161. “He hid $77k in CC debt from me—but can’t tell me what he bought”
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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.

I'm going to show the tactics to make instant improvements, like how to set up your accounts to automatically work together and how to assess your financial health.

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?

I'm so excited to get this book in your hands. You can pre-order it using the link IWT.com slash money for couples and stay tuned for a lot more on this book this year. Again, go to IWT.com slash money for couples to pre-order my new book about getting on the same financial page as your partner. She said, if you spend $1 without talking to me about it, that's it.

you've hidden $77,000 and you come to me now. Because it had happened three times, I just thought maybe I'm throwing good money after bad. I felt like I made it too easy. And so I'm afraid that it could happen again. I'm afraid to trust him with the money. If you had to describe how you think she feels right now, what would you say? Exactly how she said, absolutely betrayed.

This is my previous life. This is what I thought I was getting away from. I know what it's like not to trust somebody, and it's extremely hard to get that back. And we have less time to earn trust back. So where'd the money go? That's what I want to know. Me too. Today, I get the chance to speak to Dana and Jim. They're both 58 years old, both nearing retirement, and they're worried if they will have enough. This is the second marriage for both of them.

One of the reasons I love this podcast is I get to share stories from people in all different parts of life. Young, old, millionaires, people with $200,000 of debt, gay, straight, immigrants, people who live all over the world.

My hope is to show you how similar we all are when it comes to money. And I also hope that you will listen to these couples and apply their lessons to your own life. For example, when I speak to older couples, they're giving us the gift of a crystal ball into our own future so that we can learn from their journey and decide which lessons we want to apply. Now for Dana and Jim, there's something shocking that happened that broke their financial trust.

And they realized it as they were filling out their conscious spending plan. Let's get right into it. As I was filling it out, I found an additional quantity of debt that I did not know he had. And there's that we have a whole history of this. It was pretty traumatic. What happened?

When we first moved, he came to me and he said, hey, there have been some expenses. It's not bad. It's not bad. I just want to consolidate it and get it paid off. I don't know that I asked him. Maybe I did how much it was. But I remember thinking, that's manageable. It's about maybe $20,000. And I thought, okay. About a year later, he came to me and said, I need you to handle everything. I have $77,000 in credit card debt.

From $20K to $77,000. I didn't know what to say. I mean, that was just so unheard of. And I kept thinking, where's $77,000? I don't see what we got for that. And he was unable to tell me how it was spent. I was furious. That whole concept of financial infidelity. Like you've hidden $77,000 and you come to me now.

But I tried to be calm in the moment because it's a problem and it had to be fixed. And he just kind of said, can you fix this? And I put together a plan and he said, I'm going to work really hard and I'm going to do all these things. And so I said, okay, you're good. And I didn't monitor him day in, day out. And then after filling out the CSP,

I found another 22,000. It wasn't that much. It wasn't? No. Okay. I don't remember exactly because by that point it was kind of... It was about 12 more. But I was like, I can't believe that...

This has happened three times. I can't trust this person. This is my previous life. This is what I thought I was getting away from. I thought I could... Not monetarily. I thought I could trust him. And it was... It felt just like finding out... He was seeing somebody on the side. It felt that bad. It's been tough since then. Thank you for sharing. I'm sorry you had to go through that. And Jimmy, I definitely want to hear...

your perspective. Dana, how long ago was that conversation? A month ago? Okay. Maybe? No. Two months? More recent? A bit farther. Whenever we filled out the CSP? Yeah, it was February. So it's two months. Okay. Is that a big difference, Jimmy? Whether it's one month or two months ago? No. How come the need to correct? I'm curious. Sometimes I don't feel like I'm being heard.

So I feel like I need to, when I can, positively say something that's right or not right. I can promise you you're going to have a chance to be heard today. Okay. I guarantee that. Let's rewind to that CSP conversation. She handed you the CSP, which had some numbers filled out. What do you remember feeling when she handed you that CSP? Sick. Why? Because I knew that I had failed utterly. I was in debt an incredible amount.

