245. "We make 6 figures. Why am I hiding fast food purchases?"

Ramit Sethi of I Will Teach You To Be Rich talks to Grace and James, a couple from Ireland, aged 38 and 37, who have been navigating immense challenges. James was diagnosed with cancer and underwent a year of treatment, while Grace managed a difficult pregnancy and maternity leave with their second child, an infant. Amidst the fear and grief, their household income took a significant hit, causing financial strain. Grace felt the burden of managing their finances, leading to guilt about James continuing to work during his illness. Despite these hardships, they’ve built a strong financial foundation with high savings and have managed to stay afloat. Ramit helps them explore their individual money psychologies, the impact of their upbringings, and how their shared experiences have shaped their financial outlook, revealing a story of resilience, unwavering teamwork, and an inspiring pursuit of a rich life. In this episode we uncover: • How Grace feels immense pressure to manage finances • The emotional toll of James's cancer diagnosis • Grace's hidden "mindless" spending under stress • The Irish perspective on "mustn't grumble" about money • James's childhood money messages and aversion to debt • The surprising freedom found in small financial wins • Grace's proactive approach to long-term financial planning • The power of internal versus external locus of control • How a shared money philosophy can emerge from conflict • The importance of planning for the worst when at your best • Their inspiring journey of overcoming adversity as a team Chapters: (00:00:00) Introduction (00:05:13) Grace's guilt over James working during cancer (00:12:32) Grace's "mindless purchases" and coping mechanisms (00:15:55) The surprising reality of their financial stability (00:30:03) Contrasting money philosophies: big spend vs. small treats (00:33:45) Reviewing their Conscious Spending Plan and uncovering hidden wealth (00:46:12) The impact of fluctuating income on their financial outlook (00:55:00) Planning for the worst when they are at their best (01:00:16) James's upbringing and the origins of his money anxiety (01:11:10) Their "ice cream cone" fight and early money revelations This episode is brought to you by: Notion | Try Notion, now with Notion Agent, at https://notion.com/ramit LMNT | Get a free 8-count Sample Pack with any LMNT order at https://drinklmnt.com/RAMIT Fabric by Gerber Life | Join the thousands of parents who trust Fabric to protect their family. Apply today in just minutes at https://meetfabric.com/ramit Facet | As of the date of this recording, Facet is waiving their $250 enrollment fee for new annual members, and for my audience, Facet is offering $300 into your brokerage account if you invest and maintain $5,000 within your first 90 days. Head to facet.com/ramit to learn more about which membership option is best for you. Offer expires March 31, 2026. #FacetAd Shopify | Sign up for a $1 per month trial period at https://shopify.com/ramit Connect with Ramit • Get my new book, Money For Couples • Get Money Coaching with Ramit • Download the Conscious Spending Plan • Listen to my book—now on Audible • Get my New York Times best-selling book • Get my no-numbers journal • Other episodes • Instagram • Twitter • YouTube If you and your partner have a money issue and you want my help, I occasionally select a couple to work with, free of charge. Apply for my help here: https://iwt.com/apply

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Ramit Sethi?

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• 0:43Ramit Sethi?

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• 2:14Speaker 01

  I hide how much food I eat out. I will drive into a drive thru, buy a huge meal and eat it all. His therapist said she's shocked that he's still working with young children and cancer treatment. I was just feeling incredibly guilty.

• 2:30Ramit Sethi?

  You wrote in your application that you feel like a pressure cooker about to explode.

• 2:37Speaker 02

  What if I get sick again? They said it was going to be gone the first time when he came back. What if I can't work for another year? This time, work won't pay for it.

• 2:43Speaker 01

  I actually find it so hard to stick to the budget. I spent €200 on Timu.

• 2:49Ramit Sethi?

  On what?

• 2:50Speaker 01

  Oh, **** for me. I'd love to have a plan to not feel so terrified.

• 2:55Ramit Sethi?

  If the two of you continue on the way that you have with your money, when something comes up in life, what do you think happens the next time and the time after that and the time after that?

• 3:06Speaker 01

  Oh, I will just collapse.

• 3:10Ramit Sethi?

  Here's the scenario. Your partner is suddenly diagnosed with cancer. They have to step back from work and your household income predictably drops. On top of the fear and grief that you are both experiencing, would you know what to do financially? This is what Grace and James have been navigating. They're 38 and 37 years old. They live in Ireland with their two children, a toddler and an infant. James has been going through cancer treatment while Grace is on maternity leave. Their income has taken a hit and like a lot of couples, they're trying to figure out how to make it all work. Now, I know that a lot of people would avoid talking about money until they are forced

• 3:50Ramit Sethi?

  to, but Grace and James are doing it and they've let us look inside their real numbers. I'm opening up their conscious spending plan or their CSP. It breaks down their income, expenses, savings and exactly where their money is going. If you want my help with your own conscious spending plan, join my money coaching program at iwt.com/moneycoaching. Here's what I'm seeing in their numbers. Assets: €328,000. Investments: €79,000. Savings: €42,000. Debt: €230,000. Net worth: €290,000. Nineteen thousand, fixed costs are at forty eight percent, investments six percent, savings at forty percent, that's quite aggressive.

• 4:32Ramit Sethi?

  That forty percent savings rate tells me something is going on. Maybe they are in a rebuilding phase. Maybe they are trying to get ahead of what might be coming. It's not surprising to see a higher savings rate, given that they've been going through cancer, reduced income and having a newborn. Now, I want to hear from you. Have you ever been through a situation where your income dropped overnight? Maybe it was a health crisis, maybe it was a job loss. I want to hear from you in the comments. I want to know, what did you cut back on? And looking back, what do you wish you hadn't cut back on? I'll check out the comments later today. For now, let's get into it. Here is my conversation with Grace and James. If we just have an amazing ten out of ten conversation,

• 5:16Ramit Sethi?

  what would you walk out of here with? Why don't we start with you, Grace?

• 5:21Speaker 01

  I think I really want a game plan for how to build back up what we're currently ratcheting down on. I feel like we've had a huge, so many bumps in the road and we've done what we can, but I'd love to like, get that skyrocketing sort of like, okay, kind of a big release. I'd love to have a plan to to look towards the future and not feel so terrified. And I would love to kind of understand how I feel maybe a little bit more and why I feel like that.

• 5:55Ramit Sethi?

  Okay, James, how about you?

• 5:57Speaker 02

  Very similar with the especially with the building back up. But for me personally, to kind of really get my head and my my heart back into finances, you know, it's been very much on Grace's shoulder for the past while. And I want to be able to kind of help take some of that burden away and get myself more financially literate again.

• 6:18Ramit Sethi?

  Great. All right. Well, I'm looking forward to this. I have a lot of questions. Grace, you wrote.

• 6:24Ramit Sethi?

  My husband has cancer and I'm on maternity leave with a four month old. I feel like I'm forcing him to keep working because of our money situation. Can you tell me what you were feeling when you wrote that?

• 6:40Speaker 01

  Oh, just the horrible guilt for me. So in Ireland, we get, I'm going off the concise now. But in Ireland, we get six months paid maternity and then we get three months unpaid. And then I get an extra three months. So in all in all, it turns out to be a year. But I had been off sick and I had been on reduced hours because I just had a really rough pregnancy. So we had saved money, but not as much as I wanted. And I really, I really felt a lot of pressure to like encourage James to keep working through his treatment. His therapist basically said, um, she's shocked that he's still working with the, with the child, young children and cancer treatment.

• 7:26Speaker 01

  And when I, when he told me this, ah, the, oh my God, is that like the worst wife in the world? Like I wasn't supporting him through his treatment. I'm constantly looking at the numbers and I'm constantly like, okay, if you can keep working for another month or two, then we can put another 2,000 in savings and then that will keep us going until January. And then, I don't know. So yeah, I was just feeling incredibly guilty.

• 7:49Ramit Sethi?

  Do you still feel that way?

• 7:51Speaker 01

  Yeah, I do.

• 7:52Ramit Sethi?

  Okay. James, if you're comfortable, would you mind sharing what you're dealing with from a health perspective?

• 8:00Speaker 02

  I got cancer first three years ago. It was just a very simple mole that went funny, um, melanoma.

• 8:09Speaker 02

  They thought they'd got it all. Um, and then I found a lump in my arm of all places. And it turns out it metastasized and they hadn't caught it. So thankfully they caught it early again and surgery to remove the second site. And then immunotherapy for over a year and prognosis is looking good though, which is fantastic. I actually finished my last treatment cycle, uh, two weeks ago.

• 8:35Ramit Sethi?

  Really?

• 8:36Speaker 01

  Yeah.

• 8:36Ramit Sethi?

  Congratulations.

• 8:37Speaker 02

  Thank you very much.

• 8:38Ramit Sethi?

  Wow, that's awesome. How long have you been going through treatment?

• 8:43Speaker 02

  A year.

• 8:43Ramit Sethi?

  Wow.

• 8:44Speaker 02

  Yeah.

• 8:45Ramit Sethi?

  Okay. And how do you feel right now physically?

• 8:48Speaker 02

  Tired. It's gonna take at least three months, they said, for it to kind of fully leave my system. And then there's a lot of side effects and everything that crop up and various stuff. So I did a bit to go, but I think the big, the big kind of mental hurdle is out of the way, you know. So we are in a much better place than we were when we, when we submitted to come on the show. I'm, I'm, I'm doing great. I can't count my blessings. I'm doing really well.

• 9:09Ramit Sethi?

  I'm very happy to hear that. Very happy. How about mentally? How do you feel?

• 9:14Speaker 02

  I'm mentally much better. I've had a lot more mental space to kind of get my head around it and concentrate on getting better. I've been off work now for two, two months. My work, work had given me till the new year. Uh, then we'll reassess. Um, that has helped a lot. Um. And it's given me a lot of mental space to kind of heal. And it's also given me a lot of mental space for other things to prop up finances for one and that.

• 9:39Ramit Sethi?

  What led to the decision for you to stop working?

• 9:43Speaker 02

  Looking back, I don't recognize who I was. I was, I wasn't, I was a zombie. I was a tired husk. I was gray. Everyone used to talk about how gray I was. I wasn't really working. That's the thing. Like there had so many people covering for me doing various aspects I was doing, the bare minimum. But, you know, work gave me the option to keep working.

• 10:01Ramit Sethi?

  Why?

• 10:02Speaker 02

  Just because I thought I'd be bored.

• 10:03Ramit Sethi?

  Wait a minute. Hold on. What, where's your accent from? Are you, are you Irish?

• 10:08Speaker 02

  Oh.

• 10:09Ramit Sethi?

  I might have waded into it. Where's the accent from?

• 10:12Speaker 02

  The England.

• 10:12Ramit Sethi?

  Oh, okay. All right.

• 10:13Speaker 02

  The England.

• 10:14Ramit Sethi?

  Am I in big trouble right now? I noticed. Okay. Oh, God.

• 10:17Speaker 02

  No, no.

• 10:18Ramit Sethi?

  Sorry, everybody. Sorry. Okay, listen, the reason I'm asking is I would understand if some American, you know, born and raised in the US, all they know is work. That's our entire life. We go, what else am I gonna do? Of course I'm gonna work, but the UK excels at leisure. What's this?

• 10:39Speaker 02

  Yeah, it was money. If I take the year off, it would have to be unpaid and we couldn't afford it. We were always planning on having a second child, but our timeline massively accelerated. When the cancer came back, it was bluntly, Grace was, I might lose you. I want one more of you before you go.

• 11:00Speaker 01

  I want just a little bit more of him. I want a little bit, just in case that he vanished from my life. So that was the first thought that popped into my head. If this has come back, I don't have enough of him. I don't know if that makes any sense, but I also, we knew that he would have to have treatment and we don't know about the fertility long-term effects either. It was basically, we try now and be pregnant and have a baby while you're undergoing treatment, or we only have one child and that's it. It was really hard, but we got our beautiful second baby out of it. So she's just perfect.

• 11:45Ramit Sethi?

  Congratulations. It's beautiful.

• 11:47Speaker 01

  Thank you.

• 11:47Ramit Sethi?

  It's beautiful. And the treatment now concluding, hopefully future health. It's a beautiful end to that chapter of your life. Beautiful. Grace, you mentioned that you still feel guilty about asking James to work. Tell me more about that.

• 12:11Speaker 01

  Yeah, I feel, I feel like it made his treatment journey so much harder than it needed to be. He ended up having to go on to steroids for low cortisol and I ended up having to call the ambulance for him and, and he ended up having to go into hospital a few times.

• 12:34Speaker 01

  Probably because he was under so much pressure and he wasn't getting time to relax. And, and I think I was just expecting a lot of him, but I was also caring for a newborn.

• 12:46Speaker 01

  And you know, when the newborn came along, I just feel like I asked a lot of him and I asked too much of him and it probably did cause him harm.

• 12:57Ramit Sethi?

  Do you talk about this?

• 12:58Speaker 01

  Yeah.

• 12:58Ramit Sethi?

  Well, what's the conversation like? I'm going to imagine Grace says, I feel like I'm asking too much.

• 13:03Speaker 02

  Yeah.

• 13:03Ramit Sethi?

  And then what's your response, James?

• 13:05Speaker 02

  You know, I've never felt that. And I always tell her that she's never felt that like, you know, a lot of decisions I made around work and everything was based around my recovery. Like I wanted to keep working because it was a distraction and I thought I'd be bored. And, you know, it wasn't till I got to the very point where I couldn't, I wasn't, I was, I was probably causing work more harm than good. But I kind of said, and they were, for their credit, they were great. And it actually turns out they can, they can't give me my full salary, but they are giving me

• 13:37Speaker 02

  three thirds of my salary while I'm off.

• 13:39Speaker 01

  Two thirds.

• 13:40Speaker 02

  Two thirds, sorry.

• 13:41Ramit Sethi?

  Wow.

• 13:42Speaker 02

  Yeah, which they didn't have to do.

• 13:44Ramit Sethi?

  Yeah, that's very generous of them.

• 13:46Speaker 01

  Yeah.

• 13:46Ramit Sethi?

  Big shout out to all the companies out there. You know, we usually hear only bad things about companies, but it's quite amazing what great companies can do in tough times.

• 13:55Speaker 02

  Yeah.

• 13:55Ramit Sethi?

  It's awesome. Grace, you wrote in your application, quote, "I'm constantly saving, but then I'll blow money on silly things in a [bleep] it, life is hard moment." So.

• 14:11Speaker 01

  Yes.

• 14:11Ramit Sethi?

  What I want to know is what kind of things are you spending on in those moments?

• 14:15Speaker 01

  Oh, [bleep] Remy, absolute [bleep]. This morning, I spent 200 euro on Temu.

• 14:23Ramit Sethi?

  On what?

• 14:24Speaker 01

  Just like little things. It's all just small things. It's two o'clock in the morning. I'm feeding the child, the child's gone back to bed. I'm trying to go back to sleep. I'm on my phone and then an Instagram ad comes up and I buy skincare things for 60 euros, which doesn't even work like.

