I Will Teach You To Be Rich - 126. “We have $30k of CC debt. Why did we buy a $10k timeshare?” (Part 2)

Episode Date: October 17, 2023

It’s 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—a 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 to https://insidetracker.com/ramit. Mint mobile | To get your new wireless plan for just $15 a month, go to https://mintmobile.com/ramit. Long Angle | If you've made a lot of money and you're looking for a community of peers to turn to for advice, go to https://www.longangle.com/ to learn more. BetterHelp | Visit https://betterhelp.com/ramit today to get 10% off your first month. Connect with Ramit Get the Podcast Newsletter and exclusive Q&A about the show Get Money Coaching with Ramit  Download the Conscious Spending Plan Get my New York Times best-selling book Get my no-numbers journal Other episodes Instagram Twitter YouTube Submit a question for the newsletter iwt.com/askramit   If you and your partner have a money issue and you want my help, I occasionally select a couple to work with, free of charge. Apply for my help here. Produced by Crate Media.

When we were down in Jamaica, you went to a f***ing time share presentation. We did. Is this a joke right now? So it's a 15 year vacation club membership. It's not a time share per se. It's a vacation club. It's a time share. They did start the package off at 36,000 and because I got to say no, no, no, no, no,

no, no, no, no, no. I got them down to 10,000 for because I got to say no, no, no, no, no, no, no, no, no, no, no, no, no, I got them down to $10,000 for it. Wow. Bravo. You put down $5,000 while you had tens of thousands of dollars of credit card debt. Do you think that's a good decision now that I'm saying it out loud? Nope. So we have this club for 15 years.

Trying deals on everything that's the high at owns, I think, premier everything. So VIP and cancee air services, better rooms, and then we get a crazy amount off of them. Oh, the stuff you already paid $10,000 for, you get a little discount on it. Yep, pretty much. We said yes to go into a free breakfast, that's what it was. I wanted free breakfast. I didn't know that that was going to be a time here's presentation. I really cost you $10,000. I think they just didn't know how to get out of it. I felt very

uncomfortable in that situation. Oh my god. There are suckers. You two are the suckers. Welcome to part two of my conversation with Christina and Ron. You can check out last week's episode for a lot of important background information on these two, but let me give you a quick recap. She's 30, he's 45, and she's frustrated that she's the one who manages money in their relationship. 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 time share, which we are going to talk about today. Now, some of you love to talk about the things that you enjoy spending money on. You know, for me, I have an MX Platinum card. I like it for the lounges. It doesn't make Now, some of you love to talk about the things that you enjoy spending money on. You know, for me, I have an MX Platinum card. I like it for the lounges. Doesn't make any financial sense, but I love it. This coming Saturday in my newsletter,

I'm gonna talk about different money lenses that we can look through. A lot of people use frugality or cost. That's the number one money lens they look through, but there's so many more. Just remember, a timeshare does not fit into any of these. Okay. Make sure you're on my list at iwt.com slash podcast newsletter. That's the only place you can get this material. Now let's get to the conversation. All right. You have pet insurance. Is this for real? We do. And it's I don't know. You know what? I don't even know, nor whatever.

It's fine. All right, your car payment is a thousand dollars a month. What car is it? That's two cars and two motorcycles. Okay. That's a lot of cars for two people. Depayments. What is 450? What is this debt payments, what is 450, what is this debt payment? That's the credit card. Ah. We have a credit card debt. How much? Right now, we have about 30 of that in its credit card. 30,000 dollars in credit card debt.