And didn't know if I was going to be able to claw my way back out of it. Okay. All right. So you filled out some numbers and then what happened? She just finally got very angry. So we have our problems because we're human beings, but I really do enjoy being with her. And she's fun to travel with. Okay. I appreciate that. Just to go back on that last thing you said, we have our problems and

Let's zoom in on the money stuff because that's why we're talking today. You have you, the collective you, have your financial challenges because what? It's not because you're human. What is the primary reason that you have the financial challenges that we're talking today? I didn't have a plan. A lot of people don't have a plan and they don't end up in $80,000 of credit card debt. So where'd the money go? That's what I want to know. Me too. Okay.

robbing peter pay falls the gas electricity the gas and the vehicles everything was happening on a credit card so at that point we're already at 20 000 plus and then you know we had some furnace issues about three times those were about a grand every time it happened okay and then i've done some stuff that just hasn't went well i've raised cattle

And always made something on that. Well, I haven't done so well this time. Let's just go through the numbers. How much on the steers? About $7,000. $7,000. All right. So far, you're at $30,000. How did it get to $80,000? When we went on trips, it just depended. It was usually minimum $1,000, sometimes $1,500. Times how many trips? Three. All right. $5,000. Okay. What else? I bought clothes when I shouldn't have.

That's like a thousand bucks, 2000 bucks. There's probably more than that. Wait, what? What type of clothes do you like, Jimmy? Speaking my language all of a sudden. We went to Italy. I don't like to shop. He went into each place trying on leather coats, leather bags. Okay, just so you know. He wears cashmere socks.

No, no, no, no, no, no. They're Paca. Okay. They're from Alpaca. And it's the same idea. They're expensive socks. Oh, it was more than three grand. So it's probably closer to five or six because it wasn't just for me. I would buy stuff for other people too. Right. I love giving gifts. What else? I had to put some tires on my truck. I had to put some tires on my car. We're at 40,000 bucks or 41,000. Get me to the next 40K.

Um, there was stuff in when we were working on the basement that I did. I paid for part of that. Oh. Um, and I have had to more than one time buy medicine for my mother. How much did that cost? About $400. And I have done it 10 or 12 times. Okay. You told me she reimbursed you. No, not the last, not for a while.

And he does have a thing for watches. Dana, do you know why he didn't tell you? He was embarrassed. And he wanted to be... I think there was... Maybe I'm just guessing. The discrepancy in our lifestyles

for the last 30 years is so huge. And I think it's been hard. I know he wants to provide things and I think he wanted to make me happy. It just backfired when it made me really unhappy. Jimmy, what do you notice about all those things that you just shared with me? I didn't need a lot of it. I didn't have a plan because, and I'm not trying to use a buzzword, I didn't have any backup money for that like I should. Okay. What else?

Well, I had, at that point, listened to the podcast that she had suggested and got reminded of everything I had been doing wrong. And there was no way to recover from it. My former job, I could have worked some more overtime. I could have done this. I could have done that. But I can't this time. And there's no way to come back from it without absolutely cutting everything. So that's where I'm at now. Okay.

Actually, the one thing I do remember is she said, if you spend $1 without talking to me about it, that's it. I've been divorced once. I really don't want to do this again. And I like Dana a lot more. If you had to describe how you think she feels right now, what would you say? Exactly how she said, absolutely betrayed.

Just in this short conversation, you can hear so many clues. Jim trying to correct Dana about when they had a conversation about money, as if that matters. Jim talking about where he spent his money, but it doesn't add up, not even by half. He really has no idea what he spent his money on. Dana alludes to their lifestyle being different, which suggests that Jim's role is threatened. Notice that he casually mentions he likes to buy gifts for others.

I can almost guarantee that he sees himself as a provider, as almost all men do. For men, being a provider is a primary form of status. What you can already see is what this entire podcast is about. A rich life goes way, way deeper than numbers alone. It's about how we talk about money, how we behave with money, and it's about how we feel about our money. Hold that thought. We'll be right back.

