How to stop being weird about money (w/ Paco de Leon)

Talking about money can feel confusing and awkward, but it doesn’t have to be. Paco de Leon is a financial planner and author of the book Finance for the People: Getting a Grip on Your Finances. Paco joins Chris to discuss ways everyone – but particularly freelancers and artists – can reframe their conversations and shift their mindset from “money corrupts” to “money gives you the power and freedom to create more art”. Whether it’s advising parents how to talk about money to their children or learning how to set a premium price for your skill, Paco shares tips to help you increase your profits – and transform your confidence around money. For the full text transcript, visit go.ted.com/BHTranscripts http://go.ted.com/BHTranscripts For the full text transcript, visit go.ted.com/BHTranscripts https://go.ted.com/BHTranscripts Hosted on Acast. See acast.com/privacy https://acast.com/privacy for more information.

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

• 0:01Chris Duffy?

  You're listening to How to Be a Better Human. I'm your host, Chris Duffy. Today on the show, we're talking about money. And for me, one of the most surprising elements of doing comedy and writing has been how much I've had to think about my finances. Money management is not my passion. And yet, if I don't put in the time and effort to handle it correctly, I won't get to do the things that I actually am passionate about. I would never have guessed that the key to being able to tell jokes is that you also need to know how to categorize your expenses and track your receipts. I could never have predicted that. At the same time, there's something really interesting to me about the fact that there are no universal answers about how you're supposed to approach money. Everybody is just figuring this out on their own for themselves, whether they're a struggling

• 0:46Chris Duffy?

  artist, or whether they're a wildly successful entrepreneur. Whether you're a person working a stable corporate job, or someone who cobbles together two or three different sources of income to make ends meet. Today's guest, Paco De Leon, is a money expert. But not just any money expert. Paco is a finance person who is also an artist. So this is someone who not only sees the system from both sides, but also thinks deeply about our complicated, sometimes fraught, relationship with money. And whether you're an artist who dreams about quitting your day job, or you dream about getting a day job and just having a little bit of financial security, Paco has incredibly practical advice for everybody listening. So here is a clip from Paco on the TED series, The Way We Work.

• 1:29Speaker 01

  This might sound strange, coming from a former financial planner, but I'm not a fan of capitalism. Almost everyone I work with and know and love is an artist, including me. So I know, the way the system is set up, freelancers and artists are too often way underpaid. They often feel like focusing on money will corrupt their creativity, or they think they're just not that good at making money, anyway. But the truth is, we can be good at it. And in fact, we have to be, because our freedom is at stake. Our freedom to create, to influence, and to use the power of money to change the very exploitation that keeps artists broke to begin with. I'm not struggling anymore, and I've learned a lot since being a financial planner, and

• 2:13Speaker 01

  I just wanted to share that knowledge.

• 2:18Chris Duffy?

  Paco is going to share that knowledge with us and a whole lot more, right after this break.

• 2:30Chris Duffy?

  This episode is sponsored by the Natural Resources Defense Council. Here's a question this show asks a lot. What can one person actually do? Take protecting the environment. When the task feels so big, it's hard to know where to even begin. Turns out, the answer isn't doing it alone. It's teaming up with people who care as much as you do. With the help of 3 million supporters, the Natural Resources Defense Council is in court to defend ancient forests, pristine coasts, and the wildlife that depend on them. None of these places or species can be replaced. They're still here because people fought for them, in and out of court. And that fight needs your support today.

• 3:09Chris Duffy?

  Donate at N R D C dot org slash human and your gift will be matched five times. Today's episode is sponsored by Smart Travel, a new podcast from NerdWallet. You know that one friend who always finds the best travel deals, picks the right cards, and somehow ends up in first class for the price of coach? Smart Travel is like that friend, but in podcast form. They cover things like the smartest way to book flights without planning your trip around the cheapest days to fly, or the quick math for knowing when to pay with points or just swipe your card. It's like having a travel savvy tour guide right in your pocket to let you in on all the little known tips and tricks to avoid all the hassle and extra costs that make travel so much harder than it has to be.

• 3:53Chris Duffy?

  Travel smarter and spend less with help from NerdWallet. Follow Smart Travel wherever you get your podcasts.

• 4:07Chris Duffy?

  And we are back. We're talking about money and finances with Paco de Leon.

• 4:12Speaker 01

  Hi, my name is Paco de Leon. I am the author and illustrator of Finance for the People. By day, I help folks not freak out about their finances. And by night, I am shredding the gnar on the guitar and I play in a band. That's actually a lie, but you know, I'm not always shredding the gnar.

• 4:29Chris Duffy?

  Well, now I gotta ask what the lie of shredding the gnar on the guitar is. Is it that you're not playing the guitar or you're not constantly shredding?

• 4:35Speaker 01

  I'm not constantly shredding and you know, like the more these kinds of cool opportunities pop up to like, keep creating a deeper path in like, hey, I'm this finance person. The more it pulls me away from like, being able to do the music, which is the ironic thing is like, if I don't do the music, then I'm like, not the Paco that people are attracted to.

• 4:55Chris Duffy?

  You're not the Paco that people are attracted to. Tell me about.

