different money lenses that we can look through. A lot of people use frugality or cost. That\u2019s the number one money lens they look through, but there\u2019s so many more. Just remember a timeshare does not fit into any of these. Make sure you\u2019re on my list at iwt.com\/podcastnewsletter. That\u2019s the only place you can get this material. Now, let\u2019s get to the conversation.<\/p>\n<p>[Interview]<\/p>\n<p>[00:02:35]\u00a0<strong>Ramit:<\/strong>\u00a0All right. You have pet insurance? Is this for real?<\/p>\n<p>[00:02:39]\u00a0<strong>Cristina:<\/strong>\u00a0We do.<\/p>\n<p>[00:02:40]\u00a0<strong>Ramit:<\/strong>\u00a0You know what? I don\u2019t even know. Whatever. It\u2019s fine. All right. Your car payment is a $1,000 a month. What car is this?<\/p>\n<p>[00:02:49]\u00a0<strong>Cristina:<\/strong>\u00a0That\u2019s two cars and two motorcycles.<\/p>\n<p>[00:02:51]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. That\u2019s a lot of cars for two people. Debt payments. What is 450? What is this debt payment?<\/p>\n<p>[00:03:02]\u00a0<strong>Cristina:<\/strong>\u00a0That\u2019s the credit card that\u2013<\/p>\n<p>[00:03:04]\u00a0<strong>Ramit:<\/strong>\u00a0Huh?<\/p>\n<p>[00:03:06]\u00a0<strong>Cristina:<\/strong>\u00a0We have a credit card debt.<\/p>\n<p>[00:03:07]\u00a0<strong>Ramit:<\/strong>\u00a0How much?<\/p>\n<p>[00:03:08]\u00a0<strong>Cristina:<\/strong>\u00a0Right now about 30 of that is credit card.<\/p>\n<p>[00:03:13]\u00a0<strong>Ramit:<\/strong>\u00a0$30,000 in credit card debt? How did this not come up before? Is this the minimum, 450 a month?<\/p>\n<p>[00:03:20]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah. There\u2019s no interest on them right now because I balanced transfer them, but 30,000 is the whole lot of it.<\/p>\n<p>[00:03:28]\u00a0<strong>Ramit:<\/strong>\u00a0Everybody sounds real calm about $30,000 of credit card debt. How come I\u2019m the one freaking out about this?<\/p>\n<p>[00:03:35]\u00a0<strong>Cristina:<\/strong>\u00a0I\u2019m not scared of debt. 200,000 of student loan, that\u2019s scary to me more than the 30,000-dollar credit card debt, and we\u2019ve paid off a lot from that.<\/p>\n<p>[00:03:45]\u00a0<strong>Ramit:<\/strong>\u00a0Your pet care is 500 bucks plus the 175, that\u2019s 675 a month, plus probably some extra stuff you didn\u2019t counter. That\u2019s 700, 800 bucks a month for pets.<\/p>\n<p>[00:03:57]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:04:00]\u00a0<strong>Ramit:<\/strong>\u00a0Domestic help, 380. Somebody to clean your place. Is that what we\u2019re talking about?<\/p>\n<p>[00:04:05]\u00a0<strong>Cristina:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:04:05]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, fine. And you have a vacation\u2013 Oh my God. Do you have a timeshare? Is this a joke? What is this?<\/p>\n<p>[00:04:14]\u00a0<strong>Cristina:<\/strong>\u00a0I\u2019m going to let him take it.<\/p>\n<p>[00:04:17]\u00a0<strong>Ramit:<\/strong>\u00a0What is this shit?<\/p>\n<p>[00:04:19]\u00a0<strong>Ron:<\/strong>\u00a0Yeah, it is\u2013<\/p>\n<p>[00:04:22]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. What is this life insurance? Is this whole life insurance, Cristina?<\/p>\n<p>[00:04:26]\u00a0<strong>Cristina:<\/strong>\u00a0Whole and term.<\/p>\n<p>[00:04:28]\u00a0<strong>Ramit:<\/strong>\u00a0Oh my God. What the fuck?<\/p>\n<p>[00:04:29]\u00a0<strong>Cristina:<\/strong>\u00a0I know.<\/p>\n<p>[00:04:30]\u00a0<strong>Ramit:<\/strong>\u00a0You\u2019re putting 430 a month into this whole life insurance policy?<\/p>\n<p>[00:04:35]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah, for both of us.<\/p>\n<p>[00:04:37]\u00a0<strong>Ramit:<\/strong>\u00a0That\u2019s a lot of money.<\/p>\n<p>[00:04:38]\u00a0<strong>Cristina:<\/strong>\u00a0I read it in your book. I know, but that was the time that his dad passed away. That\u2019s like the first death that I\u2019ve experienced and he\u2019s experienced that\u2019s close to us. And so we decided to get a life insurance because it scared us both. And it was a fight. And so I fought with him about it. We ended up getting it, but there\u2019s still a part of me that\u2019s like, did we make the right decision financially to get this life insurance? Some people say it is. Some people say it\u2019s not. But I don\u2019t care what other people say. What I want is what he thinks and what would be best for us. And I just felt like he gave in because I convinced him.<\/p>\n<p>[00:05:22]\u00a0<strong>Ramit:<\/strong>\u00a0Tell me about that time, Ron. And I\u2019m sorry to bring up memories of your dad passing away.<\/p>\n<p>[00:05:27]\u00a0<strong>Ron:<\/strong>\u00a0At that point, yeah, it was a little hard just to have that conversation.<\/p>\n<p>[00:05:32]\u00a0<strong>Ramit:<\/strong>\u00a0I know sometimes people overcorrect. You had a death in the family. You want to protect, all that stuff. I would look at what your options are in terms of getting out. You probably spent a certain amount of money on it, but I never am a fan of throwing good money after bad, especially for the next 20 years.<\/p>\n<p>[00:05:49] Insurance is insurance. It\u2019s not an investment. It\u2019s different. Oftentimes, it\u2019s better to take the same money you would have put in to a whole life insurance policy and just invest it. Invest it, whether through a retirement account, or even a taxable account, and you\u2019ll end up with way more money. Don\u2019t fall for the sales guys talking about cash value, borrow against it, all this nonsense. That right there\u2019s a lot of cashflow every month that you could\u2013<\/p>\n<p>[00:06:15]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah, yeah.<\/p>\n<p>[Narration]<\/p>\n<p>[00:06:17]\u00a0<strong>Ramit:<\/strong>\u00a0Listen up. Whole life insurance is not an investment. In fact, insurance is not an investment. Insurance is insurance, and whole life insurance is a scam to fill the grubby little pockets of these insurance salespeople. Almost everyone would be better off buying term life insurance and investing the difference in all the fat fees that you would be paying this salesperson.<\/p>\n<p>[00:06:40] I say almost everyone because there\u2019s this myth that rich people can benefit from whole life insurance. But I\u2019m rich, and I know a lot of rich people, and we\u2019ve never been able to make the numbers work on whole life insurance. I avoid it like the plague.