The way people want to know about productivity hacks reminds me of how people were desperate to know what kind of shoes Michael Jordan wears. Listen, guys, no matter what shoes Michael Jordan wore, you wearing those same shoes is not going to make you dunk like Mike.

So me telling you I use a gratitude journal, which I don't, or setting an egg timer to get work done every 25 minutes, which I also don't, is not going to help you be more productive. There's one thing I use which actually helps me be more productive. It's a piece of software. I pay for it myself. It's called Superhuman. It helps me get through my inbox lightning fast. You can use it with your existing service like Gmail or Outlook.

And honestly, when I see people using another email service without keyboard shortcuts, it's like watching someone from the Stone Age try to type. I'm just like, you do that? That's how you respond to emails? No.

Superhuman saves me over 10 hours a week and here are a few things I love about it. It splits my inbox into streams. So all my important emails go to one place. It's not cluttered with subscriptions, promos, etc. There's a keyboard shortcut for everything. I literally never lift up my hand. I can't even see the keys on my keyboard right now. They're so worn in because all I do is type. I love it. That's all I do. I sit here, I type, I go, yeah, done, done, done, JJK, done. No mouse.

If I see something I don't have time to reply to right now, boom, H, remind me tomorrow. Remind me at 4 p.m. J or K, cycle through messages. V, add it to a specific folder. Do I sound like a psycho right now? How excited I am about different keystrokes? That's how you should be if you want to be more productive. Talking about a Pomodoro alarm clock. No, I sort through 50 emails in 60 seconds. That's keyboard shortcuts.

A lot of people watching this going, this guy sounds a little unhinged. I don't know if the superhuman marketing team wanted him to be talking like this when he was talking about the product.

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It's kind of amazing when you make one of these changes in your life and you look back and go, I can't believe I used to live like that. For me, it's when people automate their bill pay and they don't have to manually go into their credit card every single month and pay it off. Why was I doing that? My wife's a personal stylist. When she goes in, helps people do a closet cleanse, and suddenly they walk in their closet, they go, oh.

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I physically couldn't do that anymore. So I tried to get a job in the area, couldn't get a job in the area. So we ended up moving here. Part of the reason I had to leave that job is my shoulder got messed up on the job. So we were four months that I was on whatever disability gives, which was barely enough to cover the mortgage and the COBRA insurance. So a whole bunch of credit card wound up on that. When I started my new job,

I kept living like I was still making the same income. I actually took a pay cut, but I didn't stop living like I was still making the same money. And we're talking, what, from $90,000 to about $72,000 or $3,000. And even with that, this is probably the best I've ever had. Really? I'm not required to work 60 to 70 hours a week just to make a living. I'm being trained to take over a job that will increase my income

pay anywhere from 25% to 50%. And thus far at this company, nobody has lied to me. They have been straight up front. If they say it, they do it.

I'm kind of excited about that. So I'm working hard to get that 50% increase. Give me an example, Jimmy, when you say you didn't change the way you were spending. We would go out to eat and I would just pay for other people when I shouldn't have. Like who? I remember we went on a trip to see some friends of mine from college and

I just paid for meals and stuff for them because I thought I should. All right. And how many times did you go out to dinner or lunch or whatever where you paid? At least three. Okay. So over a period of a few days, you paid at least three times. But it wasn't just them. It was a...

just an overall continuation of a lifestyle that I didn't have anymore. Yeah. I'm not trying to blame it on one thing. That's just one example. I get it. But let me ask you, like, I understand you go, you see some old friends. First time you're out, you go, let me get this one. This one's on me. They're like, oh, you don't have to. You're like, no, it's fine. It's so great to see you put the credit card down. I get it. The second time and the third time... Kind of showing off. Tell me about that. I...

