{"id":2020,"date":"2025-12-03T01:56:29","date_gmt":"2025-12-03T01:56:29","guid":{"rendered":"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/"},"modified":"2025-12-03T01:56:29","modified_gmt":"2025-12-03T01:56:29","slug":"episode-237-we-bought-our-dream-house-then-he-lost-his-job","status":"publish","type":"post","link":"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/","title":{"rendered":"Episode 237. \u201cWe bought our dream house. Then he lost his job.\u201d"},"content":{"rendered":"<p><\/p>\n<div>\n<p><iframe loading=\"lazy\" title=\"\u201cWe bought our dream house. Then he lost his job.\u201d\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/_lcEuObNNZI?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p><iframe data-testid=\"embed-iframe\" style=\"border-radius:12px\" src=\"https:\/\/open.spotify.com\/embed\/episode\/3kB8fKcCI0FKUfrgffePRD\/video?utm_source=generator\" width=\"100%\" height=\"400\" frameborder=\"0\" allowfullscreen=\"\" allow=\"autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture\" loading=\"lazy\"><\/iframe><\/p>\n<p><span style=\"font-weight: 300;\">Karen (45) and Chad (44) built their lives around a high income: buying their dream home in a high-cost city and raising three kids with confidence in the future. But when Chad lost his $340K tech job, everything changed. Three years later, he\u2019s earning half as much, their emergency savings are gone, and they\u2019re borrowing just to stay afloat. Karen lies awake fearing they\u2019re one paycheck away from losing the house, while Chad stays optimistic that a future promotion or windfall will fix everything. Their conversations remain polite but distant, masking deep anxiety, resentment, and two completely different philosophies on money. Can Ramit help them confront reality, reconnect emotionally, and decide whether they can afford to keep the home they love?<\/span><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Turinys:<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/#In_this_episode_we_uncover\" >In this episode we uncover:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/#Chapters\" >Chapters:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/#This_episode_is_brought_to_you_by\" >This episode is brought to you by:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/#Links_Mentioned_In_This_Episode\" >Links Mentioned In This Episode:<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/sekmesreceptai.lt\/index.php\/2025\/12\/03\/episode-237-we-bought-our-dream-house-then-he-lost-his-job\/#Transcript\" >Transcript\u00a0<\/a><\/li><\/ul><\/nav><\/div>\n<h4><span class=\"ez-toc-section\" id=\"In_this_episode_we_uncover\"><\/span><b>In this episode we uncover:<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<ul>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">How Chad\u2019s income dropped by 50% overnight<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">The emotional toll of pretending \u201ceverything is fine\u201d while secretly fearing they can\u2019t make the mortgage<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">Why even buying kids\u2019 necessities fills Karen with guilt<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">Why Chad defaults to thinking \u201cmaybe we\u2019re just poor for a while\u201d<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">The dangerous gap between their public optimism and the reality Karen wrote in her application<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">How Karen and Chad communicate like polite coworkers instead of partners<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">The childhood roots that shaped their opposing money philosophies<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">Why living with zero savings and three children is far more dangerous than Chad realizes<\/span><\/li>\n<li style=\"font-weight: 300;\" aria-level=\"1\"><span style=\"font-weight: 300;\">The breakthrough: shifting from tracking numbers to actually making meaning from their spending and fears<\/span><\/li>\n<\/ul>\n<h4><span class=\"ez-toc-section\" id=\"Chapters\"><\/span><b>Chapters:<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 300;\">(00:00:00) <\/span><span style=\"font-weight: 300;\">\u201cWe\u2019re one paycheck away from disaster\u201d<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(00:17:12)<\/span> <span style=\"font-weight: 300;\">\u201cHere we go again\u201d<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(00:26:21)<\/span> <span style=\"font-weight: 300;\">Ramit breaks down their numbers<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(00:37:22)<\/span> <span style=\"font-weight: 300;\">\u201cI\u2019m looking for solutions, not platitudes\u201d<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(00:49:47)<\/span> <span style=\"font-weight: 300;\">\u201cWhy aren\u2019t you more relaxed with less money?\u201d<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(01:01:11) \u201cIs the house on fire?\u201d<\/span><\/p>\n<p><span style=\"font-weight: 300;\">(01:19:32) Where are they now? Karen and Chad\u2019s follow-ups<\/span><\/p>\n<h4><span class=\"ez-toc-section\" id=\"This_episode_is_brought_to_you_by\"><\/span><b>This episode is brought to you by:<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 300;\">Bilt | Join the loyalty program for renters at <\/span><strong>https:\/\/joinbilt.com\/ramit<\/strong><\/p>\n<p><span style=\"font-weight: 300;\">Aura Frames | Exclusive $35 off Carver Mat at <\/span><strong>https:\/\/on.auraframes.com\/RAMIT<\/strong><span style=\"font-weight: 300;\">. Promo Code RAMIT<\/span><\/p>\n<p><span style=\"font-weight: 300;\">Wispr Flow | Try it for free at <\/span><strong>https:\/\/wisprflow.ai\/ramit<\/strong><\/p>\n<p><span style=\"font-weight: 300;\">Gelt | Skip the waitlist at <\/span><strong>https:\/\/joingelt.com\/ramit<\/strong><\/p>\n<p><span style=\"font-weight: 300;\">Netsuite | Get the free guide \u201cDemystifying AI\u201d at <\/span><strong>https:\/\/netsuite.com\/ramit<\/strong><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Links_Mentioned_In_This_Episode\"><\/span><b>Links Mentioned In This Episode:<\/b><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span style=\"font-weight: 300;\">Design your Rich Life for the New Year at my virtual event. Grab your seat at <\/span><strong>https:\/\/iwt.com\/richlifereview<\/strong><\/p>\n<h2 aria-level=\"2\"><span class=\"ez-toc-section\" id=\"Transcript\"><\/span><b><span data-contrast=\"none\">Transcript<\/span><\/b><span data-ccp-props=\"{&quot;134233117&quot;:false,&quot;134233118&quot;:false,&quot;134245418&quot;:true,&quot;134245529&quot;:true,&quot;201341983&quot;:0,&quot;335559685&quot;:2010,&quot;335559737&quot;:2010,&quot;335559738&quot;:375,&quot;335559739&quot;:375,&quot;335559740&quot;:768}\">\u00a0<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span data-contrast=\"none\">Download the full transcript PDF<\/span><span data-ccp-props=\"{&quot;134233117&quot;:false,&quot;134233118&quot;:false,&quot;335559685&quot;:2010,&quot;335559737&quot;:2010,&quot;335559738&quot;:150,&quot;335559739&quot;:150}\">\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:00)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Chad lost his job in tech, was laid off. It&#8217;s been a 50% cut.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:05)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We&#8217;re in this house. We&#8217;re in this neighborhood because we were indexed on a different salary before.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:11)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And buying necessary things even makes me feel terrible and guilty.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:16)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We were paying an interest only amount on the HELOC. I asked for help from my family, and they helped us pay that off.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:24)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How much?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0$180,000. It was a hard call to make for me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:29)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It feels dishonest because not everything is okay all the time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:33)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s the same conversation you always have. There&#8217;s nothing to be done.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:37)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We definitely could struggle in the next few months to make that mortgage payment neighborhood.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How the\u00a0(Bleep)\u00a0am I talking to a couple with $0 in savings who has a 4,200-square foot house?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:51)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Maybe we&#8217;re just poor now, and we&#8217;re just going to be poor for a little bit till we&#8217;re not.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:00:57)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What would you do if your income went down by 50%,\u00a0just like that?\u00a0What if you suddenly couldn&#8217;t afford the life that you&#8217;ve become accustomed to? This is a deep American fear. The idea of going backwards socioeconomically terrifies us, especially the higher up we go.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:01:16)\u00a0That&#8217;s one reason that you&#8217;ll meet people who, even though they recently suffered a job loss, keep spending the same amount of money eating out and traveling.\u00a0They cannot stop spending on those items because to confront the reality that they have gone financially backwards is one of the most shameful ideas in American culture.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:01:35)\u00a0Today I&#8217;m about to speak to Karen and Chad. They&#8217;re 45 and 44 years old. They have three children,\u00a0and they are scrambling to afford the life they&#8217;ve built together since their combined income unexpectedly dropped.\u00a0I&#8217;m looking at their conscious spending plan or CSP. It&#8217;s the same tool that I use in every episode,\u00a0and I&#8217;m\u00a0going to\u00a0go through their numbers right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:01:56)\u00a0Assets, 1.2 million.\u00a0Investments, 665,000.\u00a0Savings,\u00a00.\u00a0Debt, $514,000. Total net worth is 1.37 million. Combined income,\u00a0175,000.\u00a0What do you notice? Yes, they have a high net worth and a high income, especially for a couple in their mid-40s, but they have $0 in savings.\u00a0They are in trouble. I suspect that because they have a large investment portfolio, but nothing in savings,\u00a0that they have recently drained that savings account to pay for life.\u00a0We&#8217;ll find out though.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:02:35)\u00a0Before I speak to them, I want to hear from you in the comments,\u00a0what would you do if you lost half of your income? Could you still afford the life you&#8217;ve built? Would you have to move? Would you have to downsize? How many months could you draw from your emergency fund before it hit zero?\u00a0And I\u00a0want to\u00a0ask you in your comment below, be realistic. Because it&#8217;s really tempting to say,\u00a0&#8222;Oh, me?\u00a0I&#8217;m so perfect. I would immediately cut out all of our discretionary expenses.&#8221;\u00a0But in truth, almost nobody does that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:03:06)\u00a0Now let&#8217;s get started with Karen and Chad.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:03:10)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Karen, on your application, you wrote something that caught my eye. You wrote, &#8222;We are no longer able to invest or save. We have no emergency savings. It feels as though we are one paycheck away from disaster.&#8221; Can you take me through the circumstances that led to this situation?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:03:30)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Sure. Absolutely. So about three years ago, Chad lost his job in tech, was laid off. And found a really great startup to be a part of, however, he took a 50% pay cut. And up to that point, we had been living the lifestyle that met the previous salary. For the past three years, we&#8217;ve done well. We had been smart and saved and had what we needed. I picked up extra work. However, after three years, we&#8217;re finally out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:02)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Ah, so for three years you were using your savings and now you are out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We were out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:08)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:09)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. I&#8217;m proud of us that it lasted as long as it did. But there are circumstances in our life that we can&#8217;t necessarily change because we made purchases while we were making quite a bit more money.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:21)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Got it. Okay. Chad, as you hear Karen&#8217;s description, do you agree with that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:04:28)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I agree that, yeah, we were indexed into a different income previously. I would agree with the characterization that we haven&#8217;t really changed our lifestyle since then. We&#8217;ve had to draw&#8211; we have a HELOC, home equity line of credit, which a couple of times last few months have had to, I call it draw forward, but borrow against the HELOC in a short-term way to pay the mortgage. And then I pay it back a few weeks later. We&#8217;re running a little bit close to the wire here, and we need to change something about how we&#8217;re operating.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:04)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How does it feel for you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:05)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I guess I have mixed feelings. On one hand, I&#8217;m pretty comfortable with taking a little bit of risk. On the other hand, I don&#8217;t want to be reckless. I want to do the right thing, and I want Karen to be aligned with me on the choices that we&#8217;re making, and that we&#8217;re not spending recklessly.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:25)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:28)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m struck by my question was how do you feel about it? And you gave me a very cerebral answer about risk tolerance. Is there a feeling where you are right now, or no?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:38)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0The feeling would be, yeah, a little bit scared that we&#8217;re going to get ourselves into a dangerous situation pretty quickly.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You&#8217;re scared, or the two of you are scared?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:48)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We&#8217;re collectively scared.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How about you specifically, Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:52)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m nervous more than scared, I would say.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Nervous about what?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:05:57)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Primarily getting ourselves into a situation where we can&#8217;t pay the mortgage anymore.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Which has happened a couple of times, and you had to pull from the HELOC.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:05)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. Which I pay back quickly, but&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:10)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What happens if nothing changes? If we end this call and nothing changes, what will happen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:18)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0So right now, if we don&#8217;t do anything, I think we&#8217;ll still stay afloat, but we&#8217;re not hitting any of our goals still of saving for retirement, saving for a rainy day, or any of those other things that Karen&#8217;s looking for.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:32)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Most people don&#8217;t hit their retirement goals. They don&#8217;t even have a retirement goal. So what&#8217;s the big deal?