• 14:39Ramit Sethi?

  What's going through your head in those moments where you see these ads? You go on Temu and you buy, what's going through your head?

• 14:45Speaker 01

  They've got me here. I do look like crap. I am exhausted. I don't take care of myself. This is one thing I can do to take care of myself. Look at me, blah, blah, blah, blah, blah, self-care, blah, blah, blah, blah, blah, 60 euros. Here's the, oh, I can just double click. Oh, it's done now.

• 14:59Ramit Sethi?

  Hmm. It's interesting the way you describe it, like you're dismissive of it. Like you, the way you describe it is it's a con, but yet you do it over and over. Why do you think?

• 15:12Speaker 01

  I think I got a sick joy out of falling for it. Sometimes the stuff is lovely. So I'm like, maybe this time it'll be really nice, the same as the other times. But other times it is a total scam. And when I look it up afterwards, I'm like, oh, why didn't I research into this more and find out that? And like, just read the comments and read the reviews and look it up on TrustPilot.

• 15:34Ramit Sethi?

  Did you make these sort of, as you put it, mindless purchases before you had kids?

• 15:39Speaker 01

  Uh, yeah.

• 15:40Ramit Sethi?

  You did?

• 15:41Speaker 01

  Yeah, I really need to stop.

• 15:42Ramit Sethi?

  How do money decisions get made in your relationship?

• 15:45Speaker 01

  I probably make most of them.

• 15:47Ramit Sethi?

  You take the lead?

• 15:48Speaker 02

  Definitely now, yeah.

• 15:49Speaker 01

  Yeah.

• 15:50Ramit Sethi?

  And before, before James got sick?

• 15:52Speaker 02

  Like, we would do weekly budgeting and stuff like where every Sunday we would sit down together when the kids were asleep. And we would kind of look over, we'd have kind of a set budget of what we'd normally spend. And we'd go through the calendar, but then mentally I could just couldn't take it. And Grace kind of took it, took it all, and she still does now.

• 16:11Speaker 01

  Yeah.

• 16:12Ramit Sethi?

  That's, all that seems very reasonable, by the way. Much more advanced than most to sit down and talk about money every week. So that's great. The fact that as you got sick, James, you had to give up on participating in that also seems totally normal. And the fact, Grace, that you took the load on yourself seems like great partnership.

• 16:33Speaker 01

  Yeah, I think we had a good system going into it because I had been doing a lot of the envelope system. And I just really liked watching the videos and I was like, ooh, I could do that.

• 16:42Ramit Sethi?

  Hold on, what, what videos did you like watching? Who watches envelope videos? What?

• 16:47Speaker 01

  Stop, it's addictive.

• 16:49Ramit Sethi?

  What are these videos? That's what I want to know. What are they?

• 16:51Speaker 01

  It's people being like, I'm going through my budget for the week. And it's like, I just love watching other people's money. Like, I love your show.

• 16:58Ramit Sethi?

  I know why you love my show. I get that. Good.

• 17:02Speaker 01

  But it did help because I set up a whole sinking fund system. So I have automatic money going to, so we have basically a year's worth of the big bills always pretty much saved. And that's automatic. So we had a good system going into it. So it wasn't like too much of a big deal to take it on, James. Don't, don't be worrying about that.

• 17:22Ramit Sethi?

  I'm impressed with Grace's knowledge about money. She's obviously taken the time to be curious about personal finance. And it shows when she talks about having an emergency fund or as she puts it, a year's worth of big bills saved up. But I'm struck by the way she describes her feelings around their financial situation. Remember, Grace said she feels guilty for, quote, "forcing James to keep working" because she was nervous about their financial situation. James isn't working anymore, but she still feels guilty. And now, even though she's worried about money, she'll go and mindlessly spend $200 on Timu at 2:00 a.m. It's all a bit contradictory. Those mixed signals tell me there's something going on here, something deeper she has not worked through yet.

• 18:06Ramit Sethi?

  And you can hear it in this one moment. She said, "I might lose you. I want one more of you before you go." Can you imagine your partner saying that? Can you imagine feeling that way? There are a lot of layers to unpack here. We're not just talking about a savings rate. We're talking about mortality and love. And we don't even know what's going to eventually happen. So, listen as I gently probe Grace about this explosive line from her application. Grace, you wrote in your application that you feel like, quote, "a pressure cooker about to explode." What do you mean by that?

• 18:46Speaker 01

  Having the sole responsibility of organizing the money and, you know, putting it where it needs to be, it feels just a huge amount of pressure. And then, just the thought of not having any money coming in with the maternity leave, and then things are just a little bit complicated. And, you know, I'm looking at all the small, fine points and like hoping they all slot together. And if they don't, then, oh, I don't know, I might explode. And I tend to get quite cross. And I think that's why I was putting a lot of pressure on James as well, to kind of keep working as well, because my systems don't work if the money's not there.

• 19:30Ramit Sethi?

  Right.

• 19:31Speaker 01

  You know, if the money's not coming in, everything could fall apart.

• 19:35Ramit Sethi?

  When you would put the pressure on him, as you put it, how would you do that?

• 19:38Speaker 01

  I think I would gently prompt. You were having surgery in September, and you took the month leading up to it off.

• 19:44Ramit Sethi?

  Oh, yeah.

• 19:45Speaker 01

  That really, really stressed me out, because I was like, "You are gonna need a lot more time off than this. We can't have this." Because, yes, we get sick leave here in Ireland, you know, we get sick pay, but we only get a certain amount of it and you're gonna need a lot of it and then we're not gonna have the money. So I remember having this discussion with you about that.

• 20:08Ramit Sethi?

  Do you let James know?

• 20:10Speaker 01

  Yeah.

• 20:11Ramit Sethi?

  You tell him, we can't do this, what about that?

• 20:14Speaker 01

  I, I, I, yeah, so I try and like lay it out and say, oh, well, I'm worried about this. And then James is like, well, I need to take it off. So he took it off and I was like, okay. Um, but then I would like, hold on to it, hold on to it. And then like, it would burst out of me again a week later being like, are you sure? You can't go back to work right now and, and, and work for another week.

• 20:35Ramit Sethi?

  And what did that dynamic feel like when the two of you were having this in the thick of cancer treatment?

• 20:41Speaker 01

  I was feeling so stressed. I was feeling like there was a baby on the way. I was, I knew I was gonna start feeling sick really, really soon. So I was trying to do all of my overtime really early on. So I could like do nights and do this before my sickness started and I had to stop working. So there was such a time limit and I just felt like, you know, he, he just needed to push through like I was pushing through.

• 21:09Speaker 01

  And he, he wasn't.

• 21:11Ramit Sethi?

  And James, how do you feel when Grace would share this with you and feel anxious and stressed out?

• 21:18Speaker 02

  Maybe like, you know, it was, I felt selfish because remember at this time he was a toddler as well, you know, she, Oh, yeah. She was two and so we weren't sleeping, you know, we were trying to, you know, raise her at the same time. And it's just so much, so much pressure. Yeah, she would every now and then she would explode like that and she'd come out and admit it. But then, you know, between those, there was lots of little, um, microaggressions, I guess you'd call them and that, you know. But for her, it was very, Grace is very practical in every sense. Like you should see our cupboards are full of jam and pickles and canned tomatoes and stuff that she would, she would find farmers, you should go to the market, the veg market at the end of the day,

• 22:03Speaker 02

  wait till the very last where the farmer had whatever X amount left. Haggling down, buy it all, spend a whole day chopping and then we'd have just loads of cast off. So the idea was that if everyone tits up, we'd have, you know, food. And then that was so stressful for me because I would, you know, I've come back from treatment or I would be have a bad week or something and I would have to take the full responsibilities, parenting and work and everything because Grace was in this manic mode of we have to have, you know, 17,000 tins of tomato, just in case.

• 22:41Ramit Sethi?

  This is a very good example. Um, what do you make of this example now that you are looking back?

• 22:48Speaker 01

  I'm really ashamed, actually.

• 22:49Ramit Sethi?

  Okay, why?

• 22:50Speaker 01

  I think I was just trying to do something to control the situation and like try and preserve, you know, something for the future. The future was so uncertain that I just, I felt like I needed to at least feed my family.

• 23:04Ramit Sethi?

  Yes. Wow. Layers of perception in your answer just now. I feel ashamed. I love the acknowledgement of how you feel. That's powerful. The need for control. I totally agree. Because if you look like going and waiting and haggling with the farmers and then, and then finally, this idea of at least I'm feeding my family. I can't fix what's going on with my husband's health. Work is work. I'm trying to get as many hours as I can in before I get sick. I'm pregnant. I got a little one. But what can I do? Feed my family.

• 23:42Speaker 01

  Yeah. And I would spend hours and hours and hours meal prepping and having food there. And I don't know if it actually made any difference.

• 23:53Speaker 02

  It really did. It still does. We still got loads left. Yeah. When she was towards the end of pregnancy, it was starting to get bad for her and I was kind of having to, regardless of how I felt or how I was feeling, I had to look after the toddler. I had to feed Grace and, and it just made life so much easier that I could just, you know, take a, a kind of a pre-made glass jar of peppers and tomato and stuff and throw it in with some rice and a bit of chicken or something, you know?

• 24:17Ramit Sethi?

  Wait, was it a good decision or not? I'm trying to figure it out now.

• 24:19Speaker 01

  I don't know. I think that we also could have just bought, bought it.

• 24:24Speaker 02

  It could have saved ourselves so much stress.

• 24:26Ramit Sethi?

  Let me say this. First of all, do you know how much you have been through as a family? It's a lot. Have you grappled with that? Have you talked about that?

• 24:35Speaker 01

  People say it to me all the time and I'm like, oh yeah. But like, you just have to do it. There's no other option and you just have to keep going.

• 24:44Ramit Sethi?

  That's exactly what my mom said. I asked her, how did you stay married for so long? And how did you raise all these kids? And, and her answer was, there's no other choice. You just do it. And I love that answer. I respect that answer. And I think that maybe when we have that approach, we also don't take time to pause and grapple with the enormity of what we have done, what we have accomplished, what we've gone through.

• 25:14Ramit Sethi?

  Exactly. Grace, as I just saw you take a deep breath. I think that many of us are raised to like, what do they call it? Stiff upper lip. Look forward, check the box. And I agree, there's power in that. But there's also power in the softer side of saying like, hey, have we actually talked about what we went through? What did it mean to us as a family? Because trust me, two powerful things are going to come out of that. One, you're going to gain a deeper appreciation for each other. This tomato example is actually much deeper than either of you are letting on. There's something really beautiful and something really haunting about this example to me. The idea that, Grace, you just want to feed your family.

• 25:58Speaker 01

  Yeah.

• 25:59Ramit Sethi?

  Let them know you're going to be there. And it doesn't matter that it took hours. It was irrational to spend that many hours, but you still did it. And, and yet there's something that perhaps is not that adaptive to your situation. The idea that you were a very, very busy, pregnant mom, and you were spending hours. Why? If you look at it that way, it doesn't make mathematical sense. So there's something beautiful. That's the first thing you're going to get out of is an understanding of what actually happened. Most of us never pause and look back, so we just keep marching forward. The second thing it's going to do is the two of you talking about it is going to allow you to create stories for your family. Your kids need to know this story.

• 26:44Ramit Sethi?

  They need to know it. Just the same way your parents pass down their stories, your kids need to know what the two of you did. And how can they learn if the two of you have not decided what happened? You know, you have to feel for Grayson James. They have had a really tough few years and my heart goes out to them. One thing that makes it all a little bit more bearable is where they live. In Ireland, there are systems in place that help people when things go wrong, especially when somebody gets sick. Of course, it's not perfect, but it is a safety net that works. Like when James got cancer, they didn't have to worry about going bankrupt on top of everything else they were experiencing. Now compare that to what we deal with here in the U.S.

• 27:25Ramit Sethi?

  In 2024, 31 million adults incurred medical debt totaling $74 billion. And the American Journal of Public Health found that roughly 2/3 of people that filed bankruptcy say that medical bills and illness-related income loss contributed to their bankruptcy. This is why I always shake my head when people tell me in my comments, "Stick to personal finance, don't bring politics into it." That's like me telling you, "Keep ingredients out of cooking." You cannot separate the two things, just as you cannot separate money from politics. Politics is why your healthcare is so expensive. It's why millions of Americans couldn't even get health insurance before the ACA, also known as Obamacare. And it explains a lot of why people declare bankruptcy

• 28:10Ramit Sethi?

  rather than the common belief that people bought too many luxury cars they couldn't afford. I want you to be able to know that if something horrific happens, like a car accident or a cancer diagnosis, that you will be taken care of and you won't lose your house. That is where I stand politically and that is what I stand for. After this break, we're going to learn more about their individual relationships with money. Now, are the two of you similar in the way you think about money? Or do you think about it differently?

• 28:41Ramit Sethi?

  Wow. Okay. I already know the answer based on James's smile. James, go ahead.

• 28:45Speaker 02

  In some senses, I think we are quite, I think, kind of big picture stuff. I think we're quite very similar.

• 28:50Ramit Sethi?

  Just tell me the differences because neither of you believe you're similar. I can tell by your faces. Tell me, James.

• 28:55Speaker 02

  If she has fun money, whatever, she'll spend on little things. I'm more of, if I buy something, I'll probably buy something big, maybe once a year.

• 29:04Ramit Sethi?

  What's an example of a big thing once per year?

• 29:07Speaker 02

  My watch broke a year and a half ago and I finally replaced it.

• 29:10Ramit Sethi?

  How much did it cost?

• 29:11Speaker 02

  Four hundred euro.

• 29:13Ramit Sethi?

  Okay. All right. And Grace, how would you describe your relationship with money?

• 29:18Speaker 01

  So I save first. I always put as the max amount that I can think to save. I earn a little bit more than James, so I always have a little bit extra. So I think, oh, well, I can spend the rest of it now.

• 29:33Ramit Sethi?

  And when the stress goes up, whether through James's illness or having kids, does anything change in your relationship with money?

• 29:45Speaker 01

  I think I spend more and I wouldn't really tell James too much about it.

• 29:50Ramit Sethi?

  What do you mean?

• 29:51Speaker 01

  I suppose I do hide a little bit from him.

• 29:54Ramit Sethi?

  Like, what's an example of something you have hidden from him?

• 29:57Speaker 01

  I think I hide how much food I eat out when I'm out and about. I'll often get absolutely ravenous when I'm out doing jobs or I'm like taking the girls to events or whatever. I'll be so hungry and they'll both be asleep in the car and I will drive into a drive through and buy a huge meal and eat it all on the way home. But I don't know. I think I got a bit of a weird thrill out of hiding little small things.

• 30:24Ramit Sethi?

  Do you take the bag and throw it outside before you go inside?

• 30:27Speaker 01

  Yeah, I do.

• 30:28Ramit Sethi?

  How old are your kids?