Maybe just want people to think I'm doing okay. All right. So that went on for a while. And was it really the CSP where you realized, oh my gosh,

I'm in big trouble? No, I knew I was in trouble before that. It was just in my face when I listened to the podcast and then the CSP. And when we moved, I didn't expect some of the costs too. I mean, my mortgage is twice of what it was. And this is not blaming Dana because that's what she heard when I said it. But she needed tires on her car and she just...

freaked out because she didn't have the money to do it. I didn't have the money to do it either, but I did it because I'm just, in my head, it's like, well, I can handle this dad better than she can. Air conditioner went on our car. I took care of it. I should have been honest up front. I can't pay for this. Have you ever said that out loud?

Um, I've used them in the past. And in my first marriage, there was a lot of times where the kids would want something. We're just like, we can't do that. Okay. I'm sorry. Okay. That's interesting. So you have that phrase. I have the capability. I guess I had kind of gotten really used to a lifestyle and you would think that $25,000 a year or so, actually more than if you include all the side jobs that I had on other stuff. Um,

Wouldn't make that much of a difference, but it really does. Okay. When you look back at the last few years with Dana, how long have you two been married for? Five years. Okay. You look back with some perspective, what do you notice? That I should have given her some control a long time before I did because she's better at it. But right from the beginning, she had her money, I had my money. I wish I had done that different.

But I can't keep living in, I wish I would have because I have a lot of those. Thank you for sharing all that. It's very illuminating. Dana, any surprises as you hear Jimmy share all that? No, most of that, I mean, I'm aware of. I think we have a little different outlook on the circumstances. But I would say the one thing is that they didn't seem like big, like the tires, air conditioning. I don't recall saying, I can't afford that. He just said, hey, I got you new tires.

I was like, okay, I don't know what tires cost. That sounds good. And but he never... So I thought, wow, he's doing pretty good. He must be keeping track and I trust him. So if he can afford it, cool. Now, when you both got married, this was your second marriage. Yes. Did you have a series of conversations about money at any point? I knew him when he grew up. Their family was...

extremely poor, like just really, really poor. And so when I met him again, so I knew him in high school and then 30 years later met up again.

I thought, wow, he owns a house. He's got a regular job. His wife doesn't work. They've got these kids and he's got a 401k. I mean, that's far more than I thought, you know, given what he knew growing up. But Jimmy is like the miracle child. I'm like, some people are like, that's your family? He is so different from them. And I was just really so impressed with he could grow up with all of that and

and still get himself through college and get a good job and take care of a family. I just said, you know, I had come through a divorce and we were settling things up and I bought a house and I was working on my, you know,

When my ex and I were dividing up retirement accounts and so forth, I was just kind of upfront about where I stood and the amounts. And then I said, do you have an investment account through work or what do you have? And then he did tell me he had to give half of it to his ex-wife in the divorce settlement. But I was like, oh, good. He's putting money in regularly, good qualities.

All right. I respect that. Jimmy, what do you remember about that conversation? Do you remember Dana asking about the 401k? I didn't mind talking about it then. I actually gave my ex-wife a little more than half so that I didn't have to sell the house. I ended up getting back with equity in the house by leaps and bounds when we sold it. Did you ask Dana about her financial situation? She volunteered it. Dana, did you pull out a spreadsheet on the second date? No.

Well, a verbal spreadsheet. I think it's one of those conversations that comes up when you are fairly recently divorced and you're kind of in the same boat. So you do a little...

Totally. You're comparing, hey, you've both gone through something life-changing. And it's not as taboo anymore to talk about money because it's been out there. And it's been raked over the coals. It's a thing. I love that you two talked about money. I wish more people in all different stages of relationships would talk about money. I think it's awesome.

It's not just... I mean, I know we're focusing on that debt and it's huge and it bothers me, but it's not a character flaw. He's a person who really has worked incredibly hard and genuinely is not someone to lie and deceive. I mean, it has been that, but it's not in his nature. It's something we have to make sure never happens again because...

I know what it's like not to trust somebody. And it's extremely hard to get that back. And we have less time to earn trust back. You know, what really caught my attention was Dana saying how much she admired Jim for achieving what he did, considering how he grew up.

