111. “We rushed into buying a $730K house. Now I can’t sleep at night”
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Before we start today's show, I have a really exciting announcement that I've been wanting to share for a long time. On January 1st, 2025, I'm releasing a new book called Money for Couples. For the last three years, you've heard me on this podcast speaking to different couples every single Tuesday. I've spoken to over 170 couples on this show about their money psychology, the money messages they heard from their family, the peculiar dynamics that they have around money and where they get stuck.

and how they can get on the same page. Well, behind the scenes, I've been working on the definitive book to help couples get on the same page with money, and that's what I wrote for you. It's coming out January 1st, and in the book, I'm going to share how to talk about money, including the exact words to use, when to talk about it, how to teach your kids about money, even the exact agenda and account setup that my wife and I use in our finances.

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And finally, you're going to get a deeper understanding of money psychology in your relationship. And you're going to discover why you and your partner see money differently and how to get on the same page. Now, it's one thing to listen to couples or watch couples every single week. I love doing that for you. But it's a whole different thing to be able to have the book and to be able to work through it with your partner. Okay?

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We put the offer down in the house and Lily woke up the next day and actually for the two weeks before closing, almost every night I had panic attacks. So just, yeah, like crazy level of anxiety. I think the psychological burden of death for me, I felt it in my body in a very real way. We weren't at the healthiest place. On the other hand, he had to make a decision

financial decision. So a lot of the conversation we had was, I'm doing this for you, but do you want it? What was your monthly payment on the place you were renting right before this? We pay about $1,800 per month for rent.

And now what are you paying? We're paying $41.50. When I put my head down my pillow at night, it's like, okay, so even if all the numbers were fine, it just seems like there's this huge kind of liability of the house hanging over my head. I kind of have like this big picture of like, oh, it's fine. Like we'll be fine. And the stress is on him because he does everything for planning and finance and all of that stuff. And I don't. So I live with peace and he loses his sleep.

Meet Jonathan and Shalom. Jonathan is 31, Shalom is 27, and they've been married for five years. He works in tech as a program manager, and she is a nurse having recently finished her second degree.

What we're going to talk about today is how they have started to disagree about money when it comes to their house. They recently bought a house, and I want you to hear the way they talk about money and about things like getting a couch because so many of us will have the exact same conversations at some point in our lives.

As always, remember that you can watch this full episode on YouTube, which is quite entertaining to see the facial expressions and body language. All right, let's get to it. Why'd you guys buy this house, by the way? Oh, that's a... I can't wait for this. How will you speak? They're just laughing. Do you want me to talk? Yeah. What made us make the leap? Yeah.

yeah so i think uh wow there's a lot of smiles going on right now what in the hell is happening everybody's like looking down uh i i was originally super against buying a house like kind of i agree let's at least see what's out there kind of open-minded like we were when we first start looking for a house we did it as a date thing okay like like sunday date let's just go see what's around saturdays you

you know, like, why don't we do open house and see what's like on the market and how much it is and what the process is? Because I don't know how buying a house, my parents don't own a place or a house, a property in the US. So we started attending like open houses and that it just...

went really fast and we saw this place and then we had to buy it a week after. The two of you were like, oh, like let's go on date night today. What do you want to do? I want to go to ice cream. I want to go to an open house. And then you blink your eyes and you tripped and you fell and you handed over $500,000. Yes. Almost felt like just the most expensive fucking date night in history.

And I think when we had the conversation, and this is like housing is so expensive in Seattle. And this was like on the lower house market. And if we ever buy a place and

this might be like the lowest price we would get for the place where like the for the area we're in and that was the rationale i had if we end up having kids that we're gonna need a place that's bigger than like just an apartment for a freedom too like we both grew up before i came to the us or jonathan also grew up was a big backyard and like we had a very good memory just playing outside and running around for me i want to be able to do that for the kids we're gonna have

And I don't want to like raise kids in a very like apartment, very tight area. And that's with that emotion, though, like I think we rushed into, hey, like we need to get the house and whatever the house is.

like whatever we can with the budget or with the price that you know we can buy it now and then i i think things things go very very fast like you start looking at houses and then you kind of get in negotiations and then things go like very very fast so the house we're looking at someone else had an offer down so i think it kind of got like how can we you know win the house and then

The issue is once you put your money down, but bigger in just payments. What was your first bid for the house? So our first bid was about, we were originally going for like 700. And what'd you end up getting it at?

- So we had to counter with the full price. - Full was what? - $730. I don't think we realized just financially and emotionally just everything that goes into buying a house. - What do you mean? It's just, you know, you look at the internet and everybody says you buy a house and then it prints money and then if you don't like it, you just rent it out and that's how you create generational wealth. Are you telling me they're not telling you the full story, Jonathan? - No, and you know, I did.