<\/p>\n<p>[Interview]<\/p>\n<p>[00:06:55]\u00a0<strong>Ramit:<\/strong>\u00a0I\u2019m going to go out on a limb here. Ron, can I guess that you absolutely hate debt?<\/p>\n<p>[00:07:02]\u00a0<strong>Ron:<\/strong>\u00a0Absolutely.<\/p>\n<p>[00:07:03]\u00a0<strong>Ramit:<\/strong>\u00a0So how long is it going to take you to pay it off?<\/p>\n<p>[00:07:06]\u00a0<strong>Cristina:<\/strong>\u00a0My plan is to pay off aggressively within a year or two if we find a way to make some money, some extra money that we get, since we both are\u2013<\/p>\n<p>[00:07:16]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah, I got away. It\u2019s sitting in your garage.<\/p>\n<p>[00:07:22]\u00a0<strong>Ron:<\/strong>\u00a0Is it smart to do balance transfers from one credit card to another to get out of like the interest to a 0%, even though you have to pay a little bit to do it, or are giving money away at that point still?<\/p>\n<p>[00:07:40]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s a good question. Balance transfers can be okay. They can save people a lot of money, but I will tell you that I often find people in credit card debt will do everything except making a plan to actually pay off their credit card debt. They use balance transfers as a gimmick.<\/p>\n<p>[00:08:02]\u00a0<strong>Ron:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:08:02]\u00a0<strong>Ramit:<\/strong>\u00a0Basically, how do I buy myself another 12 months. But what they don\u2019t do, which is the most important thing, is they don\u2019t look at their fixed costs, and go, okay, what are we eliminating? Okay. We\u2019re going to cut $500 a month off, and it could be by, we\u2019re going to eat out way less. We\u2019re not going on vacation, etc., and I\u2019m going to take all that money and automatically set it up to be transferred to my credit card bill every single month.<\/p>\n<p>[00:08:34] It\u2019s not a choice. It\u2019s not chance. It\u2019s math. It just happens automatically. So do the balance transfer. Don\u2019t do the balance transfer. But what matters really is setting up an automated transfer every single month, aggressively paying off your credit card bill.<\/p>\n<p>[00:08:53]\u00a0<strong>Cristina:<\/strong>\u00a0I am still at school. I\u2019m getting my PhD. That\u2019s why there\u2019s such a big student loan. So after calculating the cost of the program, with all the PhD and everything, my student loan\u2019s going to be around 250,000. I have not paid because I\u2019ve always been in school, and then when COVID happened, there was a postponement. There was no interest. So it\u2019s almost like I didn\u2019t worry about it, but I will be having to pay for it in 2025, 2026. So I don\u2019t know what to do either.<\/p>\n<p>[00:09:24]\u00a0<strong>Ramit:<\/strong>\u00a0Do you know the interest rate?<\/p>\n<p>[00:09:26]\u00a0<strong>Cristina:<\/strong>\u00a0The ones from the bachelors were about 3.99, or something around that. And then the ones for my graduate school and the PhD program is about seven or eight, I believe.<\/p>\n<p>[00:09:38]\u00a0<strong>Ramit:<\/strong>\u00a0And any chance of income-based repayment?<\/p>\n<p>[00:09:40]\u00a0<strong>Cristina:<\/strong>\u00a0I could try to apply for it. I know I was approved before, after my bachelor\u2019s, but the difference is because we are dual income now, I don\u2019t know how much that\u2019s going to save me or not.<\/p>\n<p>[00:09:52]\u00a0<strong>Ramit:<\/strong>\u00a0Right. Okay. Why don\u2019t you find out? And also find out about any possibilities of student loan forgiveness. There are people in your program who will definitely be able to advise. Financial aid office, for sure. Let\u2019s assume the worst case, where you\u2019re not eligible for anything. The way that I would think about it would be, okay, the bulk of your higher income, it\u2019s probably going to have to go to loans.<\/p>\n<p>[00:10:18] You control how fast you pay those loans off, but I would definitely pay more on the eight, nine, 10% interest, and I would pay the minimum on the lower interest ones. Anything with a higher interest rate, high being like over seven, I want to pay that off as aggressively as possible.<\/p>\n<p>[Narration]<\/p>\n<p>[00:10:40]\u00a0<strong>Ramit:<\/strong>\u00a0There are often options for student loans that a lot of people are not aware of. I\u2019ll take you back to my undergrad. When I was in school, my dad literally marched me over to the financial aid office, and he introduced me to Mary, Head of Financial Aid office. He\u2019d been emailing with her for weeks months. I literally knew Mary by her first name. And that\u2019s how I got to know all kinds of financial aid options that most people just don\u2019t take the time to get to know. If you are in school, or even if you have graduated, I want you to use every resource at your disposal, including going back to your college financial aid office and asking for help. Okay, now let\u2019s talk about this timeshare.<\/p>\n<p>[Interview]<\/p>\n<p>[00:11:23]\u00a0<strong>Ron:<\/strong>\u00a0When we were down in Jamaica\u2013<\/p>\n<p>[00:11:26]\u00a0<strong>Ramit:<\/strong>\u00a0You went to a fucking timeshare presentation.<\/p>\n<p>[00:11:29]\u00a0<strong>Ron:<\/strong>\u00a0We did.<\/p>\n<p>[00:11:30]\u00a0<strong>Ramit:<\/strong>\u00a0Dude, you\u2019re a finance manager. How did you sign this? Is this a joke right now?<\/p>\n<p>[00:11:37]\u00a0<strong>Ron:<\/strong>\u00a0No, because I have a wife that I want to please.<\/p>\n<p>[00:11:41]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, so what did you sign?<\/p>\n<p>[00:11:43]\u00a0<strong>Ron:<\/strong>\u00a0So it\u2019s a 15-year\u2013<\/p>\n<p>[00:11:45]\u00a0<strong>Cristina:<\/strong>\u00a0Vacation club membership.<\/p>\n<p>[00:11:47]\u00a0<strong>Ron:<\/strong>\u00a0Yeah, so it\u2019s not a timeshare per se. It\u2019s a vacation club-<\/p>\n<p>[00:11:50]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s a timeshare. Go on.<\/p>\n<p>[00:11:52]\u00a0<strong>Ron:<\/strong>\u00a0Yeah. So we get four weeks in the US. We get a couple of weeks overseas, then we get discounts over the next 15 years on stuff.<\/p>\n<p>[00:12:06]\u00a0<strong>Ramit:<\/strong>\u00a0Tell me.<\/p>\n<p>[00:12:07]\u00a0<strong>Ron:<\/strong>\u00a0And I\u2019ll say, in our defense, they did start the package off at 36,000 for this package. And because I kept saying, no, no, no, no, no, no, no, no, no for five hours, and I was trying to leave, and they just kept me there, I got them down to 10,000 for it.