So much of the way that we treat money is based on hunches and assumptions. For example, he paid for her tires. According to Dana, hey, he must be doing fine if he can buy me tires. I don't blame her. If somebody pays for lunch, we assume they can afford it. We all make assumptions about money. The point is, in your own relationship, assumptions are dangerous. And it's so simple to get real answers. You can just ask.

Hey, can we talk about our finances? It feels like there's a big elephant in the room because I earn more than you. I love you. I want us to both feel good. Can we talk about how we can make that happen? The good news is they did talk about money when they started dating, but they didn't let those conversations go deeper. As Jim tells me about his family's relationship with money, I start to understand more.

They have 108 acres of really good farm ground that's completely paid for, but they're hand-to-mouth. They always have been. When I was very young, they were not. But all that I can remember is paycheck to paycheck. And if it wasn't for the garden and all the beef and pork that we raised on our own, we would have been very hungry. Yeah.

We were very poor and they just didn't talk about money. How do you know you were poor? When you were at school and everybody's eating Doritos and Twinkies and you're eating homemade bread with homemade butter on it, you know you're poor. And you eat it so fast that nobody can see you eating it. Right. You don't want them to see you. What are the other clues that you were poor? We worked all the time.

Like around the house? Out in the barn, out in the fields. And we didn't have jobs away because we were needed there to take care of that stuff. Okay. Where were you raised? Around Pittsburgh, Michigan. Okay. All right. And when you were a kid, young, what do you remember about money and your family? I remember when I was very young, he would have been early 70s.

And he had a net worth of well over a quarter million dollars, you know, just for inflation. That's not too bad. Wow. And he went from that to being almost that much in debt. And part of it was he just flat out got ripped off by some people. And part of it was bad decisions on his part. Quarter million bucks in the 70s. That's a lot of money. And he lost it through some bad deals and bad decisions. How old were you when that happened? I'm guessing early teens. Oh, really? That early?

Yeah. All right. That must have been a huge change. What do you remember about that time? We went from having a really nice farmhouse that was warm all the time to being in another one that wasn't so warm. Wow. And then we went from that to living in a house trailer on my grandpa's second farm. When we had moved to the house trailer, I was a teenager at that point. I was eighth grade and embarrassing again. Mm-hmm.

embarrassing like when friends find out where you live generally friends didn't come to my house i usually went to theirs who's it embarrassing to them it was embarrassing to me he never declared bankruptcy he did pay it all back have they ever faced any more dire circumstances than that well the first time when he got hugely in debt all the farm equipment got auctioned off um two of the farms he had got auctioned off the second time he got in trouble he actually had a

Stress, heart attack. But he was in financial issues then too. So we had to sell the cows, had to sell the farm, and had to move to my grandpa's place. So yes, there's been consequences. Did he change his financial behavior? No. Okay. Any siblings? Two. What's their relationship with money today?

horrible. Really? How so? My brother's 13 months younger than me. My sister is four years younger than me. They both still love at home. My sister has never paid rent. I'll just say it. I don't care if they hear it. They're leeches.

And they're still living off mom and dad. They call it these days, Jimmy, failure to thrive. That's a new way to say it. It's more of a failure to launch. Okay. And they don't want to launch. Right. So they're in their 50s at this point. Yes. Okay. Yep. All right. Did your parents spend a lot of money on anything?

I don't know if there's a lot of money on certain things as much as things I see now that I just find very wasteful. My grandfather had Belgian workhorses, the great big ones. It was a hobby for him and he could afford it. When he passed away, my dad took that on. Well, they eat a lot of hay and it's very expensive. Now he grows it himself, but that's ground that could be used for something else. Hmm.

And then they have, my dad has a number of antique tractors that I don't get it. Just the horses. They probably $10,000 worth of hay each year. The three of them. Okay. You know, when you're, well, got to scrounge around for some gas money. Okay. But it's very hard for them to let go of things. Okay. So your grandfather had these Belgian workhorses.