I did run the numbers as it were. But yeah, I would just say that there's things that, you know, you'll look at a spreadsheet and it works out. The numbers may work, but just kind of the psychological element of being in that much debt and then how there's like fixed costs are not the same thing as, you know, your other money. Just it's required for you every single month.

All of this is hilarious, and I really like Jonathan and Shalom, so we're all having fun. One thing I do want to point out is that offhand comment she made about, if we have kids, we're going to need a bigger place. And we grew up with a lawn, and it has so many good memories. It is no accident that when people go through life changes in America, they all say the same thing. I'd rather have a small wedding and put a down payment on a house. Or we're having kids, so we need a bigger car and a house with a yard.

Do you find that interesting? Do you think that every one of us just independently came up with the exact same phrases? Do you think that other people in other countries say the same things? Or do you think there might be a series of organizations who stand to profit from you believing you need to spend hundreds of thousands of dollars at a very specific time in your life?

Just remember, these peculiar beliefs about money pop up in very specific circumstances over and over again. If you decide you want a house with a lawn or a certain type of car, fantastic. If you can afford it, you run the numbers and it's joyful to you, great. But do not simply slide into someone else's idea of a rich life.

You know how many people's conscious spending plans I see every week? What's fascinating is the categories of spending, especially the ones where people spend way more than they think they do. For example, subscriptions. Let's take a look at some recent numbers on how much people spend on subscriptions. $100 a month on subscriptions. $205 a month. That's from someone spending 76% of their take home each month on fixed costs.

$211 a month, $147 a month, and $487 a month. This is literally thousands of dollars a year, and most of us have forgotten about all the subscriptions we are actually paying for.

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Yeah, that was part of the thing that was really stressful. So we were paying about 1800 per month for rent.

1800. But, and now what are you paying? We're paying 4150, uh, which, um, I didn't put on the plan, but next year it's going to be going up 500. And then the year after that's going up 500. No, no, that, that can't be because everybody tells me that real estate allows you to lock in your price and you never pay more. That's what the internet told me. Uh, and by the way, your utilities cost 400 bucks a month, right? Let's not forget that. Right. That

That's kind of a considerable jump, right? You went from $1,800 a month in rent, which was all in. That's how much you paid. That was it. To now $4,500 plus assorted phantom costs that haven't even really been added. Let's just say, I don't know, $400 or $500 extra a month ballpark. That's a huge jump. More than double.

When I put my head down my pillow at night, it's like, okay, so even if all the numbers work fine, this seems like there's this huge kind of liability of the house hanging over my head. It's just like those things like, you know, flood, there's mold. I mean, there could be a tornado hits the house. I mean, and it's kind of one of those things where, yeah, I just, I feel that weight.

Shalom, what happens when your head hits the pillow? Are you thinking about the spreadsheet? I fall asleep. Oh. No. So interesting.

I kind of have like this big picture of like, oh, it's fine. Like we'll be fine. And the stress is on him because he does everything for planning and finance and all of that stuff. And I don't. So I live with peace and he's. It's so interesting. I wonder if there are any patterns here. The person who just kind of lapsed into taking care of the money.

is the one who's consumed with worrying about it. And the one who, you know, goes to work and says like, oh, I trust him. She's fallen asleep within two seconds.

Any patterns here, anybody? You all see the pattern? Yeah, I can see the pattern. I think mainly in the probably fear side of things. So we put the offer down in the house and Lily and I woke up the next day. And actually for the two weeks before closing, almost every night I had panic attacks. So just, yeah, like crazy level of anxiety, I think.

It started to kind of the psychological like burden of death for me. I felt it like in my body like in a very real way. We weren't at the healthiest place, both of us. Me, I got attached to the house because we toured so many houses and this felt like it was the house. And for Jonathan,

One hand, when he says no, he felt like he was not doing the right thing for me. On the other hand, like he had to make a decision, financial decision. So a lot of the conversation we had was, I'm doing this for you, but do you want it?

This is the most American story I've ever heard in my life. Two people are just going out for coffee, having a nice walk. They stumble into a Saturday open house and then they go, you know what? We should do this every Saturday. They do it for months. They get so tired in their ears. Meanwhile, people are chirping saying you need to buy a house. You're just throwing money away on rent.

Meanwhile, they're looking at prices going, how are we ever going to afford something like this? Then one of them starts going, well, what about kids? Well, we don't have kids yet. Well, one day we're going to have kids and then we need to have a yard and a lawn for them. Then the other one starts having panic attacks. Then they start arguing. What about me? What about you? And finally they go, screw it. Let's just write a check. I'm done with this. And then seven months later, they end up looking back and going, uh, we're paying more than double what we paid in rent. Okay.