• 30:29Speaker 01

  Our eldest is three and our youngest, well, we only have two, but she's six months.

• 30:35Ramit Sethi?

  Six months. Okay. All right. All right. All right. What would you say the primary thing that changed financially speaking was when you had kids?

• 30:45Speaker 02

  Well, obviously childcare costs, which are not under absolutely, I think, astronomical now.

• 30:51Speaker 01

  Well, they're nowhere near what it is in America, James. It's.

• 30:55Ramit Sethi?

  Where is? Just say the number so everybody in the US can get it. Go ahead.

• 30:58Speaker 01

  Oh, don't get angry at us. I'm sorry.

• 31:00Ramit Sethi?

  It's gonna happen. What is it?

• 31:01Speaker 01

  Three hundred, three hundred and fifty-five.

• 31:06Speaker 01

  Per month.

• 31:07Ramit Sethi?

  Okay, Americans, go ahead. Roast them.

• 31:10Speaker 01

  A little bit of socialism for you. The government pay 25% of it.

• 31:18Ramit Sethi?

  God, this country is so sometimes. I'm sorry, parents. I just want everybody to understand because I don't think people actually know.

• 31:25Speaker 01

  No, they don't.

• 31:26Ramit Sethi?

  How policy affects their actual finances. Things like childcare. The government can assist with those. They can subsidize them. Maternity and paternity leave. Taxes, yes. Many other countries charge equivalent or higher taxes. But imagine getting subsidized childcare, paternity and maternity leave, the ability to get healthcare and not have to worry about $78,000 bill and on and on and on. Of course, there are trade offs. Of course, there are trade offs, but just want everybody to understand when we're sitting here looking at these numbers, these numbers are not just picked out of thin air.

• 32:05Ramit Sethi?

  They are the result of who we voted for, the result of our political systems, the result of what our culture will put up with. So anyway, I appreciate you all coming here. In fact, now that we're talking about it, why don't we take a look at the actual numbers?

• 32:19Speaker 01

  Yeah.

• 32:19Ramit Sethi?

  All right. What was it like to do this conscious spending plan together?

• 32:23Speaker 01

  Oh, I loved us. Oh, I love us.

• 32:26Ramit Sethi?

  All right. I know that. James, what about for you? Jim got a weird look on his face like, oh, God.

• 32:30Speaker 02

  It was surprising how off I was. Okay, I was off and normally I'd be able to tell you off that what we make and what we spend and everything, but I was quite a bit off. And then I literally a year, a year, less than a year away from it. And I was, the numbers have changed and I was didn't know what.

• 32:48Ramit Sethi?

  Wow. Now, can I ask you, were you off because you forgot? And or were you off because the numbers have changed so dramatically in the last 12 months?

• 32:58Speaker 02

  A bit of both. Wage wise, I got that right. I thought we were making a lot less than we were. And then the savings, I didn't realize how much we were actually putting in. I didn't realize we had so much.

• 33:09Ramit Sethi?

  Ah, okay. Wow. Great. Well, let's take a look. I think this is a great lesson for all of us is that knowing your numbers is a skill. And if you stop looking at your numbers, which in your case, it makes perfect sense why you did. Somebody gets sick, they have cancer, they're going through treatment. Of course, they're not going to be sitting there looking at their CSP every week. But it just simply shows us this is a skill and the more remove we get, the more we lose touch with it, but we can also get back in touch. All right, let's take a look. Okay, um, let's see. James, can you read the word in bold? And then the number in full next to it for this entire box, please.

• 33:47Speaker 02

  Yep. So assets, three hundred and twenty eight thousand. Investments, seventy nine thousand, savings, forty two thousand and debt, two hundred and thirty thousand. The total net worth of two hundred and nineteen thousand.

• 34:01Ramit Sethi?

  Great. What do you think about those numbers?

• 34:02Speaker 02

  Great. In my head, if I took three months off, we wouldn't be able to pay the mortgage and we would be at money and we'd be on the streets.

• 34:11Ramit Sethi?

  And obviously that has not come true.

• 34:13Speaker 02

  No.

• 34:14Ramit Sethi?

  Hmm. What do you make of that now in retrospect?

• 34:17Speaker 02

  I think a lot of it was psychological for what I was going through. You know, the idea of it's that whole kind of be provider thing, even though I make a little bit less than that, it's still there's still that kind of holdover of being the man of the house type thing, you know?

• 34:31Ramit Sethi?

  Yeah.

• 34:31Speaker 02

  And we've always talked about how, because Grace's wage is kind of set, she's hit her max really, because the HSE in Ireland is a set wage band, so she can't really go any higher without moving jobs or being promoted. Whereas obviously I, being in the private sector, I have a much more higher threshold that I can reach. And we always talked about before, while I was starting out, Grace was kind of up here already. That eventually I would catch up, which is kind of where I am now. And eventually I would overtake her. So she would be able to kind of drop down to maybe part time or just nights and on call and everything. And I'd be able to pick up the difference. And that's always kind of been in my mind a little bit. And I know in the grand scheme of things, like it's a year, less than a year that I'd be off, you know, I'm going to work until for

• 35:15Speaker 02

  another 30 odd years, whatever. But it still felt like it was a massive setback.

• 35:19Ramit Sethi?

  It's quite perceptive. The idea that, first of all, congratulations for talking about. That is very rare. The fact that two people would look as objectively as possible at their careers and say, okay, here's where you are. Here's where I am. Based on our trajectory, there'll be a certain point where we're going to intersect and then I'm probably going to make more. That's very forward looking. I wish everybody had those type of conversations. So, well done. And then, this is the hard part. You make a plan, and then life gets in the way. And something goes awry. Family happens. Illness happens. Layoffs happen.

• 36:02Ramit Sethi?

  Whatever. And I know because when I make a plan, I want that plan to happen. Like, if I tell you I'm going to be somewhere at six, I'm going to be somewhere at six. And if somebody goes, oh, let's actually switch it to 6:45. I'm like, ah, it's annoying. And I've had to train myself like it's not the end of the world. But given my own planfulness, I just want to follow the plan. And I see a bit of that in you, James. Even though, when you look at the numbers, you realize it certainly did not put you on the street. Not even close. Okay. I think this is such a valuable lesson. I'm really thankful that

• 36:45Ramit Sethi?

  you're sharing with all of us. The idea that if I don't get this plan exactly right, I'm a failure. But what I can actually see from the two of you is the two of you working as a team. In any given time on a team, someone is stronger, someone is less. Someone may be injured, someone is picking up the slack and it rotates and that's, that's a team. And teams also are not only rated on how much money they make. And a lot of men look at themselves like that. It's not just that we absorb the lesson that we need to be providers. We actively encourage it. It's like, if I'm not making money, who am I? There are lots of ways to contribute to a relationship beyond making the incremental dollar. Grace, what did you think about those numbers?

• 37:28Speaker 01

  When we first got pregnant, we had to stop. I was putting, well, we were both putting 500 euro into like a long-term savings or like a long-term investment fund and we had to stop that. So we haven't done that in like three years and it's actually killing me not to have, not to be doing that, but we just can't really afford it now. And I'm really glad we didn't because we didn't have to take it out then to cover this situation. But I would love for those to be higher. It's making me a little anxious, but I am really delighted. Like I didn't expect it to be that big either.

• 38:03Ramit Sethi?

  Take a look. Investments are 79,000.

• 38:06Speaker 01

  Oh, oh gosh, actually that's including our pensions. So yeah, and then our savings is separate.

• 38:11Ramit Sethi?

  Just say that word again for all the Americans who have never heard it again. Just say it, was it?

• 38:15Speaker 01

  Pension, pensions.

• 38:19Ramit Sethi?

  All the boomers on the call, by the way, they're like, what are these guys talking about? I have a pension. My pension pays me 130% of my income. What are you talking about? Everybody has a pension.

• 38:28Speaker 01

  Oh.

• 38:29Ramit Sethi?

  All right, let's continue on. Grace, will you read off your combined gross monthly income? What's that number?

• 38:38Speaker 01

  9,000.

• 38:39Ramit Sethi?

  Okay, 9,000 bucks or 9,000 euros. I'll just call it dollars for easy.

• 38:44Speaker 01

  Yeah.

• 38:45Ramit Sethi?

  9,000 bucks, which means that combined the two of you make 108,000 dollars per year. By a show of hands, who knew that number? Okay, only Grace has her hand up. Thank you very much. All right. Thank you for continuing my statistic. 50% of people do not know their own household income. And James, you thought it was lower? Okay, let me, just for kicks, how much did you think it was?

• 39:09Speaker 02

  Eighty-five.

• 39:10Ramit Sethi?

  Eighty-five thousand, it's actually a hundred and eight thousand. So now that you're making like tens of thousands more than you thought.

• 39:17Speaker 02

  Yeah.

• 39:18Ramit Sethi?

  Do you feel any differently?

• 39:20Speaker 02

  No, because it doesn't feel like enough.

• 39:22Ramit Sethi?

  You know what? Let's change the name of this show. Forget Money for Couples. Let's just call it Ramit Was Right. That's it. That's what this entire show ends up becoming. Nobody knows their income, at least 50% don't. Then they go, if I made more money, I'd feel better. Then they make more money, then they don't feel better, and on and on and on. I'm gonna tell my producer right now, we're gonna switch the name of this show. All right, a hundred and eight thousand, what do you think about that household income?

• 39:46Speaker 01

  To be honest, Ramit, it's more because I didn't include any of my overtime, which is normally an extra 10 to 15K.

• 39:54Ramit Sethi?

  Wow.

• 39:55Speaker 01

  Which is where all the savings comes from.

• 39:57Ramit Sethi?

  That's great. Okay, so let's put, let's put a pin in that, so it's even more than that. And how do you feel about that overall household income?

• 40:03Speaker 01

  To be honest, really good. It's, it's not a very common wage to get in Ireland at all.

• 40:08Ramit Sethi?

  You make more than the average?

• 40:10Speaker 02

  The average is about 60,000, mind.

• 40:12Ramit Sethi?

  Okay, wow, great. And James, it sounds like you feel good about the income as well.

• 40:17Speaker 02

  Yeah, 100%. And then, then you get the whole, oh, you feel so guilty because you look at it and you think, God, you know, we're doing so much, we're doing really well compared to so many people. And so you feel like you can't feel bad, you can't feel guilt about, you can't feel that, oh, I need X amount or Y amount, you know, because you should be, you should count your blessings on what you have, you know?

• 40:37Ramit Sethi?

  Well, I will say that's one of the reasons that I really love speaking to guests on this show, that until now, all of this has felt like it has to be shrouded behind closed doors, you know? There are people making considerable incomes and they're just like, why do we feel behind? Why can't we actually save as much as we thought we would making six figures? And until now, you couldn't really talk to anyone about it because it's like, boo hoo, wealthy people, shut up. But I actually think that there are some legitimate questions. And sometimes people don't realize that their childcare costs are temporarily very high, or they have not actually been automatically investing, and that's why they have no investments.

• 41:20Ramit Sethi?

  So I'm grateful that we get the chance to talk about them. I do have a question about the incomes. James, I believe your income was reduced. Is that reflected on the CSP?

• 41:33Speaker 02

  No, that's if I was in full wage.

• 41:35Ramit Sethi?

  So can we update it to reflect what you currently make?

• 41:40Speaker 02

  Mine's a thirty five, so mine be, um.

• 41:45Speaker 01

  Probably two ten, something like that.

• 41:47Ramit Sethi?

  Twenty one hundred?

• 41:48Speaker 01

  Yeah.

• 41:48Speaker 02

  Twenty one hundred.

• 41:49Ramit Sethi?

  Okay, twenty one hundred instead of thirty five hundred for gross? And then what would that take your net down to ballpark?

• 41:55Speaker 01

  One five, probably, one six.

• 41:57Ramit Sethi?

  All right, let's say that. Okay, wow, so quite a considerable difference. What just happened was your fixed costs jumped from forty eight percent to fifty eight percent. So just for some context, your fixed costs originally were forty eight percent, which is at least for the US, quite low. And it jumped to fifty eight percent because of the reduction in net income. Still, not bad, not bad at all. Why don't we continue on and go down the rest of the numbers here? We are, we're gonna.

• 42:28Speaker 01

  Can I add something, actually? As of this month, I am making two hundred and eighty euros a month. So I have gone from full maternity pay, which was my five fifty, to zero. So I have three months unpaid currently and then we get a child allowance of two hundred and eighty euros a month. So we are currently on zero money coming in from me for the next three months.

• 42:54Ramit Sethi?

  And then what?

• 42:55Speaker 01

  And then it goes back up to five fifty and then I go back to work.

• 43:02Ramit Sethi?

  Just so everybody knows, when she says five fifty, the way we say it is five thousand five hundred, just so everybody.

• 43:06Speaker 01

  That's what I meant to say.

• 43:07Ramit Sethi?

  That's totally fine. All right, you have a temporary reduction to essentially zero for three months.

• 43:13Speaker 01

  Yeah.

• 43:14Ramit Sethi?

  Okay, I'm gonna, I'm not gonna reflect that on the CSP, but I'm gonna put a pin in that. And I'm also gonna put a pin in the fact that you make approximately ten to fifteen thousand dollars more in overtime, which they sort of equal out.

• 43:28Speaker 01

  Yeah, yeah.

• 43:29Ramit Sethi?

  Right? That's why I'm just gonna, they're a wash and it will just confuse things, so we just put them to the side.

• 43:33Speaker 01

  That's fair.

• 43:34Ramit Sethi?

  Can you confirm that you will be going back and making the same wages after three months?

• 43:41Speaker 01

  When I go back to work in April, I'll be working four days a week and then doing one or two overtime shifts, which will get me back up to that

• 43:48Ramit Sethi?

  Great.

• 43:49Speaker 01

  That level.

• 43:50Ramit Sethi?

  What I want to reflect for everybody listening and watching is when we are living this, we get caught in the weeds necessarily. It's like this thing is happening, but in June, it's going to be this and then it changes after two weeks. It's very, very detailed. That's how we have to live our lives. What the CSP allows us to do is to zoom up and focus on the key levers. Like in the grand scheme of things, having a three-month reduction in wages for one person, even though it seems extreme, actually doesn't even need to be reflected on here because we have the overtime. So you can basically say it's a wash. We can get a little bit more precise, but in general, it's a wash. And that allows us to focus on the big picture. For so many of us,

• 44:31Speaker 01

  Yeah.

• 44:31Ramit Sethi?

  we immerse ourselves in the weeds and we get paralyzed. And it is imperative that we zoom up and look at the big picture. You can just focus on the key levers, get 85% of the way there, and in most cases, move on with your life. So we're going to keep it as is. We're going to continue moving down that CSP. We got 58% on fixed costs. What's the percentage on investments? Can you read that number?

• 44:56Speaker 01

  Seven percent.

• 44:57Ramit Sethi?

  Seven percent. And that is in addition to a pension?