Your dad then took him on, spending tons of money that he very likely did not have. Is there any relationship between you having steers and spending $7,000 on steers versus those Belgian workhorses? No, I was trying to make money with them. I was making some money before we moved. But then after we moved, prices went up on...

The commodities went into him. Now I'm just ready to throw my hands up in the air and say, I can't make money on this, so I've got to find something else. Do you find it difficult to...

close the door on certain things that you own? Oh, yeah. Because that's something I'm good at, raising steers. But I'm not making money at it. It sounds eerily similar to your dad. But I don't have any out here anymore. I have not bought anymore. I actually just sold two of them yesterday, the ones I had left. Okay. What do you make of the fact that they are still living what you describe as hand-to-mouth? I don't understand it, but

I hope they never hear this. They don't have the internet. I said, I've become my parents. In what way? I let myself get buried in debt. I shouldn't say even let because that sounds like, oh, it just happens. I did it. Good catch. Language determines our future and it also characterizes our past. I love you taking an active role. I did that. Once you take agency, you can also change that. So I appreciate that. Did you go to college?

Yes. You did. Okay. And your siblings? No. My siblings didn't even graduate high school. Got it. Okay. Did you graduate from college? Yes. How'd you pay for that? Loans and whatever money I could earn. And I paid it off in six years. How'd you do that? I hated the debt, so I paid it off. What? Wait a minute. Okay.

In my former life, I was always paying stuff off early. Especially if you had to... One year is the same as cash. Well, I'm not going to get stuck with that whole interest at the end of it. I will pay it off two months early to make sure that I don't. Where did you get that from? It doesn't sound like you learned about it from your parents. Actually, I got it from my grandpa. I learned a lot more riding around with my grandpa in the summertime.

He was not loaded. If you looked at him, you thought he was just a dirty, stinky old farmer. But he always managed his money well. He was able to buy and pay off two farms. When he passed away, there was money left for my grandma besides what she had earned. What did that make you think? That I should be putting money away. Did you do that? When I got to the point I could, it was after I got married. We actually built a house.

on a not a very big income. And if it was all possible, I wanted my wife be able to stay home with the kids. And we were able to do that. Just listen to how stories are passed down from generation to generation. Money is not just numbers on a page. It's stories and lessons and phrases that are passed down from generations ago, sometimes from people you've never met.

People don't really like to believe that their behavior is anything but a carefully considered logical extension of them. Like they sat at the grocery store robotically calculating the best value per ounce and then they methodically decided to buy saltines. No, it's much more likely that grandma bought saltines than mom bought saltines and now you buy saltines, never even knowing why.

When I help people make the connection between their behavior and something that happened in their family, you've heard it. They're often stunned. And what I'm asking you to do is to be humble enough to acknowledge that your behavior might actually be the product of your environment. And once you accept that, you can start to unpack your environment. And then you can decide if you want to change the way you treat money. Let's take a quick break to support our sponsors.

One of the best moments of my life happened around the age of 10 or 11. My sisters had always wanted to get a dog, but we couldn't because my dad has allergies. And one day we were at somebody's house and there was a dog around and all of us quietly noticed that my dad was not sneezing. So later, my sisters were like, uh, why weren't you sneezing? And then my dad just started laughing uncontrollably. My dad lied to us for 16 plus years. He told us he had allergies.

He just doesn't like dogs. Love it. Love it. Now that is inspiring. I can't wait to do the same exact thing. But luckily for those of us who do live with the symptoms of allergies, we can live Claritin-free with Claritin-D.

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Let's get back to Jimmy and Dana.

I'm a reverse immigrant. I grew up outside of the United States and didn't move here until I was almost 14. Oh, wow. Where'd you grow up? In Ecuador and then in Honduras. Growing up, especially in Honduras, I felt like the richest person on the planet. All my friends were the ambassador's kids. I went to a bilingual school where everybody went. There was such a discrepancy. There's no middle class. It's a tough place to be.