Okay, look, buying might end up being a good decision for them, but the way they made this decision is fascinating to me. It is exactly what the real estate industry wants people to do. I never had to live by myself after. So we got married right after graduation. So I never had to experience even after getting a job, what it means to plan or like actually like budget. A lot of it has

has been done by Jonathan, even if our income, like our incomes combined, but a lot of it is done by him, how we budget our life and what we do. Early on in our relationship, I was kind of the one who just had a little bit more fluency around money, a little more background around money. I probably in the beginning of the relationship, just kind of handled things. I wouldn't say I was overly controlling, but just that's kind of the default roles we fell into.

So what is an example of something that you previously were totally aligned on, financially speaking? Traveling. We do a lot of travel. We've been to a lot of different places. Italy, Mexico, Ethiopia. Sweden. Yeah, we travel quite a bit. So in those areas, we tend to agree on how much we spent and the amount of money we allocate to those things. What would be...

perhaps the most expensive trip that you have taken together? Europe, Italy, and England. So how did you decide how much to spend? Was that decided ahead of time or was it after the fact? Talk to me about that. I'd say we kind of went in with a budget. I think we did end up exceeding it a little bit, but yeah, we were pretty careful on how we went forward with spending and so forth. Who came up with the budget?

Jonathan did. That was me. I'm going to guess that's a trend, right? Yes. And it's a reflection I'm actually thinking about right now. We do travel a lot together, but a lot of the budgeting is put by Jonathan. And I don't even have to worry about how much we're planning because he does a lot of the planning. And I kind of trust his planning. And I trust whatever happens afterwards. Yeah.

So I have a question for you. You said, I don't have to worry. I noticed you use that word worry is thinking about money the same as worrying about it. Sometimes.

Since we moved in, there's a couple of things that needed to get done. Painting the house and like fixing floors and that kind of stuff. And now for me, it's like, let me furnish the house. But Jonathan has been kind of like putting a pause on those things and saying like, we don't have the budget for that now. And we can't do those things. And in my head, the house is empty. So we need to go and like actually like make it feel like a home. Is it empty? Like literally empty? Yeah.

Not literally, but there are things that are, that should be there that are not. They're not there. Can I see? The living room? Okay. All right. Let's get a look here. House tour. So this is, how new is this house?

We moved in completely like last week. Oh, wow. Okay. Pretty new. All right. And you just bought it. Is that correct? Yes. All right. So it's a little messy, but this is what it looks like right now. All right. Hold it right there. Don't move. So we're looking at, what is this? Your family room? Yes. Beautiful living room. And show us what else. So you think that's missing like a couch? Yeah. So like having a couch would be better to have a couch, but we have another couch that

That's by the entrance, which is right there. So there's all the paper on the floor. So excuse me for that. Don't worry. Jonathan wants that couch to move on that side and we don't need another couch. Ah, and is that a source of disagreement with the two of you? Yes. Just pan over that way towards the couch, would you? I just want to get a feel for this. All right. Thank you. I'm sure there's more, but I think we get the idea. Yes.

That's cool. I like that we just got the home tour. Thank you. This might be the first. Are we the first people to have ever seen your house?

Yeah. I think so. We haven't had people over yet. So we're probably doing a housewarming party in a week or so. Love it. All right. All right, please. Me and just a few million other people who are going to see this. This is great. All right. So you move in about a week ago and you've been talking about getting new stuff, furnishing it. I say we should probably get a couch for the living room. And Jonathan responds, you can go ahead and respond.

Yeah, I usually kind of couch it in terms of like, you know, trying to create a budget for it and then planning for it and distributing that amount we put every month to getting it. So usually I kind of defer it. I don't get upset right away, but I try to have like a rational getting, like I try to get rational out of him. So yes, budgeting makes sense, but at the same time,

We just moved to a new house and after we do the basics, then we can save. Getting a couch and then we can put money if we need to do anything else on the house. So how long do you want to go before you get a couch, Jonathan? That's a good question.

Probably a good year. So I guess I have pretty simple requirements. That noise was Shalom bursting into laughter. Why are you laughing? I'm laughing because it's funny to me. Like, how can you live without a couch for a year? This is actually pretty interesting. It's funny, but I can also see both sides. Jonathan says we should save for a couch, then buy it. Shalom is like, how long can you live without a couch? A year?

Remember this detail. Well, this is going to happen pretty soon, right? You're having this get together next week? Oh, wow. The stakes are high. Wait, so what's going to happen right now? If you had people come over tonight, what would they do? Will you please answer that, Jonathan?