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:06:38)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I guess the big deal is we have three young children who I don&#8217;t want to burden if we get older and don&#8217;t have retirement and can&#8217;t take care of ourselves financially. And it&#8217;s more than the retirement goal. I&#8217;d like to have an emergency savings in case Chad, for whatever reason&#8211; if something happens with his job, I am not in a career where I can make up the difference and support our family where we currently live. So the emergency savings even more than the retirement is very important to me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:10)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:11)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And I don&#8217;t feel like we&#8217;re planning a very solid future financially for our children as well as ourselves. I&#8217;m also tired of living in this more austere lifestyle where every penny we spend, we feel guilty about.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:26)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm. I&#8217;m struck at the difference between what you both just said to me and what&#8217;s in the application that you wrote to me. What you said in the application, Karen, is, &#8222;This is dire. I feel as though we may lose our home in the next few months.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:46)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:47)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Compare that to what you both told me about, we may not be able to provide for our children, and I&#8217;m tired of living this austere lifestyle. It seem quite different, don&#8217;t you think?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:58)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:07:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Why the difference?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:01)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think one of the differences is we did have a large payment fortunately taken off of our shoulders. However, we definitely could struggle in the next few months to make that mortgage payment.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:17)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Ah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:18)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Okay, so I do want to clarify a couple of things. One is we did take a hard look at where our money drain was happening. One of the biggest drains was this remodel we had done a couple of years ago before I got laid off. We were paying an interest-only amount of $1,300 a month on the HELOC.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:36)\u00a0We were very fortunate. I asked for help from my family, and they helped us pay that off. I do have an obligation to pay them back, but we don&#8217;t have that ongoing payment now. So that did tip the scales a little bit for us.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:53)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0That&#8217;s just going to keep us afloat. We no longer have to borrow to pay our mortgage.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:08:57)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Is that the first time you&#8217;ve had family help?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:00)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:01)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It was a hard call to make for me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, was that your family, Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:07)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:08)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What do you remember feeling when you were about to ask for help?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:14)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Nervous, shame.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:16)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:17)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I did not want to do it. I thought, hey, I&#8217;m an independent person. I&#8217;ve been surviving 30 years I don&#8217;t want to ask for help now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:27)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. But you did it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:29)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0But I did it because there was a few times where I had to draw on the HELOC, which gave firm empirical proof to the severity of the situation. And that was the biggest lever we could pull on. So that&#8217;s what I did.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:43)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I wish, Chad, that you didn&#8217;t feel shame or bad about this. You were dealt a bad blow. This was all Elon fricking Musk laying you off.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, Elon did it?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:09:57)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. And he cut my work too.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:00)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What the (Bleep)? This (Bleep) guy.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:02)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0The company formerly known as Twitter.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:07)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And Chad should not feel guilt or shame about that. That&#8217;s not&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Well, we also did the remodel.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:15)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Right. Before.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:18)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. But maybe we should have had cash in hand.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:22)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How did they receive it when you ask for help?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0My father said he&#8217;d have to look into it, which was perfectly reasonable. And then he said he&#8217;d have to sell some assets to help us out actually. So that made me feel pretty bad actually. And then he took over the payments for a while, then he didn&#8217;t like how we had structured the deal where we&#8217;re just paying interest only right now, which is admittedly shortsighted. So he felt more comfortable just paying it off, and now we have a obligation back to him.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:53)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How much?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:55)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0$180,000.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:10:58)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What if your family had said no, Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:11:04)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We might be looking at more dramatic option, which would include downgrading our house, I think, would be the next thing we&#8217;d be looking at.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:11:12)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Okay. How often do the two of you talk about money?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:11:17)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Pretty frequently. I would say daily in little ways. Just yesterday we were talking about my son&#8217;s upcoming birthday party, and his concern that what we had was too simple and most of his friends, because of the area we live in, have bigger, fancier parties. And ours was pretty simple.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:11:40)\u00a0And I think Chad was much more interested in just throwing money at it and blowing the budget to buy our way out of that. And I was very uncomfortable with that. And we did have to hash that out because I felt like it was keeping up with the Joneses.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And then, Chad, where are you in these conversations? What was your reaction?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:05)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think my reaction was I don&#8217;t want to disappoint him. I want him to have a great birthday. He came to the same conclusion once he saw the facts laid out in front of him. So I was a little bit proud of him for that actually.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Wow.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:18)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think we handled it well, but my concern was that he felt the tension between us when I was saying no and Chad was saying yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:25)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I wasn&#8217;t saying yes. I was talking it out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:29)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It seemed like you were instantly Googling options for bigger event like parties.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:36)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0You&#8217;re right. I probably was. I don&#8217;t want to disappoint my son, I guess. Yeah. The birthday party thing, the emotions can drive that in the moment. Like, I want to make sure he is happy and he has the best possible birthday.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What&#8217;s your ethnic background, Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:12:57)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Scandinasian is what we like to joke.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Cool.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:03)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Filipino on my mom&#8217;s side and Scandinavian on the other side.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:08)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You talked about feelings when you grew up?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:11)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0The reason I ask is not just that when I asked earlier about how would you feel and you gave me a cerebral answer, but even when you describe feelings, it&#8217;s abstracted. You&#8217;re like, &#8222;The emotions can cause.&#8221; As if emotions are this thing over here.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:26)\u00a0As somebody who was raised in an Indian family where we don&#8217;t really talk about feelings, certainly not guys really talking about feelings that much, I just recognize some of my own way of talking about it in the same way that you are describing it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:40)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, sounds about right. We never talked about feelings growing up. I remember distinctly, when I graduated high school, my mom wrote me a letter and she&#8217;s like, basically, &#8222;Will you talk to me about your feelings more?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:54)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Your mom said that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:56)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0In the letter, yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:13:57)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I\u00a0want to\u00a0jump in here because Chad&#8217;s mom calling him out for not talking about his feelings is a huge clue.\u00a0And I personally relate to this. I had a hard time talking about my own feelings,\u00a0or even acknowledging them until I actively started working on them, especially getting help in therapy.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:14:15)\u00a0And that shows up in multiple ways.\u00a0As we&#8217;re discovering with Chad, it shows up in how he communicates, how he speaks.\u00a0Have you noticed the kind of vocabulary that he&#8217;s using? It&#8217;s clinical, maybe even a little robotic. He definitely struggles to articulate what he&#8217;s feeling.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:14:31)\u00a0Notice the story of Chad having to reach out to his dad for money, and you also notice the feeling of shame. Now I&#8217;m curious how this plays out when they don&#8217;t agree, especially about money.\u00a0Those moments really reveal a dynamic between them, so let&#8217;s dig deeper.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:14:51)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Can you think of a time in the last three, six months where you were not on the same page with money?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:00)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Chad, do you want to go ahead and lead that one?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:03)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m working at a startup right now, so I was like, &#8222;Oh, once (Inaudible) some revenue, I think I can ask for a raise.&#8221; So I was selling that dream a little bit, and Karen, who&#8217;s much more pragmatic was not comfortable with that. That&#8217;s banking on a dream. So that did ultimately force the decision to ask for help.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:29)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Mm-hmm. Karen, what was it like for you when Chad, as he put it, was quote, &#8222;selling the dream?&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:36)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Here we go again.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:38)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, wow.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:15:40)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Here we go again. This has been a constant, I think, in our marriage of, don&#8217;t worry. The next raise is around the corner. Don&#8217;t worry. I&#8217;m getting a bonus. When we chose to do the remodel on the house, there were concerns there financially, if that was a good idea to take out money. But he said, &#8222;Don&#8217;t worry. I&#8217;ve got a bonus coming.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:00)\u00a0It&#8217;s a frequent thing, but the reassurance that, don&#8217;t worry. There&#8217;s money around the corner. Don&#8217;t worry. There will be a windfall. Or this idea of mine will take off, and we&#8217;ll bring in tons of money.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:15)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Does it work? She says no. Chad, is that a phrase you use commonly, don&#8217;t worry?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:25)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. I think it means that I got us. I&#8217;ll make sure we&#8217;re going to be safe and secure.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:35)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Do you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:37)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think so, but maybe I don&#8217;t.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:43)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Just feels like a record on repeat. I don&#8217;t feel like I&#8217;m being heard. I don&#8217;t feel like my opinion is valued, or my intelligence, or my ability to see things clearly.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:16:58)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. I can see by the reaction you two have talked about this before.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:02)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We have. This is how our conversations always start.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh\u00a0(Bleep). It starts and then what happens?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It devolves. It will devolve eventually as I get frustrated and feel like maybe I&#8217;m talking to a brick wall and I need to be more direct. It feels dishonest because not everything is okay all the time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:23)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Right.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:23)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And sometimes we do need to sit down and talk about it. And sometimes worry is warranted. And when I&#8217;m being told, don&#8217;t worry all the time that reads as untrue to me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:17:34)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Probably what we are looking for is more communication to work together to build a common understanding so we have a common reality that we agree this is what reality looks like. And then jointly survey our options to decide what decisions, if any&#8211; a lot of times doing nothing is perfectly reasonable.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Are you all this polite when it comes to other parts of life, parenting and day-to-day life and food, all that stuff?