So my mom pulled me aside and she said, I want you to know when you move to the United States, you're not rich. You're going to be one of the more poor people. And I was like, I had a really hard transition. I was not happy. And then they moved to this rural place in the middle of nowhere. Let's rewind back to Ecuador and Honduras. What were your parents doing that you were raised there?

So my parents were missionaries and my dad specialized. He felt, and I won't go into this too much, but I loved his philosophy that people go and they try to, you know, most of them are preaching or doing these things. And he felt that one of his skills, and he has multiple degrees of master's, but one of his passions was organic gardening back in the 70s, late 60s, 70s.

And he worked on increasing crop production and cattle production, teaching people how to maximize these kinds of things. So we moved around some. He was always doing crazy things. One place, we raised orchids. Another place, rabbits. One place, putting in wilderness campgrounds for American campgrounds.

He taught briefly as a professor at the University of Tegucigalpa. It was the coolest childhood imaginable. I was having a ball until they dragged me out of there. Why did they leave? They felt that the political climate was a little bit sketchy. That was the whole Sandinista time period and so forth. And then they were concerned that I wasn't going to get...

as good of an education as I could if we were back in the United States. Okay. My family's very... Well, my dad especially. Investing and saving and prioritizing. We got an allowance. We learned what portion we saved, what we did with it. Wow. It was very... Right from the beginning, that was really important. How did you learn that?

Well, both of my grandfathers bought and sold property and stock. And they were investing at the very beginning. We always joke because my one grandfather bought this company called Walmart.

And he bought stock. And then a big lesson, he was doing, I mean, they both ended up doing really well. He panicked. A lesson learned. Lots was lost. But my grandfather's goal was to learn to live on 10% of his income so he could give away 90%. And he lived very well. And he succeeded too. Yeah. Both my grandparents. Well, it just wasn't a goal.

No, he did. Yeah, my grandma and grandpa both are pilots for their own airplane. And my grandmother, cute little thing, you wouldn't ride in a car with her, but she could fly an airplane. But they did things because they made wise monetary moves. And my grandfather was entirely a self-made person. He was in the Marines, came back, started his own heating and air conditioning company. I never knew my grandfather before.

He was retired in his 40s. Wow. And he always explained how he did it and the responsibility you have with money. He loved talking about it. My whole family, that was... My brother and I can talk about it

all the time. So it was really much... And we saw the results of hard work on saving. That's amazing. That's really cool. It was a wonderful legacy. The other thing my grandfather did is he said... This is back when you would read the stock in the newspaper. And so you could go in and he would say, why don't you go in? Tell me what you'd buy.

And if you, over a certain period of time, you made money on your selection and you had to read, you knew what the track record was and so forth. And then he would buy some stock for you. And if you didn't do well, he talked to you about what you didn't do. Now, some of the cousins didn't like it at all. But my brother and I thought it was a game. It was a fun way to... But he taught those lessons to his grandkids. He wanted...

It was important. You like to talk about money now. I do. You do? I do. Okay. You talked about it early on in your relationship here with Jimmy. Talk about it a lot here. Jimmy, do you like to talk about money? No. Dana, what lessons do you think you bring from your childhood experience with money to this relationship with Jimmy?

The one thing I told Jimmy was, I was already living my rich life. I loved my life. I lived in California for 20 some years, raised all my kids there. I got to be a stay-at-home mom as long as I wanted to on one income in Northern California. It was a good life. And I miss a lot of that. It's been extremely hard to adjust. But my kids were already...

out of college into grad school or in college,

I was all of a sudden going to get to do all these things. I would have all this freedom. I traveled with my girlfriends. We went places. And then that all crashed. Yeah. My ex-husband and I did right from the beginning, the thing we did best was money. We had plans right from day one. We set our goals. He maxed out his 401ks. We were doing really well on target, way ahead of schedule. And then

And I feel like how unfair. I mean, I know life isn't fair, but it's like we were there. I was doing everything right. I sacrificed where I needed to. It felt a little bit like I had lost ground and fallen out of

the structure that I was in before, the whole social structure and everything I ever was a part of. And I felt like people would, I guess, feel kind of sorry for me. Like, oh, she had it so good. And now, you know, so and I get a little, you know, moving from California to Michigan, everyone says, why? And then I get to tell them why. And it just feels like a downgrade. Yeah.