I mean, we do have a nice backyard, so it'd probably be kind of like a long party kind of thing. So standing? Could be standing. Yeah. Or picnic blankets, maybe. I can't wait to see that. What does a house mean to you? As I said, we live in a community. This space provides that like home for those people too. Like family comes and stays with us.

friends like traveling they stay with us and having that space for me is huge versus like oh just the two of us and um yeah basically like a little shelter all right what does uh house mean to you jonathan

I'd say a house, to clarify, do you mean just renting a house, owning a house, or just a house in general? Your house. My house. Yeah, I would say that the house is not really a good investment, but I think for me also there's an element of which...

when I'm kind of done living in a house, you know, I don't end up in a worse financial situation, even if I'm not getting great returns on it. When it comes to house, he does not care. It's not like literally we can live and we

We lived in a 500 square feet apartment and that was his idle space to live in. So he doesn't care, but you care. I care about that kind of stuff. Yeah. You know, when it comes to the house, there's kind of all these different things around like remodeling the house. So furniture is kind of the first thing, but we've talked about contractors coming to do estimates, right?

Sean really wanted to get the kitchen done and turned out it was going to be about 60,000, I think was what we were looking at. For me, that was just like complete shock. I reacted kind of very strongly and said, there's no way, you know, we just put down a huge amount for a house. There's no way we can

you know, we can go ahead and throw more money into the house. I'm not sure I'd ever want to spend 60K on the house, I think is kind of where I'm at. It feels like I'm putting all of my, you know, extra cash in something that for me, you know, isn't, I would say, as much part of my rich life. It's more of those things like experiences and so forth. And kind of one of those things that really triggered it for me, or kind of brought on a

brought on everything was we just celebrated our fifth year anniversary and we spent about $1,000 kind of celebrating and it was a really fun time. But then I remember

um about a you know five years ago when we got married it was about 15 grand for a wedding you know it's pretty pretty decent but first day we own the house we end up remodeling the floors and we paid the same amount and so kind of in my mind you paid 15k for the floors yeah 15k for the floors and so for me kind of

I pay attention to numbers quite a bit, but the amount of joy and happiness that we had at our wedding and how much money we spent, how much we were able to create a really wonderful environment, a really wonderful experience. Then the satisfaction I got from wood floors, which don't go to rock, they're great wood floors. That for me helped clarify where I see myself wanting to spend money.

Sounds like you got much more enjoyment from $15,000 spent on your wedding than $15,000 spent on floors. Is that right? That's correct. All right. Shalom? What did you enjoy more? Hold on. What did you enjoy more, your wedding or the floors? I think, my gosh, this is so hard. The floor. I think I would choose the floor because we're going to have it for the next 30 years. All right. Wait, I don't even know what to say right now about that.

Yes, I loved my wedding and it is a wedding and I cherished it. But like the floor will last forever. Not forever. Obviously, we're not going to live here forever. But it sounded really stupid. Okay, I was 100% sure she was going to say, I love my wedding more than the floor that I walk on with my dirty feet. And Shalom looked me straight in the eye and said, I love this goddamn flooring. I am speechless. This is why I love my job.

One of the worst feelings in life is feeling stuck.

You hear it sometimes with podcast couples here. They feel stuck around their money. I felt stuck in my business. I had made a bunch of decisions years ago and I woke up feeling trapped. So after thinking about it, feeling stuck, not sure what to do, I went to a CEO council that I'm a part of and I just laid it out. And after listening to me, they were like, oh, it's so obvious. You need to change this, move this person over here, change this resource allocation. Boom.

I wish I had done it years earlier. If you feel stuck in your career and you also wish you had a group of peers who could help you get unstuck,

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Elevate your style using Next Level Wardrobe at nextlevelwardrobe.com slash Ramit. That's nextlevelwardrobe.com slash Ramit. Where we live, it's actually, it's more expensive mortgage than to rent. So we couldn't make the money. It's, I think it's about $3,500 to rent a similar house. So we're already paying $3,500.

more than it would cost to rent. Can I just articulate that so everybody understands it? So you're telling me to rent a similar square footage, similar bedroom, bathroom in your neighborhood, it's $3,500. Correct. Everybody listen up and listen closely. It's $3,500 to rent a similar place. And you guys are paying how much per month all in? All in. How much? What did you say?

It would be close to five. This year. Yeah. This year, it's probably going to be like five. Yeah. Maybe five and a half. Yeah, exactly. 5,500 conservatively. Yes. So just so everybody understands, people go, it's always cheaper to buy. No, it's not. So you kind of modeled it out. In your model, Jonathan, had you calculated that it would cost like 5,500 a month? No. I think I...

The issue is I use kind of these like ballpark numbers, but I didn't actually like get the real numbers. And so for me, I think I didn't quite internalize it. Like I looked up online, you know, how much you generally spend on things. But because I was kind of using just general numbers, I didn't really personalize it. You're picking like 1% per year for maintenance, that kind of thing, which kind of explains why this couch has become a central focus. Shalom, do you see that? Yes. Yes.

It's not just the couch, right? It's like that old movie about washing dishes. And who is it? Rosie Perez. She's like, I don't want you to wash the dishes. I want you to want to wash the dishes. I think the house has to do with the quality of life we're living too. We spend so much time in the house. Whatever we buy for the house or we put into the house, we spend in it more than we spend time traveling. So it's not just the house. It's also our dwelling space.