How did this not come up before? Is this the minimum $450 a month? Yeah, there's no interest on them right now because I balanced transfer them, but 30,000 is the whole lot of it. Everybody sounds real calm about $30,000 of credit card debt. How come I'm the one freaking out about this? I'm not scared of debt. At $200,000 of a student loan, that's scary to me more than

the $30,000 credit card debt, and we've paid off a lot from that. Your pet care is 500 bucks. So, I mean, really, your pets are also plus the 175, that's $675 a month, plus probably some extra stuff you didn't counter, that's $7,800 a month for pets. Okay. Domestic help, $380. Somebody to clean your place. Is that what we're talking about? Okay. And you're having a vacation. Oh my god. Do you have a time share? Is this a joke? What is this? I'm gonna let him take it. What is this? So yeah, it is. What is this shit? So yeah, it is. What is this life insurance?

Is this whole life insurance, Christina? Full end term. Oh my God, what the f***. I know. How much are you putting $430 a month into this whole life insurance policy? Yeah, for both of us. That's a lot of money.

I rented it in your box. I know, but that was the time that his dad passed away. And that's like, that's like the first death that I've experienced and he's experienced that's 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, right? But they're still a part of me. That's like, did we make a right decision financially to get this life insurance? Some people say it is, some people say it's not. But I don't 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. Tell me about that time, Ron, and I'm sorry to bring up memories of your dad passing away. At that point, yeah, it was a little hard just to have that conversation. I know, you know, sometimes people over-correct,

you had a death in the family, you wanna 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. Insurance is insurance, it's not an investment. It's different.

Oftentimes it's better to take the same money you would have put in to a whole life insurance policy, just invest it, right? Invest it whether through a retirement account or even a taxable account And you'll end up with a way more money Don't fall for the sales guys talking about cash value borrow against it all this nonsense That right there's a lot of cash flow every month that you could get yeah, yeah Listen up whole life insurance is not an investment 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 sales people. Almost everyone would be better off buying term life insurance and investing the difference in all the fat fees that you would be paying the sales person. I say almost everyone, because there's this myth that rich people can benefit from whole life insurance.

But I'm rich and I know a lot of rich people and we've never been able to make the numbers work on whole life insurance. I avoid it like the plague. I'm gonna go out on a limb here. Ron, can I guess that you absolutely hate debt? Absolutely. Yeah.

So how long is it going to take you to pay it off? I mean, my plan is to pay off aggressively within a year or two. If we find a way to make some money, um, extra money that we get since we both are, you know, yeah, I got away. Commission sitting in your garage. both are, you know, yeah, I got away. It's a commission sitting in your garage. Is it smart to do like balance transfers, you know, from one credit card to another to get out of like the interest to a zero percent, you know, even though you have to pay a little

bit to do it or are we giving money away at that point still? You know, it's 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 balanced transfers as a gimmick. Basically, how do I buy myself another 12 months? But what they don't do, which is the most important thing, is they don't look at their fixed costs and they go, okay, what are we eliminating?

Okay, we're gonna cut $500 a month off and it could be by we are going to eat out way less, we are not going on vacation, et cetera, et cetera. And I'm going to take all that money and I'm going to automatically set it up to be transferred to my credit card bill every single month. It's not a choice, it's not a chance, it's math, it just happens automatically. So do the balance transfer, don't do the balance transfer, but what matters really is setting up an automated transfer every single month, aggressively paying off for credit card bill.

I am still at school, I'm getting my PhD, that's why there's such a big student loan. So after calculating the cost of the program, after the, with all the PhD and everything, my student loan's going to be around 250,000. I have not paid because I've always been in school and then when COVID happened, there was a postponement, there was no interest. So it's almost like I didn't worry about it, but I will be having to pay for it in 2025, 2026. So I don't know what to do either. Do you know the interest rate? The ones from the bachelor's were about 3.99 or something around that, and then the ones from my graduate school and the PhD program is about seven or eight,