• 45:00Speaker 01

  Yes.

• 45:01Ramit Sethi?

  Okay, uh, seven percent or $380 a month. Savings? Whoa, what's that number?

• 45:07Speaker 01

  Forty-nine percent.

• 45:08Ramit Sethi?

  Forty-nine percent. You American freaks complaining you can't save 4%? Forty-nine percent! I'm coming back to that category. Oh, wait, wait, wait. That, hold on. Before I get too excited, what's this number under guilt-free spending?

• 45:23Speaker 01

  Oh, yeah, minus 14%.

• 45:25Ramit Sethi?

  Negative 14%. Alright, so obviously the [BLEEP] is all [BLEEP].

• 45:27Speaker 01

  No, it's messed up.

• 45:28Ramit Sethi?

  In general, I can see what your priorities are. And I love that. A CSP is the fingerprints of your life. If you looked at my CSP, you'd be like, this [BLEEP] guy likes to travel. Like, it's very clear. Okay? But what I can see here is you like to save money. It's very obvious. Even if the math isn't quite right, we'll fix that. I can see what is important to you. When you look at the CSP, what do you notice? Grace first, then James.

• 46:01Speaker 01

  I think that it's off because I, I basically put all of my overtime into savings and it's normally about 2,000 a month extra.

• 46:09Ramit Sethi?

  Why do you do that? Just out of curiosity.

• 46:10Speaker 01

  Because I want to, we're saving for a lot of things. We're saving for a renovation on the house, but I'm also really, really keen on saving for owning a house. There's always stuff that comes up, so I'm trying to make sure that we're saving into high yield savings and also an emergency fund.

• 46:35Ramit Sethi?

  Sometimes people save money purely out of fear. It's what they were taught. They're afraid. All they know is frugality, which in their mind is seen as, I gotta save and essentially hoard. And you can tell because when you ask them, why are you doing that? They just go like, well, you never know what could happen. And it just, it traces back to something their dad said when they were five. What you have told me is, look, I have plans. Forward looking, we're saving for the house, we're saving for this, we're saving for that. That's actually very important because what we do is determined by why we do it.

• 47:15Ramit Sethi?

  And if your reason is, hey, I have key things that we are saving for as I can see in your CSP, then it becomes more constructive. It's not simply done reflexively out of fear. Under your savings category, you have vacations, 100 bucks a month, gifts, 50, house renovation fund, 1,000 a month, long-term emergency fund, 1,000 a month, and sinking funds, 558 per month, for a total of $2,708. Now, it's quite interesting because you have 13 months of savings already. Were you aware of that? Wow, look at Grace's proud laugh. Tell us, Grace, how do you feel right now?

• 47:54Speaker 01

  I feel great.

• 47:57Ramit Sethi?

  Did you know that?

• 47:58Speaker 01

  Yeah.

• 47:59Ramit Sethi?

  You did?

• 47:59Speaker 01

  And I've actually stopped putting it into the long term emergency fund and I'm putting it into sinking funds now instead. Now that we've gone and got that year of savings, um, I want to start putting it into the investments again.

• 48:15Ramit Sethi?

  All right. James, what do you think when you see this conscious spending plan?

• 48:18Speaker 02

  I honestly don't know. I couldn't, I couldn't believe it. I don't trust investments. I don't trust banks. I don't trust stocks. But at the same time, I was like,

• 48:30Speaker 02

  it's like I should feel good. And then like I get so annoyed at myself. I'm like, why am I not happy about this? This is incredible. You know, why? Why am I still so nervous about this? This is, you know, the fact that we could, I can go down to his wage and Grace can have their wage and we're going to be absolutely fine.

• 48:49Ramit Sethi?

  Yeah.

• 48:49Speaker 02

  I mean, that's incredible. How many people can say that? Honestly, like, and yet it still doesn't register really for me. It's weird.

• 48:58Ramit Sethi?

  How connected do you feel to these numbers when you see them?

• 49:01Speaker 02

  My whole wage goes straight into the joint account. Uh, why I had, why I need to cover my bills and that pays for the kid's school mortgage.

• 49:09Ramit Sethi?

  Wait, wait, wait, wait. I'm not asking about how the money flows. I'm asking, how connected do you feel to these numbers?

• 49:18Speaker 02

  It doesn't feel like it's my, my, my money.

• 49:21Ramit Sethi?

  That's what I thought. What do you think was behind your answer where you started to give me all the money flows just now?

• 49:26Speaker 02

  Cause literally I get my paycheck. I move over X amount to my joint account and then that's it. It disappears. And then we have savings and we have sinking funds and we have roof over our head.

• 49:38Ramit Sethi?

  Yeah. It's just like mechanized. It's like, it's like asking like, how do I feel about the way that a car turns on? I don't know. I just get in there and turn the thing and it turns on. I don't feel any way. It just works. It's a machine. Just to give you a point of comparison, when I see our numbers, I feel extremely connected to them. Not that I love looking at numbers. It's not that. It's that when many people see a spreadsheet or an investment portfolio, they see some zeros and sometimes they see their own failure. They will see things like I should have started early, et cetera. When I see it, I see the ability to take a trip.

• 50:24Ramit Sethi?

  The ability to not have to look at prices if we eat out once in a while. I see the ability that if somebody in our family needs help, we can help them. It's much deeper than the numbers. It's about the kind of rich life that we want to create for ourselves. So if I can ask you just for a second, James, to put on those lenses of not the logistics and the money flow, I get that, but rather what the money has allowed you to do, what do you see?

• 50:53Speaker 02

  If I look at them honestly, we are, and we are creating a life for our kids that I never had. I remember I filled the car up, oh, without paying attention. I just paid it. Didn't have to look at the price, which had a full tank of gas and I paid it because I do, I could afford it. And I got back in the car and I was just like, it kind of just struck me like, you know, that's,

• 51:20Speaker 02

  you know, you don't, I didn't, I didn't look at how much that diesel was for that particular gas station. I just pulled in because I needed it. I didn't go down to the cheapest one, which was a bit further down the road, you know, just filled up till it stopped and I paid it and I drove off.

• 51:34Ramit Sethi?

  What did it feel like?

• 51:35Speaker 02

  Freedom.

• 51:36Ramit Sethi?

  Freedom. What a beautiful example. Freedom is in the simplest of things. It's in filling up gas. It's in going to the grocery store and buying something because you can.

• 51:48Ramit Sethi?

  It's rarely about the fanciest vacations and flying on first class. It's, it's literally about being able to go to the restaurant and get a lemonade because your kid asks you for one.

• 52:02Ramit Sethi?

  It's a beautiful example. James, this is part of what I want us to be able to do is yeah, of course, we're going to analyze the numbers a little bit more, but actually to, to go way deeper beyond the math and to say like, what does it mean? Grace, I see you reflecting on what you just heard, James. What's going through your head right now?

• 52:22Speaker 01

  I just, I'm just really proud of us. I'm just so glad that all the work that we've been doing and all the work that I've been doing to kind of automate and make sure that our family's safe and happy that it's working and you feel great. Um, that's so nice.

• 52:38Ramit Sethi?

  I love this and big kudos to you, Grace, for picking up, picking up the load. When James had to focus on his own health and for you continuing. And I have to say on a personal level. One thing that really impresses me is that you made trade offs. That's not easy. You said, we're going to stop contributing to our investments, even though as you put it, it kills you.

• 53:02Speaker 01

  Yeah.

• 53:03Ramit Sethi?

  That's what a leader does. You said, look, I have to take over this decision making right now. My husband is sick.

• 53:11Speaker 01

  Yeah.

• 53:11Ramit Sethi?

  And we did it. So I, I think the two of you should be commended. That's true teamwork. It's awesome. You know, what's interesting is maybe today is a chance for the two of you to really take a second, celebrate how far you've come and then to reflect on the next chapter.

• 53:30Speaker 01

  Yeah, yeah.

• 53:32Ramit Sethi?

  We can't stop bad things from happening. That's life. But what we can do is make a few smart decisions when things are going well. So that when something unexpected happens, we can lean on our planning. In other words, we can plan for the worst when we are at our best. I have a friend, just the other night, she got a note that her mom is sick. Her mom lives in a different country. She had to get on an international flight last minute. She booked the first ticket she could get her hands on. She didn't check 20 different prices to get the best deal. She just said, I have to go now. And that is the level of focus I want you to be able to have in a crisis. To be able to say, I don't care about anything else right now. My field of vision is narrowed to the one thing that matters, getting on the next flight.

• 54:17Ramit Sethi?

  Money is not my primary concern. I actually love this idea. Of money not being the primary determinant. I love it so much that I extended it to a personal money rule that I use for myself. Not just for bad things, but also for good things. So my personal money rule is that for the big, important things in my life, I'm gonna plan ahead so much that money is not gonna be the first concern, the second concern, even the 10th concern. And that includes our wedding, our honeymoon, housing, and our health. Is this rule practical for most people? No. Is it right for me? Yes. That is the point of a rich life, which fits you like a bespoke coat. It is meant for you to live your rich life.

• 54:59Ramit Sethi?

  And the more you turn that dial, the more your rich life is increasingly confusing, even bewildering to other people. Now, the simplest way to start applying this concept of freedom when something bad happens is to start aggressively building your emergency fund. So when something bad happens, and it will happen at some point in your life, you will be ready. And money will not be your first concern. Now, for James and Grace, they made a series of money decisions during their journey. These decisions were not arbitrary. They were shaped by what they saw growing up. And we're gonna get into that right after this break. I do wanna know a little bit about how you grew up with money. James, I'm very interested. Just from what you told me about your gas, I have my suspicions about how you grew up.

• 55:44Ramit Sethi?

  But what do you remember your family saying about money when you were young?

• 55:48Speaker 02

  I've never really talked about it at all. We always had enough, as long as we had enough. We shouldn't grumble. You know, we had food.

• 55:56Speaker 01

  Mustn't grumble. That's very English.

• 55:58Ramit Sethi?

  Is that right?

• 55:59Speaker 01

  Oh, yeah. Mustn't grumble. Stiff upper lip, you know, mustn't grumble.

• 56:04Ramit Sethi?

  And would you say, how would you describe socioeconomically, were you middle class? How do you describe that?

• 56:10Speaker 02

  Well, in England, it's, doesn't matter how poor you are, you always say, well, we're just, we're just about middle class. We're always just gonna be, you know, you're not. We never went hungry. We never, you know, we had Christmases and stuff. We didn't have holidays. We didn't have anything, any new cars or anything like that, but it was always enough.

• 56:29Ramit Sethi?

  Okay, that's all interesting, but that doesn't answer my question. Trust me, we do the same thing in the US. Everybody lies about being middle. I talked to people who have $5 million. They're like, well, we're just getting by. We're comfortable. I go, shut the [bleep] up. Tell me what you are. You're rich. So now, looking back, how would you characterize your family socioeconomically?

• 56:51Speaker 02

  When I got my first proper job, I was making more money than my mom and dad combined.

• 56:55Ramit Sethi?

  Wow. That explains a lot. That explains the feeling of freedom from filling up your tank in the car. That explains a lot. When you got your first job and you made that much, did you ever talk about money with your parents then?

• 57:10Speaker 02

  We talk about it more now, now that they retired and, you know, they're, they, my dad was in the armed forces, so his pension's actually pretty good.

• 57:19Ramit Sethi?

  Uh huh. What, what do they say to you now? What do you talk about?

• 57:22Speaker 02

  I, I worry that they don't have enough. I worry that they spend too much on our kids. I worry that, you know, they shouldn't be buying stuff for our kids. We can do that. You know, I worry.

• 57:32Speaker 02

  When my mom asks me, what do I want for Christmas? When I know she's gonna put it on a credit card and I'm like, I don't need anything from you. You've had enough.

• 57:39Ramit Sethi?

  And can they afford it?

• 57:40Speaker 02

  They, they must be able to. They haven't lost a house, like.

• 57:43Ramit Sethi?

  Wait, that's, that's a bit dramatic. I suppose they must be able to buy toys. They're not homeless.

• 57:50Speaker 02

  I honestly don't know. I don't know. I don't know. Like, I know, like, mom, mom never, mom worked odd jobs, part-time and everything, and her pension is very small and.

• 57:59Ramit Sethi?

  Did you ever feel good about money?

• 58:01Speaker 02

  I don't know how to answer that.

• 58:02Ramit Sethi?

  I think that's the answer.

• 58:04Speaker 02

  I like that I can look at my account and I know it won't be the negative. You know, I like that I can take up a hobby if I wanted. Honestly, I think my biggest worries, I think if I liked money, I'd spend it all. Like, I think if I got, I think I have quite, I'd have quite a bad habit if I was to kind of really unleash myself of what I really wanted to do all the time.

• 58:23Ramit Sethi?

  Let me translate. Tell me if I got this right.

• 58:25Speaker 02

  Okay.

• 58:26Ramit Sethi?

  I don't feel great about money and that's actually a protective mechanism. Because if I let myself, uncaged, feel good about money, I would just spend it all.

• 58:40Speaker 02

  Yeah.

• 58:41Ramit Sethi?

  Okay.

• 58:42Speaker 02

  Yeah.

• 58:42Ramit Sethi?

  That's a very common, um, feeling that people who are ultra frugal have. They'll use certain phrases like, I don't need to eat at a fancy restaurant. Like, I'm perfectly fine with Taco Bell. Nothing wrong with Taco Bell. But what's really said beneath that. Phrase is I'm worried that if I go to this nice restaurant or nice hotel, that I might like it. And then I might find myself actually needing to eat there every single day for the rest of my life. It's obviously absurd. What to me, what it shows is a lack of self trust. I can eat at a nice restaurant a couple of times a year.

• 59:25Ramit Sethi?

  I can enjoy it and then I can come home and say, that was nice. And I don't need to go back there for another six months. Like I trust myself to make the right decisions and to indulge occasionally, knowing that I can afford it. But this idea of like, let me keep myself caged because I'm a wild animal and I'm wild. We can work on that. Yeah. What do you say, Grace? Am I getting this right?

• 59:49Speaker 01

  Yeah, a hundred percent, a hundred percent.

• 59:52Speaker 02

  But then like, you know, when we, when we say we're looking up a holiday or something, I always look at more expensive things than you do.

• 59:59Speaker 01

  Yeah, it's true.

• 1:00:00Ramit Sethi?

  Why is that?

• 1:00:01Speaker 01

  I think you, I think you're a bit of a dreamer. I think you, you, you're constantly thinking, oh, well, when we have a million euro, when we win the lotto, we're going to do this. And when we do this, and I, I think you love the idea of thinking about, you know, having this money and what you would do. And then when I like, so you look up the expensive holiday and I'll come back with the actual price because I'll do a little bit of research and then you'd be like, well, obviously we're just going to Wexford.

• 1:00:31Ramit Sethi?

  Oh, wait a minute. That was my question. So he looks up the expensive things and then where do you actually stay?

• 1:00:36Speaker 01

  Oh, we don't go.