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:09)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think my interactions with Chad are different because I have noticed if I don&#8217;t handle it in a certain way, he takes it as a personal attack, whereas my kids don&#8217;t.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:19)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:20)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0They&#8217;re much better about understanding, I think, where I&#8217;m coming from.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:27)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Got it. How old are your children?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:30)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0They are five, eight, and 10.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:34)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Five, eight and 10. Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:35)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a011.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:36)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a011.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a011. Okay. And Chad, what about for you? Why the careful diction and the walking on eggshells today? The abstraction to things like, we probably need to communicate better. Why? What&#8217;s going on?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:18:53)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Maybe I&#8217;m protecting my ego, to be perfectly honest. If I am incompetent, I&#8217;m trying to protect my ego.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:00)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Wow.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:01)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:03)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What else?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:04)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Karen&#8217;s right. I do get defensive. I feel like she is attacking maybe me personally. But I also feel like maybe she&#8217;s complaining about things that we don&#8217;t have short-term control over sometimes. What can we really do? Is this complaining just for complaining sake? There&#8217;s certain things we can do in the short-term and maybe more dramatic things we could do in the long run. And we don&#8217;t seem to lay those options out and drive a decision in any way. We just complain.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0We don&#8217;t or she doesn&#8217;t?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:38)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We don&#8217;t.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Do you lay out the options?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:19:47)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I would say that I put a lot of options out of bounds. Like, I don&#8217;t want to sell the house. Everything else that we can cut, I feel like we&#8217;ve cut. We used to have things like maids. Those are gone. I had a gym membership. Gone. We had some laundry services. Gone. We&#8217;ve cut everything we can po I can possibly think of.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:20:06)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm. So you&#8217;re saying&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:20:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m saying we don&#8217;t have any more options. I&#8217;m saying we&#8217;ve done everything we can do beyond selling the house because we&#8217;re already locked in. We got this path dependence thing where we&#8217;re in this house, we&#8217;re in this neighborhood because we were indexed on, a different salary before. So we&#8217;re locked into a different standard, I guess.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:20:33)\u00a0I guess that gets to the heart of what we&#8217;re trying to accomplish here, is like if we sell the house, downgrade, Karen seems to think this is going to magically solve our problems. I think we&#8217;re going to be back in the same boat because we haven&#8217;t actually identified the root of the problem. Selling the house will just be a bigger Band-Aid than we&#8217;ve done to date.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:20:54)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What do you think the real problem is?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:20:57)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think we don&#8217;t have any discipline right now in how we spend. When we were preparing our CSP, we were looking into Amazon, like, look, we&#8217;re spending thousands of dollars on Amazon. What is this? And Karen got very defensive. She&#8217;s like, &#8222;Whoa, why are we nitpicking all these purchases? This isn&#8217;t the spirit of the CSP.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:21:20)\u00a0And I was like, &#8222;I&#8217;d like to identify the general theme. If this is all shampoo, can we put it in a&#8211; spending $100 on shampoo. Can we get a theme out of this or not?&#8221; Right now it&#8217;s opaque. It&#8217;s just like Amazon.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:21:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. So that&#8217;s what&#8217;s going on here, Amazon purchases?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:21:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t know. We have $3,700 a month that is in your catch-all bucket at the bottom there. Seems like a lot to me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:21:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. We&#8217;ll go through it for sure. I want to understand it as well as anybody, trust me. But you mentioned something which I thought was a really strong hypothesis. Hey, even if we downgrade the house, we may be back in the same situation in the first place. So what is the root cause problem here? Just overspending on miscellaneous items?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:22:14)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. I feel like there&#8217;s a lot of reactive buying in the day-to-day on Amazon. Maybe buying things to solve perceived problems that aren&#8217;t actually problems. Like, oh, we need new lunchboxes, or we need, I don&#8217;t know, cat scratching protectors, things like that. These aren&#8217;t problems we actually need to solve. These are just things we can live with, in my opinion.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:22:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I\u00a0want to\u00a0quickly explain why I&#8217;m pushing Chad here to tell me what he thinks the problem is. The way that he talks about what he perceives the problem to be is just so matter of fact. Just a little too clever that it is evident he&#8217;s staying on the surface level. In fact, I think he&#8217;s minimizing the very issues that brought them here today.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:23:01)\u00a0No,\u00a0it&#8217;s not that they struggle to pay their mortgage with a salary that&#8217;s been cut in half. No,\u00a0it&#8217;s not the $180,000 family loan that they needed to stay afloat. No. I think it&#8217;s the Amazon lunchboxes.\u00a0He&#8217;s minimizing what they actually need, and I want him to grapple with the fact that he doesn&#8217;t know what the solution is because I can&#8217;t help someone who thinks they know everything.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:23:28)\u00a0Sometimes the hardest part of getting help is admitting that you actually need it, that you actually don&#8217;t know the answer, or sometimes even the problem.\u00a0I see this all the time, people who think they&#8217;ve got it all figured out and are probably very smart in other parts of life, but they don&#8217;t even understand the main issue.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:23:45)\u00a0It takes me back to one of my high school classes where our teacher told us that if we take our car into the shop to get fixed, don&#8217;t tell them,\u00a0&#8222;Hey, I think it&#8217;s a gas line.&#8221;\u00a0Just be quiet. In fact, the only thing you tell them is,\u00a0&#8222;Hey, my car is making a pinging noise every time I go above 25 miles per hour.&#8221;\u00a0Let them figure out the solution. You just tell them what you notice.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:24:06)\u00a0Turns out lots of people are obsessed with finding the perfect teacher, the perfect coach, the perfect book, but they spend a lot less time obsessing over becoming the perfect student.\u00a0And being a good student means admitting you need help, that\u00a0you can&#8217;t do it alone,\u00a0and that you are ready to trust someone else. Chad isn&#8217;t there yet though, so I have to push him.\u00a0Because if you&#8217;re just here\u00a0because\u00a0your wife wants you to be, we&#8217;re probably not\u00a0going to\u00a0get anywhere.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:24:32)\u00a0If you are hearing this and you&#8217;re thinking, that sounds like us, but we don&#8217;t know how to fix it, that&#8217;s exactly why I created my\u00a0Money\u00a0Coaching program.\u00a0It&#8217;s a monthly program where you get expert guidance, accountability, and a community that will help couples break through these blocks and create a clear actionable plan towards their\u00a0Rich Life.\u00a0If you are ready to take control of your money and you are ready to admit you need help, check it out at iwt.com\/moneycoaching.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You mind if we take a look at the numbers? What was it like doing the CSP? I know that there was a little bit of conflict around the Amazon numbers. We&#8217;ll get to those. What was it like? What was the tenor of the conversation?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:17)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It was polite.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:19)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:20)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It was polite, but it was good. Nothing surprised us.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:24)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I would like to ask Chad to read off the word in bold and then the number in full next to it for this entire box, please.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:37)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Assets, $1,225,976. Investments, $665,685. Savings, 0. Debt, 514,000. Total net worth, 1,377,661.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:25:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Speaking of debt, $514,000, can you break that down for me?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:03)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s the mortgage. That&#8217;s what we owe on the house.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Where&#8217;s the family obligation?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:09)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We didn&#8217;t put that in there.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, we just wiped it out. Yeah, we should put that in there.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:12)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0180k, you&#8217;re just like, &#8222;That\u00a0(Bleep)\u00a0doesn&#8217;t count.&#8221; What is that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:17)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Because the agreement we wrote upon was we would pay it back if we sold the house.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:24)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s secured against the house. Yeah. But it should be in that&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:26)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0There&#8217;s no payment plan. Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:28)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So yes, you would add 180k even though your payments don&#8217;t reflect it because that will decrease the amount you will make when you sell your house.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:39)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Decreases the equity. Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. All right. Net worth, 1.3 million. What do you think about that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:47)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think that&#8217;s great.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:48)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, it&#8217;s all non-liquid assets, but non-liquid assets means we can&#8217;t blow it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:26:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Wow, interesting response. It&#8217;s non-liquid assets, which is implied to be bad. But because it&#8217;s non-liquid, we can&#8217;t spend it, protecting us from ourselves, which seems to be good. Did I read that right?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:09)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think so.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:12)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So you both agree that the number sounds good.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:16)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0But it&#8217;s stalled.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Stalled.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:19)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. We have not contributed 401(k) since I got laid off from my job.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:23)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0If anything, it&#8217;s going down by tiny increments, which is not how it should be.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s also heavily indexed on windfalls from the house, which we rode this wave of housing appreciation over the last seven years.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:35)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. Wow. I appreciate the nuance. So the numbers tell us one thing, but what you&#8217;re saying is it&#8217;s the quality of those numbers. It&#8217;s largely illiquid. It&#8217;s actually declining. You&#8217;ve been pulling from your savings, which is now at zero. You&#8217;re not contributing to your investments much, and that may even be decreasing. And then the illiquidity, the house appreciation may have stalled.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:58)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:27:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay, good to know. Obviously, you&#8217;re pretty in sync with your numbers. That&#8217;s good. Let&#8217;s go to income now. Karen, can you read off the combined monthly income please.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:14)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0The combined is 14,642.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:17)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right. So the two of you make $175,000 together. Did you know that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:22)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:23)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. What do both of you do for a living? Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Data scientist. I work for a startup.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:28)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Great.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:28)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0My income is firm. It&#8217;s a base salary.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:34)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Uh-huh. And Karen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:36)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m an RN, and I do clinical research monitoring. My contracts tend to be anywhere from two to six months, and then I&#8217;ll have a large break depending on if there&#8217;s a study.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:47)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0$25,000 a year. What do you think about that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:50)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0That&#8217;s been a conscious choice.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:53)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Tell me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:28:55)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0When we started having kids, we made the agreement that one parent would be home.