I believe. Any chance of income-based repayment? I could try to apply for it. I know I was approved before after my bachelor's, but the difference is because we are dual income now, I don't know how much that's going to save me or not. Okay. Why don't you find out and also find out about any possibility as a student loan forgiveness. There are people in your program

who will definitely be able to advise financial aid office for sure. Let's assume the worst case where nothing, you're not eligible for anything. The way that I would think about it would be, okay, the bulk of your higher income, it's probably gonna have to go to loans. You control how fast you pay those loans off,

but I would definitely pay more on the 8, 9, 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 wanna pay that off as aggressively as possible. Okay. There are often options for student loans over seven, I want to pay that off as aggressively as possible. There are often options for student loans that a lot of people are not aware of. I'll 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'd been emailing with her for weeks, months. I literally knew Mary by her first name, okay? And that's how I got to know all kinds of financial aid options that most people just don't 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 called financial aid office and asking for help. including going back to your called financial aid office and asking for help.

I mean, notice that the people who come on this podcast and are doing well with their money, they have a plan for what can go right and what can go wrong. Even if they have debt, they have a plan to pay it off. If they wanna take a trip, they have a sub-savings account where they plan for months in advance.

We wanna do that with money, and we wanna do that with other parts of our rich life, our relationships. Let's strengthen it before there's a problem. For health, we want to work on it before there's a problem. And that's something you can do with today's episode sponsor, Inside Tracker. Inside Tracker can help you optimize your health so that you live healthier longer. They do this by providing personalized plans based on your body's data. Inside tracker tests your blood DNA and can sink with your fitness tracker and then give you science-backed recommendations on nutrition, exercise,

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Remeath R-A-M-I-T. This episode is sponsored by Mint Mobile, a service that offers premium wireless for just $15 a month. Now, let me explain why this is so important for you. Think about what you would do if you were spending $15 a month on your wireless. Instead of what, $100, $150 bucks a month, if you put that $100 a month towards a 30-year mortgage, that could shave three years off your mortgage. This is the power of taking a savings, even $100 a month and automating it towards something

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When we were down in Jamaica, you went to a about this time share when we were down in Jamaica you went to a F*** time share presentation we did you have finance manager how did you sign this Is this a joke right now? No, they have a wife that I want to please Okay, so what did you sign? So it's a 15 year vacation club members. It's not a time share per se. It's a vacation club. It's a time share going.

So yeah, so we, you know, we get like four weeks in the US. We get a couple of weeks overseas, you know, then we get discounts over the next 15 years on stuff. So so but I will say and I'll say in our defense if they did start the package off at like 36,000 for this package Mm-hmm, and because I got them saying no no no no no no no no no no no for like five hours And I was trying to leave and they just kept me there. I got them down to 10,000 for it Wow Bravo and I was trying to leave and they just kept me there. I got them down to 10,000 for it. Wow.

Bravo. Bravo. So how much did you put down? 50%. 50%. OK. You put down 5,000. OK.

And by the way, this was, how long ago was this? Last year. De-sember. You put down 5,000 while you had tens of thousands of dollars of credit card debt. Do you think that's a good decision now that I'm saying it out loud? Some people ask, Rami, 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're now locked into payments for how many more years? Just, it's 48 months. So you have to pay $5,000 more or so. Or 48 months. So it will not- But no interest. Wow, great.

For four more years and then what happens after that? We just haven't You have what what you don't Please someone tell me what happens after 48 months. We have it for so we have this club for 15 years so we get Prime deals on everything that's the high at owns I think so whether it's in the US if it's prime deals on everything that's the high it owns, I think. So whether it's in the US, if it's out of the country, we get premier everything. So yeah.

It tells premier anything. What is that? You get nuts when you get into your room. What is that? No, we get like VIP and Kant's here service is kind of like better rooms. And then we get a crazy amount off of them. Oh, the stuff you already paid $10,000 for, you get a little discount on it.

Well, pretty much. All right, so let me tell you, let me tell you the following. First of all, time shares are a scam. They are never financially a good decision. You can see this because there are forums and forums of desperate time share owners who are trying to offload for literally pennies on the dollar.