• 4:58Speaker 01

  You know, there's a responsibility to being creative, right? There's a responsibility to serving the creative ideas that are gifts that are bestowed upon you. I believe that you have to arrange your entire life to please the gods of creativity to give you the gifts. Right? And I know what works for me. And this probably works for a lot of people, like I have to get up early because the membrane between the subconscious and like where the creative gods are and where I am, that's when it's going to be the thinnest. Right? So they can give me those gifts early in the morning. I have to exercise. I have to exercise my body. Otherwise my mind takes over. I'm not used to being in my body and that is a part of creativity, right?

• 5:43Speaker 01

  Um, especially with music, right? There's a physicality to music of like playing on the fretboard, tinkering on the keys, using your body to create noise versus like writing. And so that's a direct link between like, why I must play the music and how that allows me to be the Paco that the marketplace wants, right? Cause the Paco that the marketplace wants is it's an overlap between the quirky, weird, and then the other piece is like, oh, by the way, I know a shit ton about finance and business, how to read a P and L, how to do your bookkeeping, the best practices for, you know, not freaking out about taxes if you are a first year freelancer or 10 years in business. And like, that's a beautiful combination and I feel lucky to have like, I have to find the balance between honoring those two things.

• 6:27Speaker 01

  Otherwise I'm not the Paco that people have come to know and love.

• 6:31Chris Duffy?

  Yeah. And I think that's what draws me and it makes your writing and speaking about personal finance to me so powerful, right? Like in your book, Finance for the People, Getting a Grip on Your Finances, you frame the book by saying that money is a proxy for power. And you talk about how important power is, especially for people who may not necessarily think of themselves as powerful, or even want to be powerful. Because often power is associated with like forcing people to do things that they don't want to do, or exploiting people. And you talk about how as an artist, right? Like, we need to have the power to do our art. We need to have the space and the time and the respect to do our art. And that money is a way of getting those forms of power, which are crucial to the

• 7:15Chris Duffy?

  actual work itself.

• 7:17Speaker 01

  Yeah, absolutely. Money is just one form of currency, and it's an important form of currency. And then, you know, for better, for worse, the path that we're on with humanity is, we have to figure out that financial aspect, that financial piece. Otherwise, you're not going to have the energy, you're not going to have the time, you're not going to have the drive, you're not going to have the space to put your message out in the world. But, you know, I definitely look at managing your money, figuring out your finances, playing this game as just an opportunity to hold up a mirror and look at who you are and understand the way that you think and the way that you move in the world and notice those things and look at those patterns outside of money. How are you interacting in the same way?

• 8:02Speaker 01

  How do you have the same relationship with money and work and career and your business the way that you have with your mom, or your estranged sister, or your partner, or your ideas of perfection, or your ideas of worth, right? And so for me, I just look at money as just another way to explore who we are.

• 8:21Chris Duffy?

  I was struck by another line in the intro to your book, which feels, I mean, you're talking about it when you're talking about money, but it feels like you could have written it about the process of therapy and self-discovery too, which is, it's about feeling less fragile by implementing strategies to help us cope and let go of the things outside our control. Now that's you talking about finances, but that that could easily be a book in like an instructional manual for talk therapy.

• 8:46Speaker 01

  Yeah. So, you know, at the risk of like sounding too much of a self-help junkie, right? There's different avenues for growth and progress. And I think most people will take the same path. Many paths lead to the same destination, right? And I think like fitness is a pretty common journey. Like a lot of people who finally start eating right and caring about the quality of their sleep and, you know, exercising regularly and getting fresh air, caring about their physical body. They learn those patterns and that model. And then you can take that as kind of like a stencil or blueprint and you can start to overlay that in other areas of your life. Right. The other path is money. A lot of people do it through money, right?

• 9:26Speaker 01

  They're, they look at how they've been spending it, how they haven't been saving it, you know, where they can find their agency and they exercise it. And then again, that's a stencil, an overlay that you can use. You can look at the state of the damn world right now and be like, it's really, really, really, really simple and easy to find ways to numb out and to check out and just say, it's all too much. Let's not give a single flying fuck. But, you know, I, maybe we need to do that every once in a while, but to find power, to find like we have some modicum of control, how you can move the needle to mix analogies and focus there and do that a little bit. And, you know, one day you'll look up and realize, okay,

• 10:09Speaker 01

  I can make a difference, right? Like me talking into this microphone, staring into this camera screen, having a lovely conversation with you, Chris, feels trivial to me in this moment, but I bet you I'll say one thing or you'll say one thing. And it's going to strike a chord in someone's heart or punch someone right in their soul and they might make a change and god damn it. Isn't it worth it? So do more of that, people.

• 10:32Chris Duffy?

  For people who are listening, can you give us just like the 30 second history of who you are and how you got to the place you are in your career where you do all these things?

• 10:42Speaker 01

  Sure. I started playing music when I was really young.

• 10:47Speaker 01

  And then when I got to college, I thought I better make a choice that will make my parents, will allow them to sleep at night, right? So I'm going to choose something practical. I'm going to study finance and economics because around this time, 2006, when I made that choice, a bunch of people were getting really rich and they didn't seem that smart. And I was like, bingo, that's my job because what I want to do is have time for my art, for music. So I studied finance and econ. My first job with my degree was working at a small boutique business consulting and management firm, where I learned how to do bookkeeping and I saw the inside of people's businesses. So I'm like 22 years old, helping these creative businesses do their books. And from a creative perspective, I'm also still playing in the band.