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:00)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Ah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:01)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Whoever was making more would be the so-called breadwinner. And I wanted to be home with my kids while they were young and while they wanted me. And while Chad was making a good income, it was fine, totally comfortable. It was idyllic.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:17)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Did you grieve the loss of income?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:24)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I did.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:25)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Not me so much. It was more like the job change was a welcome change, foister of (Inaudible), I would say.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:29:35)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Part of what&#8217;s happening is that you&#8217;re comparing yourselves to when you used to earn hundreds of thousands of dollars. Coming down from that income level is actually emotionally catastrophic. Your socioeconomic status has changed. Literally, the things you buy off the shelf may have changed.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:01)\u00a0And that is grief. It sounds shallow. Oh, just stop buying the premium cheese. But in America especially, a lot of the things we buy, whether for ourselves, our pets, our kids, define who we are. That&#8217;s part of the culture, like it or not. And to not be able to do those things that we used to be able to do feels sad. It feels draining. It feels empty. It feels lonely.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And I think maybe Chad hasn&#8217;t gone through that or acknowledged that, and tends to dismiss my feelings around that, when I feel like I have grieved, and a lot of it is thrown back as, well, it&#8217;s just material things. It&#8217;s not a big deal.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:48)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, I totally do that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:51)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0So I haven&#8217;t really felt like I&#8217;m allowed to grieve about it without feeling materialistic and shallow.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:57)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:30:59)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s just stuff, I guess.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:31:03)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Okay, so one of our daughters has a learning disability, and she may need extra intensive schooling, and I&#8217;d like to provide that for her. And I feel like we could if we weren&#8217;t so stuck on living at the level we were when we were making more. I don&#8217;t know if I&#8217;m articulating that well, but it&#8217;s not just the things. It&#8217;s about offering our kids resources that they might need.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)\u00a0<\/span><b>\u200a<\/b><\/p>\n<p><span style=\"font-weight: 400;\">(00:31:34)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What Karen is describing here, potentially not being able to afford resources for their children,\u00a0is the emotional toll of losing a big part of your income. We know that it can be financially devastating, but it can also be psychologically devastating.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:31:49)\u00a0I&#8217;ll never forget this LA Times article that I read during the 2008 recession, and it was about these wealthy women whose husbands used to make a lot of money,\u00a0they lost their jobs,\u00a0and the families lost everything. No more country clubs, no more eating out.\u00a0Their social circle immediately shrunk,\u00a0and the life they knew went away.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:32:11)\u00a0And I remember commentary about this article.\u00a0A lot of people saying,\u00a0&#8222;Boo hoo, rich people can&#8217;t go to the country club anymore.&#8221;\u00a0But I remember thinking, no, this is actually real loss. And in many ways, regardless of whether you are wealthy or you are working class,\u00a0not being able to live the lifestyle that you used to can be incredibly painful. In fact, it can actually feel like losing a part of your body.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:32:35)\u00a0Because in America, what we spend reflects who we are. The car we drive is not just a car.\u00a0It is the status of what we have achieved in society.\u00a0The food we eat, the streaming subscriptions we have, the toys we buy for our kids,\u00a0they make up who we are.\u00a0And to be very candid, if somebody told me that I could never stay at really nice hotels anymore, I would be devastated.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:32:57)\u00a0It sounds silly. Is it superficial? Maybe. But it&#8217;s also real. So if this happens to you, if your income drops, the tactic that you need to embrace is to make immediate changes.\u00a0Do not wait hoping things will get better. They might, but they also might get worse. I learned this in a very difficult way in my own business. Years ago, my business took a steep downturn,\u00a0way worse than anything I had ever projected.\u00a0And I realized it can always get worse.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:33:28)\u00a0Even Karen and Chad, they&#8217;ve been able to sustain for three years because they had savings, which is amazing. But things haven&#8217;t gotten better.\u00a0They&#8217;ve gotten worse. So when you face a financial emergency, the first step is to admit it. Hey, this is a major red flag. We have to stop and change things immediately. We have to slash our guilt-free spending.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:33:47)\u00a0That&#8217;s why you have the conscious spending plan. It&#8217;s already at the bottom. Cut it immediately.\u00a0Trim your fixed costs that are above what you can afford. Go into survival mode. Treat it like you are stranded on a mountain with limited rations. I would ration every damn thing\u00a0because\u00a0I don&#8217;t know if rescue&#8217;s coming in a day, a week, or a month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:06)\u00a0And I would rather get rescued with extra rations and be a little skinny when the rescue team comes around than run out of food after a week.\u00a0This is how you survive an income drop.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><b>\u200a<\/b><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right. So you&#8217;re making $175,000 a year. And what is that number, that fixed costs number, Karen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:28)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0The fixed costs, that 70%.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:31)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a070%. So it&#8217;s a bit high. I can see why you feel stressed out. Let&#8217;s go down to investments, at zero. Savings at zero. And then guilt-free spending at 30% or $3,400 a month. Savings are at zero. Why is that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:51)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I feel like every time I try to bring it up as something we should do, because we are so polite, it doesn&#8217;t go anywhere.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:34:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Let&#8217;s just do it right now. I&#8217;d love to see a polite conversation. Go ahead. Show me the last time you talked about savings. Go ahead, Karen. Let&#8217;s do it as if you were actually having the conversation. Go ahead.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:35:10)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. I am very concerned that we don&#8217;t have savings, but I&#8217;m not sure where we&#8217;re going to get that money from. So we need to sit down and look and figure out where we can get money to move into savings.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:35:23)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Okay, I can look at that. I feel like we&#8217;ve cut basically everything we can cut. Where do you think we can get the money out of exactly?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:35:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think if we reverse engineer this and maybe pull the savings aside first. But I do agree it might be tight because we are down to last dollar most months. We talked about how if the kids ate school lunch, we could save $240 a month. Even if we could take that small amount and start putting it into savings, maybe a savings account that has some interest or money back, maybe it might take a while, but it&#8217;s a start.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:04)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. School lunch is definitely a good option. $240.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And I know the kids aren&#8217;t going to like it, but we can&#8217;t just say no.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:12)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. You have to eat the boiled hot dogs today.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:15)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And we&#8217;ve talked about me working more so that we can have savings.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:20)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Kids are only young for so long. So part of me is like, &#8222;Okay, the kids are only young for so long. Maybe we&#8217;re just poor now, and we&#8217;re just going to be poor for a little bit till we&#8217;re not.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:31)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0But it makes me very nervous to not even have a month&#8217;s worth of savings in case something happens. Ideally we want three because we&#8217;ve seen how hard it can be to find work.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:45)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0So what would that be, $30,000? So 250 bucks a month. How long does it take us to get to $30,000?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:57)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Quite a while.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:36:58)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I can hear myself. Basically, I sound like I&#8217;m making excuses for us to not do anything.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:06)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. But like you said, we&#8217;ve already done this. We&#8217;ve already really dug in, and we&#8217;ve cut a lot of subscriptions. We&#8217;ve cut a lot of extras. So my big question is, how many austerity measures do we really want to put in place before we&#8217;re just not enjoying life anymore?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:25)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0That was even more polite than usual, or more&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:30)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It always starts like that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:32)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What does it get to?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:34)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Usually it&#8217;ll get to me being frustrated because I don&#8217;t feel like Chad always will contribute ideas outside of, it&#8217;ll be fine. We&#8217;re just going to be poor for a while.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s the same conversation you always have. There&#8217;s nothing to be done.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s got to be frustrating to talk about the same thing over and over and over and over and not really make any progress on it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:59)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Very.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:37:59)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It makes me not want to talk about it. Just going we&#8217;re to come to the same conclusion and do nothing. So what&#8217;s the point of talking about it?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So what&#8217;s the solution?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:11)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t have an answer right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:14)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And yet you are in the financial situation that you are in. What&#8217;s the disconnect?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:20)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think the biggest one is we bought this house in Dex on different salary.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:26)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. And you didn&#8217;t make any changes substantively after your income dropped.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:35)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, totally.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0In fact, you&#8217;ve resisted making any changes by taking it out of the equation.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:43)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0By having the family help you mean?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:45)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0No, by saying like, &#8222;We don&#8217;t want to get rid of this house. That&#8217;s off the table. Let&#8217;s talk about cutting our Amazon spending instead.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:38:55)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. I have resisted that change, I guess, when I&#8217;ve evaluated options. I&#8217;ve come to the conclusion changing our house, first of all, we&#8217;d be trading a two and a quarter interest rate for whatever it is right now, six and a half.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:09)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0So I backed into, if we wanted a reasonable house in this area, it would save us on the order of $700 to maybe $1,200 a month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:22)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Seems like a lot.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:25)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I thought it didn&#8217;t sound like that much, I guess.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:28)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm. Are the two of you a financial team?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:32)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I would like to be, but I often feel like we&#8217;re almost adversaries.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:35)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:38)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No, not really. I do the taxes, and I just show it to her before I file it, but she&#8217;s not involved with that at all.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I thought you talk about money every day though.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:39:55)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We talk about spending, but planning wise, we don&#8217;t do any planning right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s very difficult to get ahead if you are adversaries. It&#8217;s very difficult to get ahead if you don&#8217;t have a shared vision.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:14)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Again, I thought we did. The past few years have maybe shown me a different side of Chad than what we in theory talked about.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:25)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Has your financial status shown you a different side of you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:34)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Definitely. I think I&#8217;ve become more of a worrier than I expected. I feel like I&#8217;ve become, I don&#8217;t know if I can come up with a better word or articulate it, but much more uptight about it, much more concerned about the future than I used to be.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:54)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Uptight means what?