how can you talk about renting you're

just throwing money away BS should I

just dismantle these arguments once and

for all because there's some shocking

math behind a mortgage and most people

don't know this let's get into it the

meet safy the financial expert and

entrepreneur is back to teach you how to

take control of your money and confront

the financial problems that hold us back

most people fall into four money types

that I've identified number one is

avoiders and they'd hate talking about

money but if your partner simply will

not talk about money that's a huge red

flag because % of the people I talk to

do not know their household income 90%

who are in debt do not know how much

debt they're in and 100% of the people I

talk to in credit card debt also have

trouble with that is shocking next up

Optimizer they can get you to a very

good place they'll be investing we love

to live in a spreadsheet but it can be

taken too far and then the dreamer who

believes that success is one deal away

and they tend to fall into crypto coin

scams like all this BS finally worriors

they love to worry are we going to have

enough what if we run out of money

typically they picked up worrying from

their parents who said stuff like money

doesn't grow on trees and the problem is

you can take it a little too far and

they become cheap and become so obsessed

with $3 questions like agonizing over

buying a coffee but everybody listen

closely cuz I want to break down how you

can change any of these types so Remy

the only investment most couples make is

buying a house what is the alternative

this is where real wealth is created

let's simplify the whole thing and I

have four numbers that everyone should

be talking about the first off is your

this has always blown my mind a little

bit 53% of you that listen to the show

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much

[Music]