<\/p>\n<p>[00:12:23]\u00a0<strong>Ramit:<\/strong>\u00a0Wow. Bravo. Bravo. So how much did you put down?<\/p>\n<p>[00:12:32]\u00a0<strong>Ron:<\/strong>\u00a050%.<\/p>\n<p>[00:12:34]\u00a0<strong>Ramit:<\/strong>\u00a0You put down 5,000. Okay. How long ago was this?<\/p>\n<p>[00:12:39]\u00a0<strong>Cristina:<\/strong>\u00a0Last year.<\/p>\n<p>[00:12:41]\u00a0<strong>Ron:<\/strong>\u00a0December.<\/p>\n<p>[00:12:42]\u00a0<strong>Ramit:<\/strong>\u00a0You put down 5,000 while you had tens of thousands of dollars of credit card debt. Do you think that\u2019s a good decision now that I\u2019m saying it out loud?<\/p>\n<p>[00:12:51]\u00a0<strong>Ron:<\/strong>\u00a0No.<\/p>\n<p>[00:12:51]\u00a0<strong>Cristina:<\/strong>\u00a0No.<\/p>\n<p>[00:12:53]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Some people ask, Ramit, does it actually feel good when other people realize that you were right and they were wrong? And the answer is yes. It feels great, but it also does not feel good to know that you\u2019re now locked into payments for how many more years?<\/p>\n<p>[00:13:11]\u00a0<strong>Cristina:<\/strong>\u00a0It\u2019s 48 months.<\/p>\n<p>[00:13:16]\u00a0<strong>Ramit:<\/strong>\u00a0So you have to pay $5,000 more or so.<\/p>\n<p>[00:13:20]\u00a0<strong>Cristina:<\/strong>\u00a0For 48 months.<\/p>\n<p>[00:13:22]\u00a0<strong>Ron:<\/strong>\u00a0But no interest.<\/p>\n<p>[00:13:23]\u00a0<strong>Ramit:<\/strong>\u00a0Wow, great. For four more years, and then what happens after that?<\/p>\n<p>[00:13:27]\u00a0<strong>Cristina:<\/strong>\u00a0We just have it. I don\u2019t know.<\/p>\n<p>[00:13:31]\u00a0<strong>Ramit:<\/strong>\u00a0You have it for\u2013 what? You don\u2019t know?<\/p>\n<p>[00:13:33]\u00a0<strong>Cristina:<\/strong>\u00a0I don\u2019t know.<\/p>\n<p>[00:13:33]\u00a0<strong>Ramit:<\/strong>\u00a0Please someone tell me what happens after 48 months.<\/p>\n<p>[00:13:37]\u00a0<strong>Ron:<\/strong>\u00a0So we have this club for 15 years. So we get prime deals on everything that Hyatt owns, I think. So whether it\u2019s in the US, if it\u2019s out of the country, we get premiere everything, so yeah.<\/p>\n<p>[00:13:55]\u00a0<strong>Ramit:<\/strong>\u00a0What the hell is premiere anything? What is that? You get nuts when you get into your room? What is that?<\/p>\n<p>[00:14:00]\u00a0<strong>Ron:<\/strong>\u00a0No, we get VIP and concierge services, better rooms, and then we get a crazy amount off of them.<\/p>\n<p>[00:14:11]\u00a0<strong>Ramit:<\/strong>\u00a0Oh, the stuff you already paid $10,000 for, you get a little discount on it. Wow.<\/p>\n<p>[00:14:15]\u00a0<strong>Ron:<\/strong>\u00a0Yeah, pretty much.<\/p>\n<p>[00:14:16]\u00a0<strong>Ramit:<\/strong>\u00a0All right, so let me tell you the following. First of all, timeshares are a scam. They are never financially a good decision. You can see this because there are forums and forums of desperate timeshare owners who are trying to offload for literally pennies on the dollar. You can buy timeshare contracts for super cheap, but even still, it\u2019s not a good decision.<\/p>\n<p>[00:14:40] There are lots of different ways to take vacations on an economical level. Here\u2019s the facts. You already signed up. Their contracts are pretty ironclad. You could try to sell it for pennies on the dollar. If it were me, I would try to sell it. Let me tell you why. This is just my personal opinion. It\u2019s of course your money. It\u2019s up to you.<\/p>\n<p>[00:15:05] I don\u2019t like throwing good money after bad. And what I find is that when people make a decision that they then are committed to, they really twist themselves into a pretzel trying to justify it, and oftentimes they wake up and their fixed costs are really high, and it\u2019s on stuff they bought six years ago, and they don\u2019t even remember why they bought it anymore.<\/p>\n<p>[00:15:24] Sometimes you have to take a loss on certain things. I\u2019ve had people on the show who bought a house they couldn\u2019t afford. I was like, get rid of it. Just sell it. They go, we\u2019re going to lose money. I go, yeah, you either lose it now or you\u2019re going to lose it over the next eight years and fight every day of your life. That\u2019s just my personal opinion. I don\u2019t even know if you can sell, but I think what\u2019s more interesting to me is what happened to cause you to get into that situation. Have you ever considered it?<\/p>\n<p>[00:15:51]\u00a0<strong>Ron:<\/strong>\u00a0I haven\u2019t considered it.<\/p>\n<p>[Narration]<\/p>\n<p>[00:15:53]\u00a0<strong>Ramit:<\/strong>\u00a0All right, let me just break this down for timeshares. First of all, the math is extremely complicated on timeshares, and just like a casino, it always advantages the person selling the timeshare. Next, it is almost always a better decision to simply spend money on your own hotel, or Airbnb, or even rent someone else\u2019s timeshare.<\/p>\n<p>[00:16:13] You can tell. Because there are so many desperate timeshare owners, you can often get these things for a steal. Then we hear the argument that a lot of people say, if we have this timeshare, it will force us to take vacations. Are you kidding me? That\u2019s the same argument with people buying a house. This will force us to save money.<\/p>\n<p>[00:16:31] In what fucking world do you think I\u2019m going to approve of people literally spending hundreds of thousands of dollars to force yourself to take a vacation, or to save a little money? Get your life together. If you want to take a vacation, put it on the calendar and take it. In fact, you can actually take more vacations, longer vacations, better vacations, and you can end up with hundreds of thousands of dollars more by doing one thing, one secret little trick. It\u2019s called avoiding timeshares. Fuck you, timeshare industry.<\/p>\n<p>[Interview]<\/p>\n<p>[00:17:01]\u00a0<strong>Ron:<\/strong>\u00a0We said yes to go into a free breakfast. That\u2019s what it was.<\/p>\n<p>[00:17:05]\u00a0<strong>Ramit:<\/strong>\u00a0I love those sales things. I love those because you get to see really talented salespeople at work.