• 11:31Speaker 01

  Then I pivot and I go into wealth management. So I'm working at this financial planning firm that's managing just north of a billion dollars. And I start to learn about personal finances. And I'm here in LA and I'm sitting across from a lot of studio heads. And I'm kind of broke at this point, you know, I'm not making a lot of money. I'm still playing in the band. And I get this moment of like, wait a minute, I'm like helping this VP at some studio save like 50 grand on a tax bill. But like my community of people, like the artists, the painters, the ceramicists, the filmmakers, my people, they don't have access to this. So I was like, had this moment of truth or is like come to Jesus moment rather, where I was like, oh, I need to take everything I've learned because I've learned a lot and I need to start setting the information free.

• 12:15Speaker 01

  And the thing that kept coming up was like, is there a way that you can help your community of creative people with the sharp tools that you have in your toolbox? And so the question was, how can I serve this community and thrive and not be broke? And so everything that you've seen since then, the bookkeeping agency that I've run, the TED Talk that I've done, the book that I've written, the podcast that I've had, all of that is just data trying to answer that hypothesis of like, can I be useful? Can I be helpful? And so, yeah, I run a bookkeeping agency and I make a lot of finance content. I'm just like, you know, trying to help people just inch by inch, brick by brick.

• 12:54Chris Duffy?

  I imagine there's a lot of people who listen to this show who are younger, who are maybe not in their first job, but you know, still starting out in their careers. When you are in that position where you're kind of probably not making that much money, maybe struggling to, you know, pay your bills and stay out of debt or not go into a lot more debt than you're already in. How do they start to think about money in this way that is empowering? Because I think for a lot of people, myself included, money feels like it's empowering when you have a lot of it. And when you're rich and when you don't have a lot of it, it is a constant stressor and a burden and not like a fun tool. It feels like a weight rather than a tool.

• 13:37Speaker 01

  So to be fair, I struggle, right? I'm going to oscillate back and forth myself between feeling very confident about understanding money from a very logical perspective. And then the reality of being like, but I wish I had more or I feel constrained. Or is any amount ever going to feel enough, right? So I think having those feelings of push and pull are normal. It's just what it's like to be a human person on planet earth, first of all. So I've been grappling with this myself, but let me, let me back up and say that when I was a financial planner, I was a broke financial planner. I was making very little and I was riding my bike to work in Los Angeles during rush hour traffic,

• 14:23Speaker 01

  which was like a 15 mile total commute. Yeah. And I was like growing lettuce in my backyard to save like $2 at Trader Joe's, right? I've struggled financially. So how do we help young people get through this? The first thing you have to do is really just look at the things that you can control, right? And we can't control inequality, unfortunately, but what we can control is like understanding how the market works, right? And sure, stock market, but I mean, like the market in which you're exchanging your skills and what you can produce. And unfortunately, your time for money. And I think here's where a lot of creative people get uncomfortable because now I'm forcing you to say like, Chris, how valuable is making people laugh in the world?

• 15:08Speaker 01

  How do we put a dollar value on that? But to, you have to start looking at what you're able to create in the world, produce in the world, how you're able to move people in the world or inspire people in the world. How can we assign a dollar value to that? So. Just looking, this sounds very cold and I feel like my economics degree is coming out, but just understanding how people value things in the world, I think is really going to be the first step.

• 15:33Chris Duffy?

  Yeah, I'll say that for me personally, one of the hardest parts of leaving my job teaching and starting the work of being a comedian and a writer was having to constantly price things, you know, having to say, hey, will you hire me to write this thing or make this video or perform a live show for you? And that those things didn't have like a set price tag. That was a really hard thing for me. And I think the biggest mental shift that helped me, and this is only specific to me, I don't know if this will be true for everyone else, but is I was shocked because I thought that if I said, hey, me performing stand up for you costs $500 instead of $50, I thought people would be angry or like me less. And

• 16:15Chris Duffy?

  it was astonishing to discover that most of the time when I said $500, people who were trying to hire me respected me more and treated me better. I couldn't believe like it's better for me because I'm getting more money, but also like you're treating me so much better. You're treating me like I'm a professional instead of like, I'm just a guy who's here with a microphone. That was a huge revelation.

• 16:38Speaker 01

  It's a weird thing that happens when you are showing people like, okay, here's how I'm going to value this, right? And that, you know, that statement in itself can be misleading because somebody who maybe doesn't have a draw, right? The ability to bring in a crowd, keep a crowd, get people happy enough to buy more drinks, right? Like you can't just wake up and say, I'm going to charge a certain amount. You have to like meet a threshold of skill. But once you exceed that, once you meet and or exceed that, yeah, it's really amazing how if you don't charge enough, actually you look like a cheap option, right? And the, the phrase I always like to use is the $1 oyster. So tell me, Chris, if you

• 17:21Speaker 01

  saw somebody selling an oyster for a dollar, would you think that's a great deal? Or would you be a little bit like, I don't know, that sounds like food poisoning tomorrow?