much

REM if someone's just clicked on this

conversation please explain to me

exactly why they should stay and listen

to what we're about to discuss on the

basis that we're about to talk about the

things you've written in this

book if you are single and dating if you

are engaged or if you have been married

for 25 years money is one of the central

parts of our lives and most of us think

about money as something to be avoided

it's something we only talk about when

things have gone

wrong what a terrible way to live and

there is a different way which is we can

use money as a source of connection

possibility and joy and that is what

we're going to talk about today I had a

conversation a couple of days ago

actually with um James ston who's the

divorce expert he's a divorce lawyer by

trade but he knows more about divorce

than anybody else and he said to me

there's two things which cause people to

end up in his office going through a

divorce number one is cheating in

infidelity and the second thing is money

problems in the relationship so I find

it especially sort of pertinent to have

this conversation with you about

couple's relationship with money um

because clearly one of the things that

is most likely to end my relationship or

or I guess prevent me getting into one

is this financial avoidance that most of

us engage in you've interviewed hundreds

and hundreds of couples about money on

your podcast what have you learned about

our relationship with money in

relationships from that I've learned

that 50% of the people I talk to do not

know their household income 90% of the

people I talk to who are in debt do not

know how much debt they're in and 100%

of the people I talk to in credit card

debt also have trouble saying no to

their children isn't that shocking of

those things 50% do not know how much

income they make because most of us are

simply living by looking at our checking

account and that's it the debt part kind

of makes sense why would you want to

know how much debt you owe you don't

really want to think about it so you

ignore those emails and envelopes and

the credit card debt part that is really

interesting the idea that if you can't

say no to spending so you've racked up a

bunch of credit card debt the same

princip principle applies to saying no

to

kids for me when I discover these I find

them absolutely fascinating but the good

news is you can also change these things

and what's the difference between men

and women in terms of spending habits in

a relationship secrecy avoidance

arguments well let's start with the

roles men always describe themselves as

providers always that's what we are

taught it's exists in culture the

problem is of course what happens when

are not the top earner which is happen

happening increasingly more now so when

I often ask them who are you financially

speaking if you're not a provider and

they're just stumped but there's got to

be something more than simply being a

provider you can be a provider and you

can be a nurturer you can be a provider

you can be a helper a leader there's so

many different ways um often what you'll

see with women is discussions about a

secret bank account keep a little money

aside just in case we have to remember

that in the

US many grandmothers were not allowed to

open up their own bank accounts that

happened in two generations ago and so

there has been a rightful message that

has been passed down Orly keep a little

bit of money aside just in case whether

it be physical abuse Financial abuse

divorce Etc and I totally respect that

message I don't think you should have a

secret account I do think you should

have an account that is yours only but

no secrets in a relationship what about

arguments as it relates to money and

relationships what are the the cause of

the arguments is it someone spending too

much is it hiding money is it something

else it's usually not hiding money

that's very small extreme the biggest

phrase that I get from couples is he or

she's a spender and I'm a saver so it's

creating this identity that they're a

spender I'm a saver or they don't want

to talk about money ever why can't I get

them to finally sit down with me and get

on the same page that's a phrase that's

tossed around everywhere when I ask them

what is getting on the same

page the answer is I don't know I just

want to talk about it so when it comes

to money yes there are the numbers that

we need to understand of course but what

I often tell people the way you feel

about money is highly un correlated to

the amount in your bank account that is

why I speak to so many

multi-millionaires who still worry about

money they think if I just have 50,000

more 500,000 more $5 million do more

well guess what I've had all those folks

on my podcasts and they still worry

about money that means there's two

things you need to do to master your

relationship with money one you got to

know your numbers this is a language you

have to learn the basics of personal

finance two you have to master your

money psychology that means you need to

change the way that you talk about money

and behave with money so that you can

ultimately change the way you feel about

money you do those two things you're

going to have a very healthy

relationship with money we'll go into

all of those things and how you do them

um on this point of gender roles

obviously Society has changed in the

last couple of decades in terms of

equality and more women are in work at

higher level positions in corporations

in the SE Suite earning much more money

this has caused

a shift I should say in the sort of

typical gender roles and assumptions of

what what each gender is supposed to be

doing in couples and I'm wondering now

with more women earning more money in

many cases they're going to be earning

more than their husband in heterosexual

relationships have you seen new Dynamics

and new issues created because of this

in terms of like I don't know insecure

men feeling emasculated or the woman not

being happy that she's contributing more

and I asked this because I had someone

on my podcast a couple of uh months back

who said to me that I think it's 70 or

80% of women expect that their romantic

partner will earn more than them but

that Gap is closing now because women

are earning more and more money I'm just

wondering if you've seen in those

couples scenarios where the woman ears

more and it's causing problems I've seen

it all the time I've seen it all the

time I think that we see different

gender Dynamics um I recall one episode

where I spoke to uh a young woman woman

and her boyfriend she was around 40

years old she made way more than her

boyfriend care to guess how much she

makes per

month

$20,000 $200,000 per month she has a

business it's doing very well she's

around the age of 40 now her boyfriend

was never taught about money when he was

growing up most people are not he never

learned about investing certainly no one

was telling him about a Roth IRA when he

was 12 years old

and he had started his own business and

he was on the upswing he's making a few

thousand dollar a month good for him

she's making 200 Grand a month her

parents started talking to her about

investing when she was 5 years old so

here we already see a difference not

just in gender but in socioeconomic

status okay and over time that

progressed so they come to me and she

says I want him to pay for dinner

occasionally fine super reasonable he

even said no problem I want to so he

would take his credit card out and he

would offer to pay and she would say no

I want you to contribute more to your

IRA so in many ways she wanted him to

pay she wanted to feel taken care of

which is totally reasonable but when he

offered she said no so this is the kind

of thing that I often see which is I

think I want one thing but when I get

that thing I don't actually want it it

doesn't make me feel the way I thought

it would I want to earn 50k more I think

that'll make me feel safe oh my God I am

earning 50k more it doesn't actually

change the way I feel so I worked with

this couple and I helped them understand

why they both felt this way about money

and you know from the outside it's like

this is so irrational if you make more

just pay more if I were in that

situation etc etc none of that stuff

matters when you are in the couple in

that relationship you will feel a

certain way and we got to work with you

individually not what everybody else

says in the end the conclusion that they

came to was she wanted him to

occasionally pay for dinner but she also

wanted him to fill up his Ira so this is

what they did every so often before they

went out to dinner she would give him

her credit card and she would say here I

want you to pay for tonight and he said

cool he understood it they went out and

that's what they did now to us sitting

here we're like this dance makes no

sense why don't they just do it this way

or that way guess what every single one

of us has some irrational thing we do

with money every single one of us and I

think that we are ready to actually have

conversations about how we are

irrational money is not just dollars and

cents on a page that's why you don't

feel good about money even when you have

more than you ever thought you would

that's why you worry about money but you

have never read a single book on

Personal Finance we are all irrational

including me and when you get into a a

relationship you got to acknowledge that

and then you got to say hey what is our

vision of a rich life together let's

build that if it means we do a little

dance about the credit card once every

two months fine do we both feel good is

it fair then I'm good with it what's

going on there with her because it it

sounds like there's this battle between

her mind and maybe her heart or it's

almost like the social expectation is

coming in but then her her brain is

saying no invest in the IRA and in Ira

for anyone that doesn't know in other

it's a retirement account a retirement

account so she's saying invest in the

future but also buy my dinner well it's

the same it's the same we all have these

things that Society has told us but then

we don't quite agree and we're not sure

what to do last time I was here we

talked about how you don't necessarily

need to buy a house in order to live a

rich life and in my case I have rented