<\/p>\n<p>[00:17:11]\u00a0<strong>Cristina:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:17:11]\u00a0<strong>Ramit:<\/strong>\u00a0My parents used to take us to them when we were kids because you get a free breakfast or a free whatever. I would just watch these salespeople at work. Of course, we didn\u2019t ever buy anything my family literally had no money to be able to afford it, but I learned to really enjoy it. It\u2019s a really interesting dynamic. Ron, especially, most days, you\u2019re sitting here saying no to the things that your wife wants to do. Dinner, trip, whatever, but on this one, it\u2019s like, fuck it, let\u2019s go. $10,000, Hyatt, here we come. It\u2019s interesting, right?<\/p>\n<p>[00:17:46]\u00a0<strong>Ron:<\/strong>\u00a0No.<\/p>\n<p>[00:17:47]\u00a0<strong>Ramit:<\/strong>\u00a0He\u2019s visibly uncomfortable. He\u2019s stretching in his chair. What do you say, Ron?<\/p>\n<p>[00:17:51]\u00a0<strong>Ron:<\/strong>\u00a0I didn\u2019t want to do it.<\/p>\n<p>[00:17:54]\u00a0<strong>Cristina:<\/strong>\u00a0It\u2019s pretty funny.<\/p>\n<p>[00:17:55]\u00a0<strong>Ramit:<\/strong>\u00a0You didn\u2019t want to do it? Oh, she wanted to do it?<\/p>\n<p>[00:18:00]\u00a0<strong>Cristina:<\/strong>\u00a0If I would say, I didn\u2019t know what I was getting into.<\/p>\n<p>[00:18:04]\u00a0<strong>Ramit:<\/strong>\u00a0Okay.<\/p>\n<p>[00:18:05]\u00a0<strong>Cristina:<\/strong>\u00a0I wanted free breakfast. I didn\u2019t know that that was going to be a timeshare presentation.<\/p>\n<p>[00:18:09]\u00a0<strong>Ramit:<\/strong>\u00a0That free breakfast cost you $10,000.<\/p>\n<p>[00:18:12]\u00a0<strong>Cristina:<\/strong>\u00a0I know, but I didn\u2019t know. This is the moment I say I relied on him to make a decision.<\/p>\n<p>[00:18:20]\u00a0<strong>Ramit:<\/strong>\u00a0Bullshit. Come on. Let\u2019s be honest. All right. I don\u2019t mind, Cristina, that\u2013 Ron has admitted. He has not been a financial partner. He\u2019s admitted that, and I think he\u2019s willing to make some changes, but you can\u2019t be like, I\u2019m the one who manages all the money day-to-day. I know all this stuff. And then like, oh, Ron, what do you think about this? Little old me.<\/p>\n<p>[00:18:39]\u00a0<strong>Cristina:<\/strong>\u00a0True. Okay.<\/p>\n<p>[00:18:41]\u00a0<strong>Ramit:<\/strong>\u00a0I would say it\u2019s not fair to put it on him if you\u2019re the one who wanted it and drove the decision.<\/p>\n<p>[00:18:47]\u00a0<strong>Cristina:<\/strong>\u00a0I think I just didn\u2019t know how to get out of it. I felt very uncomfortable in that situation.<\/p>\n<p>[00:18:53]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s role play right now here. I\u2019ll show you how to get out of it. I\u2019ll be the aggressive sales guy. Okay. If you come to this Hyatt thing, you get an extra discount than the VIP and the concierge. We\u2019ll even pick you up. We\u2019ll send you a town car. And of course, you get preferential rooms, and you\u2019ll never have to worry about where you\u2019re going on vacation.<\/p>\n<p>[00:19:07] Just think about having kids and a family. It\u2019s so beautiful. You bring your dogs too. Of course, we\u2019re pet friendly. And I\u2019ll give you a special deal. I know you started. 30,000. Just for you, because you\u2019re so special. You folks are so great. I could bring it down to 23,000. How\u2019s that sound to you?<\/p>\n<p>[00:19:22]\u00a0<strong>Cristina:<\/strong>\u00a0Sounds great.<\/p>\n<p>[00:19:25]\u00a0<strong>Ramit:<\/strong>\u00a0Oh my God. There are suckers. You two are the suckers.<\/p>\n<p>[00:19:31]\u00a0<strong>Cristina:<\/strong>\u00a0It does sound great.<\/p>\n<p>[00:19:33]\u00a0<strong>Ramit:<\/strong>\u00a0What in the hell is happening right now here? Why don\u2019t we flip it? You be the salesperson. You don\u2019t have to do the whole thing. And I\u2019ll be me. This is as recent as three years ago when I sat in a sales presentation and watched. Go ahead.<\/p>\n<p>[00:19:45]\u00a0<strong>Cristina:<\/strong>\u00a0Okay, baby, you do it because you do this.<\/p>\n<p>[00:19:47]\u00a0<strong>Ron:<\/strong>\u00a0No. This for you. You wanted this thing.<\/p>\n<p>[00:19:50]\u00a0<strong>Cristina:<\/strong>\u00a0We have a timeshare. Really great. You have VIP, premier discounts. You have a concierge, and you\u2019ll have a great time.<\/p>\n<p>[00:20:03]\u00a0<strong>Ramit:<\/strong>\u00a0Oh, that sounds really great. I appreciate it, but I think we\u2019re going to pass. Have a nice day.<\/p>\n<p>[00:20:11]\u00a0<strong>Cristina:<\/strong>\u00a0He literally even walked out. And I said to Ronnie, you take care of this. Literally, there was a moment I said, I got to take a business call. I walked out of the room.<\/p>\n<p>[00:20:23]\u00a0<strong>Ramit:<\/strong>\u00a0I don\u2019t even know what to say. It\u2019s so American that, actually, I\u2019m speechless, to not want to make somebody uncomfortable, so you just signed over a 10,000-dollar contract instead of being like, not interested. Bye.<\/p>\n<p>[00:20:45]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:20:46]\u00a0<strong>Ramit:<\/strong>\u00a0What the hell?<\/p>\n<p>[00:20:47]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:20:48]\u00a0<strong>Ramit:<\/strong>\u00a0All right. Listen. Luckily, it was only $10,000. And your stupid whole life insurance policy, which is another fucking scam that you fell for. Can I just say, it\u2019s really important that the two of you build the skill of saying no together?<\/p>\n<p>[00:21:05]\u00a0<strong>Cristina:<\/strong>\u00a0Okay.<\/p>\n<p>[00:21:06]\u00a0<strong>Ramit:<\/strong>\u00a0Because the world will come after you to take your money.<\/p>\n<p>[Narration]<\/p>\n<p>[00:21:10]\u00a0<strong>Ramit:<\/strong>\u00a0All right. When I was a kid, my parents loved timeshare presentations. They loved it. Why? Because they sit there for two hours knowing full well that they\u2019re not going to buy anything. They can\u2019t afford it. But they get a free gift. So one day, as a little kid, my dad\u2019s very excited. Hey, everybody, get in the van.<\/p>\n<p>[00:21:28] We\u2019re going to a presentation. So we go there, and they sit there for an hour and a half, two hours, and they get that cardboard breakfast, and they have to listen to the\u2013 does that sound like that\u2019d be something you\u2019d be interested in? And my dad just smiles. Literally, there\u2019s no universe in which he was going to sign a single thing.<\/p>\n<p>[00:21:48] By the way, which is exactly how I feel. I find it so comical that people are afraid they\u2019re going to trip and fall and sign for $200,000. I\u2019m like, in what world? But obviously, it happens. So my dad comes out of the presentation with this box in his hand. He\u2019s got a pep in his step. He\u2019s excited. We go, dad, what\u2019d you get?