Would you be willing to spend more on the house if it meant you traveled less? I think house would come first for me. Have you ever made these kind of trade-offs before with money? No. Okay. So if that's the case and your income is sort of combined and he quote worries about money and it seems to work for you, then just out of curiosity, why not just let him handle the money for the house? Why is it different for the house?

I think that is what's making this a little hard for us to we both love to travel. We both try to love to try new things and stuff. I am more into like doing interior stuff and house stuff and Jonathan dislike or hate that actually. So I think that's why we're having a lot of disagreement. There's like we don't have the same value when it comes to home and house.

But the rest of our values align when it comes to actually like doing stuff together or spending money toward other things. Jonathan, where'd you grow up? I grew up on Bainbridge Island. So it's like an island in the Pacific Northwest. What would you describe your socioeconomic status growing up? Probably like upper middle class. Upper middle class. All right. What do you remember your parents? Was it two parents? One parent?

Yeah, it was two parents. You know, my dad, kind of in our family, he's the one who kind of handles the spreadsheets. He's got a spreadsheet just larger than I can possibly imagine. Horizontal scrolls and vertical scrolls, 100 columns. He's got series records of every penny that goes out of the house. And it's kind of, you know, my mom, you know, she trusts my dad and, you know, he tends to do a pretty good job at it. So that's kind of...

kind of their roles. So they definitely influenced me. When did they talk to you about investing? What age? So investing, I've actually probably got to give you credit for that. I think even before it comes to investing aside from saving, I actually came across that idea in your book in sophomore year in college. So you found that on your own? Yep. You don't recall your parents talking about that?

I know. I mean, I went to my parents afterwards and asked my dad a lot of questions and he helped a lot. I just kind of filling information. Do your parents pay for college for you? No, they helped, but I paid. Cool. How'd you do that?

So I, you know, I went into a fair bit of debt in college and in sophomore year, I read your book. And then after graduating, I lived what is essentially a closet for, you know, probably a few years. What was your rent? What was my rent? I paid $600. Cool. Okay. What do you do?

So I'm a, I'm a program manager in tech. Cool. All right. So your parents were upper middle class. They did talk to you about finances, but not to the level of investing. And you went to school, you sort of sought out your own education, found my book, et cetera, uh, lived frugally. And then eventually I'm guessing increased your income and paid off a bunch of debt, right? Correct. All right.

Shalom, tell me about what you remember about money as a kid. Where did you grow up, by the way? I moved to the U.S. when I was 14. So before that, I was in Ethiopia. Two parents and two younger siblings. Got it. Are your parents still abroad? No, they're in the U.S. They live here in Washington. Let's start back to when you were in Ethiopia. What do you remember about money back then?

culturally from what I remember like people don't really talk about money but I remember like my parents would try to invest in like real estate so they would have like one home and then they would do another apartment or something to like invest or like to put money toward that potentially rent it um but there was never a conversation with us about like how we

we should save or invest money. But I remember in college, my dad was telling me that like,

I should use money to serve me not to become a slave office. And in fact, I didn't know anything about stocks or any of that until my brothers reached one of my, my youngest brother reached high school and he started putting money towards stock. And I remember like coming home, you're about to lose a lot of your money. And he was in high school. He would, he would work like part-time after school and he would put his money towards stock. And I thought it was just like some fraud.

that people hide out there. All right. And then what happened? I mean, he is well off now in college. My parents didn't, he didn't take any loans. He paid his college and he bought, he bought a new brand new car for himself to commute. Yeah. He was very self-sufficient. All right. Great. So,

Um, when you graduated, how many years ago did you graduate from college? 2017. And then I went back to school again for a different degree. That's awesome. All right. Fantastic. Okay. So that's great to hear. And just so I understand correctly, you both, uh, when you met, which was years, uh, more than five years ago, um,

Jonathan started taking over sort of like day to day what to do with the money. Is that right? Mm-hmm.

Is that common? Is there a cultural thing here, Shalom, where you grew up? No. No, it's not. In my household, my mom is the one who manages the money. And she's very much... Yeah, my dad basically is in my position where mom takes care of everything financially or manages everything. And he knows, but he doesn't really... I don't think he has an interest or...

I feel like we're on the same page. I am interested to the point that I know where the money is flowing, the money flow is going, but not to the point like I want to know exactly what happens month to month. I know it's in a good hand and it's a safe hand in my head. Okay. With Jonathan. Okay. What does your mom say, by the way, about your money management?

Um, I used to be known in the house for spending a lot. And now? And now I think I'm better. And actually they warned Jonathan before we got married that I was very expensive. And, uh,

Was that like a half joke? Like, ha ha ha, she's expensive, but also like she likes to spend money. Yeah, watch out both. You know, even though they have different views on money, they're both very likable. They're open with how they feel and they're young. So even if they're not totally on the same page, they still have time to get there. Let's see if we can look at the numbers. Can you read off, you know, assets and then tell us the number that's next to it, please.