for the last 20 years by choice and I

made more money renting and investing

the difference than I would have by

buying a house and this is shocking to

people like we saw the comments last

time people went berserk how can you

talk about renting you're just throwing

money away on rent and this is something

we have been fed constantly for

Generations that in order to be

successful you must buy a house so when

somebody like me comes around and says

actually you should run the numbers

because sometimes renting can be

better people are shocked same thing

with um if you want to be taken care of

or you want someone to treat you or you

want someone to pay for the first first

date same thing when men come and they

talk about being a provider but in

certain relationships where they

actually earn less I'll say to them if

we look at the numbers you're not the

provider so who are you and they're

stumped and that is when we need to

start grappling with the idea that maybe

what we were told is not exactly true

for us in our situation today and that's

okay do you think it causes more

problems when the in terms of the

relationship Dynamics and that sort of

masculation and you know that the man

not feeling like a provider when the

woman earns more money than the man from

what you've seen not necessarily I think

that it is a different framework than

we're used to yeah when we think about

my parents for example my mom stayed

home with us my dad went to work single

earner simple everybody knew where they

stood what the roles were it was very

simple it's very difficult to do that

today housing is historically expensive

healthc care is expensive especially in

the US and so you have two people

earning in in urban cities you have

young women earning more than men in

their

20s a lot of us are trying to figure out

what does this role mean for me and for

my partner and for our relationship that

makes it tricky I wonder if a lot of men

are just choosing to remain single until

they've kind of worked on themselves

because I think actually that's probably

the path I would have taken if I'm being

completely honest well I kind of did

take is I didn't have a relationship

until I was able to really provide oh

the p word yeah and where did that word

come from provide like watching my

father watching movies everything

exactly yeah no one ever says like you

are a provider but we learn it from a

million different uh perspectives and

yeah I hear a lot of guys I mean when I

uh was living in New York and I had a

lot of single friends topic of

conversation was I'm not ready to get

married I need to get to a certain point

in my career first you have all these

words for it and deep down there's a

feeling that we're often expressing you

know maybe I'm not ready maybe I'm not

enough maybe I need to do XYZ before I

do the thing that I want and so part of

what we talk about when it comes to

relationships and money is like let's

actually shine a light on that let's not

be shy about it if you want someone to

pay for your dinner fine that's totally

fine let's have that conversation if you

want to be the sole earner in your

household okay let's see what it would

take and too often we don't have those

conversations we just dance around them

for 50 years who should pay for the

first date then my answer is doesn't

matter it would be nice if the person

who suggested the date pays but I think

we spend way too much time focusing on

the first date and way too little time

thinking about the next

14,622 days it's like a couple who's

obsessed with the wedding fine you want

a nice wedding great what about the

marriage same thing with money first aid

okay we can have that conversation but

aren't you more interested in how your

partner thinks about money and talks

about money are they a cheap skate are

they generous are they abundant did they

grow up the same or different than you

that is something we don't talk about

meanwhile we have five million YouTube

videos on who's going to pay on the

first date we are missing the real point

the point of money in a relationship is

not just about the first date that's fun

for clicks but it's about do we see

money the same way do we connect are we

going to be rowing in the same direction

or are you going to be doing that and

I'm doing this and we can never get

aligned you can only make a first

impression once right and if you are a

guy this is just how I feel anyway if I

go on a date a first date with a woman

and we have a wonderful date you know

it's a nice restaurant and then it gets

to the end of the day and then I turn to

her and say should we split the bill I

couldn't even say it with a straight

face frankly I couldn't I definitely

couldn't ask her to play yeah I just I

just could never and if I think if you

anonymously pulled 10 of my female

friends and said how would you feel if

on the first day the guy asked you to

pay I think privately they would say

that's a bit of a turnoff that's a red

flag that's an ick I think probably

that's true and again goes to the power

of socialization right like culture is

very difficult to change we got to admit

that we got to acknowledge that and when

I was dating I paid for dates so I don't

have a problem with it I like to be

generous I think that when you are in a

relationship you like to know that your

partner is generous too now generous

comes in lots of ways it could be paying

for dates it could be planning a trip it

could be being thoughtful and you know

buying extra toothpaste because we're

running low there's so many different

ways to be generous but generosity for

me would be a value paying for a date

sure I paid for dates I'm happy to I

like to do it but generosity to me is

way more important to talk about that in

a relationship versus the date itself

because chivalry you know this this idea

that the man is to lead um in that

regard and to you know open the door

yeah and open the car door and pull out

the chair yeah but think about it I

agree with all that stuff I I'm I

support it but think about what message

that sends when you tell Men You're

supposed to be chalous but there's no

real context no real around it and let's

say you have a 26-year-old guy now who's

earning less than his girlfriend so he

wants to be chivalrous but for him he's

like well look at our bank accounts and

so what I want to emphasize to people is

you can be chivalrous you could be

generous money is just a small part of

that let's not over fixate on who's

paying for top us okay and let's

actually think about the important

things when it comes to money we are so

obsessed with $3 questions people are

obsessing over should I buy this coffee

can I afford this appetizer on and on

and on about $3 questions we totally

neglect the $30,000 questions or the

$300,000 questions is this person

financially aligned with me how do I

even find out am I investing 5 to 10% of

take-home pay every month are we doing

it together um do we talk about money

regularly and proactively and positively

those things matter and they're actually

worth hundreds of thousands of dollars

these $3 questions including who's

paying for appetizers or should I buy a

latte irrelevant fact get get the big

answers in life right and you can buy

all the appetizers you ever want what

are the financial red flags in a

relationship then number one is they

don't want to talk about money if you

don't want to talk about money red flag

the biggest red flag of all because we

could differ on how we see money we can

even have different values for a few

things but if your partner simply will

not talk about money you have a huge

problem why if you can't talk about

money then you can't even understand

where they're coming from and they are

not curious about what you want so how

are you ever going to get on the same

page think about this a lot of people

think we need to have the conversation

about money the con as if it's one

conversation would you have the

conversation about raising kids no

you'll will have thousands in your life

that's the way it should be money is

very much like parenting not like uh

should we play pickle ball or tennis

today irrelevant so we want to have lots

of conversations about money and that

means we need to first of all be willing

to talk about it and then we need to

find a way to have fun doing it why

don't we and who doesn't is it men is it

women that don't do it more more or

who's not talking about money and why

aren't they talking about it it's not

about gender couple it has nothing to do

with gender terms of who does or doesn't

talk about money there are avoiders

that's one of four categories uh money

types that I've identified avoiders hate

talking about money and they will use a

series of conscious and unconscious

techniques to avoid talking about money

they'll say things like um uh why why do

you always have to talk about money

can't we just have a nice night out or

you're so much better at this you just

handle it you're just so much savier at

this stuff that's an avoider do they

know their own financial situation no so

they don't know their own financial

situation and they don't want to talk

about it correct we and by the way we

all have something like this it could be

our fitness it could be our relationship

with our parents there's something in

our life that we know we should deep

down but we avoid it yeah and there's no

there's no immediate consequence like if

I don't call my college friend it's fine

I could probably call him tomorrow and

you can go on and on and on like that

until one day you can same thing with

our fitness it's very easy to

procrastinate on Fitness or money

because it's not like your house is

being taken away or even your cables

being shut off it'll probably be fine

until one day you hit this brick wall

and it's

not so that's the avoider that's the

first money type yep next up Optimizer I

have a soft spot because I am an

Optimizer optimizers we love to live in

the spreadsheet it's like let me sit and

calculate this and what if I run a

compound interest calculation a Monte

Carlo calculation and what if we do this

but not that I love calculating

everything and left alone I would sit

there and do that for the rest of my

life okay the problem is you can take it

a little too far now I don't think I've

taken it too far perf I think I'm

perfect on my spreadsheets but my wife