You can buy time shares, contracts for super cheap, but even still, it's not a good decision. There are lots of different ways to take vacations and an economical level. Here's 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's of course your money, it's up to you. I don't like throwing good money after bet. And what I find is that when people make a decision that they then are committed to, they really sort of twist themselves into a pretzel trying to justify it. And oftentimes they wake up and their fixed costs are really high. And it's on stuff they bought like six years ago and they don't even remember why they bought it anymore. Sometimes

you have to take a loss on certain things. Like I've had people on the show who bought a house, it couldn't afford. I was like, get rid of it. Just sell it. They go, well, we're going to lose money. I go, yeah, you either lose it now or you're going to lose it over the next eight years and fight every day of your life. That's just my personal opinion.

I don't even know if you can sell it. But I think what's more interesting to me is what happened to cause you to get into that situation? Have you ever considered it? I haven't considered it. All right, let me just break this down for time shares. First of all, the math is extremely complicated on time shares and just like a casino, it always advantages the person selling the time share.

Okay, next, it is almost always a better decision to simply spend money on your own hotel or Airbnb or even rent someone else's time share. You can tell because there are so many desperate time share 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 time share, it will force us to take vacations. Are you kidding me? That's the same argument with people buying a house.

This will force us to save money. In what fucking world do you think I'm gonna 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 wanna take a vacation, put 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's called avoiding time shares. F**k you time share industry. We said yes to go into a free breakfast. That's what it was. I love those sales things. I love those because you get to see really talented sales people time-chair industry. We said yes to go into a free breakfast. That's what it was. I love those sales things. I love those, because you get to see really talented sales people at work. My 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 sales people at work. Of course, we didn't ever buy anything. My family literally had no money to be able to afford it, but I learned to really enjoy it. It's really interesting dynamic. Ron, especially, you know, most days you're sitting here saying no to the things that

your wife wants to do, dinner, trip, whatever. But on this one, it's like, f**k it. Let's go. $10,000. High it. Here we come. It's kind of interesting, right? No.

Yeah, he's visibly uncomfortable. He's like stretching in his chair. What do you say, Ron? I didn't want to do it. You didn't want to do, oh, she wanted to do it? Oh, I wanted to do it. If I would say I didn't know what I was getting into. Okay.

I wanted free breakfast. I didn't know that that was getting into. Okay. I wanted free breakfast. I didn't know that that was going to be a time-shoot presentation. That's free breakfast cost you $10,000. I know, but I didn't know. And I was really reliant. This is the moment I say I relied on him to make a decision. Bullshit. Look, you can. Come on. Let's be honest. All right. I don't mind Christina that Ron has admitted. He has not been a financial partner. He's admitted that and I think he's willing to make some changes. But you can't be like, I'm 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. Joe. Okay. I would say it's not fair to put it on him if you're the one who wanted it and kind of drove the decision. I think they just didn't know how to get out of it. I felt very uncomfortable in that situation. Let's role play right now. Here, I'll show you how to get out of it. I'll be the aggressive sales guy.

Okay, well, if you come to this higher thing, you get an extra discount than the VIP in the concierge, who'll even pick you up, will send you a town car. And of course you get a preferential rooms and you'll never have to worry about where you go on vacation. Just think about having kids in a family. It's so beautiful. You bring your dogs to. Of course, we're pet friendly. And I'll give you a special deal. It's all I know you started 30,000, but for you, just for you, because you're so special, you folks are so great. I could bring it down to 23,000. How's that sound to you? That's great. Oh my God. There are suckers.

You two are the suckers. It does sound great. What in the hell is happening right now here? Why don't we flip it? You be the salesperson. You don't have to do the whole thing. And I'll be me. This is as recent as three years ago when I sat in a sales presentation and I watched.

Go ahead. Okay. Maybe you do it because you do this This is for you you wanted this thing We have a time share really great You give VIP premier discounts We have a concert Shawn then you'll have a great time Oh, that sounds really great.