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:40:57)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Just always stressed about it. I always want to talk about it. Just constantly carrying that heavy load. And I feel terribly guilty even when I go to buy the kids a new pair of shoes because their shoes wore out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:41:12)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:41:12)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And buying necessary things even makes me feel terrible and guilty. And that is not, I don&#8217;t think, how I used to feel about it, even though I&#8217;ve always been fairly frugal. I never felt an existential dread over it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:41:34)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Got you. Chad, how about you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:41:36)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t think I&#8217;ve changed too much. I think I haven&#8217;t really, to be honest, thought too much about money for the most part, which is probably why we&#8217;re here. I&#8217;ve been focused a little bit more on trying to achieve impact in my job and make sure the family is happy, healthy, and the kids are doing well. But I don&#8217;t specifically think about money. The kids come first. The marriage comes second, in my opinion.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:42:10)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0They do at this point because I see more return on my investment there.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:42:17)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s a pretty striking comment. What if that just keeps up? The two of you, the way you described it, we have one person who describes herself as worried, concerned, uptight. Another describes himself as not really thinking about money, focusing on having impact at work, making sure the kids are okay. Just play it out. Two years from now, five years from now. Where does that leave us?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:42:42)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0The tension will continue. It will continue. And it&#8217;s not good for my health and wellbeing or his, or the families in general, not to mention the financial implications. But it will impact our relationship, how we relate to each other. That feeling of not being heard definitely permeates the rest of the marriage, which is obviously destructive.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:43:16)\u00a0So I think it will get worse, and I may just tune out, turn off and do my own thing. And I think you see that when we start talking separately. We&#8217;re not saying we when we talk about certain things, because I do feel I&#8217;ve approached Chad many times, and it&#8217;s almost dismissive. Like, oh, here she goes again with this.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:43:36)\u00a0And what does she know? She&#8217;s just worrying again. So I&#8217;m just going to reassure her and pat her on the head, and say it&#8217;s going to be fine. So it&#8217;s just a really unhealthy dynamic.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:43:47)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What would you want him to know if he could actually hear you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:43:53)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I would want him to really know that I know the numbers. I am smart. I do have valuable opinions. I do have a pretty solid grasp on our situation. I am not overwhelmed, and I&#8217;m not overreacting.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:44:10)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:44:17)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m going to say an answer. I know you&#8217;re going to shoot me down before, but hoping for a windfall eventually that we&#8217;ll solve all our problems. But yeah, barring that, Karen&#8217;s absolutely right, going on this trajectory where we&#8217;re going to increasingly resent each other because we&#8217;re not on the same page. We&#8217;re not pointing in the same direction. We&#8217;re not moving in the same direction.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:44:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Is there anything you would want to tell Karen if you could be uncharacteristically honest?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:44:56)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I love that you&#8217;re at home with our kids as much as you can be. I think that kids are the most important thing, and I don&#8217;t care if we&#8217;re poor, I guess, at the end of the day. Right now I don&#8217;t care if we&#8217;re poor. I think it&#8217;s more important to spend time with the kids. So I really appreciate that you do that and you&#8217;re here for us.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:45:21)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0But your actions aren&#8217;t reflecting those words.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:45:24)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Why is that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:45:24)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0You&#8217;re not willing to make any changes to make that a long-term possibility. You are shut off, or you shut me down, or you won&#8217;t&#8211; how do I want to word this? You&#8217;re not willing to come up with ideas with me to make that possible, or even sit down and talk it through well enough to decide if that is possible.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:45:52)\u00a0It&#8217;s a vague of I love that you&#8217;re here and with the kids, and I don&#8217;t mind being poor, but what does that mean? Because that&#8217;s what we&#8217;re doing right now, and it&#8217;s not sustainable. That&#8217;s not a place we can move forward from. I&#8217;m looking for solutions, not platitudes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:46:15)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t know what to say. Let&#8217;s come up with a plan is all I can say.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:46:21)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What if Chad doesn&#8217;t change, and what if you still need to build up savings for your family?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:46:26)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;ll just have to go it alone.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><b>\u200a<\/b><\/p>\n<p><span style=\"font-weight: 400;\">(00:46:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Wow. I have to say that I love the honesty that I&#8217;m hearing from Karen. We are finally moving past polite, and I am a little bit puzzled by Chad&#8217;s responses.\u00a0What&#8217;d you notice in that interaction? I noticed that Karen is crying out for partnership. She&#8217;s saying,\u00a0&#8222;Give me a seat at the table.\u00a0Notice that we are in trouble. Believe me when I say that I&#8217;m smart and I understand the numbers.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:46:52)\u00a0What she&#8217;s really saying is,\u00a0connect with me.\u00a0And Chad responded with,\u00a0&#8222;We&#8217;re going to have another windfall. It&#8217;s going to be fine.\u00a0And I don&#8217;t care if we&#8217;re poor.&#8221;\u00a0He&#8217;s abstracting the severity of the situation to these pat little phrases like,\u00a0&#8222;I love my wife,\u00a0and I&#8217;m glad she gets to be home with our kids.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:47:13)\u00a0It&#8217;s\u00a0like watching a politician wave away millions of people losing their snap benefits,\u00a0and instead say some abstract comment like,\u00a0&#8222;We should all have the opportunity to work in America.&#8221;\u00a0Okay.\u00a0The issue here is becoming clear to me. The spending alone is not the problem.\u00a0The disconnect is a much bigger problem. And until we bridge that, no amount of calculating numbers is\u00a0going to\u00a0fix it. When we come back, we&#8217;re\u00a0going to\u00a0go way back to their childhoods to see if we can get to the root of this dynamic.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:47:46)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Karen, what do you remember your family saying about money when you were young?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:47:51)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0They didn&#8217;t talk a lot about it. I would say we were solidly middle class until I was about 12 when my parents divorced. And then there was definitely a transition there financially.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:06)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What happened?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:07)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0My mom pretty much stayed where she was, but then my dad basically moved into basement apartments, studios, stuff like that. So I would visit him there. And he worked his way up to buying smaller, more modest homes in not the nicest neighborhoods. And I lived with him primarily. So it was definitely a more modest lifestyle. I needed to get a job fairly early if I wanted to pay for gas or clothing of my own. Any extras, I had to work for.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:42)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What did it feel like that your mom was at a certain level and your dad was literally in a basement?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:48)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It felt unfair.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:48:51)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It did. It felt unfair. But also he seemed happier, and the money didn&#8217;t really matter because he had more peace of mind. He had more freedom.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:04)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0The money didn&#8217;t matter.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:07)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Right.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:08)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s just a ringing in my ears because I heard something very similar just a few minutes ago. Do you remember that? What did Chad say? I don&#8217;t care if we&#8217;re poor.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:22)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0He don&#8217;t care about the money as long as the kids are okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:25)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. Quite similar.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:28)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:29)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What do you make of that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:49:31)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And that&#8217;s what I mean by previously I thought we had that shared vision of it&#8217;s not about the money. It&#8217;s not about all the nice things. It&#8217;s not about being able to keep up with the Joneses, but more about safety and security and freedom and time to spend together. Mostly it&#8217;s that freedom, freedom of time, which is, I guess, what I&#8217;m pointing out with my dad. I saw him have more of that, that freedom.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:04)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Less money, but more freedom of time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:06)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Yeah, yeah. More relaxed and more like I have these things, and I can afford them.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:11)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Why aren&#8217;t you more relaxed with less money now?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:14)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Because we still have the same high amounts of bills to pay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:19)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I see.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:19)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And so we don&#8217;t have that freedom of time or we can&#8217;t go do things as a family because we are constantly working, including me. I&#8217;d like to point out I am working, and I am working full-time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:38)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Do you want that, less money, more freedom of time?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:44)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. Or the same amount of money that we have now, but yeah, more freedom of time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:50:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. Why don&#8217;t you just move to a much smaller apartment, and you&#8217;d have more money? Would you be down for that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:02)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:03)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:04)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We have different views on that. I think we can stay within our community and move to a smaller, more modest house, but still enough space for our family, and still be within our school system. Not much would change. And I think our kids are really flexible and adaptable, and they&#8217;d probably just see it as an adventure. And maybe they&#8217;d see that mom and dad are more relaxed and a happier and have more time for them, which I think is healthier than&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:31)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Than what it is today?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:33)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What phrases ring when you think about money as a kid, as a teenager? What phrases echo from your family?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:51:44)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Gosh, one that I think of specifically was my dad being pretty apologetic that he couldn&#8217;t pay for my college or help with college. And a lot of that guilt that I still think he carries today that he couldn&#8217;t help more financially to set me on a better footing in my young adult life.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:04)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Were you angry or resentful at him?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:06)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0No. I figured it out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:09)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You figured it out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:10)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I figured. I joined the military. I got a GI Bill. It all turned out fine.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:15)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Quite interesting.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:17)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I was raised resilient. And then on my mom&#8217;s side, the opposite as far as she very much would say, you have to make your own money. You have to be very careful with money. At any time the other shoe could drop, and you could find yourself with nothing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:32)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How did you internalize that? How did you make sense of that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:35)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Definitely felt very insecure. I think about that as far as, yeah, you&#8217;re right. Tomorrow something could happen, and I could have nothing, and I can&#8217;t really rely on my partner to be the one in charge of it. And to always be a little bit cautious about what they&#8217;re saying.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:52:56)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And how did that come up when the two of you met each other and you were dating?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:03)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t think we were particularly challenged by it because we both were making fairly solid incomes on our own. So we never really had to face it until recently.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:14)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Got you. That&#8217;s a pretty honest answer. Karen, when you look back and you reflect on the lessons that you took away from your family about money, what occurs to you? What surprises you? What sticks with you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Again, I think it&#8217;s that how quickly your fortunes can change.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:37)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It happened for you when you were 12.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:39)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It happened for you just recently when Chad downsized to a different job.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:46)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Right. And both times we&#8217;re very uncomfortable.