<\/p>\n<p>[00:22:11] He goes, we got a grandfather clock. We drove two hours with the entire family for him to sit in this presentation with my mom, and then we get a grandfather clock. We said, wow, okay. That\u2019s actually pretty cool. A grandfather clock for our house. We get home, he pulls out the box, opens it up. The grandfather clock, literally\u2013 let me show you how big it was.<\/p>\n<p>[00:22:31] It was this big. We thought we were getting a six-foot grandfather clock made of oak. We got a plywood piece of crap that was this big. That thing sat in our house for years. First of all, props to my dad who just loved it. He loves that story. I love it because I love the chance, as I got older, to sit in those rooms and watch these salespeople at their craft.<\/p>\n<p>[00:22:57] Now, do I respect them? They\u2019re definitely going to hell, but I like to watch their sales techniques. And I will say, occasionally I speak to couples who just constantly get taken advantage of. Constantly. And at first, I feel sorry for them, but then it just happens over and over, and I realized they also play a major part in it. It\u2019s not like they\u2019re innocent does walking through the world. They literally hand over their credit card repeatedly and then rationalize their decisions. Cristina and Ron have yet one more example of this. Listen.<\/p>\n<p>[Interview]<\/p>\n<p>[00:23:29]\u00a0<strong>Ramit:<\/strong>\u00a0I\u2019m telling you right now. You make $200,000 plus. Everybody\u2019s going to come after you. Financial advisors charging 1.45%. Whole life\u2013 do you have that too? What\u2019s that look on your face, Cristina? How much do you pay your financial advisor? You don\u2019t know.<\/p>\n<p>[00:23:45]\u00a0<strong>Cristina:<\/strong>\u00a0I don\u2019t know.<\/p>\n<p>[00:23:45]\u00a0<strong>Ramit:<\/strong>\u00a0Is this a joke? How did this not come up in the prep? What the fuck is\u2013 all right, let\u2019s get into this then. All right. So just 1, 2, 3. You got the whole life insurance. You got the timeshare, and you got the financial advisor charging AUM. You are the trifecta of Americana. The two of you, the more money you make, the more you are giving away in fees every single day.<\/p>\n<p>[00:24:10] And one day, you wake up. Whoa, the American dream, what happened? The American dream got stolen by Wall Street, and the two of you let it go with a big old smile on your faces. How much is the financial advisor\u2013 are they managing all your investments?<\/p>\n<p>[00:24:26]\u00a0<strong>Cristina:<\/strong>\u00a0I don\u2019t do investments. The Roth IRA is with them, and the life insurance is with them.<\/p>\n<p>[00:24:31]\u00a0<strong>Ramit:<\/strong>\u00a0Of course, the life insurance is with them, which is why they\u2019re a salesperson.<\/p>\n<p>[00:24:35]\u00a0<strong>Cristina:<\/strong>\u00a0There were a friend from high school that I met up with and told me that they were a financial advisor. And I was like, great. Help me.<\/p>\n<p>[00:24:44]\u00a0<strong>Ramit:<\/strong>\u00a0Ron. What are you hearing when you hear this?<\/p>\n<p>[00:24:50]\u00a0<strong>Ron:<\/strong>\u00a0That if it sounds good, she\u2019s going to go with it.<\/p>\n<p>[Narration]<\/p>\n<p>[00:24:53]\u00a0<strong>Ramit:<\/strong>\u00a0How many of you would trust your high school friend to manage your money? Half of you wouldn\u2019t even trust your high school friend to cut your hair. I\u2019m going to do an entire episode about paying a financial advisor a percentage-based fee, which you should never do. Stay tuned for that soon. And if you have any crazy stories about paying 1.5% AUM to a financial advisor and finally discovering it, send it to me on Instagram DMs. You know I love these stories.<\/p>\n<p>[Interview]<\/p>\n<p>[00:25:19]\u00a0<strong>Ramit:<\/strong>\u00a0All jokes aside, I think what I\u2019m really noticing is that at the beginning of this call, there was this dynamic that Cristina is in charge of money, and Ron is this hapless guy. He\u2019s just not into money, so Cristina does it. And truthfully, what I\u2019m really hearing is that both of you are not especially savvy with money.<\/p>\n<p>[00:25:42] And that\u2019s okay, that you haven\u2019t made huge mistakes yet. But I\u2019m concerned for you. And all jokes aside, I don\u2019t want you to get taken advantage of by financial advisors, whole life insurance salespeople, and timeshare salespeople. I don\u2019t. So the way that I would look at it, if I were the two of you is, gosh, we\u2019ve almost been battling each other for years on this, and what we need to do is realize that it\u2019s got to be the two of us against the world.<\/p>\n<p>[00:26:14] That\u2019s the way to look at this. If you two work through my book together, I would recommend you get the book, get the journal, do a six-week thing, six-week program. Each week, the two of you read it. You put your questions and notes in a Google doc and alternate who leads the conversation. Oh, bank accounts. I\u2019ll take this one. You take that one. You two are going to be so much smarter and more confident with your money.<\/p>\n<p>[00:26:42] And I think, I\u2019m just going to fast forward to the end, what you will realize is that you need to fire your financial advisor, who\u2019s not really an advisor. They\u2019re a salesperson. You need to get out of that whole life insurance. If I were to go look through it all, I\u2019m confident that\u2019s the conclusion I would come to. And this timeshare, if you can get rid of it, I would hopefully get rid of that.<\/p>\n<p>[00:27:06] I would then take the money that I saved and put it all towards credit card debt. I would get extremely aggressive. Now I understand why the two of you seemed so calm about the credit card debt. And the answer is that you don\u2019t really understand the implications of this debt. If you can\u2019t pay this debt off quickly, it will stay with you for five or 10 plus years.<\/p>\n<p>[00:27:34]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:27:37]\u00a0<strong>Ramit:<\/strong>\u00a0Any reactions to that?<\/p>\n<p>[00:27:39]\u00a0<strong>Cristina:<\/strong>\u00a0A lot. Yeah.<\/p>\n<p>[00:27:43]\u00a0<strong>Ramit:<\/strong>\u00a0Ron?