I appreciate it, but I think we're gonna pass. Have a nice day. I didn't even walk down. And I said to Ronnie, you take care of this. Like literally there was a moment I said, I gotta take a business call. Wait a minute. Walked out of the room. Well, I don't even know what to say.

I'm like, I'm like, if you literally, this is so, it's so American that I actually, I'm speechless to not want to make somebody uncomfortable. So you just sign over a $10,000 contract. Instead of being not not interested, buy.

I, I, yeah. What the hell? Yeah. All right, well, listen, luckily it was only $10,000. Yeah. And your stupid whole life insurance policy, which is another f***ing scam that you fell for, can I just say it's really important that the two of you

build the skill of saying no together. Okay? Because the world will come after you to take your money. All right, when I was a kid, my parents loved timeshare presentations. Okay, they loved it. Why? Because they sit there for two hours,

knowing full well that they're not gonna buy anything, they can't afford it, but they get a free gift. So one day, as a little kid, my dad's very excited, hey everybody get in the van, we're going to a presentation, all right, 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,

which is out to online, God be something, you'd be interested in. And my dad just smiles, like literally, there's no universe in which he was going to sign a single thing. By the way, which is exactly how I feel. I find it so comical that people are afraid they're going to trip and fall and sign for $200,000. I'm like, in what world? But obviously, it happens. So my dad comes out of the presentation with this box in his hands

He's got a pep in his step. He's excited. We go dad. What'd you get? Because you got a grandfather clock We drove like 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's actually pretty cool. Grandfather clock for a house. We get home, he pulls out the box, opens it up the grandfather clock. Literally, let me show you how big it was. It was like this big.

We thought we were getting a six foot grandfather clock or 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, loves that story. I love it because I love the chance as I got older to sit in those rooms and watch

these sales people at their craft. Now, do I respect them? They're 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, okay, constantly. And at first I feel sorry for them, but then it just happens over and over. And I realize they also play a major part in it.

It's not like they're innocent do's walking through the world. They literally hand over their credit card repeatedly and then rationalize their decisions. Christina and Ron have yet one more example of this. Listen, I'm telling you right now, you make $200,000 plus. Everybody's going to come after you. Financial advisors charging 1.45%. Hold life. Do you have that too? What's that look on your face, Christina? How much do you pay your financial advisor? You don't know. I know, no. Yoke.

How did this not come up in the prep? I know. You have. What the f***? All right, let's get into this. All right, so just one, two, three. Let's just, you got the whole life insurance. You got the time share and you got

the financial advisor charging AUM. You are the trifecta of Americana. The two of you, the financial advisor charging AUM. You are the trifecta of Americana. The two of you you know you the more money you make the more you are giving away in fees every single day. And one day you wake up, oh 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 are they managing all your investments? I don't do investments. The Roth IRAs with them and the life insurance is with them.

Of course the life insurance is with them, which is why they're a salesperson. They 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. Ron, what are you hearing when you hear this? That if it sounds good, she's going to go with it. How many of you would trust your high school friend to manage your money? Half of you wouldn't even trust your high school friend to cut your hair. I'm going to do an entire episode about paying a financial advisor a percentage base 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. All jokes aside, I think what I'm really noticing is that at the beginning of this call, there was this dynamic that Christina is kind of like in charge of money and Ron is this like hapless guy. He's just like not into money. So Christina doesn't. And truthfully, what I'm really hearing is that both of you are not especially savvy with money, right? And that's okay that you haven't made huge mistakes yet. But I'm concerned for you and all jokes aside, I don't want you to get taken advantage of by financial advisors,