• 17:31Chris Duffy?

  You know, I, I know exactly where you're going and I know the right answer. And I do have to be honest, Paco, that I am a terrible person to ask this question because almost every year of my life, I have gotten food poisoning from eating something that I knew was bad. So I am definitely the guy who's like, $1 oysters, yum. And then I eat 17 and the next day I'm like, those came with a cost. There's a high price to the $1 oyster. But I do think that a rational person would say, I'm going to investigate why these oysters are cheaper than I think they should be.

• 17:59Speaker 01

  Exactly. And that's what happens when you're, you're like anchoring your price or you're saying to somebody, this is what I'm worth. I mean, a great example, like when I first started my bookkeeping agency, I remember trying to compete with like a company like Bench, right? And they're, they have economies of scale. They, they were using proprietary software. They had investors, they could afford to lose money, right? When you're a small business, you shouldn't operate at a loss the way that these larger businesses can, because they're going for volume. And I remember charging really cheap and trying to, try to be around that price. And it was fine. It was going okay. And then one day I was like, this is, I'd like hit a wall, right? The pain was too great. I'm like, something's got to change. And like from here on out, we're raising our prices, you know?

• 18:42Speaker 01

  We're, we're worth more, we're more premium. And the moment I raised my prices, like more people said, yes. And I was like, oh crap, this is totally the goddamn $1 oyster here.

• 18:56Chris Duffy?

  We're going to take a quick break and then we'll be right back.

• 19:05Chris Duffy?

  This episode is brought to you by Planet Visionaries, a podcast in partnership with the Rolex Perpetual Planet Initiative. What connects a hidden laboratory in the Amazon, giant pandas in China's mountain forests, research relating to the ocean and communities living alongside wildlife in India? That's what you'll hear on season six of Planet Visionaries. Stories from the explorers, scientists and conservation leaders whose work addresses research, biodiversity and conservation issues in specific locations. Planet Visionaries, hosted by environmental advocate and professional climber Alex Honnold, brings you real stories of discovery, determination and research and initiatives relating to environmental change.

• 19:48Chris Duffy?

  In partnership with the Rolex Perpetual Planet Initiative, this is Planet Visionaries. Listen or watch wherever you get your podcasts.

• 19:59Chris Duffy?

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• 20:42Chris Duffy?

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• 21:06Speaker 02

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• 21:34Chris Duffy?

  And we are back. This is another clip from Paco on the series, The Way We Work.

• 21:39Speaker 01

  When it comes to your offering, you have to be able to answer the following question. Why would anyone hire you over your competition? If you can't answer that question, neither can your potential clients, which means you can't charge more for the thing that makes your work special. Price becomes a differentiator and bidding becomes a race to the bottom.

• 21:55Chris Duffy?

  This is something you talk about in your TED Talk, which is, why would someone hire you rather than hire the five other options that seem on paper to be similar? And one thing that I've really loved is you say, if you can't answer the question of why you rather than the others, then the only thing to differentiate you is price. How can you do that same work for as little money as possible? And being the cheapest is a tough battle to win.

• 22:18Speaker 01

  Super tough battle. And then if you just like go a few steps further and like look into the future of those choices that you've made, when you're the cheapest now, you're like, what kinds of clients are you then attracting? Which means then what kinds of conversations are you having on a day-to-day basis? Right? Probably things like, why does this cost this much? Could you give me a discount? Or you're straight up going to get people that do not value you, right? They value the cheapest option. They value spending less money. They don't value like, oh, I want to have a great experience. Or this is worth it because the customer, the attention of detail that they give to the customer experience is top-notch, things like that. And yeah, you definitely have to figure out what sets you apart, which I think some people struggle with that.

• 23:01Speaker 01

  But I find that to be a really fun space to play in. Like, there's a lot of potential and possibility and you can kind of like turn things on its head, so to speak.

• 23:11Chris Duffy?

  I've heard someone say, like, you have to give them a handle to pick you up by afterwards. So maybe for me, it's like, he's a comedian, but he also interviews scientists and smart people about stuff. He uses comedy to make big ideas accessible. I think that's often my handle. You give me anything, but you kind of need to give people a handle to pick you up by so that they can remember you and talk about you to other people.

• 23:33Speaker 01

  Totally, yeah. In the financial planning industry, I remember we'd be like, we got a guy, right? You're, you need an estate planner and you have all this complication? Don't worry, we got a guy, right?

• 23:43Chris Duffy?

  This is, in your book and in all of the speaking and interviews that I've heard you do. You are always talking about not just what we should do with money, but how we should think about money. And that's not always a way that people process personal finance. So I want to just ask you why that is. And I would also love for you to tie in a thing that's really stuck with me from your book, which is the idea that if there's one way that we can generalize, it's that we are all weird about money.