• 1:00:38Ramit Sethi?

  Oh, wow. Okay. What the hell kind of story was that? I look up the expensive things and then we don't go. What is that?

• 1:00:45Speaker 01

  Yeah.

• 1:00:46Ramit Sethi?

  All right.

• 1:00:46Speaker 01

  Sorry.

• 1:00:47Ramit Sethi?

  No, that's actually extremely insightful. And, and I think the characterization of potentially dreaming a bit. I don't mind dreams. Like I like them. I like saying like, ooh, wouldn't it be nice? I love that. But I like to go one step further, which is, hey, do you actually want to stay there? Because if you do, we could. We might not be able to do it this year, but we could put some money aside and we know exactly mathematically how long it's going to be. It might take two and a half years. And then we could go there. We'll literally put it on the calendar right now. Do you?

• 1:01:19Speaker 01

  This is what I say to him. This is what I'd say. And I, and then he like, no, no, no, no, no, it's crazy. We can't spend that.

• 1:01:25Ramit Sethi?

  And do you know why? Do you know why he says that?

• 1:01:29Ramit Sethi?

  Ask him.

• 1:01:30Speaker 01

  Why do you say that? Why do you?

• 1:01:32Speaker 02

  Cause it's a dream. We can't afford it, really.

• 1:01:36Speaker 01

  But we can. Look at our savings.

• 1:01:38Speaker 02

  What if I get sick again?

• 1:01:39Speaker 01

  Hmm.

• 1:01:40Speaker 02

  You know, they said it was going to be gone the first time and it came back.

• 1:01:43Speaker 01

  Yeah.

• 1:01:43Speaker 02

  What if it comes back again? What if I can't work for another year and this time work won't pay for it?

• 1:01:48Speaker 01

  Then you do the childcare and I work and it's all fine.

• 1:01:51Speaker 02

  I wouldn't mind that too much.

• 1:01:53Speaker 01

  Yeah.

• 1:01:54Ramit Sethi?

  What I'm hearing is we're having fun.

• 1:02:00Ramit Sethi?

  I love talking to the two of you, but I really love peeling the layers and going deeper. And beneath the jokes about the gas and the hotels, there's actually pain. The idea that look at what we've been through together. It has been hard.

• 1:02:17Speaker 01

  Yeah.

• 1:02:17Ramit Sethi?

  And what if we have to go through it again? What are we going to do? We did it once.

• 1:02:22Speaker 01

  I don't know if we can do it again.

• 1:02:25Ramit Sethi?

  Let's, let's acknowledge that. We don't have to fix it this very minute. But what I can tell is money is deeply emotional.

• 1:02:33Speaker 01

  Mm hmm.

• 1:02:33Ramit Sethi?

  We try to nibble around the edges. We try to ignore it. We, you know, we use logistical answers, but actually like the logistics are fine. We can fix some things here and there. That's not what you're coming to me for.

• 1:02:46Speaker 01

  No.

• 1:02:47Ramit Sethi?

  It's because there's something much deeper here, much deeper. Grace, can you tell me what you remember growing up? What did your family say about money when you were young?

• 1:02:55Speaker 01

  Both my parents come from really big families. Um, they were, they would have been middle class in the fifties in Ireland, which was very, very, still quite poor compared to the rest of the world. My mom was a nurse and she uh, was what they called the laying hen. So she would be the one with consistent money coming in. And my dad started his own business and it's, and it worked super hard all his life. Um, but we were, to be honest, probably upper middle class. They did a huge amount of work. They bought, um, they invested in properties. Um, they were very smart with their money. But one of the things that always sticks out in my mind is my dad, um.

• 1:03:40Speaker 01

  Uh, he had a business at one time where he made automatic gates. And we had an automatic gate installed in our house and that was seen to be like really rich. And then my mom pulled me aside and I think I was in primary school or something. She said, now don't tell anyone we've got automatic gates. Because they think we're rich and we're not.

• 1:04:03Ramit Sethi?

  Wow. When you remember this story from, you know, decades ago.

• 1:04:08Speaker 01

  Yeah.

• 1:04:08Ramit Sethi?

  Why do you remember this story in particular?

• 1:04:11Speaker 01

  I think she was a bit frightened about money. I remember coming home from Irish college one day and they had a hot tub in the house. They had a hot tub in the. And I was like, where the hell did this come from? They were like, well, instead of buying a new car, we, we got a hot tub instead. And I was like, what? They're doing really, really well, but I always had the feeling that it was like a secret.

• 1:04:33Ramit Sethi?

  Yeah.

• 1:04:33Speaker 01

  That we couldn't tell anyone.

• 1:04:35Ramit Sethi?

  In, in what ways do they downplay their success publicly?

• 1:04:39Speaker 01

  They would never show off. We'd never buy expensive cars or anything like that. It was all very practical, normal.

• 1:04:44Ramit Sethi?

  What if I met them and I asked them, what do you do? What would they say? It's a very American question, by the way.

• 1:04:48Speaker 01

  Yeah, they would say, oh, sure. We're retired and enjoying it and we're traveling around the world now and having a great time.

• 1:04:54Ramit Sethi?

  Okay. What are they going to do with the money when they pass?

• 1:04:57Speaker 01

  They're very generous with it and I think it'll go to, it'll go to us. There's three of us in the family and they're going to split everything equally. And we had conversations about it and kind of fought like, kind of, they don't want us fighting over anything. And I'm like, that's fine. Like, we're all quite successful, which is really brilliant.

• 1:05:17Ramit Sethi?

  You know, it's kind of a striking example for everyone listening and watching that you can see parents who learn about money and talk about money between themselves. They tell their kids about money.

• 1:05:33Speaker 01

  Yeah.

• 1:05:34Ramit Sethi?

  They have set you grace up with a very good financial education. And they'll talk, and they'll say things, hey, don't tell everyone at school. We're not rich. Well, you may have been rich or certainly upper middle class. But I can understand parents not wanting their kids to go and blab, you know, I, I understand. But it's not a surprise to me that siblings often turn out similarly with money. Not always, but they grew up with the same money messages. And to me, the big takeaway from this is you better get good with money and you better talk to your kids about money because it's not an accident.

• 1:06:14Ramit Sethi?

  If you want your kids to grow up equipped to deal with the world, you talk to them from the time they are three, four, five. Otherwise, some head selling whole life insurance is going to be taking over that role and you really don't want that. So let me ask the two of you, the two of you grew up quite differently with money. When was the first time you substantively talked about money in your relationship?

• 1:06:39Speaker 02

  Australia.

• 1:06:40Speaker 01

  Yeah.

• 1:06:41Speaker 02

  It was actually kind of a bit of a, kind of a first kind of really big fight because Grace went to Australia. But when I met her, when I first met her, she'd already planned on to move to Australia. And I was, I didn't really have, I was kind of working part time, wasn't really making any money, living at home still. And then she left and then after a few months, I was like, I can't let her go. So I quit everything and moved across, followed her. And to me, this is the first time that I had traveled really ever. And it was the other side of the world.

• 1:07:14Ramit Sethi?

  Hold on, very romantic. What the hell is going on right now? I'm like, yo, this is a good story. Sorry, go on.

• 1:07:20Speaker 02

  We bought a camper van. We traveled down the west coast of Australia for six months and then Grace got a photographer job and I was doing odds and ends. We had a small flat, which was dirt cheap because it was right next to the airport in the flight path. So, you know, the best alarm clock in the world is a Boeing landing over your head in six in the morning. So I was making money so I could enjoy Australia, whereas she was taking care to make money so she could save. And then her plan was to maybe go back or stay. There was an ice cream shop around the corner that I really liked. And if Grace was having a bad day, I'd get her some and she would just get so mad that I was spending money on ice cream. And I think that was the first time we kind of really talked about it. We hadn't talked about it.

• 1:08:05Speaker 02

  We hadn't talked about what our kind of idea and goals were when we were out there. And it was kind of a really eye opening for me because I remember Grace was talking, she wasn't talking about what she wanted to, the money she was making. It was what about the money is going to do for us. It was we. And I hadn't been thinking like that at all.

• 1:08:22Ramit Sethi?

  Honestly, I'm very impressed. Actually shocked, pleasantly shocked because that story tells me so much. And I really appreciate you sharing it with me. The idea that, James, you had never really traveled before. You get on a plane, you go across the world to chase a girl. The two of you, living a very frugal life, living under a flight path, just like, we gotta make it work. But what really strikes me is the way that you looked at money differently. I can just imagine, James, the way you grew up, like, not thinking much further ahead. Most people, at least the ones I talked to in the US, they are literally thinking about that month,

• 1:09:07Ramit Sethi?

  maybe next month, and that's it. And I'm begging people to think further ahead. Six months, a year, ultimately 20 years. Because when you look that far ahead, you can actually achieve amazing things. You can take the trips you want. You can buy the car you want. It's awesome. What's amazing is Grace was already doing that. Grace has been thinking about money, talking about money in her family since she was a kid. The fact that the two of you got in a fight about freaking ice cream cones is hilarious. This is a great example where sometimes the most substantive conversations can come from what seems like the most trivial purchase: ice cream. And look at, look at what happened. You built a life together as a team.

• 1:09:48Speaker 02

  Yeah.

• 1:09:49Ramit Sethi?

  Starting way back with a freaking ice cream purchase. Now, I want to ask you to, there's a reputation for people in Ireland, let's just say, the UK, for feeling guilty about money.

• 1:10:02Speaker 01

  Oh, yeah.

• 1:10:03Ramit Sethi?

  Is that true?

• 1:10:04Speaker 01

  Oh, 100%. Oh, 100%.

• 1:10:07Ramit Sethi?

  Like, you feel guilty about making it, spending it, all of it?

• 1:10:11Speaker 01

  Talking about it. Yeah.

• 1:10:12Speaker 02

  Yeah.

• 1:10:12Ramit Sethi?

  So how are you two so open? How come you're so comfortable talking about it right now?

• 1:10:16Speaker 01

  I think it's because... It it clicked with me. I was in work one day and um I had a meeting with one of these pension guys. Um, eh, and we have a system in Ireland. I didn't know about it really, um, called additional voluntary contribution. It's pension. It's kind of the only way you can save money with benefiting with tax. But I didn't really know anything about it, but I made a me, I had a a meeting with this guy. And I said, listen, I know nothing. Tell me about this. And he walked through, if I did nothing, how much money I would have when I was sixty five, seventy. I think on my contract, it says I have to work until I'm seventy before I get a pension.

• 1:11:01Speaker 01

  But it was something like eight thousand euros a year. And that number stuck with me and I was like, that cannot happen. A, I'm not working until I'm seventy, because I can't be hauling patients around when I'm seventy. So I need to retire earlier than that or do something different. Um, and B, like, I can do something now. And he was like, right, if you start saving now, you can have this much or whatever. I think it was like a million and I was like, lol, okay, let's try. Um, and so I started learning all about it. And what I really started being annoyed about was no one else was talking about this. Everyone in work was like, what are you doing talking about pensions?

• 1:11:40Speaker 01

  You know, because I was like, no, you need to go and and learn about this because you'll only be getting eight thousand in um a year. And everyone was like, oh, I'll deal with that when I'm fifty. So it was really frustrating me that people were just weren't talking about money and especially women. Um, yes, we get a fabulous um maternity leave, but it also affects our pension and all the sort of stuff. And and as women, you, for me, I feel like it's you have to have your own something, something to fall back on. Because we are in a more vulnerable position at certain times in our lives. So we're having children and all that sort of stuff. So I started being sort of militant about it.

• 1:12:23Ramit Sethi?

  You looked ahead, decades ahead, and you said, that's not going to be the future for me. I'm going to make changes right now. And you did. I love that. And I, it's reflected, by the way, in your CSP. I can see it with a forty nine percent savings rate. It's obviously very clear. When you both think back to the messages that you grew up with around money. Which of those messages do you think you bring to this relationship today?

• 1:12:52Speaker 02

  Debt, I think, and credit cards and anything that isn't like is is literally the be or an end or you should never, ever, ever, ever own. Like, we don't, we had, like, our car, we just, we saved up, we bought it outright. And our old car is, God, it's 13 years old.

• 1:13:10Ramit Sethi?

  Your lesson is you bring an aversion to debt to this relationship. Is that right?

• 1:13:18Speaker 02

  Yeah, I think so.

• 1:13:19Ramit Sethi?

  Okay, what else?

• 1:13:20Speaker 02

  Yeah, gifts, physical things as showing love.

• 1:13:26Ramit Sethi?

  Ooh, that would explain the ice cream.

• 1:13:30Speaker 02

  Yep.

• 1:13:30Ramit Sethi?

  That you could not afford, actually.

• 1:13:32Speaker 02

  Yeah. And I think if it's one thing I actually spend my money on, it's toys for the kids. Because I remember the Thunderbirds, there was a big toy island that every kid had to have, and I couldn't have it. And instead, Mum made me one out of plasticine and out of toilet roll and stuff and painted it and everything. And I, oh, I have.

• 1:13:55Ramit Sethi?

  That's kind of adorable and like sad at the same time. I kind of love it.

• 1:14:00Speaker 02

  Yeah.

• 1:14:00Ramit Sethi?

  That's really beautiful. Do you have a bunch of toys in the house?

• 1:14:04Speaker 01

  Yeah, they're everywhere.

• 1:14:06Ramit Sethi?

  No credit card debt?

• 1:14:08Speaker 01

  No, I have a sinking fund for kids' toys. Every week, there's about 80 euros that goes into the sinking fund for like stuff they might need.

• 1:14:16Ramit Sethi?

  80 a week?

• 1:14:18Speaker 01

  I know.

• 1:14:18Ramit Sethi?

  I'm not in touch with kids' toys prices, but that seems like a lot.

• 1:14:21Speaker 01

  No, no, it's not just for toys. It's for like swimming lessons and trips away and things like that. Sorry.

• 1:14:27Ramit Sethi?

  All right. Can you say no to your kids?

• 1:14:29Speaker 02

  No.

• 1:14:30Ramit Sethi?

  Okay, great. You both admit it. All right. All right. Grace, what messages do you bring from your childhood that you bring to this relationship with money?

• 1:14:37Speaker 01

  I think communication. I always saw my mom and dad have conversations about money. And Mum always did the books for Dad's business. So they'd always just have them have the books out and Mum would be talking about taxes and returns. And and it would just be like in the air, like the conversations. And they never fought about money. It was always just a discussion or, you know, and I think that's what I've almost forced you into, James, because it was one of the things that is essential to me in a relationship is to. Be honest and open about money.

• 1:15:11Ramit Sethi?

  Yeah.

• 1:15:12Speaker 01

  And then I'm the one that's hiding stuff. I don't know.

• 1:15:14Ramit Sethi?