has taught me enough's enough we we've

won that part of life let's focus on

another part connection and fun and

experience are these people often

thought of as boring yes they are they

are deep down they are boring I was

boring when I was sitting there thinking

money is only about numbers it's not

money is about Adventure and possibility

and generosity and you will often find

optimizers I'll give them a challenge

I'll give him a $100 challenge Al you

have to take $100 in the next week and

spend it on yourself they cannot do it

they will spend it on their dog they'll

spend it on their kid they'll spend it

on their partner but they will not do it

for themselves and I go go why didn't

you do it they go R do you know that if

you put $100 in the S&P 500 and you

compound that for the next 45 years

it'll turn into this much I go I don't

give a spend the money because

money is not simply meant to be hoarded

right it's meant to create a rich life

and when you have

optimizers the thing is they can get you

to a very good place they will probably

have your account set up dialed in

they'll be investing great they're going

to be very proud look at the compound

interest returns all that is fantastic

but it can be taken too far these are

the people that die and then you figure

out that they had like $9 million some

saving account what a waste they never

tasted the caviar but they've got yeah

like people send these newspaper

articles around like oh local librarian

discovered to have $9 million and I go

what a tragedy what a tragedy to live a

smaller life than you have to I want you

to save I want you to invest but I also

want you to try a nice meal or if you

don't like nice food or you don't want a

nice t-shirt also fine get super

generous give that money surprise the

people around you tip 50% so those are

optimizers the third category is

worriors they love to worry typically

they picked up worrying from their

parents almost always and their entire

relationship with money is worry are we

going to have enough what if we run out

of money what if we don't have enough to

pay at the gas station

and often times it's very surprising

because I told you that 50% of couples

don't know how much they make right so

they'll say like we need more we don't

have enough right now and I'll ask them

how much do you think you make this just

happened a couple of weeks ago on a

podcast episode they thought they made

around $70,000 a year okay we add up all

their stuff they make $120,000 a year so

I go well here you go you you wanted to

make an extra 40K you actually make 50K

more than you thought do you feel any

better and she

goes no because the way you feel about

money is highly uncorrelated to the

amount in your bank account so worriers

worry that's how they relate they can't

imagine any other relationship to money

and my job is to help them realize first

of all let's actually look at your

numbers let me help you understand what

it means do you have enough what does it

take to have enough and then can you

start to develop a new relationship with

money it's almost like a new taste bud

I'm never going to tell you to eat

tomatoes if you hate Tomatoes but I am

going to teach you maybe you like okra

and we can develop a new taste for

that finally the

dreamer the dreamer believes that

success is one deal away if we just

close this deal if I just get this thing

and they tend to fall into get-rich

quick schemes lots of scams ml m a lot

of crypto shitcoin scams like all this

BS but they are extremely resistant to

calm lowcost long-term investing in

other words the way that most people

build real wealth they think it's boring

they even have little phrases like uh I

don't want to be stuck in a ninetto five

like those suckers I'm like that sucker

makes 10 times what you make what are

you talking about but they have simply

been surrounded with the idea one more

deal and I'll finally make it they must

be hard to be married to it's impossible

it's really really difficult they don't

not only do they not want to talk about

money when they finally do talk about

money they're almost living in a

different world often you will find that

dreamers can only dream because they are

being subsidized by someone in their

life usually their partner and if their

partner were to leave for example the

House of Cards would collapse and

actually that's usually the only thing

that gets them to truly change so if

we've got these four money types um the

avoider the optimizer the worrior the

dreamer in your view who lives a happier

life you can live a happy life with any

of these also you can change any of

these types but on average one person's

going to probably I mean I I'm the

optimizer and I'm pretty happy so is

that is that the answer yeah optimizers

are great they love their spreadsheet um

I think that uh the warrior clearly is

not going to live the happiest life the

dreamer is actually quite happy yeah the

dreamer is quite happy they live in

optimism yeah they're living in a world

that's not real it's subsidized by

somebody else they're always optimistic

about what's going to happen next week

next month next year never realizing the

catastrophe that they are leaving behind

them that's that's the whole issue this

the reason I wrote the book is it's one

thing to treat money in a certain way on

your own when you're single you can be

irresponsible you can be an Optimizer

but when you're in a relationship it's

not about you anymore it's about the two

of you as a unit and so you have to

deeply understand yourself and then you

have to be willing to communicate with

your partner and really create a rich

life vision for the two of you most

couples I talk to have no vision for

their money that's why they fight over

who spent $50 at Target I go who gives a

about Target financial problems are

almost never about overspending at

Target the biggest problem with couples

and money is they have no Rich Life

vision what is money to us what do we

want to use money for how do we want to

feel about it so they're confronted with

a thousand different decisions with

their money every week and they have no

vision to guide them this is for us this

is not for us one of the things I've

always wondered in relationships

is how many couples know how much money

the other couple has in their savings

account and their total sort of

Investment Portfolio because I've never

been in a relationship where I mean I've

only really been in two relationships

you could say but I've been with you

know dated people over the years and

been with my current partner for many

many many years but even my current

partner has no idea how much money I

have zero IDE when will you have that

conversation probably never should we

bring them out right now let's bring

them

out I've just never had the conversation

if we if you need something we can get

it yeah and it's just always been like

that in my life okay so I I made a

mistake in my own relationship I was uh

dating my now wife for many years and at

one point she had asked some question

about her 401k or something and I said

well there is a book called I will teach

you to be rich here's a copy of it and I

was joking around with her and so it I

ended up learning all about her finances

so I knew about her entire Financial

picture it didn't occur to me to talk

about my own and a little while later

she she very assertively said this

doesn't feel fair you know everything

about my finances but I don't know about

yours

and I realized I violated my own rule in

chapter n of my first book which is talk

about money early on talk about it

regularly so we talked about it we

talked

about is actually one of the most

memorable conversations we had because

talked about the numbers talked about my

pride in how hard I had worked to build

my business and invest for 20 years 25

years and um and then we talked about

what it meant for us like what kind of

Life do we want to have do we want to

live here do we want to live there do we

want to have kids do we want to eat this

type of food travel like that

conversation about possibility is the

conversation I want every couple to have

because it's about

possibility and you can start to dream

and that dream is important you can get

to the logistics of course we'll get to

that but so few of us still

dream with our money but you know that I

think for someone like you who is the

optimizer and who's probably quite proud

of the system you've created love

systems but there's going to be so many

people listening now that are in a

relationship and they are maybe early in

the dating process and maybe they've

been with a person six months they've

taken them out on lots of nice dates and

they have $1,000 in their savings

account and their partner has no idea

and they're thinking

if I tell my partner what's in this bank

account she is going to be shocked or he

is going to be shocked and they are

going to leave me so I'm keeping this

a secret because they are living

under ill an

illusion that I have more than I

actually have yeah but remember this

just because you don't have as much

money as you want doesn't mean that you

are less of a person what could be more

completely agree I completely agree what

could be more appealing than saying you

know what

would you be open to talk about our

finances we're getting a little bit

serious you know I know we're kind of

talking about taking the next step I

think money is going to be an important

part of it I know it is for me and I

wonder if we could sit down and talk

about it first just being proactive how

many people watching and listening are

like I wish my partner whether they're

dating or my partner of 20 years would

come to me and say can we sit down and

talk about money but the part of that is

is shameful about financial situation

yes if I run it back 10 years just over

10 years ago I was living in an area

called um Rush Holm I was in a

shared house with living with some um a

few people who had come to the UK

legally okay um I didn't have a carpet

in my room I was in a single bed didn't

have duvet or bed sheets or anything and

every day I woke up and thought to

myself how am I going to eat today so

I'd find different ways to find food at

the same time I was dating this girl

called Ruby this girl called Ruby had no

idea she'd never seen where I lived she