• 24:13Speaker 01

  So when I was working at the bank as a debt collector, I remember I would be calling people and the level of emotion that people would have, right? They're so ashamed, they're so embarrassed. They're like, how dare you call me at dinner to, you know, collect this debt? And I totally, I totally get where they're coming from. But that was a very formative experience of like seeing people's reaction to their finances and realizing that, you know, having this shame, right? And talking to a stranger is, is part of money. And so over time, like I'm stitching together this kind of mosaic and realizing like, oh, you know, people are weird about money. It's a very weird thing. There's all these forces that we can't control. There's this idea in the world that one shouldn't talk about money,

• 24:57Speaker 01

  which then exacerbates all of these negative feelings that we have. And so, you know, I think we should really unpack that. And, and for me personally, the moment that I was able to really change my financial life, I, when I look back on it, all of those moments start with like, what did I used to believe? And then how did I change that belief? And then how was I able to change my behavior because I changed that belief? And I know that sounds so woo woo and, and like, you know, if you just believe it, you can achieve it. And I, that's not what I'm saying, but you have to believe that something is possible before you act on that possibility.

• 25:37Chris Duffy?

  You say this explicitly in the book, and I know that you, you believe it is, it's easy to think when someone is talking about the work that they've done in finance and also the Position of recommending to people what they should do with their with their money, that you are a fan of the status quo and like capitalism's number one cheerleader. And I know that you said in the book, like, that is very much not the case.

• 26:01Speaker 01

  Yeah, I mean, another thing that is prickly, I guess, from my perspective is that even though I'm helping people get through this system that we have, right? Teaching them the rules, things that are spoken, unspoken, things that get passed on behind closed doors in certain zip codes, right? A big motivation for that is like, yeah, I want people to understand the rules of the game, but I do realize and now even more, like seeing the future, like, you know, looking at the horizon, like, there's change is gonna happen. And what needs to happen first is we need to understand how we got some of these rules. Like, what is the history of credit scores? Or what is the history of credit cards? Why? Why does the stock market work the way that it does, right?

• 26:43Speaker 01

  And once we understand these fundamentals, then we can, okay, we can at least go from a place of, do we want to keep certain things? This is why this is great? Or like, when it's, you know, should we burn it all down? Should we build something new? I think, again, knowledge is really the the the starting point.

• 27:00Chris Duffy?

  Here in the US, there is a very robust system of enforcement and laws around the idea of insider trading, right? The idea that people shouldn't be able to invest based on material, non-public information. So the idea that like, if you're an executive and you find out that your company is gonna have a worse sales quarter, you shouldn't be able to sell your company's stock when other people can't. And the philosophy behind that, as I understand it, is that it's it's not fair to regular people because you have more information than they do. And I'm not, certainly not arguing for insider trading being legal. But it is interesting when you think about that philosophy because

• 27:42Chris Duffy?

  A lot of the rest of the finance system, maybe all of the rest of the finance system, does not live up to that underlying philosophy that like we should all have the same information and knowledge and ability to make money off of these systems. And I think part of what you're doing that's radical is trying to get some more people who are on the outside to be on the inside of the system.

• 28:04Speaker 01

  Yeah, that's, you hit the nail on the head. That's exactly what I'm trying to do. Really, what I've seen is I've seen a lot of people just feel like this world of money is quote unquote, not for them. And I feel that way. I've felt that way. I continue to feel that way. But I think I've always chosen to try to be in spaces where maybe I just feel like I don't belong. Maybe that's a symptom of being an intersectional person is like you never feel like you belong. Maybe it's a symptom of having immigrant parents that you feel like you never belong, right? But if I can get as many people to understand, you know, the underlying forces and where

• 28:44Speaker 01

  they can find their agency, then I think net, net, net, it's, it's just going to help people suffer less at the end of the day. And that's really, that's really all I'm trying to do, Chris.

• 28:56Chris Duffy?

  So this season on the podcast, we are using as kind of a guiding light, these, some of these like virtues or moral values that we would maybe strive for. And one virtue that people talk about a lot is the idea of thrift. And for me, you know, when I thought about thrift originally, I would think of that as just like being cheap. But it's actually, you know, the definition of thrift is the quality of using money and other resources carefully and not wastefully. So how do you think about thrift and why is that important or is that important?

• 29:28Speaker 01

  Yeah, I definitely think thrift is important when I think about it in relation to power, right? It's, it's all about trying to be mindful with your resources because if you're not using it here on something that seems frivolous or wasteful, then you can allocate it and use it over there in a way that has impact, right? And however you choose, that impact is your choice. But understanding the opportunity cost and the trade off is hugely important. And I never thought I would be comparing thrift to power, but, but here we are.

• 30:00Chris Duffy?

  I'm thinking about it even just in your own personal story, right? Like you're someone who's riding your bike and you're growing lettuce. So those are examples of thrift, but. In some other ways, the fact that you are working this job that maybe doesn't pay you exactly what you wanted to pay so that you can then get access to knowledge and connections and and power is in some ways, that's an example of thrift too.

• 30:26Speaker 01

  Yeah, that makes me seem like a genius and I was plotting to do that, but I really wasn't. I, I think I was just trying to, you know, figure out my path. And in retrospect, I wasn't saving, I was trying to save like $40 a week in gas and $2 a week in lettuce. So I wasn't saving $42 for myself. I was actually saving $42 from my employer. And I, what I realized in retrospect now is I should have just confronted the discomfort. I should have had an uncomfortable conversation with my boss and said, hey, listen, this is, I'm not surviving here. And like, you're paying yourself a fuck ton. I literally see it. How can we make the math math so that I'm not, you know, putting myself in danger

• 31:09Speaker 01

  and super stressed out? So, you know, that, I would say maybe the thrift power relationship in that example is maybe more maladaptive than I would encourage folks to follow.