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:50)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm. Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:55)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s frustrating because I thought we had future proofed. I thought we had done a pretty good job.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:53:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:00)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And I still do think we did pretty well, but we do seem stuck.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:09)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm. Okay. Karen, thank you very much. Chad, what do you remember about your family when you were young? What did they say about money?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:21)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0My dad said&#8211; I can&#8217;t remember the exact number, but I think he said, &#8222;Every paycheck, always save 10%.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:28)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:28)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0That&#8217;s one thing I definitely remember. Second thing I remember is, &#8222;Don&#8217;t bank with the banks. Bank with a credit union. Because the banks rip you off.&#8221; Third thing is, &#8222;Don&#8217;t buy American cars. Buy Japanese cars.&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:45)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Wait, this guy has great advice. I agree with 100% of what he said. Wait, out of curiosity, what happened to the 10% rule? I don&#8217;t see that happening in your finances.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:54:57)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I have not followed his advice, I suppose.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Y&#8217;all drive an American car? Please don&#8217;t say yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:04)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, thank God. All right. And what about your mom?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:09)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0She wasn&#8217;t really involved with the financial planning.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:12)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So your dad was the money person.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:15)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:15)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And what was your mom&#8217;s role when it came to family and finances?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:22)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0My mom was a homemaker. My dad, I&#8217;ll call him a company man. So she would keep the house going, and he would work long hours at work, I would say, like 60-plus hours a week. So we wouldn&#8217;t see him that much during the week and a little bit on the weekends, I guess.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:41)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Did you like that or resent it?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:42)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s all I knew, so I don&#8217;t know. He was working for us as far as I could tell. Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:49)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Okay. And did your mom spend money for the family? How did she go about that? Did she have to ask your dad? What was the arrangement there?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:55:59)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. So it is an arrangement that I&#8217;ve carried forward to today, which is that my dad had an account and he would move money over to her account when she needed it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:56:09)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And you do that today?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:56:12)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We have a joint account, but right now my paycheck goes into my account I&#8217;ve had all my life, which is a credit union. And when Karen needs money, I do move it over, but we don&#8217;t manage a joint account actively right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:56:26)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. On the occasions, which isn&#8217;t all the time or frequent, I will just text him and say, Hey, I need X amount. Can you transfer that over today?&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:56:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Since you earn less, Karen, you mentioned you don&#8217;t frequently have to ask for money. How does that work? Because your expenses are relatively high compared to your income.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:56:49)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0My expenses are mostly what do I take care of? I take care of the car insurance and the phone bill, most of the kid stuff. So I actually wouldn&#8217;t say my expenses are high.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Just want to point out, this is very, very common in a way that I hate. Dad pays the mortgage. Mom pays the kid expenses. And then when, as the kids get older, which means they&#8217;re more expensive, in a lot of cases, nothing changes. And then mom is now put in the position to, &#8222;Please, please, can you transfer an extra $500?&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:32)\u00a0And dad&#8217;s like, &#8222;Why do you need the extra 500\u00a0(Bleep)\u00a0dollars? Why aren&#8217;t you being efficient with them?&#8221; And it just gets perpetuated. Why are you both nodding so much right now?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:40)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I could see that dynamic totally.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:41)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I could see it too.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:42)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. Okay. Chad, back to you growing up. Are your parents both alive?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:51)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:51)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. How are they doing financially?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:55)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0They&#8217;re doing well. I characterize them as upper middle class.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:57:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm. Okay. And what about debt in your family? Was there any debt as you were growing up?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:07)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No. I would almost say my dad&#8217;s allergic to debt. Other than the mortgage, no, we never run debt. Apparently, my mom did have some credit card debt when they got married, but he paid it off immediately.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:23)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No debt.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Your dad seems very methodical about money.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:33)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0He&#8217;s an engineer. Yeah, he is an engineer.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:35)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0But you&#8217;re a data scientist, right?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:58:37)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. I call characterize myself as a quasi-engineer. He&#8217;s the type of engineer where you have to get everything right or the chemical factory blows up. I&#8217;m more in the trying to look for the insights and the trends in the data, and yeah, trying to see the big picture in what&#8217;s going on in product or its system. Yeah. And trying to derive insights to affect change in the system. And then follow up to make sure those insights are actually acted upon. Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:59:13)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You do that at home with your finances?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:59:15)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:59:16)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0There are so many parallels to draw from from Karen and Chad&#8217;s early experiences with money. Karen is almost mirroring what her own dad went through. He was forced into a more modest lifestyle, but do you remember what she said? He emotionally thrived with more time and less money.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:59:32)\u00a0It&#8217;s no surprise that these are the very things Karen says she would be fine with. And I can also understand why she said earlier that she would go it alone if she has to. Those messages of resilience,\u00a0of not relying on anyone else,\u00a0those have been ingrained in her for decades.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(00:59:48)\u00a0Interestingly, Chad has done almost the exact opposite of what his parents did with money.\u00a0His own father was debt avoidant. Yet Chad took out a home equity line of credit and borrowed from the family. He skirted past the advice to save and invest 10%.\u00a0But one thing though that he has replicated is his father&#8217;s commitment to work. Chad himself admitted that he would rather focus on work-related goals than work through the financial issues that affect his entire family.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:00:17)\u00a0One thing I&#8217;ll say that I&#8217;ve noticed is it is very interesting when people grow up with strong money messages. One of two things often happens. One, they follow them exactly. They basically recreate what they grew up with. Or two, they go completely the opposite direction. But here&#8217;s the fascinating part.\u00a0You can never predict what is\u00a0going to\u00a0happen. There is no rhyme or reason to which approach someone is\u00a0going to\u00a0choose.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:00:43)\u00a0Okay, let&#8217;s shift our focus now back to the numbers. Their housing costs are 33.6%, little bit higher than the 28% I recommend.\u00a0They&#8217;ve hinted at it multiple times, but we finally need to address the elephant in the room, which is their house.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:00:58)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What does the house mean to you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:01:00)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It means a stable place for the kids, I guess, is the main thing I think about. I think safety is something maybe we take a little bit for granted here, or we just assume everything&#8217;s safe. We don&#8217;t even lock our doors here. I don&#8217;t want to be moving to a place that&#8217;s not safe. It&#8217;s not worth any amount of money to me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:01:20)\u00a0I&#8217;ve been working out of the house for the last five years, so it&#8217;s like also a place to work out of. If I didn&#8217;t have that, I&#8217;d have to figure something out, get a co-working space or something to that effect. Yeah, we haven&#8217;t had a conscious plan, so if we can come up with an actual plan, that would go a long way to addressing those concerns. Do you agree?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:01:41)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s more than a plan, Chad.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:01:44)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0And action.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:01:45)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s more than action. Before any of that, you could have come up with a plan before you even saw me. If you look at your CSP, it&#8217;s quite obvious what to do. It literally jumps off the page. I&#8217;ll show you. Why you haven&#8217;t been able to get to the plan is the crux of why we are here today. Y&#8217;all, the plan is not the hard part. You&#8217;re both very intelligent. And the idea that, oh, it&#8217;s just things. Well, let try to take that argument with you, Chad. Why don&#8217;t you just get rid of your house? It&#8217;s just a thing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:14)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, it should be on table for sure.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. But why haven&#8217;t you? Why have you been so resistant to getting rid of the house, including in this conversation? It&#8217;s just a thing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:26)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It feels like short term thinking, I guess.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:31)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You have $0 in savings. Don&#8217;t you need to think short term right now?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:35)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Maybe, yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:37)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. The\u00a0(Bleep)\u00a0house is on fire.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:41)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Is the house on fire? Because we don&#8217;t have the savings. That&#8217;s why the house is on fire.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:02:46)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. Three kids, one person who&#8217;s already lost a job in the past. That&#8217;s a massive risk. Massive. And it&#8217;s not the two of you. Even if it was the two of you, you would be in a really, really precarious position. But with three children, it is red alert level of risk.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:09)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Hmm. Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:14)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Finally.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0When you think about the financial environment that you want to raise your kids in, what kind of environment comes to mind?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:29)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I want them to learn responsibility, I guess. And maybe that&#8217;s not something I&#8217;m teaching them through my actions right now. What should we do different?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:37)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Great question.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:39)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I can propose ideas.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Go ahead. I&#8217;m listening.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:03:41)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0One, we start a written doc, so we can document it. Just throwing ideas. Maybe we can each have little soft targets. Like, okay, I&#8217;m going to try to save $300 a month. You&#8217;re going to save $300 a month. We&#8217;ll bring our receipts to a little party at the end of the month, and we can have a little celebration to jointly&#8211; we can have a special beer or something. I don&#8217;t know.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:11)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Keep going. That&#8217;s great.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:12)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0So we need a forum for that. So I think a standing meeting, that&#8217;s what we do at work, with documentation. Let&#8217;s put some process around it. Let&#8217;s have some goals. Let&#8217;s do some goal tracking, some metrics tracking.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What is the goal?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:33)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think the goal personally is to hit that 10 and 10 number. That&#8217;s where we&#8217;d like to be.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:38)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a010% investments, 10% savings. Is that enough? How do we know?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:43)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s a starting point.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. Fair enough. It&#8217;s a starting point. I agree.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:47)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We need feedback from the stakeholders on whether that&#8217;s where we want to be, but that&#8217;s where we&#8217;re headed right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:54)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:55)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0And we need accountability on the results. So that&#8217;s where we need the metrics tracking.