wasn't aware that I was looking behind

uh Sofas in takeaways for pound coins

there is no possibility in the world

that I would have ever told Ruby the

financial situation I was in yeah I like

so I don't know what to do in that

situation and I'm sure I'm sure I would

assert that maybe 30% of people

listening right now don't want to tell

their partner their financial situation

because they're deeply embarrassed still

shameful to the point that they think

their partner might leave like them less

be less attracted to them if they really

knew the truth I totally agree I totally

agree it's crazy how much shame we have

around money and it's uh a young guy not

having enough it's um a young woman who

has $188,000 of credit card debt it's

all over the Spectrum that's the second

point which

is if you want to talk about money talk

about money don't wait for your partner

to do it bring it up yourself even if

you feel embarrassed or ashamed okay if

you're planning to make a life with this

partner you got to be able to talk about

this because you're going to be talking

about a lot of other personal sensitive

things over the course of your life the

second thing is what could be more

attractive than somebody saying you know

when I was in my

20s I moved to the city I spent a lot of

money going out and I wasn't super

responsible I racked up a lot of credit

card debt I've paid it down from 18,000

to 6,000 it's going to be paid off next

year and I just know that I'm never

going back there

again oh my God someone who acknowledges

what they did has a good reason for it

and then most importantly has a plan

huge turn on so what I'm begging all of

us to do is to realize just because you

have more or less money does not make

you a better or worse person I want to

take shame away because we all have

something that we are ashamed of but not

talking about it and putting it in the

corner in the darkness that doesn't

solve it that's why I love talking about

the most taboo of taboo subjects money

gender prenups dating these are things

that nobody's talking about so when you

hear couples on the podcast and they're

talking about being married for 15 years

and they've never actually had one

conversation about money I want you and

everyone watching to be inspired because

stuff doesn't have to be shameful and

doesn't have to be kept in the dark

and what do you think about prenups then

do you think they are a good thing for

all couples do you think all couples

should initiate a prenup no no not all

couples there are some couples who

should have one my wife and I have one

so we went through this process and um

who should get a prup is if one or both

partners are bringing substantial

premarital assets to the marriage

meaning before they get married they

have a large Investment Portfolio a

business rental property or a house like

you should have AE up but most people

should not because when most people get

married they don't have substantial

assets what if your partner turns around

if I turn to my partner say babe ra told

me to go get a prenup yeah and she goes

absolutely not well that's not a good

introduction I wouldn't say that

although I don't mind if you throw me

under the bus oh this guy raid he said

this thing fine how to bring it up is an

art so when I was um deciding on a

prenup I asked for lots of advice from

lots of friends and um some of the

advice out there especially online is

not great um one of the most common

pieces of advice is blame it on your

lawyer I'm like get real you're about to

build a life with your partner and you

can't be honest about this thing this in

the grand scheme is a minor topic so

I'll tell you exactly what I said to my

wife we sat down and um we I said uh I

want to talk to you about something um

you know that because of how long I've

been in business I've been very lucky

I've been fortunate I worked hard I've

built this business up and I'm really

proud of what I've accomplished and

saved and you also know my lifestyle I

don't drive around in a Lamborghini uh I

like to travel I like to wear nice

clothes and I like to save money and

it's important to me that as we are

getting closer in our relationship to

getting married that we talk about a

prenup and my heart was p pounding I had

planned it I had thought about it I had

talked to so many people what I knew is

I wanted to take responsibility it's not

some lawyer that wants it it's me it's

important to me I wanted to bring up the

topic and I wanted to reassure my wife

that I'm not going to change overnight

when we get married into someone who's

blowing all of our money it's just

important because of the business that I

built in her response I was like

like how is she going to respond because

bringing up a prenup is very

fraught she's the best she said okay I

wasn't expecting that but I'm willing to

learn more about it that's as good of a

response as I could have hoped so we

started the series of conversations we

both had lawyers it was going well at

first until it wasn't and we were

talking about numbers that to me seemed

astronomical I started to feel resentful

she didn't feel listened to she didn't

feel heard she started to feel resentful

and these conversations were were like

so difficult I would say they were some

of the most difficult conversations of

our relationship at one point she said

we should go see a therapist because

these conversations are not good and I

was like you're right so we went to see

a therapist we sat in that therapist

office I still remember therapist asked

us a bunch of questions including how do

you see money and she turned to me I was

like how do I see money

growth I could literally see numbers

floating in front of my eyes the

optimizer in me was talking about the

rule of 72 it was like so obvious what

an obvious question then she turns to my

wife how do you see money and she said

safety so what sa safety to me that was

like saying charcoal like the two words

don't relate at

all but it started us on A New Path of

realizing that we were seeing money

completely differently me and that was

exactly when I realized I wish there

were other couples talking about money

from behind closed doors that exactly

was the Genesis of me doing my podcast

and my Netflix show to show people not

just tell them but to show them how real

couples deal with money what was the

resistance between you two in sort of

more specific terms she she wanted a

different arrangement to the one that

you wanted yeah the terms are are super

technical in prenups it's um so with a

prenup you have a variety of different

rules or technicalities which would be

like what if you separate in 6 months

what if you separate in 25 years but

there are children involved who gets the

house what if you have a house what if

you have two houses what if you have

this much in your joint investment but

each of you has this much in individual

investment and so what happens is it's

not even just the numbers themselves

it's the fact that the process is set up

to be adversarial mhm so they have a

lawyer we have a lawyer we're

communicating through lawyers when it

comes to this topic when normally you're

just talking to your fiance or your

girlfriend and there's an art to also

managing the lawyers see the lawyers

want there's nothing bad we had great

lawyers I'm happy with them but lawyers

job is to look over every freaking

contingency and make sure that nothing

is left a chance and I think a good

reminder for anyone considering a prenup

is to remember you manage your lawyers

and your job is to come to an agreement

with your partner for the rest of your

life so sometimes you can be generous

you can be willing to let up on a few

things here and there as long as you are

looking at the Northstar we're going to

be together we want these premarital

assets to be protected and in case

something goes wrong we both want to

feel good about what the arrangement is

and there is a 60 odd percent chance

that you will break up if you look at

the marriage statistics so well those

statistics are a little skewed that

includes second marriages that also

includes all different socioeconomic all

everybody else if you break it down for

example just by having a bachelor's

degree or certainly an advanced degree

that goes way down first marriage goes

down and in fact the divorce rate has

been decreasing for decades so this 50

60% thing that's kind of tossed around

not quite accurate but whatever the

statistic is what's more important is if

you should always think about how can

things go right and also how can they go

wrong and I think with money A lot of

times uh we only think about one or the

other we buy a house never asking

ourselves like what if one of us loses

our job and we get married without ever

asking like what if we separate so you

want to be able to play both what

happens if things go right incredibly

right and what happens if things go

wrong let's make a plan what are the

other red flags then we mentioned the

first being they don't want to talk

about money ah um they have a money guy

a money guy is so common everybody talks

about I have this money guy your money

guy is probably uh whole life in

insurance salesman charging you 1.25%

AUM let me explain what that means so

many people in America do not want to

learn the basics of money and so they

hire a financial adviser now I don't

have anything against financial advisors

in general but a money guy that they're

typically referring to is someone who

charges them a percentage of their

assets so if I have a $100,000 portfolio

they'll charge or let's say a million

dollar portfolio I might be paying 1% 1%

doesn't sound like a lot but if you

actually run the math you will pay about

28% of your lifetime investment returns

in fees that's not $10 or $100 that's

tens of thousands or sometimes hundreds

of thousands of dollars so it's a red

flag if someone has an advisor that

they're paying a percentage based fee to

I would much rather you pay an hourly or

project or that type of fee too

okay um they're

cheap I can help a lot of people but I

can't help cheap cheap

is cost is the first and last thing they

always consider so you might come home

you're so happy oh my gosh look at this

beautiful thing I got for the kids how

much was that and it just sucks the life

out of every room cheap people are