$730,000. What are these assets that you have? I don't know. I think it's stocks. I don't think it's that. I don't. Car property? I don't know. I think it's the house. Okay. You don't know. That's fine. Investments? What do you see? $90,000. $90,000. All right. Savings? What do you see? $60,000. And debt? $655,000. What's that total net worth that you have?

Um, 225,000. All right. Have you ever seen these numbers before? Not this part. All right. That patterns always show up. It takes me a little while, but the patterns always show up, don't they? All right. So I love putting Shalom on the spot when she's never seen these numbers in her life. What do you think about this number 225,000 as your total net worth? Is it good? Is it bad? What do you think?

I mean, it's good. It's a positive number. Okay.

All right. That's what she's got to say. All right. Positive numbers are good. 225,000. The two of you are pretty young. That seems great to me. And then what's this generosity number? So generosity. So that's kind of a lump fund that we'd like to keep. So it could be generosity just for like, let's say we know someone who's in need. Also kind of tithing for church and that sort of thing. Just whatever causes are important to us.

Your savings is 16%. That's pretty aggressive. Why is your savings so high?

So in general, I hear people say the rule for how much you should budget like monthly for house is like at least 1%. This really shows you that when you buy a house, not only do you have to pay those expenses up in the fixed costs, but you actually have to start putting a lot of money for future stuff. Yes. Maybe future stuff that you know about, like we want to do the backyard landscaping, or it may be future stuff that hasn't broken yet, but it will break.

Oh, he's looking down and he's putting his head in his hands. What's going on? You mentioned the landscaping. So that's a whole other topic. Oh, well, why don't we just get into it right now? You know I live for this. Sure. So it was the first day after we put the offer down. I was at kind of a family gathering. And, you know, of course, the house comes up as, you know, sometimes does.

We mentioned we put an offer down and I showed pictures. That's the thing you do after you say you bought a house, people want to see pictures. I go around with Redfin on my phone just to show people pictures. My brother-in-law who actually does a fair bit of gardening, he used to do landscaping back in the day. He looks at the landscaping and he's like, "Wow, that's gorgeous landscaping. I hope you like landscaping."

Just to kind of give you some background, I'm somebody who loves books. I don't do anything really other than almost a lot. But just when it comes to kind of maintenance, that kind of thing, I didn't realize it until that conversation. Wait, hold on. Do you like Home Depot? I absolutely hate Home Depot. I have a bit of trauma, I think, just childhood trauma. My parents would spend...

like hours trying to find like a light fixture. Wait, me too. Yeah, I hate this place. Yeah. And there's like something like that smell of like wood chips and chemicals. Wood chips and despair. So your brother-in-law mentions this to you and then? Yep. Yeah. So my brother-in-law mentions landscaping and he's like, expect it with shrubs. With shrubs, like you're gonna have to like hire a pro to do it. You're gonna have to really, you know, go on YouTube and watch videos. And that's what people say. I would have taken a saw...

I would have hired somebody off like Upwork immediate. Well, it's not even Upwork. I don't even know where you hire people to come to your house, but I would have been like, bring a chainsaw.

and bring a garbage bag. That's exactly what you said. Oh, here's 20 bucks. Someone's ratting me out. Be gone in 10 minutes. I don't care how you do it. Did you say that? I actually, so what I, this is probably one of our biggest fights actually with the house. We've had some disagreements, but Shlomo's in the background and I just pulled my brother along. I'm like, oh, well, I can just, I can, you know, give it a...

give the shrubbery a trim. It won't need another one. And yeah, we'll be gone. Functional. Very utilitarian. Sholm heard like chainsaw and, you know, the shrubs and she got

Let's just say she had a reaction. Wait, what was your reaction? I'm asking very intently because one day this might happen to me and I need to know. Well, it was just, it sounded very ignorant. He was telling people around the party that he's going to just literally take that thing out when he goes back. And then I'm just hearing that she's like the lady who was here, she put a lot of work to it and they're not cheap. Like you call them whatever you want, but they're not cheap trees. You...

I'm listening. Keep going. This is so funny. Yes. So that's what happened. Like he wasn't even kidding. He was serious. I'm going to just going around. This is amazing. All right. So are the shrubs still there? Yes, they are. And who takes care of these beautiful things?

We're trying to figure that out right now. Yeah, I don't want to put my generosity money for the shrubs. I don't know. I just love the idea of walking into their house. Jonathan and Shalom are sitting at opposite ends of the table, both of them looking at their phones, so angry with each other. And I'm like, hey, guys, it's Ramit Sethi here. How's it going?

And they totally set aside the years that it took for them to get to know each other, the unlikely journey it took for them to meet each other, to get married, to buy this house. And they just look up and they start cursing about these shrubs.