• 31:25Chris Duffy?

  Okay, we're going to take a short break and we'll be right back after this.

• 31:34Chris Duffy?

  This episode is sponsored by ADT. It's that time of year again when life gets busy, back to school, back to work, back to routine. When everyone is out the door and on the go, it's comforting to know your home is taken care of while you're away. ADT makes that part easy. Enjoying the little moments with friends and family is easier when you have one less thing on your mind. With their customizable systems that can be professionally installed, ADT has your home security covered. The ADT Plus app lets you access your whole system from your phone. You can arm, disarm, and even check live camera feeds. Visit ADT.com or call 1-800-ADT-ASAP. When every second counts, count on ADT.

• 32:17Chris Duffy?

  This episode is sponsored by Peloton. Sometimes the world gets loud. There's always something to think about, something to check, something demanding your attention. And one of the things I love about moving is that for a little while, you can turn some of that noise down. Maybe it's a run, a walk, a hike, whatever gets you moving. You focus on the next step, your mind gets quieter, and you get a chance to be right where you are. Peloton helps you find that feeling. And now, the new Peloton Tread Flex makes the joy of running feel even more accessible. It's movable, foldable, and designed to fit easily into your space. All you need is a corner, not a home gym. Run, walk, or hike when you need to, then roll it away when you don't. With programs for every level and instructors who feel more like friends than drill sergeants, Peloton meets you where you are. Let yourself run.

• 33:02Chris Duffy?

  Explore the new Peloton Tread Flex at onepeloton.com. This episode is brought to you by Planet Visionaries, a podcast in partnership with the Rolex Perpetual Planet Initiative. What connects a hidden laboratory in the Amazon, giant pandas in China's mountain forests, research relating to the ocean, and communities living alongside wildlife in India? That's what you'll hear on season six of Planet Visionaries. Stories from the explorers, scientists, and conservation leaders whose work addresses research, biodiversity, and conservation issues in specific locations. Planet Visionaries, hosted by environmental advocate and professional climber Alex Honnold,

• 33:45Chris Duffy?

  brings you real stories of discovery, determination, and research and initiatives relating to environmental change. In partnership with the Rolex Perpetual Planet Initiative, this is Planet Visionaries. Listen or watch wherever you get your podcasts.

• 34:05Chris Duffy?

  And we are back. I've heard you give some really practical advice for people about spending. Because there's, obviously, there's, you know, there's the piece of saving, there's also the piece of trying to make more, which I often think is undersold is the answer, right? There's a lot of people out there being like, just don't buy your avocado toast, don't get your gelato, don't spend money on whatever. There's a very condescending paternalistic tone often of like, don't do that. And to me, it's often like, well, the answer is just... Pay me more, let me be in a union so that you don't take advantage of me. And then I'd be able to afford that and it wouldn't be a problem. But spending is a piece of this, and I think a lot of times we don't always spend consciously. So let's talk about this, this law that you've jokingly called, or maybe not jokingly, called Paco's Law,

• 34:48Chris Duffy?

  which is your spending will equal what you have available to spend.

• 34:51Speaker 01

  My philosophy on figuring out ways to constrain your spending. I really want people to like create this idea of scarcity with their cash in order to kind of manage your spending. I think you need to find ways to like protect yourself against yourself because, you know, we're emotional creatures. We're scrolling Instagram. There's a team of neurologists and psychologists and marketers whose whole job, when they're paid very well, is to try to get us to impulse buy, right? And it used to just be like, okay, you're out shopping and you see a rack and you think, let me buy this magazine. And those were low stakes. We are not in low stakes territory anymore, folks.

• 35:32Speaker 01

  I mean, we are walking around with tiny little billboards in our pockets, constantly advertising to us. So to think that you can use willpower or you can try to overcome this, you, you have to recognize the danger that we're in and figure out ways to protect yourself from all the ways that you're being exploited. So especially for something like social media, one of the things that I like to do is I just create rules. And so one of my rules is we don't just see an ad willy-nilly and buy. That is, we don't do that because we know what's going on. They're trying to trick us. What we do instead is we take that thing that we're thinking about buying and we put it on a list. We, I call it the buy list because, you know, I wasn't that creative when I was thinking about it.

• 36:17Speaker 01

  But I spend the time imagining buying this thing. And I go through the motions of picking the color and picking the size and hemming and hawing. And I put on this list and I know that the thing has to stay on the list for, I don't know, five days. You have to come up with some sort of time period where the thing stays on the list. And what happens is when you're shopping quote unquote without actually spending the money, your brain still thinks it's shopping. So oftentimes you get that dopamine hit that you're looking for. And I would say 99% of the time, Chris, I forget that the list exists until another thing is exciting and enticing. And then I put on the list and then I look and I'm like, oh yeah, I don't want that

• 37:00Speaker 01

  other thing. I'm glad I did that. So that's one way to having rules and doing the buy list. The other thing that I like to do is I like to separate my spending. And so when it comes to fun things like going out and you know, all the things that make life feel like life, all the stuff that you buy that you don't really need. I like to buy that out of a specific account. You can call it your allowance account. You can call it your fun and bullshit account. Call it whatever you want, but allocate like a certain amount of money into that account every month. And that's what you'll use to spend your, you know, heart's desire.