obsessed with cost cheap people rarely

recognize the effect they are having on

their loved ones and cheap people

find it very very difficult to change

they don't want to change they actually

reinterpret their behavior and call it a

virtue oh I'm not that I don't need that

fancy wine I'm perfectly happy with this

well what if your partner wants one

glass of wine they seem like a miserable

group yeah I don't like cheap people I

don't like cheap people I don't like

cheap tippers and their Partners don't

like them so it's it's one I'm not

saying everybody has to go out and spend

a million dollars but you got to use

money to live your rich life the point

of money is not to just hoard it and

save it that's why when you create a

rich life Vision you ask yourself what

do we want to spend extravagantly on not

just a little bit but extravagantly and

what do we want to cut cost mercilessly

on you have to be able to play different

notes like you're in a symphony if your

only note is spend less that's a

miserable existence are there any more

red flags I want to go into why people

and where they develop these

relationships with money but are there

any other sort of standout red flags

that we should be looking for well if

they if they follow Robert kosaki that's

a huge red flag I mean the guy

once Robert kosaki wrote this uh

well-known personal finance book and the

guy has really lost it in the last few

years he literally I'm not joking he

literally told people the best

investment you can have is a can of

tuna I'm not joking and I replied to him

Robert I sold everything in my portfolio

and bought 3 million cans of tuna um is

this a good investment but sadly I never

heard back so beware of Beware of

charlatans let me put it that way

personal finance and money is filled

with people who will promise you get

rich quick who will tell you that the

sky is falling and when it comes to

money we want to be balanced we want to

have fun we want to be have a healthy

relationship with money it's very

similar to Fitness lots of people making

promises you want to find the people who

are giving you long-term advice you know

these cheap people that you mentioned

mhm and you know any of them I a couple

come to mind tell tell the camera who

they are right now so we know who are

these cheap people they also fit into

the category of the Warriors in my

experience so someone who's a bit of a

warrior can also be quite quite cheap

and I was just wondering in the hundreds

of couples that you've sat down with an

interviewed does there tend to be a

origin story which links to their Friv

their FR frugalness with money and

they're penny pinching yes okay always

when I talk to people um I asked them

what do you remember your parents saying

about money when you grew up always and

they'll tell me they are very conversant

they remember and usually the parents

said stuff like we can't afford it and

uh money doesn't grow on trees we don't

talk about money in this family these

are the type of things that people said

but you will often find um usually when

kids are

teenagers when there's something really

tragic that happens and it's of often

that um Dad lost his job and that meant

that they completely changed

socioeconomically often they had a big

house they had to really like shift into

Grandma's apartment that kind of thing

that affects people in a huge way now it

affects people in one of two ways and

you cannot predict how some people go

I'm never going to let that happen to me

therefore I'm going to have a high

savings rate I'm going to invest I'm

going to start a business and they

develop a really healthy relationship

with money others go the Direction

you're suggesting which is they become

incredibly cheap incredibly worried

about money anxiety is common and they

often do not see the connection at all

until I point it out to them and when

you talk about making this Rich Life

vision together what exactly does that

mean we start off in the book just

talking about let's have our first

positive conversation about money okay

you have to remember most people have

never had a positive conversation about

money money is the the only way it comes

up is why did you spend that much at the

gas station last week that's it so we

start off by just saying I give him an

agenda literally an agenda you can read

off these words and start it off it's

like why this is going to be awesome

here's how I feel about money today how

do you feel here's how I want to feel

about money how about you high five I

love you we're good that's it part of

having conversations about money

is this philosophy of declare Victory

and go home you don't need to talk about

it all at once make it short make it fun

and at the end always say I love you

that's it over time you're going to

associate talking about money with

positivity and that's what we want when

it comes to a rich life Vision this is

where it's really fun so I have some

fill in the blanks um where you fill it

in like I wish we spent more money on

and then you fill it in I think we could

probably cut back on and then you fill

it in then you compare your notes my

wife and I did this really fun exercise

which I would encourage everyone to do

and it is the 10-year bucket list so

imagine you sit down with your partner

and you go let's each take a piece of

paper write down what would make the

next 10 years incredibly Rich meaningful

to to me and to us so you write it down

and then you compare notes this is

exactly what we did and you get excited

you oh you want to learn Spanish amazing

do you want to do it online or do you

want to go to Mexico City oh you want to

go skydiving ah that one's not for me

but I'll meet you at the ground right

have fun and you just get excited you

encourage the other person and then you

find one that you both want to do that's

meaningful for both of you so maybe it

is we want to um create an art studio in

the garage love it maybe it is we want

to take a round the world trip at some

point in the next 10 years okay great

the difference with this exercise is

you're actually going to make it happen

so right there on the spot you estimate

how much it would cost take five minutes

don't take more than that you can

estimate it within 80% like that decide

when you want to do it maybe if there's

kids involved you're going to want to go

in summer winter Etc and then all you do

is take the rough amount divide it by

the number of months and that's how you

know how much you have to save for it we

did this and for us what was really

meaningful is to have a 10year wedding

anniversary so we know where we want to

do it we know the exact place we know

all the friends and family want to have

with us and we knew when it was going to

happen so we we had a funny experience

because we each sat down and estimated

the cost and I think the number I picked

was something like three times bigger

than hers and in those cases I say go

with the bigger number okay it helps you

dream a little bigger if you can't save

that much money per month that's okay

shrink the dream a little bit right

narrow the scope or maybe extend it a

little longer until you have to do it

but suddenly every single month when you

sit down and talk about money it's like

a video game you're like oh we're 3%

closer to that goal that is how you

start to build a vision for money and

have fun along the way and do you

subscribe to this idea that you should

have like a joint bank account and then

separate bank accounts or because right

now I just have my bank account and how

does it work how does it work for you so

do you just you just pay for most things

I have to give context on what my

partner's like she really doesn't care

about material things so she's avoider

she just doesn't she doesn't care about

whether we fly first class or economy

she doesn't care about if we stay in

that hotel or this hotel right she

doesn't care if we stay in the 70th

floor Penthouse we live there or or if

she stays in a studio she doesn't care

what does she care about she cares about

quality time with me she likes having

nice experiences she likes going to

places doesn't care how she gets there

or where she stays she likes traveling

and exploring and she likes her simple

thing she's a very simple person if I

didn't get her birthday present or

Valentine's Day present or Christmas

present or if I just made her a

scrapbook every year she'll be thrilled

okay so I am the one that wants the

nicer you want the okay I'm the same I'm

the same to to a large extent but we

have a like we you know life it costs

money so

um I pay for most things okay and you're

cool with that it's fine right yeah I've

always been cool with it okay cool so

I'm particularly cool with it because

she doesn't care right right does that

make sense yes it makes there's no

resentment because she doesn't care I'm

the one that's making sure she travels

this way yeah I have to intervene and I

have to fight to make sure that her

plane ticket is booked here or that the

hotel she's staying in isn't going to be

dangerous I've got so many stories of

her booking it herself and then me

having to rescue her because it's super

dangerous yeah so so you and I have a

similar um Dynamic at least in this way

um I think my wife does have her money

dials money dials are the things you

love to spend money on and you can turn

that dial up but when we met she was not

into hotels at all I'm a hotel guy I

love hotels and so we had to have some

conversations at first I'm just like oh

yeah like of course I'm paying and then

when we merged our finances which I

recommend couples do well suddenly it's

not my money it's our money yeah and so

now we are forced to talk about that

stuff and come up with a way like she's

like I don't need to stay there and like

personally I don't really think it's

worth it for our money and I'm like well

like have you seen have you seen the

suite at this place and do you know what

type of wood they use and that she

doesn't care so so how does that work

you said you merge your finances when

you say you merge your finances do you

mean you're paying into the same bank

account correct so and this is what I

recommend for most for for almost all

couples um you take your paychecks or if

you're we're both business owners you

take whatever money comes in put it in