You know what? I have this guide I put together of questions to ask before you buy a house. You know what I'm going to do? I'm going to add an extra section on expensive shrubs that can add massive relationship fights. Go ahead. You can find that link right in the show notes. I'm not kidding. Click the link. It's in the show notes. Okay. I love coffee and I want to tell you about the system I set up so that I can get all kinds of new coffee regularly.

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And so what I'll do is I'll ship myself a couple of new bags of different roasts, different types of coffee from different regions. And then I take a little notation card. I write down what works and what doesn't. Now, if you think I'm a psycho...

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I get tons of email every single day, and I want to give you a behind-the-scenes look at how I manage emails from my team, from my family, and from you.

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everywhere. Next, I use keyboard shortcuts unlike you barbarians who literally click and peck through every single email. U to mark it unread, S to star it, J or K to cycle through messages. I use keystrokes to schedule messages like when I want to ask one of my co-workers a question but I don't want to send them an email on a Saturday. Now I can work through dozens of emails in minutes using this and

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So if you want to buy back your time, Superhuman is a no-brainer to me. It's something I spend my own money on and I love it. Right now, all IWT listeners will get a free month of Superhuman. You can get started at superhuman.com slash Ramit. That's superhuman.com slash Ramit, R-A-M-I-T. I think it kind of goes back to my principle of like,

putting as much money as possible in creating experiences everything and i just for me you know it is a small amount of money i could probably compromise uh i think for me it's just i kind of feel i'm like already at the top of what i feel comfortable spending for kind of full housing expenses what did you just hear that he does not want to put more money into the house

There is a part of that. I think I've heard people often say like, you know, any money you put into the house, you get it back. And like the top percent, if you're really lucky in the right market and everything, you'll get about 80% back on something. That's like best case. And in my mind, maybe this is kind of where I focus too much on spreadsheets when I'm

Someone says, I have an investment for you and it'll return you 80% of the money you put in it. I don't, you know, I guess I have a hard time going with that. I agree. First, let's just clarify what, what Jonathan is saying, which is that, you know, a lot of people say like any money I put into the house basically turns into equity. And so if I paint or if I upgrade the kitchen or whatever for $50,000, and I'm going to be able to sell the house for $50,000 more, which is,

largely bullshit because most upgrades people make in a house is purely a cost. You're not going to recover much on it. Like just go look at some people's ghastly kitchens or the window treatments. It's like, I'm not going to pay for your horrible taste. I couldn't care less that you spent 30 grand on that too bad. There are a couple renovations in a house that tend to pay a little better. These are all easily Googleable, but all that said,

We should also remember that you are living in a house with your partner. And this isn't purely a flip that you're designed to spend as little as possible and squeeze out as much ROI, right? That's different. You're actually living in this house. Because truthfully, Jonathan, if you wanted to take that approach and we took it to the logical extreme, you would have old floors, you know, like you wouldn't do any landscaping because why? You're going to make no money on it.

Obviously, you live there. You got to do something. Okay. The question is one of degree. How much money are you willing to put in? Shalom, what do you think hearing this? I think you had a fair point. And that's something I'm struggling with. I think communication is or clarity is a big thing. And I've been trying to communicate that like,

Yes, now I'm understanding the whole idea of it's actually not just a house. It's an investment. But at the same time, it's a place we live in. So it has to be livable for Boba Fett. Shalom, what happens when Jonathan gets hit by a bus one day? That's scary. Yeah, I thought about this when we talked about this. When I signed up for retirement, I got...

angsty because I didn't know what to choose and what to do with all these numbers and I start losing it saying that like I wish I had this much education when I was in high school or like the kind of education high school should be giving before I would actually like become adults because now I'm like

late 20s then i'm freaking out about like signing up for retirement oh yeah it's so late you're so late there's no chance you can catch up now 27 oh you're you're that's it it's over you had a chance but you didn't learn it so all right so uh anyway back to my question what happens uh if he gets hit by a bus i don't know that's a very good question and jonathan do you ever think about that

yeah i know i have thought about that and uh one of kind of one of the things that you know i think was really helpful we almost never talked about money when we first married and we've come a long way but it just seems like because the house is such a big burden that you know it's it's forced us to connect on that that deeper level and i think we're still trying to still kind of have those kind of conversations so yeah yeah you know if you have like a bad habit in some part of life

When the stakes get higher, that habit emerges. It's like, I don't know, if you're bowling and you have a certain thing you do when you're bowling, it's fine when you're just playing with your buddies. But if you're playing at the professional level, that's going to get exposed really quickly. And in your case, for the last five years, it's been fine. Your earnings were probably really good. Taking a trip for an extra thousand dollars, no big deal. But getting a house is the biggest purchase you ever do.