  Well, let me say that I really appreciate what you just said about your parents. And I hope that the children of every guest that I speak to on here say the same decades from now, that they will say, my parents didn't fight about money, but they talked about it. It was always a discussion. It was always in the air. That's actually what I want. I don't want money to be hidden. I don't want it to be a source of tension, although sometimes it will be, and that's okay. I want it to be an important part of the family, just like food, just like respecting your elders, just like studying and having fun. Money is one of those core parts of a family. It has to be in the air.

• 1:15:55Ramit Sethi?

  And when we shine a light on it, instead of hiding it, then we can build a healthy relationship with it. I love that Grace didn't sit back and hope things would improve. She learned how pensions work. And then she made a decision that is going to have a huge impact on her future. That is what's known as having an internal locus of control. An internal locus of control is the belief that you can control your future. Compare that to someone with an external locus of control, who believes simply that life happens to them. So which one are you? Do you have an internal locus of control or an external locus of control? To answer that question, take a look at your own behavior with fitness,

• 1:16:38Ramit Sethi?

  food, your relationships, your career, and money. External or internal? It's quite an interesting question to think about. This has actually been one of the biggest questions that I have come back to throughout my career. We all know intuitively that if we eat better, we will be healthier. We know that if we save and invest, we will be more secure. So why don't we do it? This is the question I've been thinking about since the year 2000. One reason, and it's a big one, is that a lot of people don't actually believe that they can control anything around them. A lot of them have tried before, or they've been told it's out of their hands, or they have tried and it failed over and over. And so they simply stopped trying.

• 1:17:23Ramit Sethi?

  That can lead to an external locus of control. And I think this is one of the most overlooked reasons that people stay stuck. These beliefs are shaped by a lifetime of experiences, even multi-generationally. A lot of you watching this right now had some great-grandfather who something bad happened to, and that story, that myth or legend, was almost passed down your family tree. And today, you think you cannot affect the way the world works because of what a great-grandfather, somebody you never met, experienced 100-plus years ago. If you're listening to this and you're starting to realize, oh, my gosh, I want to have an internal locus of control. I want to take control of my money and make rapid changes that I can help.

• 1:18:08Ramit Sethi?

  Inside my money coaching program, I'm going to walk you through the exact systems that I use to take control of your money and start seeing real results. You can join the program at iwt.com/moneycoaching. Now, Grace believed she could make a difference in her own life. She saw the lever, she pulled it, and she got results. Up next, we'll take a closer look at the other changes Grace and James are considering as they build their rich life. If the two of you continue on the way that you have with your money, when something comes up in life, what do you think happens after the next time and the time after that and the time after that? What do you think will happen?

• 1:18:51Speaker 01

  I will just collapse.

• 1:18:54Speaker 02

  I'd worry for us as a couple. You know, it just becomes too much. What if we can't support the other one anymore? It just sounds crazy, but I don't think that would ever happen.

• 1:19:06Ramit Sethi?

  It does sound crazy. I mean, you have such a beautiful teamwork here.

• 1:19:10Speaker 01

  Yeah.

• 1:19:11Ramit Sethi?

  There's no doubt about it. It's so obvious. But I also think the two of you are very good at putting your blinders on and moving forward. And what a shame. Shame to live that way when you actually have all the ingredients for a true rich life. What I see in you versus what I see when I talk to other people who perhaps were not raised to save money, who did not have a healthy education about money, right? They didn't have those road miles and so I'm having a different conversation with them. I'm actually trying to show them why it's important to save money at all. The two of you have the ingredients for greatness. And in many ways, we can see it on the CSP. It's reflected. Wow, what a savings rate. It's incredible.

• 1:19:53Ramit Sethi?

  Maybe the way that you talk about money and behave with money could be tweaked a bit. I just want to reflect, the two of you went through an incredibly stressful situation. I don't think anybody can give you feedback on how you did. Who the hell knows what it's like to have one kid on the way, a young kid, husband who's going through cancer treatments, morning sickness, like nobody. So what we can say is I think you handled it the best you could. I think you've done a pretty phenomenal job. And I think that life is going to be stressful in other ways.

• 1:20:38Ramit Sethi?

  And what I want to do is I want to equip you so that you can continue to get closer together, not let these stressful situations tear you apart. Right? How does that sound?

• 1:20:50Speaker 01

  Yeah, that sounds great.

• 1:20:52Speaker 02

  Wonderful.

• 1:20:53Ramit Sethi?

  Okay, awesome. Have the two of you talked about what your rich life vision is?

• 1:20:57Speaker 02

  Retiring early.

• 1:20:58Ramit Sethi?

  Okay, retiring early. Great. Any idea what age?

• 1:21:01Speaker 01

  Fifty.

• 1:21:02Ramit Sethi?

  Fifty. Okay. All right. So that's like about 12 or so years away. What else? Grace, what's in your rich life?

• 1:21:09Speaker 01

  I would love to be able to go on.

• 1:21:16Speaker 01

  Two or three holidays a year, one back to the UK. And I would love to be able to bring your parents, James, on holidays somewhere because they really haven't been on many. And I would love to be able to help my kids the way that I was helped, you know, financially going into college and stuff. Oh, I really want to do the renovation on the house. That'd be so incredible. Oh, my gosh. I want to have my own craft room upstairs with the lights. I would love to probably go down to maybe two days, two or three days a week working.

• 1:21:55Speaker 01

  And then the other two or three days work on my own businesses. I love creating community and hosting events.

• 1:22:04Ramit Sethi?

  Cool. All right. So here's what I'm, what I'm hearing from both of you is you, you want to live a very rich life. Like these aren't, oh, I don't know, like when we're 70, maybe we want to take a trip to the Grand Canyon. No, it's like, we want to retire early. We want to renovate the house. We want to travel three times a year. This is a lot. I love it. Right now, how do you feel about money?

• 1:22:29Speaker 01

  Uh, just nervous about if something like this is going to happen again, are we going to be okay? Are we going to be able to manage it? Because we actually, we had a serious illness cover in addition to life insurance.

• 1:22:45Ramit Sethi?

  How much should they pay you?

• 1:22:47Speaker 01

  Thirty thousand.

• 1:22:48Ramit Sethi?

  Wow, that's great.

• 1:22:50Speaker 01

  It was really, really amazing. So that really saved, saved our and it helped us. That's where a lot of the savings have come from.

• 1:22:58Ramit Sethi?

  So when I think about your rich life, I'm thinking first, can we set things up so that you are safe and resilient? First, we can get to the home renovations and the travel. Second.

• 1:23:13Speaker 01

  Yeah.

• 1:23:13Ramit Sethi?

  Of safety first. How do you both feel about that?

• 1:23:15Speaker 02

  Yes. Hundred percent.

• 1:23:16Ramit Sethi?

  Okay. I want to know that if James gets sick again, or Grace for that matter.

• 1:23:23Speaker 01

  Yeah.

• 1:23:23Ramit Sethi?

  That the family is financially safe. And wouldn't that feel good to know that you have the math, that you both understand it, and most importantly, you are both connected to it?

• 1:23:37Speaker 01

  Yes.

• 1:23:38Ramit Sethi?

  It's like wipe away these blurry lenses. In fact, throw them away. We know that we're safe and now we have earned the right to talk about the next part of our rich life. Okay?

• 1:23:48Speaker 01

  Yeah.

• 1:23:49Ramit Sethi?

  I'm going to put the CSP up on screen and I would like to get your help to try to figure out what needs to happen in order for you both to be safe. Quick recap here. Your assets 328K, investments 79K, savings 42K and debt 230K. That's a total net worth of 219K. Income is 91,200.

• 1:24:10Speaker 01

  That will go up. When you go back to work, James?

• 1:24:13Ramit Sethi?

  James, when is that happening?

• 1:24:14Speaker 02

  January, January 1st.

• 1:24:15Speaker 01

  January or February, I'd say.

• 1:24:17Ramit Sethi?

  All right. Let's leave it for now, but we can change it.

• 1:24:20Speaker 02

  Yeah.

• 1:24:21Ramit Sethi?

  Fixed costs are at 58%. Again, things are a little bit different where you're living because of pensions and et cetera. I just do want to reflect on some of the numbers in this fixed cost because they're quite, they're quite amazing. So your mortgage is $997. What the [bleep]? 997? There's not even four digits in your.

• 1:24:40Speaker 01

  It's incredible, right?

• 1:24:41Ramit Sethi?

  It's insane. This is another one. I just want to say it again, just so people get even more pissed. Childcare is $355. Again, there's only three digits in that number. This is insane.

• 1:24:53Speaker 01

  That's for 45 hours a week. And they get, they feed her and they include, um, yeah, it's, it's unbelievable.

• 1:25:03Ramit Sethi?

  I love it. I want easy childcare for all parents. Like, how can you expect parents to have kids and to work if it's freaking thousands of dollars? Okay, let's go on. I'm getting mad right now. All right. Car payment 200. $200, um, debt payments 200. What's that for?

• 1:25:21Speaker 02

  Oh, it's my student loan.

• 1:25:22Ramit Sethi?

  Oh, okay. Wait, how much is your student loan?

• 1:25:25Speaker 02

  Uh, 20,000.

• 1:25:26Ramit Sethi?

  All right, fine. Groceries are $600 a month. Oh, my God. I feel like I'm living in like 1985. What the [bleep]? Phone is $30?

• 1:25:38Speaker 01

  Yes, for both of us.

• 1:25:40Ramit Sethi?

  How is this possible?

• 1:25:42Speaker 01

  I, I call every year and I'm like, I want to move down to Tesco Mobile, which is like the super, super budget. And they're like, oh, we can do that for blah, blah, blah. So it's 15, I'm currently paying 15 euros a month.

• 1:25:54Ramit Sethi?

  I see so many CSPs. The thing about the CSP, I feel like some formula got messed up and every number has one zero dropped off of it. Like literally every number is missing a zero. This is crazy. 30 for phone should be 300 in the US. All right. So your investments, again, uh, just to sum it up, you are doing 960, let's call it 1,000 bucks a month plus 380, so roughly 1,300 bucks a month for your investments. On a salary of about 91,000, gross. 49% on savings and negative 14% on guilt free spending. Obviously that doesn't work and you, you mentioned that you feel stressed out about money.

• 1:26:39Speaker 01

  Yeah.

• 1:26:40Ramit Sethi?

  You see why?

• 1:26:41Speaker 01

  Yeah.

• 1:26:41Ramit Sethi?

  If you don't have any money to eat out or to do anything, but yet you are still buying all these toys.

• 1:26:48Speaker 01

  I know.

• 1:26:48Ramit Sethi?

  Actually, it's the worst of both worlds.

• 1:26:50Speaker 01

  Yeah.

• 1:26:51Ramit Sethi?

  Might as well just be honest about it and maybe stop buying so many toys. I don't know. That's up to you. So what do we need to do in order to change these numbers? Cause they actually need to be rationalized. We need to pick appropriate numbers. You can choose based on what you want for your rich life. But then you actually got to stick to them. If you want to change them later, you could change them six months from now. But one of the most important things is, hey, let's pick numbers together that match up with our vision. And then let's both agree to stick to them. And after six months, we can reevaluate. How would you change these numbers based on what you said your rich life vision was?

• 1:27:29Speaker 01

  I think we're saving too much.

• 1:27:32Ramit Sethi?

  Okay.

• 1:27:32Speaker 01

  Definitely. I would like to save a thousand per month.

• 1:27:38Ramit Sethi?

  Okay. You're doing that right now into your emergency fund. In mind, you already have thirteen months of emergency fund.

• 1:27:43Speaker 01

  Yeah, so I I'll stock the emergency fund and we'll ju- just keep for the house, maybe, yeah.

• 1:27:49Ramit Sethi?

  Okay, so let's drop, you're saying, drop the long term emergency fund off.

• 1:27:53Speaker 01

  Yeah.

• 1:27:54Ramit Sethi?

  Okay, watch what happens. Okay, your savings drop down to thirty one percent. And your guilt free spending is now at four percent or two hundred and sixteen dollars per month.

• 1:28:06Speaker 01

  I spend more than that.

• 1:28:07Ramit Sethi?

  But it's a good directional change. So it's interesting because you do have thirteen months of savings, which I think is great. When, James, you got sick, I'm guessing you burned through your savings pretty quickly. Sorry for this question, but what's the likelihood of this happening again?

• 1:28:22Speaker 02

  In theory, it should.

• 1:28:25Ramit Sethi?

  Okay.

• 1:28:25Speaker 02

  Because you have gone through a treatment, had surgery, scans are good.

• 1:28:29Ramit Sethi?

  Okay.

• 1:28:30Speaker 02

  But there is no, obviously, exact.

• 1:28:32Ramit Sethi?

  Are you concerned, financially speaking, health wise, obviously, but financially speaking, are you concerned?

• 1:28:38Speaker 01

  We're not gonna get that extra, we're not gonna get that insurance payout again.

• 1:28:43Ramit Sethi?

  No.

• 1:28:44Speaker 01

  Because he's uninsurable now.

• 1:28:45Ramit Sethi?

  Yeah. Can I say this? If I were in your situation, here's how I would approach this. I would say, look, I think we've done an amazing job, especially Grace done an amazing job of shepherding all this stuff while I had to focus on my health. We have thirteen months of savings. That's incredible. But I'm in a high risk situation.

• 1:29:07Speaker 01

  Yeah.

• 1:29:08Ramit Sethi?

  If I get sick again, we do not have the same benefits that we had last time.

• 1:29:14Ramit Sethi?

  I think that we should save what to others might seem like an irrationally high amount of money, but for our high risk situation, it makes sense. What number should that be? I don't know. Let's talk about it. Okay, let's settle on eighteen months of savings.

• 1:29:31Speaker 01

  Yeah, yeah, I think that sounds good.

• 1:29:33Ramit Sethi?

  And once you have that, it's locked away and you know that that's your break in case of emergency. But eighteen months gives you time. You can adapt, you can cut your spending, you can extend it. You're not going to count on all these subsidies and and things like that payouts, but it gives you time. What do you think about that?

• 1:29:54Speaker 01

  That's.

• 1:29:54Speaker 02

  I like that.

• 1:29:55Speaker 01

  Yeah.

• 1:29:56Ramit Sethi?

  The point is, we need to pick a number that's reasonable and and will. Serve the needs financially speaking in case one of you gets sick.

• 1:30:07Speaker 01

  Yeah.

• 1:30:07Ramit Sethi?

  Okay, I don't think I've recommended to anyone 18 months of savings. Like my own personal thing, I like to have a year and that's quite aggressive already. But 18 months in your situation, considering

• 1:30:25Ramit Sethi?

  all the things we've talked about could make sense.

• 1:30:28Speaker 01

  Yeah.

• 1:30:28Ramit Sethi?

  Okay, so if that is the case, then can we go back to the CSP? And let's just take a look, we actually just took that emergency fund down to zero. What do you think?

• 1:30:37Speaker 01

  I would say we'll pause the renovation fund and move the long term saving fund into that. Yeah.

• 1:30:43Ramit Sethi?