the joint checking account that joint

checking account then pays a variety of

different accounts it pays our joint

expenses like our rent and if we eat out

it pays for our joint credit card bill

the money also is paid out from the

joint checking to her individual

checking and individual savings which

she has her money no questions asked if

she wants to spend it on something like

she loves

self-care what am I going to ask it's

her money it also sends some money over

to me that's no questions asked money

that I same money yeah the money that

came in from us two together is

processed in the joint checking account

account and an amount goes to each of us

the same amount goes to both of you good

question it could be the same 50/50 I

think is actually great but once in a

while if you have somebody who's earning

like let's say 10 times more okay you

may decide to make it proportional right

so like one the higher earning partner

might get more because imagine just for

argument sake imagine you're earning a

million dollars a month easy

math and um suddenly you're getting like

$22,000 a month for guilt fre spending

you're like um what the hell this this

doesn't make sense usually partners are

totally cool with that but I will tell

you this I used to be on the

proportionality train meaning

everything's proportional Etc my wife

and I did this for many

years it's really complicated it gets

really really complicated and what's

more important is you want to set your

accounts up so that they drive the right

Behavior just like when you hire people

you set the right incentives to drive

the right Behavior when our moneyy was

separate and we were doing all this

proportionality calculation all these

different accounts we didn't see the

money as ours now all the money goes

into that pot it's ours so we sit down

every month we look at our numbers and

we go what's worth it do we care about

this hotel do we care about that etc etc

we really love that let's keep spending

on that and find a way to do that it's

about us and of course we have our own

individual money so why didn't you just

the money coming in Why didn't it just

go to you individually and then you pay

into the joint account why did you make

that's what we did at first and it

became really complicated so the money

came into each of us and then we because

we each run businesses that are each

variable we wanted it to be proportional

well guess what if it changes every

single month we had to recalculate the

proportionality every single quarter

what a mess so we're we're literally

calculating every 3 months and then it

changes and then at the end of the year

we have to reconcile all this stuff

we're like what is this marriage or a

freaking multi-national conglomerate so

part of a philosophy around a rich life

vision is one of our values is fight for

Simplicity fight for it because I talk

to couples who have more complicated

Financial setups than we do shouldn't be

the case most people's setups should be

very simple all your money comes into a

joint checking account from there it is

it pays out to individual accounts

and it pays all your joint expenses your

life is together your rich life is

together that's it we're married we're

going to be married forever our future

is together so let's set our accounts up

accordingly so then if you end up

getting a divorce that joint checking

account do you just split it in half or

yeah so this is a this is a good

question when you are married the money

that is earned is community property so

let's just say we put $100,000 in that

checking account and we were to get

separated tomorrow

5050 yeah that and that's reasonable

right it's community property the prenup

is only concerned with what happened

before the

marriage so you're in the camp of not

caring too much about the small expenses

the coffee it's a waste of time why is

it a waste of time because the they are

$3 questions if you actually add it up

how much they actually cost you it's

actually not that much it's the simple

joy that you enjoy in the morning and

you could spend your entire life

agonizing over buying a coffee but when

I ask people okay so you stopped buying

coffee for a month how'd you feel they

go oh I felt okay I go what' you do with

the money you saved they go I don't know

it's in my checking account not only do

you have to make the decision every

single day to save on these tiny little

things you then have to properly invest

that money and you have to do this every

single day for the rest of your life

what if we just got five critical

decisions correct for the rest of our

life and didn't have to worry about

coffee why are we playing so small oh

let's decide do we have enough money to

buy this Saran Wrap who cares let's talk

about are we investing properly do we

have a a Target rate that we are doing

watch this I bet you so many couples

watching this right now have had

arguments about why did you spend so

much at the grocery store why can't you

stop spending so much on the kids and on

and on but have they ever had

conversations like this what is our

savings rate is it 4% 6% 7% what is our

investment rate is it 6% 8% whatever the

number is Let's Make a rule that every

December we increase it by

1% if you just did that if you increase

your investment rate meaning the

percentage of your net income that you

invest every single month I always

recommend people start off at 5 to 10%

let's say you're at six if you make a

rule every December we're going to

increase that by 1%

it will be worth hundreds of thousands

of dollars to you more than all the

coffee you ever buy in your entire life

so why the hell would you focus on

coffee when you can make one decision

per year and make way more than all

those coffees combined most couples when

they think about investing or their

investment rate the only investment most

couples make together is buying a house

yeah well and that that's questionably

not even an investment most people think

renting is wasting money yeah and the

the logic goes well if my rent is $2,000

a month or £2,000 a month my mortgage is

only going to be £2,000 a month and we

so we might as well buy a house because

then we get to keep the asset are you

trying to get me mad right now I'm

starting to Swit just hearing this

because you're right that's what they

say should I just dismantle these

arguments once and for all right now

sure okay renting is not throwing away

money just like going to a sushi

restaurant is not throwing money away on

Sushi you're paying for something you're

getting value you it's fantastic the

next argument they use is um you're

paying your landlord's mortgage I go

okay aren't you paying the sushi owner's

mortgage when you go there and get sushi

funny we never think about it like that

we only think about paying the

landlord's mortgage finally we have to

understand that buying a house can be a

good financial decision it can be but

renting and investing the difference can

also be a good decision and right now in

the US in the top 50 US Metro cities it

is cheaper to rent than to buy so let me

give you some math let's say because I

lived in New York close

by if the rent was let's say 3,000 bucks

a month to own the equivalent property

right next door would have been 6,600 a

month that's

$3,600 per month more just to own so

most people don't know this they don't

factor in Phantom costs like maintenance

taxes transaction opportunity cost they

simply look at a number that says uh

3,600 or whatever the number may be and

they go great investment we have got to

get more sophisticated with the biggest

purchase of Our

Lives I'm just looking at some of the uh

comments on our last conversation oh

yeah what did they say it's a balancing

act there's there's two groups of people

here there's a group of people who

attest to the fact that they bought a

house and it's the single best thing

they did yep um this person said I

bought a house it's the best thing I

ever did it's launched my mindset and

New Direction

remember that having your own space has

profound psychological impacts and can

change your life that's a good comment

okay let's talk about that first I love

that comment we have to remember that

life is not just about a spreadsheet

it's not so when it comes to a major

purchase like a house or a car we got to

start with the numbers okay we have to

start by running a buy versus rent

calculation by running an amortization

chart I have a whole bunch of stuff on

buy versus rent and then we we need to

know can we afford it is this part of

our Rich Life vision what if one of us

loses our job and on on on but then

second we need to say what kind of

Lifestyle do we want if we love to

decorate that's probably worth something

we should maybe we need to buy a house

if we want our kids to be in a

particular area maybe we need to buy

there's so many non-financial reasons to

buy or to rent and so we can't just do

one or the other but my main argument is

this most of us never run the numbers we

will spend a million dollars in toal

cost of ownership for a house and we

won't run one calculation so we got to

play multiple notes doing the financial

and non-financial parts I think that's

what a lot of people are actually saying

a lot of people are saying you know I

bought a house and this person is saying

I used to be I used to live in a caravan

I finally bought a house and I don't

care about being rich necessarily but

having my own house means the world to

me great great non-financial reason they

want stability I totally value that I

would all also ask did you run the

numbers I think the key thing is most

people when they buy the house they see

it as an investment and they see it as a

good investment I think in part because

they don't really know any other way to

invest totally right so we we grow up we

think okay the minute you get enough

money the first thing you have to do is

buy a house I mean there's a real

sequence of of events in our lives that

are given to us which is go to school go

to college or university or something

like that there get the degree get the

job buy the house get married have the

kids and then move to Florida get skin

cancer die oh retire okay have your

pension die we don't have pensions

anymore that was in the 60s but yes and

actually that's a pretty good life if