• 37:36Chris Duffy?

  Maybe it's just because I wasn't like super financially savvy when I first started working for myself, but I didn't realize you can just, you can have like three or four no fee checking accounts. And so now like what I do is when money comes in, whether it's a $5 check or a $5,000 check, I just put the same percentage into, I try and do it by percentages. So I'm like, I know that if I put 33% away in a tax saving account, that I will definitely have more than I need for taxes and I won't get walloped at the end of the year. And then at the end of the year, when I don't need it all, it's great. Like then that becomes like goes back into the you can spend it money. So for me, like having a no, a no fee checking account that is just the kind of untouchable bucket

• 38:18Chris Duffy?

  has been really helpful for that. And then I kind of added other buckets as I went along where I was like, I'd like to save a little bit to give away to charity. Okay. So that's a bucket that I don't want to touch. I want to have some, maybe like a retirement account like thing. So at one point, I think I had like six different, I've kind of toned down how many buckets I have because it was silly to put like 17 cents into a bucket sometimes. But maybe it's intellectually good to put 17 cents in sometimes.

• 38:41Speaker 01

  Yeah, again, it's like you're forcing scarcity upon yourself, right? And allowing, like, you don't have to do any more mental math. That's why I really like this method because you just like log into your bank accounts and you can see very clearly like, okay, that these buckets are not for me and they're not to spend. I think when you have all your money lumped together, it's easy to feel flush and think, oh, I can spend here and spend there. You're relying then on mental math and there's better ways. There's technology, we should definitely rely on it and free, you know, resources like free checking accounts. We should definitely rely on those things.

• 39:12Chris Duffy?

  One of the biggest obstacles to tackling our finances is often shame. Right? Feeling ashamed of how much you earn or how much you've spent or how in debt you went or the choices that you made or didn't make. How do you personally, and then in working with other people, how do you think about dealing with shame and that that kind of really big emotion?

• 39:37Speaker 01

  Yeah, so I once heard somebody talk to me about shame being like, you know, you feel shame when you go outside what was expected of you. Right? So it's like, we are cute little horsies and we're in a little corral, I guess is what it's called, right? With with wooden barriers keeping us corralled in, right? Those corrals and that world is, you know, what the world expects of us, right? Our parents expect us to go to college and society at large expected us to go to college. They expected us to do great after college and make all this money and expected us to be responsible with our finances and not feel,

• 40:18Speaker 01

  you know, like, how did I get, you know, they have these expectations and we stay within those corrals as the best we can. And then when we go outside of it, that's when we start to feel like, oh no, we busted through and we shouldn't have. And that's kind of where shame is. So I think maybe looking at shame from that perspective can help you realize that, okay, you're you're just going outside what was expected of you and that's a hard thing to experience as a human because we need each other to survive, right? And so we have this deep and profound sense where we want to belong. And we want to be accepted. I think just knowing that is really helpful for me, like my own personal experience of like growing up queer is like a masterclass in shame, a masterclass in,

• 41:04Speaker 01

  you know, you have this corral around you and you are, you're not even the horse, right? You're something else disguised as a horse. So if you've dealt with that outside of your finances, you know, and you've been able to work through that, you might have a model for doing that. I think another thing is just letting it out. Like journaling is really helpful for me. I know some people don't, they're not like a words person. Maybe they don't have an inner monologue. So maybe that's not going to work for them. So you got to find something that works for you. But for me, just getting everything onto the page, confronting why I feel so shitty. And then, you know, sharing that with other people. Every time I write something in my newsletter where I'm like, oh God, I was vulnerable. I hit send and I'm like, oh my God, that was so vulnerable.

• 41:48Speaker 01

  It's, I'm disgusted, right? You have that vulnerability hangover. I'm like, why would I do that? I, why am I telling strangers on the internet about how I'm grappling with my sense of worth right now? What is the matter with me? And then, you know, five people were right back and they're just like, I feel so seen. I feel so much better. Like I was feeling shitty and this made me, and I'm like, oh, okay. Yeah. So I hated it. It was uncomfortable. I felt embarrassed. It was cringey. I guess we're going to do it again.

• 42:14Chris Duffy?

  It also makes me want to know, as a musician and as someone who plays in a band and makes art and performs it, and as a money person, how do you think about like the value of your work and your, your music to yourself, not to the world?

• 42:30Speaker 01

  I think about art as a completely different value than money, right? That paco goes to the marketplace and realizes the utility that she brings to the world and how I can impact people, right? There's this whole other paco that is just like walking around, experiencing life, just like the rest of us, and is sometimes struggling to figure it out, right? To just find the balance, to be a good person, to not be a shitty friend, right? To just deal with all the ways that we are also compromised in terms of like, I want to be a good person, but I have to do this thing, right? And art for me is a way to just process. So the value is beyond financial. The value is art is a necessity that I have to do in order to process

• 43:14Speaker 01

  my experience of life. And then come to the table hole, whatever table that is, right? That table could be me and my partner or me and my work. So I don't look at art necessarily as something valued financially, personally. And that's my relationship to art.