  Wow, okay, so now we're back up to 31%. For an emergency fund, we're putting a thousand dollars a month away. You have zero towards the renovation fund, anything else?

• 1:30:54Speaker 01

  Vacations. Does any hundred euro really make a difference to cut that? I don't really want to stop going on holidays.

• 1:31:02Ramit Sethi?

  At a hundred dollars a month?

• 1:31:04Speaker 01

  Yeah, it's not really gonna make.

• 1:31:05Ramit Sethi?

  It's not gonna make a difference and you both told me you like vacations.

• 1:31:08Speaker 01

  Yeah.

• 1:31:08Ramit Sethi?

  And like you've gone through a lot, I don't mind it. I think if you wanted to save a hundred bucks a month, there are other places you could do it from.

• 1:31:16Speaker 01

  Yeah, yeah.

• 1:31:16Ramit Sethi?

  Okay, now that we have rationalized this a bit, you have 31% going to savings, which actually seems, I mean, it's a little high, but it's appropriate. You don't have enough in guilt free spending.

• 1:31:28Speaker 01

  No, I don't.

• 1:31:29Ramit Sethi?

  I understand that for the next three months, reduced income, but it's going to go back up. I'd like to just plan for real life. So tell me the numbers and I will adjust them here.

• 1:31:40Speaker 02

  So my route back to 3500, sorry, how do you say it?

• 1:31:45Ramit Sethi?

  3500. And your net income will be what?

• 1:31:49Speaker 01

  2673.

• 1:31:51Ramit Sethi?

  2673 dollars, okay, wow, let's see what just happened. Fixed costs are down to 48%, amazing. A total reflection of your. Core values right here, which is like, we don't need a big old fancy house. We don't need a big old fancy cars. It's all quite modest, which I like. I really like that. Next up, investments are at 6%. Oh my God. Savings are at 26%, but all the way down to guilt free spending. Look at Grace's face. Look at that big old smile. She goes, yes. Yeah. Okay. And James is smiling too. Guys, I love this.

• 1:32:25Speaker 02

  Yeah.

• 1:32:26Ramit Sethi?

  So you're at 21% or $1,389. Now, what do you think about that number?

• 1:32:33Speaker 02

  Like, we always overspend on guilt free stuff. And then in our heads, we said, well, we can only spend X amount and then we beat ourselves up because we spent over it. But now, looking at that, actually what we have been spending has been reasonable for the amount of money we do make. And we shouldn't be beating ourselves up because, I mean, we go out to dinner maybe once every other month and we have takeaway properly every once, three months or so.

• 1:32:59Ramit Sethi?

  I love the lies already. Oh, everybody noticed the lies. Just rewind five seconds and look at Grace's face. Yes. This is the favorite time of Ramit Sethi's life.

• 1:33:13Speaker 01

  Oh, God.

• 1:33:14Ramit Sethi?

  Okay, why don't we just discuss where you all have been spending guilt free spending money?

• 1:33:19Speaker 01

  Yeah, let's do that.

• 1:33:21Ramit Sethi?

  Go ahead, Grace.

• 1:33:22Speaker 01

  This September, I have it on my little spreadsheet.

• 1:33:27Speaker 01

  We spent 250 euros on dining out.

• 1:33:31Ramit Sethi?

  Wait, can you just put this on screen? I'd love to look at it myself. Oh, great. Okay, hold on. Let me just describe what I see right now. So this is a nice looking spreadsheet and it's got some different categories. Scroll up a little bit if you don't mind. So we have cash flow, overview, bills, expenses. I can see at the bottom tabs, we have August, September, October, November, 25 and on and on and on. Okay, very good. Let's go down a little bit. What's nice, so I see the dates to the budget amount. For example, the mortgage 996 and then the actual, which is 996. That's great.

• 1:34:10Speaker 01

  And then the expenses on the, in the orange is the, like, every day, day to day.

• 1:34:16Speaker 02

  Read out, read out the kids one then.

• 1:34:18Speaker 01

  Oh, God, the kids one. The budget was 100 and I actually spent, we actually spent 1,133.

• 1:34:28Ramit Sethi?

  On what?

• 1:34:28Speaker 01

  Now, let me see, let me see.

• 1:34:30Ramit Sethi?

  Oh my god, amazing. Stop right here. Stop right here. Okay, everybody remember what James said about forty-five seconds ago? He goes, oh, we eat out, what, once every three months or some BS? Okay, look at this. September 3rd. Dining out, off-the-bone lunch. I don't know what that is, but it sounds expensive. Next day, McDonald's, five twenty-five. That's quite modest. Um, moving along, kids? What are these? I don't even know what any of these words are. Knit, comb, and Doty's. What does that mean?

• 1:35:02Speaker 01

  So, it's just pacifiers and stuff, just in case. There was, there was headlights in the, in the, in the crash, so I just wanted to be prepared.

• 1:35:10Ramit Sethi?

  Okay, more words I don't know. I thought I spoke fluent English. All right, moving along. We got Starbucks, this is all on the 4th. Dining out the next day, twenty dollars and ninety cents for coffee. Next day, dining out, twenty dollars at McDonald's. Okay, and on, on, on, on. Okay, you can take this off-screen for a second. Wait, I, hold on, just, look, look at this, look at this. Look at row number ninety-five. Timu. Like, this is the only, this is the only one I've seen where people put what they spent, but then they go in there and add comments that are like, "Ahh," or like,

• 1:35:44Ramit Sethi?

  "Who does this?"

• 1:35:46Speaker 01

  Everyone should do it. It's great crap.

• 1:35:48Ramit Sethi?

  All right, take this off-screen, please.

• 1:35:50Speaker 01

  Okay.

• 1:35:51Ramit Sethi?

  First of all,

• 1:35:55Ramit Sethi?

  are you gonna tell me you only eat out once every three weeks or three months or whatever? James?

• 1:36:00Speaker 02

  None of that is me.

• 1:36:02Speaker 01

  It's true, it's me, it's all me.

• 1:36:05Ramit Sethi?

  Ah.

• 1:36:06Speaker 01

  Yeah.

• 1:36:07Ramit Sethi?

  So, we're, we're a team, except when it comes to eating out.

• 1:36:11Speaker 01

  Yeah.

• 1:36:12Ramit Sethi?

  All right. Do you have, because you have this sort of well-constructed budget, you know, it has all the stuff in it, but when we go to the actual discretionary stuff, you're behind on, on me. Many of the things.

• 1:36:28Speaker 01

  Yeah.

• 1:36:29Ramit Sethi?

  What do you think about that?

• 1:36:30Speaker 01

  I actually find it so hard to stick to the budget. Bills are fine. I can argue down bills. I can argue down everything.

• 1:36:39Speaker 01

  But when it comes to like sticking to the budget that was set, it's more of like a tracking expenses rather than like sticking to the actual budget. I don't know how to explain it. I'm not doing it very well.

• 1:36:53Ramit Sethi?

  It's easy to track. It makes us feel like we are doing something. But the one thing you are not doing when it comes to changing your behavior is changing your behavior.

• 1:37:05Speaker 01

  Yeah.

• 1:37:06Ramit Sethi?

  It's a distraction for us. We track it. We go through it. We tell ourselves we're looking for patterns. You know, the pattern. It's very obvious from looking at it for five seconds. The real energy should be spent on saying, what is the overall vision of our rich life, which we've done some element of today? How much do we want a portion to different four key buckets? Okay, we've done that. Now, we know those numbers. We know what the finished puzzle looks like. How are we gonna get there?

• 1:37:38Ramit Sethi?

  That's where the energy should go. Tracking is irrelevant. Yeah, you should track a couple of discretionary things like eating out. One of you should own that number. And you can track it through your credit card, debit card, whatever. But the the level of tracking here is actually not getting you what you want. It's getting you a distraction. How does it feel to hear that?

• 1:37:55Speaker 01

  I know this. I know this in my soul.

• 1:37:58Ramit Sethi?

  Yeah. Yeah. Good. Okay, great. I personally think that you are destined for something bigger than tracking 100 rows of expenses on a spreadsheet. I just do. There's got the stuff that the two of you have been through, the way that you have done it together. You've tackled really hard stuff. And it would be a shame to focus your energy.

• 1:38:25Ramit Sethi?

  In this small of a way.

• 1:38:27Speaker 01

  I think it's the same thing that I was doing with the tomatoes. You know, it's the control. If I can just get it down on paper, then I can make sense of it. But actually, I I know what's wrong.

• 1:38:40Ramit Sethi?

  Yeah. What do you think might be a different alternative to that approach that you've taken with the tomatoes and with the budgeting?

• 1:38:49Speaker 01

  Zooming out a little bit more and seeing a little bit more about the importance of it, really. I enjoy process. I always have. I enjoy knitting. I enjoy spinning. I enjoy, you know, the meticulous details. I really like that. And I find that I can't do my knitting, spinning, blah, blah, blah, blah, blah, because I'm minding children. So instead I will focus it on things that are for the family, like meticulously tracking the budget or making food for my family. But I don't need to be doing it in this way, putting in so much effort. I probably need to just relax a little bit.

• 1:39:33Ramit Sethi?

  Wow.

• 1:39:34Speaker 01

  Do you think?

• 1:39:35Ramit Sethi?

  One of the, one of the most profound things I've heard on this podcast. Your level of self perception is really high.

• 1:39:43Ramit Sethi?

  And you just mentioned something offhandedly. I pro, I probably don't need to, I think you said something like work as hard or or put the amount of time in.

• 1:39:53Speaker 01

  Yeah.

• 1:39:55Ramit Sethi?

  Can you say it a different way? Would you be comfortable putting less work into this?

• 1:40:01Speaker 01

  I don't know why that's hard, because I love like, but yeah, I I think I need to like put less work in to do, to do what then?

• 1:40:14Ramit Sethi?

  Isn't that the key question that so many of us ask? If I stop doing this, if I delegate this, then what?

• 1:40:23Ramit Sethi?

  Will I do and on a deeper level, who am I?

• 1:40:27Speaker 01

  Yeah.

• 1:40:28Ramit Sethi?

  Who am I if I'm not canning tomatoes for the family and tracking this detailed report that's available for the last three years of expenses? Who am I?

• 1:40:41Ramit Sethi?

  Can you answer it for me, Grace? Who would you be?

• 1:40:43Speaker 01

  I'd just be probably just mom and wife.

• 1:40:47Ramit Sethi?

  Yeah. You know, moms are not loved because they have the most extensive spreadsheet in the world.

• 1:40:54Ramit Sethi?

  Wives are not loved because they track every single expense. That's not why they're loved. None of us are.

• 1:41:01Speaker 01

  Yeah.

• 1:41:03Ramit Sethi?

  Part of getting to the next level of where you want to get is

• 1:41:09Ramit Sethi?

  having a crystal clear vision of where you want to go. And both of you as a team, working to get there. You already did the easy stuff. Then you got stronger. You had to because you had to go through tougher stuff. You went through illness, very difficult. Most of us cannot understand what that's like. You did it. And now to get to the next level, the level where you are safe as a family with 18 months of saving setup.

• 1:41:35Speaker 01

  Yeah.

• 1:41:35Ramit Sethi?

  Where you are showing your children a healthy relationship with money. That probably requires not doing some of the same things you used to. And actually saying, I choose not to.

• 1:41:50Ramit Sethi?

  Because in order to get where we're going, that's not my future anymore. James, what's coming up for you as you hear this?

• 1:41:56Speaker 02

  What you've been talking about is just there, it's just been in the background for so long that we haven't been able to kind of express it. You know, sometimes I feel like she's so focused on the saving money, the canning tomatoes, but you know, we never get to eat the tomatoes, we never get to spend the money, we never get to. It's a process and then once it's done, it's put on a shelf, it's put into savings. And then we're on to the next one. And so to be, who she'll be if she doesn't do that, you know, she'll still be.

• 1:42:29Speaker 02

  You know, the best mom should still be my perfect wife, you know, that's not going to change. We'll just maybe have a bit more time together. You enjoy our rich life, as you say. And so I hope a big part of her not being able to take on all this is that I will be able to come back on board and that we can start being a team again. Now that I'm hopefully out the end of this, that I can start taking on some of that burden and she can maybe relax a little bit. Let the steamer off that pressure cooker and then.

• 1:43:03Ramit Sethi?

  You know, James, you were always a team. Didn't stop because you got sick. Yeah. Not once have I heard either of you insult the other. Haven't heard it. If anything, bending over backwards to support each other. And you were a team always. I think the way that the two of you talk about money reveals so much. The idea, James, that you maybe deep down think that you've let down your partner, but of course you have not. You got sick. Now you're better. You put in a lot of work to make that happen. And now you can come back and you can participate

• 1:43:45Ramit Sethi?

  in the numbers more than you were able to. Perfect. Amazing. Grace, the idea that you have to control everything. That you may not be a good mom or wife if you're not tracking numbers reveals so much. What I love, what I'm seeing the two of you get is, hey, we've made this work. We've made it work. We're actually very grateful at what we've been able to go through. But now perhaps there's a new way to look at our money together. Maybe it's not about going way down into the weeds. Maybe it's about coming up with a few key levers, those four key numbers, and like actually creating a vision for ourselves that lets us appreciate living.

• 1:44:32Ramit Sethi?

  Let's go out. Let's actually go out as a family and go eat out once a week. Fine, we'll find a way to do it within our numbers. But that's important to us. And trust me, when you go out to eat on Saturday with the whole family, you are going to really appreciate it. That's actually the best part of the whole thing. How do you feel? Do you feel confident that you could change the way you relate to money together?

• 1:44:58Speaker 01

  I think we can change the way we're going at it. I think we were going at it from a survival point of view. And now that now that we are at this place, even though we're at a very sort of precarious place, but we both have jobs that we can go back to. We both can like build a backup in no time, really. Once I'm back doing overtime, that can go into fun stuff, you know, and go into, you know, the extra savings and you get bonuses as well. So that's extra money that we can do. So we're actually fine. And I think I just need to sit in it and enjoy the fact that we've sort of almost made it.

• 1:45:43Ramit Sethi?

  Yes. No, you have made it. You have made it. You made it out of a cancer diagnosis. You made it. You still have money in savings and investing. If anything, when I look at it, I feel gratitude. I feel gratitude towards your employers. I feel gratitude towards the government.

• 1:46:01Speaker 01

  Universal health.

• 1:46:02Ramit Sethi?

  Exactly. I feel gratitude towards that insurance payout.

• 1:46:06Speaker 01

  Yeah.

• 1:46:06Ramit Sethi?

  That you had the vision to to choose to get that. A lot of gratitude.

• 1:46:12Speaker 01

  Huge.

• 1:46:13Ramit Sethi?

  What you said was so beautiful, going from survival to the next chapter. What word? What's the theme of the next chapter of your life as it relates to money? James, what would you say?

• 1:46:25Speaker 02

  Enjoyment.

• 1:46:26Ramit Sethi?

  Enjoyment. I love that. And what about you, Grace?