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:04:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:01)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0And then the crux of it is we need a strategy. So what is the strategy? The strategy is identifying a point of leverage over the problem. It&#8217;s a single, I won&#8217;t call it a single thing we can do. There&#8217;s no silver bullet. But a set of tactics that jointly work together to solve the challenge.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:21)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What are some example tactics that you will probably have to do in order to hit the 10% savings and 10% investment goals?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:29)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Sell the house, (Inaudible) the house. Go somewhere with crappier schools because that&#8217;s the only way you get cheaper houses. You go to a school district with crappier schools.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:42)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, I didn&#8217;t realize we&#8217;re insulting our options. I thought we were just putting them out on the table.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Right. It feels a little bit taboo.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:05:49)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I like taboo. What do you think this freaking podcast is? Sometimes the truth is only found in the taboo. Sometimes taboo is where the truth is. You shouldn&#8217;t run away from taboo. You should actually run towards it with a big old flashlight.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:06:06)\u00a0And the key insight here is that money is deeply emotional. It&#8217;s not the numbers on the page. The numbers on the page are the least interesting thing of this whole conversation. We can knock those out in five seconds, and you&#8217;re going to see that. The fact of why you have not been able to look at it is that you both are locked into a dynamic where each of you has their own role.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:06:30)\u00a0You can&#8217;t move any different squares in this game. And what I&#8217;m saying is y&#8217;all are not actually playing chess. You can move any direction you want, but you have to be able to talk about what are the rules of the game here? What is the even game we&#8217;re playing?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:06:41)\u00a0We are not playing a game of we need $250 a month in savings. That&#8217;s a\u00a0(Bleep)\u00a0boring game, and nobody wants to play it. That&#8217;s why the two of you don&#8217;t play, because it sucks. That&#8217;s not actually fun. I think the game that you are playing here should be much bigger. How does that strike both of you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:06:58)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, I think that makes sense.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:02)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We&#8217;re just winging it right now, to be honest, being very reactive. If we start from a common vision, then we can work backwards to understand what we need to do to achieve that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:13)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Love it. Y&#8217;all want to do it real quick? What&#8217;s the Rich Life vision?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:18)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I keep emphasizing time. I would rather have freedom and time to spend with my kids, to be home after school, to give them a snack, to help them with their homework.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:31)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Great. That&#8217;s good. Freedom and time. Let&#8217;s go. We&#8217;re going to go rapidly. Chad?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:35)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t have to go back to a 9-5. I can do my own startup ideas.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Run my own startup, let&#8217;s say. Okay, Karen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:44)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Opportunities to be healthy and be outside.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:48)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Chad?\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:50)\u00a0<\/span><b>Chad:\u00a0<\/b><span style=\"font-weight: 400;\">Be able to pay for a kid&#8217;s college. Don&#8217;t have to worry about that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:53)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Being able to provide that extra schooling and education if we need to.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:07:57)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;d love to take a gap here with the kids and take them around the world.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:08:00)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, that would be amazing. Ooh. And I want to volunteer my time doing things I&#8217;m passionate about rather than going to a job that I don&#8217;t love.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:08:10)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Great. To me, this is personal. Also, I want to note that you probably can&#8217;t do all these things right now. That&#8217;s also okay. Your Rich Life is a vision. Some of the things you may not be able to do today, but you can do 10 years from now with savings and investment. The real secret is that the Rich Life is in the journey, not necessarily in checking off the boxes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:08:34)\u00a0What I see here is just a powerful vision of a family that wants to be able to do a lot of things with kids, a lot of things with freedom. That&#8217;s so clear what the two of you value. Here&#8217;s my question for you. Compare the Rich Life I just wrote down versus where you are spending your money. What do you notice?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:08:58)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0All of our money is going to bills and things to supporting our current life, our current lifestyle.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:07)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah. Not even current life. You&#8217;re supporting a past life when you used to make hundreds of thousands of dollars more.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:12)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Mm-hmm.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:14)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Nothing about the future. Very little money being spent on the vision of any of this. Y&#8217;all want to take a look at the CSP and make some changes?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:22)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:23)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:24)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So here we are with your CSP up on the screen. As a refresher, you make $14,000 a month gross. Your fixed costs are 70%. Investments and savings are zero. Guilt-free spending, 30%. Chad, tell me the first thing you&#8217;d like to change.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Cut that mortgage in half would be nice.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:51)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What? How are you going to do that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:53)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Downgrade the house. It&#8217;s the only option.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:09:57)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Damn, hold on. This is crazy. I never had anyone who ever started with the house, ever. This is crazy. Can you get housing for your family for $2,000 a month?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:12)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0We could, if we take the equity we have and put it as a down payment on a smaller place here.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I need the number that you would actually walk away with.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:22)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0500,000. That&#8217;s minus the 180, I believe, minus the transaction costs.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:28)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s a lot.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Say the number.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:33)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a072 grand.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right, 72 grand in fees. What else? Isn&#8217;t there some other fees associated with selling?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:10:42)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0I think we dodge the cap gains if it&#8217;s under 500. I don&#8217;t know how you want to think about it, if you want to move over to renting or buying a new place. But if you&#8217;re going to buy a new house, there&#8217;s a lot of fees involved with that transaction too.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Okay. So you have some math to run, but seems to me that&#8217;s one big option.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:10)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Immediately I&#8217;m thinking of all the friends that the kids play with every day across the street. We won&#8217;t have that anymore, and that seems sad to me. I don&#8217;t know.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:20)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0If we can find a way around it, I would love to. It is so ingrained in us to have home ownership. That&#8217;s the pinnacle of adulthood in this country, and that&#8217;s success.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0And to pay for your kids&#8217; college.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Right.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:34)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Who paid for your college, Karen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:39)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You paid. And did you build responsibility? Were you resourceful?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:11:46)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. One of the ideas I had to bear with me here was we can rent out our house for a fairly big chunk of money, like our current house, and then we could rent something more affordable and more within our current budget.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Nice. How much could you rent it out?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:06)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0And we&#8217;d actually be making&#8211; comps around here, we&#8217;re about 6,500 a month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:11)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a06,000, 6,500. And if you could rent something, how much could you rent a place that y&#8217;all would need? How much?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:18)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Between three and four.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:20)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Whoa.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:22)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:24)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You have to run the calculations more carefully.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:27)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Basically, you could just scale it by square footage. If we&#8217;re in a 3,000-square foot house, it&#8217;d be scaling down to a 2,000-square foot house. So a third less.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:36)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a03,000 square feet. What the\u00a0(Bleep)?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:38)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0No, we&#8217;re actually in 4,200 square feet.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:40)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, right, the basement.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:41)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What the\u00a0(Bleep)?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:43)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Chad thinks that this is a modest house in a modest neighborhood.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:48)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0How the\u00a0(Bleep)\u00a0am I talking to a couple with $0 in savings who has a 4,200-square foot house? This is crazy. Chad&#8211;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:57)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0This is what I&#8217;ve been screaming<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:12:59)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Chad, do you see my reaction? Why do you think I&#8217;m reacting the way I am?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:05)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Seems like a big house.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:06)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;s in the top 1% of the size of houses in the entire world and also your income. I don&#8217;t know the exact decile or whatever, but it&#8217;s up there, really high. And you know what&#8217;s at zero, the zeroth percentile, your savings?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:23)\u00a0All right. So we put the house. That&#8217;s an option. Whether you would choose to sell and buy another place, whether you would choose to sell and rent, or whether you would choose to keep the house and then potentially rent another place, those are three very interesting options. Let&#8217;s keep going. I think there&#8217;s more options. This time, Karen, what would you do?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:46)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I could pick up my work.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:49)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a01,500 is your net right now. How much would you make?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:52)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I could make up to six.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:55)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a06,000 a month, net? What the\u00a0(Bleep)?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:13:59)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0But I wouldn&#8217;t be home ever.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:01)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right. So can you do something in the middle?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:03)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Or I&#8217;d be working night shift at the hospital.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:05)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Something in the middle maybe.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Something in the middle, if I could find reliable part-time work, I could make something in the middle.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:13)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right. What else, Karen?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:14)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think groceries.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:17)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Groceries, $2,000.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:21)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think we can get that down, but not much less than 1,500 to 1,800.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:26)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Pick a number.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:29)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a01,800.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:30)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0What the\u00a0(Bleep)? No. I know I told you pick a number, but that number, I&#8217;m not taking. 1,800? Come on. What food do you guys order? Tell me.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:37)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0We do Amazon grocery delivery through Whole Foods.