<\/p>\n<p>[00:27:45]\u00a0<strong>Ron:<\/strong>\u00a0Yeah, just hearing you talk about it, man, it\u2019s a slap in the face to see some of the decisions we\u2019ve been making and the money we\u2019re just wasting.<\/p>\n<p>[00:28:00]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:28:02]\u00a0<strong>Ron:<\/strong>\u00a0You said it\u2019s better to take a loss right now than to have that loss follow you, and you\u2019re paying it off for years and years. So just cut it and be done. Makes sense.<\/p>\n<p>[00:28:17]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. There\u2019s a sense of freedom, and there\u2019s a sense of agency about being decisive. Yeah, we made a mistake. We were new. We weren\u2019t paying attention. We weren\u2019t aligned, but we caught it. We got rid of it. Sure, we took a little bit of a loss, but we\u2019re not going to make that mistake again. Something very powerful about exerting control over the world instead of letting the world exert its control only over you.<\/p>\n<p>[Narration]<\/p>\n<p>[00:28:42]\u00a0<strong>Ramit:<\/strong>\u00a0Here are my observations. Number one, we learned that Cristina, who was painted as the responsible money manager in part 1 is honestly just as in the dark as Ron is. And that false confidence in her abilities has led to some really bad spending. And then Ron, who\u2019s very quick to defer to her, he\u2019s starting to get empowered to make hard decisions for the benefit of himself and Cristina.<\/p>\n<p>[00:29:12] Now let\u2019s zoom back out because they\u2019re going to have to make some difficult decisions. But why? One of the things I like to do is to show people why they have to make these difficult decisions. In other words, what do they get?<\/p>\n<p>[Interview]<\/p>\n<p>[00:29:26]\u00a0<strong>Ramit:<\/strong>\u00a0So if it were you two\u2013 well, it is you two. What do you want to do with your money?<\/p>\n<p>[00:29:35]\u00a0<strong>Ron:<\/strong>\u00a0I want to be smarter with it. I want to save and invest more.<\/p>\n<p>[00:29:38]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. How much more?<\/p>\n<p>[00:29:45]\u00a0<strong>Ron:<\/strong>\u00a0The life insurance is 400, and then this vacation club is another 100, so at least putting that extra 500 into investments or savings, even if it\u2019s split up, or if it\u2019s split 60-40, 70-30, whatever it is.<\/p>\n<p>[00:30:03]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. All right, good. What else? Let\u2019s go back and forth. Each of you give me one thing and then go back and forth. What else would you do?<\/p>\n<p>[00:30:12]\u00a0<strong>Cristina:<\/strong>\u00a0I want to, yeah, lower our fixed costs as much as possible, and then increase our investments.<\/p>\n<p>[00:30:21]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. What do you want to lower on your fixed costs?<\/p>\n<p>[00:30:23]\u00a0<strong>Cristina:<\/strong>\u00a0I really want to lower our car payment.<\/p>\n<p>[00:30:27]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. How do you want to do it?<\/p>\n<p>[00:30:29]\u00a0<strong>Cristina:<\/strong>\u00a0Sell the motorcycle.<\/p>\n<p>[00:30:32]\u00a0<strong>Ramit:<\/strong>\u00a0How much can you get for these two motorcycles?<\/p>\n<p>[00:30:37]\u00a0<strong>Ron:<\/strong>\u00a0Oh man, it\u2019s so hard to say. We already know we\u2019re selling the more expensive one.<\/p>\n<p>[00:30:43]\u00a0<strong>Ramit:<\/strong>\u00a0How much are you going to get?<\/p>\n<p>[00:30:47]\u00a0<strong>Ron:<\/strong>\u00a0Realistically, depending on when we actually sell it, if I sell it now, it\u2019s towards the end of the season. I might only be able to get eight for it. If I wait until the next season, when it starts, I can probably get like 10 for it.<\/p>\n<p>[00:31:02]\u00a0<strong>Ramit:<\/strong>\u00a0How do you make that decision? Should you do it now, or should you wait?<\/p>\n<p>[00:31:07]\u00a0<strong>Ron:<\/strong>\u00a0Obviously, I want to get the most for it. We\u2019re in the Midwest. It\u2019s coming down to that time where the weather is just starting to turn.<\/p>\n<p>[00:31:17]\u00a0<strong>Ramit:<\/strong>\u00a0How do you make the decision?<\/p>\n<p>[00:31:20]\u00a0<strong>Ron:<\/strong>\u00a0Shoot or get off the pot.<\/p>\n<p>[00:31:22]\u00a0<strong>Ramit:<\/strong>\u00a0I say take the money immediately. That would be my approach. I would be like, there\u2019s a fire. We\u2019re going to move fast. Even if we\u2019re not getting a 100% perfect, we\u2019re just moving. We\u2019re executing. What do you think about that?<\/p>\n<p>[00:31:40]\u00a0<strong>Ron:<\/strong>\u00a0I guess some money is better than no money.<\/p>\n<p>[00:31:41]\u00a0<strong>Ramit:<\/strong>\u00a0Bingo. Bingo. Whether you are making 6k, 8k, 10k, in the grand scheme of your overall income, how much does a 2k difference matter to you?<\/p>\n<p>[00:31:55]\u00a0<strong>Ron:<\/strong>\u00a0True.<\/p>\n<p>[00:31:56]\u00a0<strong>Ramit:<\/strong>\u00a0It\u2019s 1%.<\/p>\n<p>[00:31:57]\u00a0<strong>Ron:<\/strong>\u00a0Okay.<\/p>\n<p>[00:31:59]\u00a0<strong>Ramit:<\/strong>\u00a0Don\u2019t agonize, and don\u2019t think small. Cristina, any comments or questions on that?<\/p>\n<p>[00:32:03]\u00a0<strong>Cristina:<\/strong>\u00a0Uh-uh.<\/p>\n<p>[00:32:04]\u00a0<strong>Ramit:<\/strong>\u00a0All right. What\u2019s next? How else? Oh, you\u2019re going to take that\u2013 let\u2019s just say you end up netting 6k. What are you going to do with it?<\/p>\n<p>[00:32:11]\u00a0<strong>Cristina:<\/strong>\u00a0Pay off the credit card.<\/p>\n<p>[00:32:14]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah. Put that towards the credit card immediately. What else do you want to do? Got to cut this fixed cost down.<\/p>\n<p>[00:32:24]\u00a0<strong>Cristina:<\/strong>\u00a0I don\u2019t know. You already said we\u2019re going to get rid of the life insurance and the vacation club membership.<\/p>\n<p>[00:32:30]\u00a0<strong>Ramit:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:32:32]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah. There\u2019s nothing else.<\/p>\n<p>[00:32:35]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. All right, so that actually will make a pretty big difference, honestly. You throw the $6,000 right at the credit card debt. Amazing. You get rid of this 430 a month of whole life insurance. Where does that go?<\/p>\n<p>[00:32:53]\u00a0<strong>Ron:<\/strong>\u00a0Investments or savings.