• 1:46:30Speaker 01

  I'd love to thrive.

• 1:46:31Ramit Sethi?

  Thrive?

• 1:46:32Speaker 01

  Yeah.

• 1:46:33Ramit Sethi?

  These are very positive, forward looking words.

• 1:46:37Speaker 01

  Yeah.

• 1:46:37Ramit Sethi?

  Like, nobody, look at, look at my body language. Nobody thrives like this. Worried about how much. Nobody thrives like that, right? They thrive standing up straight, sitting up straight, leaning forward and saying, what is it we're going to do in this chapter of our life? We are so grateful we're here.

• 1:46:54Speaker 01

  Yeah.

• 1:46:55Ramit Sethi?

  We're going to thrive.

• 1:46:56Speaker 01

  And I really want to enjoy, enjoy our kids and, and see them grow and, oh gosh, they're just incredible.

• 1:47:05Ramit Sethi?

  You know, I can see when, when the two of you are talking right now, I can almost see the, the family stories being created. I can see them like a spider web. They're almost unraveling in front of me. It's the story, when we first started talking today of dad was sick and it was hard and he got better and we're happy. It's nice. It's a nice story.

• 1:47:29Ramit Sethi?

  But this story is so much more detailed. It's the difficulty we had to go through. It's the fact that we didn't know what was going to happen. We had to stop working.

• 1:47:41Ramit Sethi?

  Dad kept trying to work because he thought he would get bored. But actually, maybe he was scared of just coming home. Who will I be? If I'm not working? Mom over here going to the farmer's market, canning tomatoes. Because she was afraid, afraid of who she would be if she couldn't feed her family. And we were so grateful. We had the help of our employers and our friends and our family. And once we got that final check from the doctors, we celebrated. How did we do it? We sat at home, we watched TV, we cried, we hugged, we did it all.

• 1:48:19Speaker 01

  Went to Legoland.

• 1:48:20Ramit Sethi?

  There you go. Amazing. Yeah, exactly. These are the stories that your kids remember, but secretly they're actually not for your kids. They're for you. Grace, before we wrap up, you mentioned that it'll be 2:00 AM, 3:00 AM, and you find yourself purchasing something off of Instagram.

• 1:48:46Speaker 01

  Yeah.

• 1:48:48Ramit Sethi?

  Can you tell me what you might do to change that? Not out of judgment, I'm not judging you for it. But now it seems to me you have a powerful vision. That is perhaps more powerful than whatever item is offered on Instagram.

• 1:49:07Speaker 01

  Yeah.

• 1:49:07Ramit Sethi?

  What tools could you use to change the way that you relate to spending?

• 1:49:11Speaker 01

  I think I need to take my cards out of the back of my phone.

• 1:49:22Ramit Sethi?

  Great. I love that. Very simple, but very powerful.

• 1:49:26Speaker 01

  And disconnect the Apple Pay from my phone as well.

• 1:49:30Ramit Sethi?

  You want to do it right now?

• 1:49:31Speaker 01

  I do. I do. I do. I do. I want to do that right now. I'll leave there.

• 1:49:35Ramit Sethi?

  So she took the credit cards out of the back of her phone.

• 1:49:38Speaker 01

  And I just have my driving license in there now.

• 1:49:41Ramit Sethi?

  Okay, okay, great.

• 1:49:42Speaker 01

  That's gone.

• 1:49:43Ramit Sethi?

  How does it feel to remove them?

• 1:49:45Speaker 01

  I feel like it's going to be hard to do the normal things that I'm doing.

• 1:49:52Speaker 01

  But maybe that needs to happen.

• 1:49:54Ramit Sethi?

  That's good. Important things are always hard.

• 1:49:57Speaker 01

  Yeah. Goodbye.

• 1:49:58Ramit Sethi?

  James, what's it like for you watching this?

• 1:50:00Speaker 02

  I have thought this would happen.

• 1:50:02Speaker 01

  They're gone.

• 1:50:03Ramit Sethi?

  They're gone. All the cards are gone. I see that. She held it up to the screen. Well done. Let's, let's do a round of applause because that's very impressive. Well done. Grace. Many of us find it silly to have to do something like this. You know, like, oh, I have to remove cards for myself. Like, I'm a grown adult. I should be able to control myself. But actually, once we accept that human nature is very responsive to even the smallest of barriers, then we learn how to deploy those barriers on purpose.

• 1:50:34Speaker 01

  Yeah.

• 1:50:35Ramit Sethi?

  As an example, in the US, in California, a few years ago, they started charging like five cents for bags. For, you know, grocery bags. The amount of grocery bag consumption went down dramatically. Like huge, just for a nickel. Using these barriers in our own life is incredibly powerful to, for example, make it a little harder to spend on things that you do not want to actually spend on. Very effective. And how about for the two of you? One thing that I heard is this feeling of guilt, this feeling of being behind with your money. What's a way that the two of you can change that relationship with money?

• 1:51:16Speaker 01

  I think having our meetings again.

• 1:51:18Speaker 02

  Yeah, definitely. Not hiding anything. You know, if you come home and there's a McDonald's cup in the thing, you'd be like, yeah, kids were tough. I needed something on the way home. Fine.

• 1:51:30Ramit Sethi?

  I love that. Honesty, always. I love that. There's nothing wrong with getting McDonald's once in a while. There is nothing wrong with it. It's totally fine. There's no need for shame. In fact, you can actually build it into your plan.

• 1:51:43Speaker 01

  Yeah.

• 1:51:44Ramit Sethi?

  That's the way to do it. Hey, once a month, maybe twice a month. I'm gonna set some money aside for McDonald's. Fine, you can certainly afford it. I want you to live a full, rich life. And that involves eating out once in a while? Yes. Getting something for the kids? Yes. And building up a sizable savings just in case? Also, yes. You can actually do all of those things with planning.

• 1:52:10Speaker 01

  Yeah.

• 1:52:11Ramit Sethi?

  What surprised you about today's conversation?

• 1:52:14Speaker 01

  I think that that control aspect, that surprised me that I thought I was gonna be just a really mean woman making my sick husband work. How dare I? But actually, it was, it was really emotional. I, I just, I really appreciate that you saw me. You saw what was going on and I didn't.

• 1:52:40Ramit Sethi?

  You know, Grace, I saw a different story than you saw. In your application, there were multiple references to making your husband work. Fifteen minutes into talking, I didn't see any evidence of that. If anything, James himself said, what else would I have done but work? And so sometimes the way we see ourselves is not the way that others see us. And it is so rare that we get the chance to see ourselves reflected through somebody else and maybe for someone to give us honest feedback.

• 1:53:14Speaker 01

  Yeah.

• 1:53:15Ramit Sethi?

  And I think you were very open to it. I say all this because it really shows you the power of how you can craft your own story. Your story was that I'm a bad wife forcing my husband to work while he has cancer.

• 1:53:32Ramit Sethi?

  That's not the story I heard. Meaning you have the power to shape your own story.

• 1:53:38Speaker 01

  Yeah.

• 1:53:39Ramit Sethi?

  James, what about you?

• 1:53:40Speaker 02

  I'm surprised how easy it is to talk about it. My expectations for this is that, you know, it would be

• 1:53:48Speaker 02

  that we would beat around the bush and not be honest about it, or we would hide things. But then, once we kind of got into it, the idea of hiding and not being honest about it was just ridiculous. Like, how are we ever going to get better if we don't talk about it? If we're not honest about it, honest with ourselves? And I think, I mean, that's something that we have been kind of holding back on. And it's purely because we just don't want to hurt the other one or don't want to burden the other person. But in some ways, we've actually come making it worse because we haven't been talking about it so openly. And so I'm just surprised how good it feels and how easy it is to actually talk about money so openly. And even the stuff around money and how it affects us all.

• 1:54:31Ramit Sethi?

  Amazing. I appreciate you for really showing up and being so open, being so honest.

• 1:54:36Speaker 02

  I feel hopeful.

• 1:54:39Ramit Sethi?

  Great. Grace.

• 1:54:41Speaker 01

  I feel a huge sense of relief.

• 1:54:45Ramit Sethi?

  Amazing. And I really commend you for what you've been through, but how you have done it especially.

• 1:54:52Ramit Sethi?

  Tough things like this illness can really cause fractures in relationships. Not only did I not see any of that, I actually see the way that the two of you showed up for each other. It's very, very impressive. And what an example you set for the many people that will watch this.

• 1:55:06Speaker 01

  Wow, we're very lucky. We're so lucky that we have so much supports. Like, you know, the financial cost of a cancer diagnosis in the States is a totally different story.

• 1:55:19Ramit Sethi?

  Yeah. What are the stories that you tell yourself? We all do it. We tell ourselves stories. In fact, we tell them so often that they start to feel like facts. I'm just not good with money. I need a big house to be successful. People like me don't wear things like that. You know, I once remember I was reading a financial forum and people were talking about when you have X million dollars, what are you going to do with the money? And there were hundreds of posts in this thread and I read them all. And I have to tell you, after reading them, the feeling that I got was disappointment.

• 1:55:59Ramit Sethi?

  Almost every single respondent in that thread said the same thing. I would get a house, I would renovate my house, I might get a car. And I was thinking, these are people from all over the country, all over the world. We're not talking about having $10,000 or $25,000. We're talking about millions of dollars. And everyone's answer, like something like 85% of the answers are all exactly the same. You independently decided that you just want a house, that's it? And I thought to myself, where is the creativity? Not one person said, you know what, I've always wanted to learn how to dance. I'm going to hire a dance instructor to come to my house and teach me how to dance.

• 1:56:41Ramit Sethi?

  Not one person said, I've always wanted to learn how to act. I'm going to go to an acting class and I'm going to get really good at acting. Not one person talked about hiring a chef to come and teach them how to cook. It was just a house. It was literally inanimate objects that they wanted.

• 1:56:57Ramit Sethi?

  I don't find this cool. I think that each of us is different. I think that each of us has something that we would love to do, but a lot of times we don't think people like us do it. I think that we think that's for rich people. I think that we tell ourselves all kinds of stories. And I've told myself stories too, that I'm just a skinny Indian guy, that I can't express my emotions, that experiences are better than things. And for a long time, I believed them. I never even thought to question them. Most of us never stop to ask, wait a second, is this even true? Like, some of you believe you don't even like to eat lamb, but you never had Indian kima. You believe you don't like opera, but you've never seen an opera that you understood or one that connected with you. So that's what I want you to think about today.

• 1:57:41Ramit Sethi?

  What is your story? What is your story? The story you've been telling yourself about health, about money, about relationships, about where you live, about anything. Take a second. Think about those stories, write them down and interrogate them. Why do I believe this? Is it true? Who told me that? Keep going. Ask why, ask again. Sometimes you'll get to the end of that chain and realize, I don't even believe this. I just picked it up somewhere and I never put it down. And on that note, let's now hear follow-ups from Grace and James.

• 1:58:14Speaker 01

  Hi, Ramis. Just a little update. It's been about two, three weeks. And we've just got back from an amazing holiday in the forest up in Langford. And it was so much fun. We had a budget and we hadn't spent it all by the last day. So we just kind of went wild on the last. It was lovely, actually, to like just have that guilt-free spending and just be like, no, no, this is the money set aside for it. So that was really nice. We are also, James is taking the lead on the money meetings, which I'm really enjoying because it doesn't just fall to me, which is nice.

• 1:58:56Speaker 01

  And also it allows me a little bit more space in my brain, which is lovely. We haven't really started the big savings. Well, we're not, nothing's coming in. So, but we are kind of reducing down the silly spends. I'm finding it hard.

• 1:59:23Speaker 01

  So I need to realign now after the holiday and have a little plan in mind for what I actually want to spend my money on. But yeah, I think we have a meeting tomorrow now and we're just going to kind of lay out whatever is ahead of us. We're already planning next year's holiday, which is really exciting because we haven't gone on any sort of holiday in about three years. Um, well, apart from, you know, we've just, that's been our first one. Um, so yeah, it's all, it's all looking positive and I can't tell you how mu- how much better I'm feeling. So I hope James is feeling better as well.

• 2:00:02Speaker 01

  Thank you. He's tired after the holiday, but, um, so yeah, thanks so much.

• 2:00:07Speaker 02

  Positive changes, very positive changes, I feel from it. Um, a big thing of the getting back involved with the finances again. So

• 2:00:20Speaker 02

  after the show, after the interview, we did a, we did have a kind of catch up. Grace showed me her, went through, went for the spreadsheets that we've kind of been looking at. We set out some kind of big goals, main one being to get our, we've tried, we've figured out how much of our savings would have to use over the next two months while we're both on no pay and low pay. And then we kind of tried to figure out how much we would need to where our savings would go next year.

• 2:00:52Speaker 02

  Um, to kind of build that back up, that emotional fun back up. Um, so we've got, and then we've got our first kind of catch up tomorrow and then we'll meet once a week briefly, just to, because we'll map out the month before and then we'll meet a week and see here if something crops up, another party we've got to go to or um, we've got to go somewhere extra that might need a bit more fuel, whatever it is. I found being involved in the money more the ability to just kind of call Grace up on some of her spending. I'm loving that she's being a lot more open with me now about it. Um, because she knows some of it is ridiculous. Like she even says, she comes at me with how ridiculous it is and.

• 2:01:33Speaker 02

  You know, and I have to, cause I think before I'd be like, you know, she was in charge of the money. She thought it was a good idea, then great, go for it, you know? And that is kind of, I think that's helped a lot. Um, and being more involved with money has helped me a lot as well. I can feel a lot more secure in us as a family and as our finances. I'm a lot less worried. I feel I'm getting a lot less worried about money. It's still there, obviously. Um, but kind of seeing it all, being more involved in it again is helping a lot with the kind of anxiety that I was feeling about it, you know? Um, we probably won't go

• 2:02:13Speaker 02

  completely bankrupt.

• 2:02:16Speaker 02

  Uh, if I get sick again, you know? Um,

• 2:02:21Speaker 02

  small things like that. And, you know, I'm trying to, similar to Grace, I'm getting more, trying to be more involved with stop worrying about it and be more involved with the family, like trying to not, um, spend money on things for the kids, but more in, um, just stuff together as a family, not just, you know, toys that they can play with and that'll end up thrown away or given away or something. Try and create more memories and more, more things together as a family. You know, we've been through a lot.

• 2:02:53Speaker 02

  A lot, a lot. And, you know, we're coming out the other side of it. It's time to enjoy it a little bit, you know? So, yeah, so that's where I'm at. You know, it's early days yet, um, but if we can stick with it, I think we'll be on a much better course moving forward, so. Um, thank you again for

• 2:03:16Speaker 02

  sometimes you just need someone else to kind of listen in and

• 2:03:21Speaker 02

  cause I think deep down we knew a lot of it. Sometimes you just need someone else to kind of point it out, someone from the outside, just to be like, yeah, you know, you're not crazy, you know? So, thanks again. And, uh, who knows? Maybe we'll see each other again soon.