whole life insurance sales people and time share sales people. Okay, I don't. So the way that I would look at it if I were the two of you is gosh, like we've almost been battling each other for years on this. And what we need to do is realize that like it's got to be the two of us against the world. That's the way to look at this. Okay. If you to work through my book together, right, I would recommend you get the book, get the journal, each, do a six week thing, right, 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, like I'll take this one, you take that one, you two are going to be so much smarter and more confident with your money. And I think I'm just going to fast forward to the end. What you will realize is that you need to fire your financial advisor, who's not really an advisor. They're a salesperson. You need to get out of that whole life insurance. If I were to go look through it all, I'm confident that's a conclusion I would come to. And this time share, if you can get rid of it, I would hopefully get rid of that. I would then take the money that I saved and I would 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't really understand the implications of this debt. If you can't pay this debt off

quickly, it will stay with you for five or ten plus years. Yeah. Okay. All right. Any reactions to that? A lot. Yeah. Yeah. Wrong? Yeah. Yeah. Yeah. Yeah. I mean, just hearing, hearing you talk about it, it's, man, it's kind of like a slap in the face to see some of the decisions we've, we've been making and the money we're, we're just wasting. the decisions we've been making and the money we're just wasting. Yeah, you know, you said it's better to take a loss right now than to, than to have that loss, you know, follow you and you're paying it off for for years and years. So kind of just cut it and be done. Makes sense.

Yeah, there's a sense of freedom. And there's a sense of agency about being decisive. Like, yeah, we made a mistake. We were new. We weren't paying attention. We weren't aligned. But we caught it. We got rid of it. Sure, we took a little bit of a loss,

but we're 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. Here are my observations. Number one, we learned that Christina, who was painted as the responsible money manager in part one, 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's very quick to defer to her, he's starting to get empowered to make hard decisions for the benefit of himself and Christina. I get a lot of questions from people who have used my book. They've automated their finances. They've set their investments up.

They go, all right, I did the basics. What's next? And when you've made a lot of money, you'll notice that there's not a lot of advice specifically for you. The blog posts that are typically focused around people who are just starting off or even people in debt do not really apply to you anymore.

And it can also be embarrassing to ask. You can't really post about certain topics when you have money because your friends don't know how much you make. And nobody really wants to hear about, how do I take cooler vacations? Or what do you all do for tax optimization? Because the first response is, oh, rich people problems. I don't like that phrase because rich people problems are problems nonetheless. How are you supposed to find someone you trust,

whether it's an accountant or a travel advisor? The usual advice that you find on Google doesn't really apply at a certain level. So if you've made a big jump in income or net worth, and you wish you had a community of people who just get it, I wanna introduce you to today's sponsor, Long Angle. The Long Angle community is composed of high net worth individuals with diverse backgrounds in technology, finance, medicine, real estate, law, manufacturing, sports,

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I think this podcast has unlocked something important. Listening to couples on this podcast, sometimes it is so easy to know what they should do. It's so obvious. So why is it that we get stuck with our own problems? Maybe it's careers, relationships, even the way we look at the world. Sometimes we're so close to our own problems that it's hard to see. And sometimes we need somebody who we can talk to with a little perspective. Now you've heard me encourage a lot of my guests on this show to see a therapist.

And if you feel like you're in your own way, maybe you're struggling with debt, you want to find a better career, just feel better overall. I would encourage you to give it a try as well. If you're thinking of starting therapy, give better help a try. They are one of our sponsors, and it is entirely online. Just fill out a brief questionnaire to get matched with a licensed therapist and you can also switch therapists at any time for no additional charge. Make your brain your friend with better help. Visit betterhelp.com slash remeat to get 10% off your first month. That's better help help.com slash reme. Now, let's zoom back out because they're 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? So if it were you two, well, it is you two, what do you want to do with your money? I want to be smarter with it. I want to save and invest more. Okay. How much more? Well, you know, you're talking about, you know, the life insurance is like 400 and then this vacation club is another hundred. So at least putting that extra 500 into into investments or savings, even if it's split up or if it's split 60, 40, 70, 30, whatever it is.