• 43:31Chris Duffy?

  Someone is becoming a freelancer. They're starting out on their own. What's the most important thing or things that they should do in their first week or their first month?

• 43:40Speaker 01

  Wow, first week or first month? They should start reaching out to their network and say, hey, I'm selling this thing. Will you buy it? Or do you know somebody who will? And oftentimes that's a service, but that's the first thing you should be doing is validating that what you are going to try to make money on will make money. They should do the thing that you did, that you, I forgot to say gold star, A plus, four checks or whatever, with the saving into the tax savings account. You should be doing that first month.

• 44:06Chris Duffy?

  Great. And what about first year? They're finishing their first year doing something.

• 44:10Speaker 01

  First year, you should be working with a small business accountant that you really feel like you like. Ask your friends, hey buddy, who do you work with? That's a small business accountant. Or go online to an online community of other entrepreneurs in your space and ask, who do you guys use? Who's, who's the guy, right? What's, find the person with that handle. And before the end of the year, you should have a year end tax planning meeting where you're like, hey, look at all this money I made. Look at all this money I spent. What am I going to owe in taxes next year?

• 44:37Chris Duffy?

  What about if you are a person who has a stable job that you've had for a few years? And you are, let's say you're in a band or you're making some kind of art on the side. What finance advice would you have for, for that person?

• 44:49Speaker 01

  Take advantage of that paycheck and take advantage of what other kinds of benefits you are getting at that company. Your compensation is not just how much they're paying you. Your compensation is things like your health insurance and things like an employer sponsored retirement plan. So take advantage of that as much as you can.

• 45:05Chris Duffy?

  Okay, your parent and your kid is in late elementary school or, or middle school. What is an important thing? Doesn't have to be the most important thing that you can teach them about personal finance.

• 45:15Speaker 01

  One thing is I would make sure that your child knows that they're valuable in the world, no matter what they do and what they choose. Help them foster a sense of self-worth and confidence because that will translate to a paycheck. And the other thing is help them understand like the value of money. Money is a and value is a very abstract thing. I think a lot about money like music, actually. It's, it's, it's very abstract. You can't grab it. It's just out and around and trying to understand value. Help them understand that.

• 45:44Chris Duffy?

  Beautiful. Paco de Leon, thank you so much for being on the show and for gracing us with your, your wisdom and your presence.

• 45:49Speaker 01

  This was my absolute pleasure, so thank you for having me.

• 45:54Chris Duffy?

  That is it for this episode of How to Be a Better Human. Thank you so much to today's guest, Paco de Leon, for making us all so much richer with knowledge. Paco's book is called Finance for the People, and you can find out about everything that Paco does at the website, thehellyeahgroup.com. That is thehellyeahgroup.com. I am your host, Chris Duffy, and you can find more from me, including how to hire me for extremely entertaining and lucrative work projects at chrisduffeycomedy.com. I'm also open to offers of wealthy people looking to become my benevolent benefactor. Please be in touch. How to Be a Better Human is put together by a team who are so incredibly valuable. On the TED side, we've got billions of dollars of human capital coming from Daniela Balarezzo,

• 46:35Chris Duffy?

  Banban Cheng, Chloe Shasha Brooks, Laney Lott, Antonio Le and Joseph DeBryne. This episode was fact checked by Julia Dickerson and Matthias Salas, whose only currency is truth. On the PRX side, they say a picture is worth a thousand words, but a thousand words, recorded and mixed cleanly, are worth a trillion pictures. Making that happen, Morgan Flannery, Norgil, Patrick Grant and Jocelyn Gonzalez. Of course, thank you to you for listening. Thank you for sharing the currency of your time and attention with us. Please share this episode with a friend or a family member, with someone who you think would enjoy it. That's the number one way that we get out to new listeners. We will be back next week with even more How to Be a Better Human. Until then, take care and thanks for listening.

• 47:25Chris Duffy?

  This episode is sponsored by the Natural Resources Defense Council. Here's a question this show asks a lot. What can one person actually do? Take protecting the environment. When the task feels so big, it's hard to know where to even begin. Turns out, the answer isn't doing it alone. It's teaming up with people who care as much as you do. With the help of 3 million supporters, the Natural Resources Defense Council is in court to defend ancient forests, pristine coasts, and the wildlife that depend on them. None of these places or species can be replaced. They're still here because people fought for them, in and out of court. And that fight needs your support today.

• 48:04Chris Duffy?

  Donate at N R D C dot org slash human and your gift will be matched five times.

• 48:14Speaker 02

  This episode is sponsored by Capital One. Capital One's tech team isn't just talking about multi-agentic AI. They already deployed one. It's called Chat Concierge, and it's simplifying car shopping. Using self-reflection and layered reasoning with live API checks, it doesn't just help buyers find a car they love, it helps schedule a test drive, get pre-approved for financing, and estimate trade-in value. Advanced, intuitive, and deployed, that's how they stack. That's technology at Capital One.

• 48:41Speaker 03

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