<\/p>\n<p>[00:32:56]\u00a0<strong>Ramit:<\/strong>\u00a0All right. This is where it\u2019s like a chef. It\u2019s like, how much salt do I want to put in my dish? How much do I want to put towards these high-interest student loans? How much do I want to make sure that I\u2019m contributing jointly to our investments? There\u2019s no perfect answer. Over time, you\u2019re going to start to see certain things. For example, when you pay off your cars, which is going to free up a ton of money every month, remember this. Don\u2019t get a new car for a long time. Drive that for as long as you can because can you imagine having an extra $1,000 a month right now?<\/p>\n<p>[00:33:31]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:33:33]\u00a0<strong>Ramit:<\/strong>\u00a0So imagine, when you have these costs that just stop, wow, you get the chance to redirect it to something you care about, like investments, or savings, or debt payments.<\/p>\n<p>[00:33:43]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:33:44]\u00a0<strong>Ramit:<\/strong>\u00a0But let me just give you an example, Ron. In the stock market, we can safely assume that over time you make about 7 to 8 % per year, roughly. When your credit cards start charging you interest, they\u2019re going to charge 26.99%. So where do you want to put more money?<\/p>\n<p>[00:34:00]\u00a0<strong>Ron:<\/strong>\u00a0Credit card.<\/p>\n<p>[00:34:01]\u00a0<strong>Ramit:<\/strong>\u00a0Exactly.<\/p>\n<p>[00:34:02]\u00a0<strong>Ron:<\/strong>\u00a0Pay that off before we start investing more.<\/p>\n<p>[00:34:05]\u00a0<strong>Ramit:<\/strong>\u00a0Exactly. And the good news is with your income, you can actually do it. You can actually get really aggressive, but what you can\u2019t do is only pay the minimum.<\/p>\n<p>[00:34:13]\u00a0<strong>Cristina:<\/strong>\u00a0No.<\/p>\n<p>[00:34:16]\u00a0<strong>Ramit:<\/strong>\u00a0All right. So you got 430 a month going now towards 24,000. That\u2019s good. Plus the 450 you\u2019re already paying. Your vacation club membership, let\u2019s see if you can even get out of that. I hope you can. Maybe that frees up an extra a 100 bucks a month. If you were able to get the credit card debt, done. If you get rid of your time shares, and whole life insurance, and financial advisor, all those need to go, you can invest on your own. You have a very simple need. Or if you need to get a financial advisor, pay an hourly rate. That\u2019s the way to do it. I\u2019ve even done that myself when I\u2019ve had a financial advisor look over my investments.<\/p>\n<p>[00:34:59]\u00a0<strong>Ron:<\/strong>\u00a0Okay.<\/p>\n<p>[00:35:00]\u00a0<strong>Ramit:<\/strong>\u00a0Really, what it is beneath all the numbers is the two of you working as a team and learning how money works so that you don\u2019t get taken advantage of again and again and again. The craziest thing about getting taken advantage of in America by financial companies is you don\u2019t even know you got taken advantage of. Do you realize it? The way you described it, you go whole life insurance. It\u2019s a gift. Timeshare, VIP. We have a concierge. It all actually is sold to you as sounding good. Meanwhile, they are just taking your money for things that you could get for a 10th of the price somewhere else.<\/p>\n<p>[00:35:43]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:35:44]\u00a0<strong>Ramit:<\/strong>\u00a0Leaving the two of you to fight over a dinner out.<\/p>\n<p>[00:35:50]\u00a0<strong>Cristina:<\/strong>\u00a0Yeah.<\/p>\n<p>[00:35:52]\u00a0<strong>Ron:<\/strong>\u00a0Sad to hear.<\/p>\n<p>[Narration]<\/p>\n<p>[00:35:54]\u00a0<strong>Ramit:<\/strong>\u00a0Notice what\u2019s happened so far. We\u2019ve gotten all their expenses out on the table. We\u2019ve established they\u2019re spending way more than they ever realized, and that candidly, they make poor financial decisions. Now they are starting to realize the seriousness of the changes they have to make. And I will say, it\u2019s not enough to leave people like this.<\/p>\n<p>[00:36:14] Okay. Yeah, right now, it\u2019s catastrophic. Things are bad. I want to give them a vision of why they are making these changes. Remember, people aren\u2019t logical. They\u2019re not rational. They rarely make big changes with their money simply because it\u2019s the right thing to do. People need a vivid reason to make a change. And specifically, I\u2019m going to get Ron involved in that vision.<\/p>\n<p>[Interview]<\/p>\n<p>[00:36:36]\u00a0<strong>Ramit:<\/strong>\u00a0The good news is that you can change it, but it\u2019s going to require the two of you together. Let\u2019s play a game of another couple, dual income, no kids. They earn the same as you two. They live in a similar city. What do they do with their money differently than what you two do?<\/p>\n<p>[00:37:03]\u00a0<strong>Ron:<\/strong>\u00a0Wow, they\u2019re probably having a lot more fun. They\u2019re probably traveling, probably happy, enjoying life together.<\/p>\n<p>[00:37:15]\u00a0<strong>Ramit:<\/strong>\u00a0Tell me more. Are they talking about it?<\/p>\n<p>[00:37:22]\u00a0<strong>Ron:<\/strong>\u00a0If they\u2019re smart, they are.<\/p>\n<p>[00:37:24]\u00a0<strong>Ramit:<\/strong>\u00a0Okay.<\/p>\n<p>[00:37:24]\u00a0<strong>Ron:<\/strong>\u00a0Just budgeting how they\u2019re going to plan a couple of vacations, two vacations for the year. If the wife wants to go get a bag a new purse or something like that, whatever her thing that she\u2019s into, she goes and does that without any worry on what the husband\u2019s going to say, and vice versa. He can go do what he wants without\u2013<\/p>\n<p>[00:37:48]\u00a0<strong>Ramit:<\/strong>\u00a0I like it. How often are they talking about money?<\/p>\n<p>[00:37:53]\u00a0<strong>Ron:<\/strong>\u00a0Probably twice a month. Once in the middle of the month. Once at the end of the month.<\/p>\n<p>[00:37:57]\u00a0<strong>Ramit:<\/strong>\u00a0Nice. What\u2019s the tenor of those conversations?<\/p>\n<p>[00:38:01]\u00a0<strong>Ron:<\/strong>\u00a0Just going over what they have in their accounts and just saying, oh, this was a good month. This is how much we earned. We had a really good month.<\/p>\n<p>[00:38:10]\u00a0<strong>Ramit:<\/strong>\u00a0Good means what?<\/p>\n<p>[00:38:13]\u00a0<strong>Ron:<\/strong>\u00a0Good means that they\u2019re able to enjoy that month. They\u2019re able to just not stress and worry about going out to dinners and going away for a weekend.