I like that. All right. Good. What else, Christina? Let's go back and forth. Each of you give me one thing and then go back and forth. What else would you do? I want to get lower or fix costs as much as possible

and then increase our investment. Okay. What do you want to lower on your fixed costs? I really want to lower a car if you want. Okay. How do you want to do it? The motorcycle. How much can do you want to do it? That motorcycle. How much can you get for these two motorcycles? Oh, man, it's a tiredness. Well, we already know we're selling the more expensive one.

Realistically, depending on when we actually sell it, like if I sell it now, it's towards the end of the season, I might only be able to get like eight for it. If I wait until the next season, when it starts, I can probably get like 10 for it. How do you make that decision? Should you do it now or should you wait? Obviously, I want to get the most for it. It's just, you know, we're in, in the Midwest, you know, it's coming down to that time where the weather is just starting to, starting to turn. So how do you make the decision?

Shoulder get off the pot. I say take the money immediately. That would be my approach. I would be like, there's a fire. We're going to move fast. Even if we're not getting 100% perfect, we're just moving. We're executing. What do you think about that? I guess some money is better than no money. So, bingo. Bingo. Whether you are making 8, 6K, 8K, 10K in the grand scheme of your overall income. How much is a 2K difference matter to you? True.

It's 1%. Okay. Right. Don't agonize and don't think small. Christine, any comments or questions on that? Mm-hmm. All right, what's next? How else... So you're gonna... Oh, you're gonna take that... Let's just say you end up netting 6K.

What are you gonna do with it? Hey, that's next? How else so you can oh you're gonna take that let's just say you end up netting 6k What are you gonna do with it? Yeah, put that towards a credit card immediately what else you want to do? I cut this fix cost down Well, you already said we're gonna get rid of the life insurance and the vacation club membership. Yeah. Yeah. I don't. Yeah. I, I, there's nothing else. Okay. All right. So that actually will make a pretty big difference. Honestly, that's like you throw the $6,000 right at the credit card debt. Amazing. You get rid of this $430 a month of whole life insurance. Put that, where does that go?

Investments or savings. All right, this is where it's like a chef. It's kind of 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'm contributing jointly to our investments? There's no perfect answer. Over time, you're gonna start to see certain things.

For example, when you pay off your cars, which is gonna free up a ton of money every month. Remember this, don't get a new car for a long time. Drive that for as long as you can. Because can you imagine having an extra thousand dollars a month right now? Yeah. So imagine when you have these costs that just stop, Wow, you can you get the chance to redirect it to something you care about like investments or savings or debt payments.

Yeah, but 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 your interest, they're going to charge 26.99%. So where do you want to put more money? Credit card. Exactly. Pay that off before we start investing more. Exactly. And the good news is with your income, you can actually do it. You can actually get really aggressive, but what you can't do is only pay the minimum. Okay. Okay.

All right, so you got 430 a month going out towards 24,000. That's good. Plus the 450 already paying. Your vacation club membership, let's see if you can even get out of that. I hope you can. Maybe that frees up an extra 100 bucks a month. If you are 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 needs or if you need to get a financial advisor, all those need to go. You can invest on your own. You have a very simple needs, or if you need to get a financial advisor, you know, pay an hourly rate. That's the way to do it. I've even done that myself when I've had a financial advisor. Look over my investments. Really what it is beneath all the numbers is the two of is, the truth is, the truth is, the truth is, the truth is,

the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, the truth is,

the truth is, the truth is, the truth is, the truth is, the truth is, the truth is, is you don't even know you got taken advantage of. Do you realize it? The way you describe it, you go, whole life insurance, it's a gift, time share, VIP. We have a concierge, like 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 tenth

of the price somewhere else. Yeah. Leaving the two of you to fight over a dinner out. Yeah. Said to hear. Notice what's happened so far. We've gotten all their expenses out on the table. We've established their 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's not enough to leave people like this. Okay, yeah, right now it's like catastrophic, things are bad. I wanna give them a vision of why they are making these changes. Remember, people aren't logical, they're not rational. They rarely make big changes with their money

simply because it's the right thing to do. People aren't logical, they're not rational. They rarely make big changes with their money simply because it's the right thing to do. People need a vivid reason to make a change. And specifically, I'm gonna get Ron involved in that vision. The good news is that you can change it, but it's gonna require the two of you together. Let's play a game of another couple.