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:41)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think the reason I picked that number is I looked up the average that a family of five spends around here and went with that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:49)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I don&#8217;t care. That family makes maybe more money than you do.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:53)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Oh, they are.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:54)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0No, that number&#8217;s anchored in reality. That&#8217;s our long-term average.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:14:58)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, when you were spending without looking at prices. You are living a different life now. I certainly didn&#8217;t hear that in your Rich Life vision. Let&#8217;s go fill up our cart with a bunch of\u00a0(Bleep)\u00a0we don&#8217;t even look at the price of.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0So you think we can realistically bring that down.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:11)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Way down.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:12)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I&#8217;m honestly openly asking that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:14)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yes, there&#8217;s definitely ways, like 1,000%. You can just search cheap grocery, food, and you&#8217;ll find people&#8211; there&#8217;s entire subreddits about how to order food that is healthy for a family for a much, much, much cheaper place. Probably one of the ways would be just to not shop at Whole Foods as well.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:33)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0What would be a range on groceries? Maybe you&#8217;re like 50 to 75 percentiles?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:15:40)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0The magic number, believe it or not, is 800 to $1,200 a month. Almost everybody falls between that number regardless of whether they&#8217;re two people or five people. That seems to be the magic number. I think that if the two of you were like, &#8222;Hey, we want to get more disciplined, but we also do really like having X or Y, we&#8217;re probably going to end up being at 1,300, maybe 14.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:04)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Okay.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:05)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0That&#8217;s still huge.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:07)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, it&#8217;s a big savings.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:08)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, that&#8217;s great.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:09)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Let&#8217;s take groceries and turn it into 1,400. I&#8217;m going to give you a little leeway. I think you&#8217;d get it lower, but 1,400, nice and easy. Look at your fixed cost number. It dropped from 70 to 64% right there. That&#8217;s great. Especially with your housing cost, fine. Investments, what do y&#8217;all want to do?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:27)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0It&#8217;d be great if we could get back up to that 10% investments.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:31)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a010%. All right. Let&#8217;s just say you&#8217;re investing about 1,100 bucks a month. Fine. Savings?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:41)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I want to get that up to at least 30,000, so we have three months.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:16:46)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0So how much do you want to put here? Notice by the way that we are now drawing from down here, your guilt-free spending. You can see I decreased it. You&#8217;re now at 27%. But you have 10% that moved up to investments. Not bad. Savings, how much?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:01)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0500 a month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:05)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0500 a month would be nice.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:07)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0All right. Let&#8217;s do it. 500 bucks a month on savings. You&#8217;re at 4% savings. Seems a bit low to me, considering you have zero. I don&#8217;t like it. What do you think?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:15)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0So we need at least 10%.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:18)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I think so. All right so now you&#8217;re at 10% savings, which is 1,100 bucks a month. And you have 17% in guilt free spending, which is $1,988. What do you think about that?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:33)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0I think that looks good. I do worry about one-offs medical emergencies.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:38)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0They don&#8217;t come out of guilt-free spending. We need clear lines of demarcation. We need to be saving for medical emergencies. You have three kids. Things come up.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:17:47)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0I need to jump in and clarify this really quickly. First off, if you have several small kids, your financial risk is way higher than a single person or a couple with no children. Emergencies when you have kids aren&#8217;t just, oops, I forgot to pay a bill. They are medical bills, urgent travel, even job loss that can blow up your finances overnight like it did with Chad and Karen.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:18:08)\u00a0And the stakes are much higher.\u00a0With kids,\u00a0you can&#8217;t afford to be caught off guard. You absolutely want a six-plus-month emergency fund that covers your bare essentials, including medical emergencies. Automate\u00a0it.\u00a0Make it non-negotiable. That is how you build real financial freedom.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:18:25)\u00a0For Chad and Karen, we set aside $250 a month.\u00a0Now I\u00a0want to\u00a0hear from you in the comments, what is your current setup for emergency savings? Do you have anything automated right now? And what are the numbers that you are aiming for? Tell me in the comments below.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Interview)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:18:41)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Let&#8217;s keep moving along. You are at 65% on the fixed cost, which while not ideal, is okay. It&#8217;s fine. Savings at 10%. Good, good. Investments are at 10%. That&#8217;s good. That&#8217;s way better than it was before. That&#8217;s great. Your investments, using your current strategy of contributing zero will yield you about $2.68 million at retirement.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:08)\u00a0Thanks to the work that you&#8217;ve done contributing over the years, that puts you in a pretty good position. Your current CSP, by the way, by adding the extra $1,100 a month, instead of having 2.68 million, you&#8217;ll have 3.26 million. So it&#8217;s a considerable amount more just with that simple change.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:28)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0(Inaudible) with that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:29)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Not bad, especially if you own a house. Kids are out. Not bad. I would like it to be more. I get the sense, based on your description, you probably want to live a pretty nice life. But that part is not on fire.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:44)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Great.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:45)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0You could even contribute a little bit less to your investments. You could model it all out. If we did 500 a month instead of $1000 a month, what would it look like? If we paused for one year, really built up our emergency fund, what would that look like?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:19:58)\u00a0If I were in this situation, I would run all the calculations, but just instinctively, I would probably sell the house or rent the house out. Probably sell it because renting it out has a lot of expenses that you&#8217;re not going to cover or predict. And historically you have not been particularly effective at putting that money aside for those big house expense.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:20:19)\u00a0I would sell that freaking house. I would pay off the debt. I would take most of the money and invest it. I would go rent a place that is somewhere around but cheaper. Way smaller, way smaller. You have a lot of options on that side. The challenge is actually talking about money in a way that aligns with your vision.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:20:40)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0Got you.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:20:41)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0So it&#8217;s going deeper than just the math, like you said.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:20:45)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Yeah, that&#8217;s the thing. It&#8217;s interesting, now seeing the pieces come together, when I asked you, Chad, were you resentful of your dad because he was working all the time? And your answer was, &#8222;That&#8217;s all we knew.&#8221; I might ask your kids 20 years from now, &#8222;Were you resentful that your parents created a family mission? We&#8217;re going to actually start to spend more time together.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:21:11)\u00a0&#8222;We&#8217;re going to do more arts and crafts together. We&#8217;re can do all this stuff together. And by the way, we&#8217;re going to have a cozier house where we can actually spend more time together, which is going to be, let&#8217;s just say, 2,200 square feet. Were you resentful?&#8221;<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:21:22)\u00a0They&#8217;re like, &#8222;Resentful? We\u00a0(Bleep)\u00a0loved it. We got to spend more time with our parents. We got to travel more. We got to do all this stuff. What are you talking about resentful? That was awesome. We didn&#8217;t know any different.&#8221; What do you think? Karen&#8217;s got a big smile on her face. Chad, what about you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:21:38)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Sounds good. Yeah. I think our financial situation hadn&#8217;t sunk in quite yet.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:21:44)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0Has it sunk in now?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:21:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Yes. I think you really got into the heart of it, which is communication between Karen and I needs to improve, and without that we don&#8217;t have anything.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(Narration)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:22:00)\u00a0<\/span><b>Ramit:<\/b><span style=\"font-weight: 400;\">\u00a0We&#8217;re\u00a0going to\u00a0get to their follow-ups in just a second. But first I\u00a0want to\u00a0share my analysis.\u00a0Their story goes a lot deeper than the numbers in the way that they truly feel about money. They&#8217;re stuck in a cycle of fear and pride and miscommunication. The house is not just a mortgage. It&#8217;s a symbol of identity and security, but one that is also keeping them potentially trapped.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:22:24)\u00a0The real problem, of course, is not the Amazon spending or even zero savings.\u00a0Karen and Chad have a chance at taking back control because they&#8217;re finally naming the real issues. But in my opinion, it&#8217;s\u00a0going to\u00a0take a lot of honesty and some really tough choices.\u00a0That is the path to a\u00a0Rich Life. Now let&#8217;s check their follow-ups, where the real progress begins.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:22:46)\u00a0<\/span><b>Chad:<\/b><span style=\"font-weight: 400;\">\u00a0Thanks again for spending time with Karen and I.\u00a0Really appreciate it, the opportunity to go deep on our money problems.\u00a0I think the big biggest takeaway is that Karen and I, we really need to come together as a team and improve our communication around money. And we really need to solve this problem of getting us on a better financial footing to move forward in our relationship and our marriage,\u00a0to keep it strong.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:23:12)\u00a0So you&#8217;re\u00a0going to\u00a0take it seriously. You&#8217;re\u00a0going to\u00a0act with some intentionalities. We&#8217;re\u00a0going to\u00a0take some concrete steps. We are\u00a0going to\u00a0start some marital counseling to help improve our communication. We are actively now contributing\u00a0$1,000\u00a0a month to our emergency savings fund with a goal to get that up to $30,000 or so as quickly as possible.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:23:33)\u00a0And then once we have that, we&#8217;ll start to look at some of the other secondary goals like reengaging on the\u00a0401(k)\u00a0and college\u00a0savings,\u00a0things like that.\u00a0Yeah, I think those are those main things. So thanks again.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:23:47)\u00a0<\/span><b>Karen:<\/b><span style=\"font-weight: 400;\">\u00a0My biggest surprise from the conversation was that a lot of our issues actually boiled down to communication. Not the situation we&#8217;re in, but how Chad and I communicate about money,\u00a0our own money psychology,\u00a0and how that&#8217;s getting in the way.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:24:07)\u00a0Our biggest takeaways was that we need to work together as partners and watch our tone. We do tend to be adversarial when we talk about money, and I think that shuts down the conversation,\u00a0and we can&#8217;t move forward. Specific changes we&#8217;ve decided to make as we are now allocating a lump sum of money to savings every month,\u00a0paying ourselves first, which fortunately we can do now as I&#8217;ve picked up more work hours.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">(01:24:36) So we are taking that money and saving it for our emergency fund. And we are also going to try to work on that grocery budget and take that challenge on to see if we can cut down on those costs. Anyhow, it was an absolute pleasure working with Ramit a couple of weeks ago, and we really appreciate the time that he took.<\/span><\/p>\n<\/p><\/div>\n<p><script>\n!function(f,b,e,v,n,t,s)\n{if(f.fbq)return;n=f.fbq=function(){n.callMethod?\nn.callMethod.apply(n,arguments):n.queue.push(arguments)};\nif(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';\nn.queue=();t=b.createElement(e);t.async=!0;\nt.src=v;s=b.getElementsByTagName(e)(0);\ns.parentNode.insertBefore(t,s)}(window, document,'script',\n'https:\/\/connect.facebook.net\/en_US\/fbevents.js');\nfbq('init', '259290718675278');\nfbq('track', 'PageView');\n<\/script><a href=\"https:\/\/www.iwillteachyoutoberich.com\/237-karen-chad\/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=237-karen-chad\"> Nuoroda \u012f informacijos \u0161altin\u012f <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Karen (45) and Chad (44) built their lives around a high income: buying their dream&#8230;<\/p>\n","protected":false},"author":1,"featured_media":391,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[4],"tags":[3538,2854,3521,3539,3804,3803],"class_list":["post-2020","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-sekmes-istorijos-patarimai","tag-bought","tag-dream","tag-episode","tag-house","tag-job","tag-lost"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/posts\/2020","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/comments?post=2020"}],"version-history":[{"count":0,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/posts\/2020\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/media\/391"}],"wp:attachment":[{"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/media?parent=2020"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/categories?post=2020"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sekmesreceptai.lt\/index.php\/wp-json\/wp\/v2\/tags?post=2020"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}