And so any lack of communication, any bad financial habits, such as one partner doing everything and the other not really participating, it gets exposed. And there's a gap that becomes wider between the two of you. Does that feel like it resonates with you? Yes. Yes, for sure. Like when we had less to pay for when we first got married, again, money was not a thing we talked about. Yeah.

you know he made and i made the money we come together we put some to our traveling rental whatever and we never kind of discussed oh like we should probably like save this much or like it just automatically goes to things but now because there's this big thing cold house and there's a lot of things i want to do with it i feel like we have more fights when it comes to money

More conversations that we've never had before. And yeah, that's totally right. Now, what do we get? What do we get to do with that money? You're going to set up your monthly meeting. You're going to talk about it. You're going to have a calm way of discussion. You go, oh, you know what? I think we misallocated this. Gosh, this is how I'm feeling. And when I look at this, this is what I think. What do you think? Oh, I don't know if I agree, but like, tell me more. And we talk about it. You go, oh, okay. I see your point. Let's go ahead and amend it. Done.

But you can't live your life playing defense with tiny little decisions like that. Okay? Ironically, for the biggest financial decision of all, the two of you both admitted that you rushed right into it. So there's a pretty fascinating dynamic going on here. I'd rather have you spend more time on the big stuff and less time on the little stuff. Okay? The other dynamic I want to point out is that this is a good start with the CSP. It does feel a bit theoretical.

in the sense that you like Shalom, you don't talk about a CSP. You talk about a couch. So like, this is how I would approach this conversation, Jonathan. I'd be like, okay, Shalom, I understand that you want a couch and what gets you excited about having a couch? Like, why do you want one? A place to sit, to host. Okay. But don't we have that little couch by the front door? Also the aesthetic.

Oh, you want our house to look good. You don't think it looks good right now? Not yet. So like if we were able to get a couch, how much do you think a couch costs? Like ballpark? Let's say, let's say two grand with everything. Two grand. All right, cool. Okay. So you want a couch, it would be two grand. And like, how soon are you thinking you want that couch? When do you want this couch? I would, I was thinking like, and maybe the next three months.

- Okay. - But then that's not going to allow us, right? The budget. So I can wait. - How long can you wait? Because like, for example… - I can wait a year. - You can wait a year? - Yeah. - Okay. So that would be like… Look at Jonathan's face right now. The guy's like… - I'm impressed.

Shalom's change in perspective about the couch seems small, but I think it's actually a bigger lesson that we can all apply. Most of us go through life seeing something and saying, I want that. I want that coffee. I want that night out with friends, that car, that house. But very few of us have a system to help us decide. We basically just buy whatever we see, and we use very loose logic to decide if we can afford it. And then we wonder why we're not getting ahead.

This way of making decisions stays with us as we become more financially successful. That's why you hear multimillionaires on this show who still agonize over the price of gas or blueberries. It's not because they don't have enough money. It's because they are arbitrarily making decisions. They have no system.

With Jonathan and Shalom, you see this pattern. Jonathan analyzes purchases. Shalom is much more casual about what she wants, but they haven't developed a way of making financial decisions together.

The couch is really just a symptom. It's a small thing like training wheels. But together, they're going to face thousands of decisions about money together. So from my perspective, this is a great opportunity to develop a shared vision, a shared system. And just note, about 45 minutes ago, Shalom couldn't even believe waiting a year to get a couch. Now she seems much more open to it. Let's hear their follow-ups.

Jonathan said, during the call, I was absolutely shocked that my wife said she would prefer to spend $15,000 on new wood floors than our wedding if she had to pick between the two. One of the biggest takeaways was the value in financial simplicity, which can take a lot of time and effort when there are two people involved with their own dreams and perspectives. Simplicity is not a starting point, but something that is reached through a lot of communication and compromise.

Reflecting after the call, what surprised me most was how much time we spend focusing and arguing about small financial decisions like whether to buy a couch or which restaurant to visit and how little time we spend on large, important, life-changing decisions like buying a house, where to live, travel, and our long-term savings goals. I'm grateful we had the opportunity to talk with Ramit. It really helped to get another perspective on our relationship with money as well as each other.

And Shalom's follow-up? Unfortunately, we never heard back from Shalom, and we tried even as recently as last week to reach her.

I'm wishing Jonathan and Shalom the very best going forward. I really enjoyed speaking with both of you. And for those of you who enjoy this podcast, I'd like to encourage you to go to IWT.com slash podcast newsletter. Every single week, I share a new insight about money psychology right there on the newsletter. This is material you will never see publicly. It's IWT.com slash podcast newsletter.

Thanks for listening to I Will Teach You To Be Rich. I'm Ramit Sethi. Please follow the show on Apple, Spotify, or wherever you listen to podcasts. If you haven't read I Will Teach You To Be Rich, my book, pick up a copy. You can get it at any bookstore or any library, and it will show you the specific tactics for how to build the I Will Teach You To Be Rich system into your personal finances.