Dual income, no kids. They earn the same as YouTube. Okay, they live in a similar city. What do they do with their money differently than what you to do? Hmm, wow. They're probably having a lot more fun. They're probably having a lot more fun. They're probably traveling, probably happy and

enjoying life together. Tell me more. Are they talking about it? If they're smart, they are. Okay. Just budgeting how they're going to how they're gonna plan a couple vacations, you know, two vacations for the year. If the wife wants to go get, you know, a bag, you know, a new purse or something like that, whatever her thing that she's into,

she goes and does it without any worry on, you know, what the husband's gonna say. And vice versa, he can go do what he wants without I like it. How often are they talking about money? Probably twice a month once in the middle of the month one set the end of the month are nice What's the tender of those conversations? Just going over what they have in there in their accounts and just Just saying oh, this was a good month. This is how much we earned. We had a really good month. Good means what?

Good means that they're able to enjoy that month. They're able to just not stress and worry about going out to dinners and going on, just going away for a weekend. Okay, well, this couple earns a similar amount as YouTube. and going on, you know, just going away for a weekend. Okay. Well, this couple earns a similar amount as YouTube. Do you think that a couple who earns the amount you do should have to worry about a dinner out?

No. Let's say in those conversations that not everything goes right. They overspend on something. How do they handle that? I would say that they say, okay, well, we spent a little bit too much last month, you know, this month we, you know, we should really just watch it if we're planning on taking a trip later on the year. No shopping sprees or maybe just one dinner this month

or something like that. I really like that. There's a sense of ease I'm getting from you right now, Ron. It just feels very calm. Like, yeah, something happened. Okay, we noted it. Write a little note to ourselves, and we'll fix it next month, and we're partners high five. You hear that? Yeah, that's the way that I want to be. Okay. Christina, what do you notice about Ron's example as he went

through each of those scenarios? He's sounded calmer. Yeah. To me, hearing him talk like that, it sounded like I can approach him. Mm, approachable. Yes. Okay. I like that. I think we can work with that. What do you notice about that example, Ron? That's probably happy. I think so. What else? I think so. What else? Comfortable. They're synced. They're synced. They're connected. They're connected. Yeah, I love that. And you know what's 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're still connected, right? You grew up in different countries, different family structures, but you're married and you're connected. That's even more extreme than money. Okay, yeah,

you see money differently. Okay, that's probably not going to change for some of the big things. That's 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. Let's check out Christina and Ron's follow up video. What 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. I guess what surprised me was seeing or hearing you know how much money we actually make. The 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're not savvy

with our money and we need to learn together and make these decisions together. Yeah, I learned that I need to be more hands-on with, you know, making the big decisions of how we're going to spend our money, how we're going to save our money, you know, for the future. So the future we've made is we've definitely canceled the life insurance. That's gone. We've also lowered our some of our fixed cost like our phone bill. We actually were able to lower so we're able to save some money and now we're gonna use that to invest and pay some of our credit card. I put the motorcycle up for sale so now we're 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.

We appreciate all your help, and we wanna thank you for having us and talking to us. Christine and Ron, I wanna 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. So thank you, Christina and Ron, thank you every guest that's 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 slash podcast newsletter. Thanks for listening to I will teach you to be rich. I'm RemeteSatie. Please follow the show on Apple Spotify or wherever you listen to podcasts. If you haven't read I will teach you to be rich. My book, pick up a copy. You can get it at any bookstore or any library, and it will show you the specific tactics for how to build the I will teach you to be rich system

into your personal finances.