you think about it it's actually a very

good life especially the way that our

parents generation grew up where you

know they could buy a house on a

reasonable salary one salary but that

doesn't exist right now housing is

historically expensive um and not

through any fault of young people by the

way I there's a lot of this um stuff

thrown around the media young people are

buying too much avocado toast they're

always buying the new iPhone that's not

why housing is expensive housing is

expensive because people who bought

their houses in the 60s 70s and 80s

bought a house and then systematically

prevented everyone else from building

more housing so it is it's called

nimbyism not in my backyard they have

allowed almost no housing to be built

particularly in the US that's why if you

only have a limit Li mited Supply guess

what happens to the price it goes way up

that's changing slowly housing prices

will in certain cities like Austin even

Santa Monica have come down in certain

areas it's really important to be able

to build more housing so that young

people middleclass people poor people

can afford housing we should not have

people unable to afford rent or buying

housing it's a big problem so are you

saying that the average couple if

they're looking to make a financial

return yeah on their joint savings count

account they shouldn't invest that money

in a house I personally would not

consider my primary residents to be a

great investment because it has massive

costs right massive um maintenance

opportunity cost of that down payment

let's say you put down 50k or 100K that

could have been invested it has all

kinds of uh Phantom costs and then you

have to stay there for until you pay it

off presumably 30 years most people

don't stay for 30 years there's some

shocking math behind a mortgage like

most people don't realize that they will

be paying more towards their uh interest

than towards principal for 21 years let

me say that again most people when they

take a 30-year mortgage right now with

interest rates the way they are they

will be paying more towards interest

than they are towards the mortgage in

year 1 2 5 10 year 20 until till finally

year 21 when they are finally paying

more towards their mortgage their

principal rather than interest so you

know that phrase I don't want to throw

money away on rent we might more aptly

say I don't want to throw money away on

interest so if I'm in a couple I'm in a

relationship and me and my partner have

managed to save I don't know 50k what is

a better use of that 50k to drive a

financial

return okay so let's simplify the whole

thing I have a conscious spending plan I

have four numbers that couple should be

talking about okay the first off is your

fixed costs those should be roughly 50

to 60% of your take-home pay and what's

the fixed cost fixed cost includes your

housing or uh that could be rent

mortgage your utilities your car payment

any debt payment anything that is

consistent even groceries that you need

to live every single month so 50% of my

monthly income go straight to those

fixed costs monthly take-home post tax

post tax okay 50 to 60% is the number

you want to be targeting right there is

um is the Crux of why couples are

stressed out about money it's because

they are spending too much on fixed

costs and within that there's two areas

they spend too much on you know what

they are housing is number one because

it's so expensive and they don't

calculate number two is cars usually

trucks we love trucks trucks and SUVs in

America the cultural script is oh we're

having a kid we need to get a big house

and a big SUV uh because we do so that

right there is where people get stressed

out about

money next number is your savings this

should be 5 to 10% minimum this includes

your emergency fund this includes saving

for a down payment anything you're

saving for money you don't need for

between 1 to five years basically okay

next up is Investments this would be 5

to 10% minimum this is where real wealth

is created and this is where couples

neglect they they talk about saving and

they'll say oh we try to save I don't

try to brush my teeth I don't try to

save I make it automatic that's what I

want couples to do that's what I cover

in the book and then finally my favorite

category of all guilt-free spending this

is going out for drinks concerts travel

20 to 35% of take-home pay that's a lot

that's a lot if you look at it people go

wow yes and when you get down to that

number and you're out and you're having

drinks with your friends or you're out

to a beautiful experience you don't have

to worry about anything else you don't

have to feel guilty or anxious because

you're already handling all these other

three numbers you know you're set and

you have this money set aside and you

can enjoy it guilt free so this 10 this

sort of 10% that is automatically

invested would you set up some kind of

system that automatically invests it

always always you should not be doing

any of this manually so your investment

should be happening automatically and

for a couple you actually get to

celebrate it every month you have a

monthly money meeting where you talk

about money every month most couples

don't do this you will now after

watching this and you talk about it you

look at how your Investments are doing

you give each other a high five a big

hug congratulations and once you do this

for six months a year you really start

to see how it adds up fast what if your

partner wants to buy a house and you

don't o that's tricky how would you

handle it um it depends on my level of

conviction about the decision I think

you got to pick your battles and

relationships but um I am probably more

financially

aware than my partner because my brother

is he's been an investment banker for 13

years he works for me full-time he's my

money guy yeah okay he's my older

brother where does he charge you 1.5% uh

he doesn't charge me a percentage on my

P so happy no he works full-time in the

business so he

he manages much of my money but he would

make the case to me of pretty much the

case you've made yeah so based on an

opportunity cost basis I a lot of people

don't even know what opportunity cost is

I'm going to Hazard a guess I'm going

try and explain it which is essentially

all the things you could have done with

this money instead yes so based on all

the opportunities you have available to

you Steve is buying this house a good

use of that money and the answer was

actually no when I bought my first house

it was no unless this is a emotional

decision

because you and your partner want a

psychological feeling of safety to bring

up the kids whatever it might be just a

then if it is Steve if that's why you

want to buy it and you think you're

going to stay there for a considerable

amount of years then go ahead we're

going to kind of section this as a

different rationale than the rest of

your Investments what you do I did

exactly what he said you bought it

knowing it was an emotional decision

yeah I bought it knowing it was a bad

decision I love this yeah okay this is

amazing everybody listen closely cuz I

want to break down what you just said in

in a different term first off you got to

run the numbers yeah always for the

biggest purchases in your life you need

to calculate carefully what's my buy

versus rent what's my opportunity cost

what's it going to amortise at all these

things that most people are not familiar

with learn it it's not that complicated

second you need to factor in the

non-financial hey why am I doing this do

I just feel this certain way there's

nothing wrong with feeling irrational

about money nothing you want to buy this

thing and it's a bad financial decision

okay first can I afford it if so we can

continue the conversation and then you

buy it Eyes Wide Open saying I know it's

not an investment I know it's not even a

good Financial DEC fact it's a terrible

financial and I'm still going to do it

when I when my wife and I go to buy a

house one

day it will be the worst financial

decision of Our Lives we already know

that but we will probably still do it

anyway same as you because there's more

to life than just what's in a

spreadsheet but you have to know know

all the pieces on the board before you

make these big decisions and you have to

be able to do it with your partner you

know it'd be very easy for you to do

things unilaterally it'd be very easy

for me to do it as well what I've

learned and what I emphasize on my

podcast every episode is just because

you may be the higher earner or have

more money it's actually your obligation

to bring your partner in and to get them

involved and they may not be as Savvy or

even as interested but you have to find

a way to bring them into this world and

get them connected with you with my wife

and me of course I know more about

Investments so I'm doing our investments

but we're still talking about them we're

saying like hey here's the numbers we

chose are we still good with that let's

take a look at it high five you know

here's what we're thinking for next year

that's the level we're talking about

these are these are exactly the kind of

conversations you want to have and I I'm

actually really thrilled you shared that

example because I celebrate that you

made a bad financial investment because

it wasn't an investment it was just

something you wanted and you could

afford

it yeah and we're both aware me and my

partner we had the conversation we're

both aware that um this is one of the

worst things we could have spent the

money on if our objective if our kpi our

key performance indicator was to make

more money this was a terrible decision

to make yes but we're also aware we just

didn't care we thought you know it's

there's a lot of non-monetary things

that are going to be beneficial about

this decision and I think that's what

most people don't realize actually and I

just think about my friends I think most

of my friends believe that when they buy

their house they're doing so because

they don't know they don't know any

other way to invest Society hasn't given

us an alternative so what is the

alternative simple lowcost long-term

index funds are fantastic ways to invest

I'll explain what they are the myth

about investing is that you have to sit

there and look at PE ratios and things

like that no you pick often one One Fund