<\/p>\n<p>[00:38:27]\u00a0<strong>Ramit:<\/strong>\u00a0Okay, this couple earns a similar amount as you two. Do you think that a couple who earns the amount you do should have to worry about a dinner out?<\/p>\n<p>[00:38:38]\u00a0<strong>Ron:<\/strong>\u00a0No.<\/p>\n<p>[00:38:39]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s say, in those conversations, that not everything goes right. They overspend on something. How do they handle that?<\/p>\n<p>[00:38:48]\u00a0<strong>Ron:<\/strong>\u00a0I would say that they say, okay, we spent a little bit too much last month. This month, we should really just watch it if we\u2019re planning on taking a trip later on the year. No shopping sprees, or maybe just one dinner this month, or something like that.<\/p>\n<p>[00:39:03]\u00a0<strong>Ramit:<\/strong>\u00a0I really like that. There\u2019s a sense of ease I\u2019m getting from you right now, Ron. It just feels very calm. Yeah, something happened. Okay. We noted it, write a little note to ourselves, and we\u2019ll fix it next month. And we\u2019re partners. High five. You hear that?<\/p>\n<p>[00:39:22]\u00a0<strong>Ron:<\/strong>\u00a0Yeah. That\u2019s the way that I want to be.<\/p>\n<p>[00:39:25]\u00a0<strong>Ramit:<\/strong>\u00a0Okay. Cristina, what do you notice about Ron\u2019s example as he went through each of those scenarios?<\/p>\n<p>[00:39:32]\u00a0<strong>Cristina:<\/strong>\u00a0He sounded calmer. To me, hearing him talk like that, it sounded like I can approach him.<\/p>\n<p>[00:39:42]\u00a0<strong>Ramit:<\/strong>\u00a0Approachable.<\/p>\n<p>[00:39:44]\u00a0<strong>Cristina:<\/strong>\u00a0Yes.<\/p>\n<p>[00:39:47]\u00a0<strong>Ramit:<\/strong>\u00a0I like that. I think we can work with that. What do you notice about that example, Ron?<\/p>\n<p>[00:39:57]\u00a0<strong>Ron:<\/strong>\u00a0That they\u2019re probably happy.<\/p>\n<p>[00:40:03]\u00a0<strong>Ramit:<\/strong>\u00a0I think so. What else?<\/p>\n<p>[00:40:08]\u00a0<strong>Ron:<\/strong>\u00a0Comfortable. They\u2019re synced.<\/p>\n<p>[00:40:14]\u00a0<strong>Ramit:<\/strong>\u00a0They\u2019re synced. They\u2019re connected. They\u2019re connected. Yeah, I love that. And you know what\u2019s interesting? The two of you can be connected about money, even though you see it totally differently. You can be. Culturally, the two of you are totally different. You\u2019re still connected, right?<\/p>\n<p>[00:40:33]\u00a0<strong>Ron:<\/strong>\u00a0Mm-hmm.<\/p>\n<p>[00:40:33]\u00a0<strong>Ramit:<\/strong>\u00a0You grew up in different countries, different family structure, but you\u2019re married, and you\u2019re connected. That\u2019s even more extreme than money. Yeah, you see money differently. That\u2019s probably not going to change for some of the big things. That\u2019s okay. But you can still connect, and you can actually still have fun, still spend a little bit on the things you love, still save. All those things are possible.<\/p>\n<p>[Narration]<\/p>\n<p>[00:40:58]\u00a0<strong>Ramit:<\/strong>\u00a0Let\u2019s check out Cristina and Ron\u2019s follow up video.<\/p>\n<p>[00:41:00]\u00a0<strong>Cristina:<\/strong>\u00a0What surprised me from our conversation was how open Ronnie and I were, and how we were able to quickly work together and figure out our next steps.<\/p>\n<p>[00:41:14]\u00a0<strong>Ron:<\/strong>\u00a0I guess what surprised me was seeing or hearing how much money we actually make.<\/p>\n<p>[00:41:24]\u00a0<strong>Cristina:<\/strong>\u00a0The best thing I learned was maybe the idea of working together as opposed to working against each other, and honestly, getting that call of, yeah, we\u2019re not savvy with our money, and we need to learn together and make these decisions together.<\/p>\n<p>[00:41:45]\u00a0<strong>Ron:<\/strong>\u00a0Yeah. I learned that I need to be more hands-on with making the big decisions of how we\u2019re going to spend our money, how we\u2019re going to save our money for the future.<\/p>\n<p>[00:41:59]\u00a0<strong>Cristina:<\/strong>\u00a0So the few changes we\u2019ve made is we definitely canceled the life insurance. That\u2019s gone. We\u2019ve also lowered some of our fixed cost. Like our phone bill, we actually were able to lower, so we\u2019re able to save some money, and now we\u2019re going to use that to invest and pay some of our credit cards.<\/p>\n<p>[00:42:19]\u00a0<strong>Ron:<\/strong>\u00a0I put the motorcycle up for sale, so now we\u2019re just waiting to get a couple of bites on it so I can sell it and use that money to pay off some of the debt.<\/p>\n<p>[00:42:29]\u00a0<strong>Cristina:<\/strong>\u00a0We appreciate all your help, and we want to thank you for having us and talking to us.<\/p>\n<p>[00:42:35]\u00a0<strong>Ramit:<\/strong>\u00a0Cristina and Ron, I want to thank you for coming on this podcast and having these conversations with me for all of us who are watching and listening. It is so rare that we get a chance to listen in on real couples, including their real numbers and how they think about money, and talk about money, and even disagree about money.<\/p>\n<p>[00:42:53] So thank you, Cristina and Ron. Thank you, every guest that\u2019s come on this podcast. If you are interested in learning more about money psychology, every Saturday, I release a newsletter where I share material you will not find anywhere else. You can get it at iwt.com\/podcastnewsletter.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>It\u2019s time to get tactical in this energetic follow-up episode with Cristina and Ron. Building on their story, we unpack their three most glaring money mistakes\u2014a percentage-based financial advisor, whole and term life insurance, and a $10,000 timeshare vacation plan. This episode is brought to you by: Inside Tracker | Get 20% off by going [&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-118949","post","type-post","status-publish","format-standard","hentry","category-podcast-episodes"],"acf":[],"aioseo_notices":[],"modified_by":"Vika DD.NYC\u00ae","_links":{"self":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/posts\/118949","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=118949"}],"version-history":[{"count":0,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/posts\/118949\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/media?parent=118949"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.iwillteachyoutoberich.com\/wp-json\/wp\/v2\/categories?post=118949"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}