Let's talk about socioeconomic mobility in America. Not something you might normally hear on a podcast, but it's important. Just as families have stories, so do countries. In America, we've all been taught that if you work hard, you can achieve anything. We even have phrases like, I want my kids to have better than I had.

Well, it turns out that America has very low social mobility. If you were born poor, odds are very good you will remain poor. If you were born wealthy, you'll probably remain wealthy.

Journalist Jason DeParle points out that, quote, about 62% of Americans in the top fifth of incomes stay in the top two-fifths. According to research by the Economic Mobility Project of the Pew Charitable Trust, 65% born in the bottom fifth stay in the bottom two-fifths. And listen to this, just 8% of American men at the bottom rose to the top fifth.

I'll link the Wikipedia page with tons of primary research in the show notes. What's really shocking is we might say that our childhood zip code is a far better determinant of our success than how hard we work. Something that is a direct slap in the face to the myths we've been taught since childhood. Are there exceptions? Sure there are. I'm one of them, for example. But I know that in addition to working really hard, I got insanely lucky along the way.

Now consider Dana's story. She grew up with educated parents who taught her about the importance of money. She got married, saved and invested aggressively. She did all of the things that upper middle class and wealthy people do in America.

But then she got divorced. And in America, we're only told about going up, earning more, spending more, giving more to our kids. But nobody ever talks about going down, which is why going from a certain socioeconomic class to a lower socioeconomic class is absolutely devastating and isolating.

Most of us simply will not consider the idea that we might not be able to eat at the same restaurants we're used to or buy the things we're accustomed to. And in my experience, people will do almost anything aside from directly acknowledging that they have gone down the socioeconomic ladder. Jimmy, when it comes to money, what word would you use to describe yourself for most of your life? I made it and I paid the bills. What would you call that? It.

A provider? Yeah. Basically, most men in America, that is the word they use to describe themselves. Provider. What are the implications of that? That you just don't provide the basics. You want to provide the wants and wishes too. Okay. Right. So you're not like a subsistence farmer. You want to provide for more than mere basics. I agree. Hence, the providing of...

dinners on your card for your classmates who you haven't seen in years. The offering to pay for tires when you yourself have tens of thousands of dollars of credit card debt. Hiding of how bad it's really becoming because if you are not a provider, then you are a... Failure. And in America, most of us, particularly men, we would prefer to feel anything other than shame, especially shame around our identity as a provider. Which brings us to today.

So you got married. You talked about finances a little bit. Did you keep your finances separate since this was the second marriage? Yeah. This is a conversation we specifically had was that I wouldn't need to contribute anything. He already paid all the bills and everything else that...

My money would be spent for trips and eating out and those kind of things. And I was like, wow, that's great. Who made more money at that time, by the way? I did. How much more? $40,000. So you were like, you're not going to need to work or you're not going to need to contribute to the mortgage or whatever. I'll take care of all that. I already was. Okay. So that didn't change. Okay.

So I gave up a nice alimony for life that was hard to accept that I didn't have to work. But if I married, I gave it up. Are you okay sharing how much that was? I was netting like $5,000 a month. Okay.

But I think maybe, I'm just thinking this now, that that might have been kind of threatening for Jimmy. She's marrying me and she's giving up what money she had. How can I continue to make her life good? And I think he's, in some ways, a lot of that debt came from trying to make me happy and make it okay that I did that.

And on my end, I probably have vocalized a lot of regrets of what I gave up, missing my life so badly that I think he really lovingly tried to compensate for a lot of that. With money. Yeah. Yeah, she does vocalize a lot the stuff that she misses. Sometimes it's very hurtful to hear that because I know I can't do it. Sometimes she...

on what her ex is making now. And I will never make that kind of money. If you dig deep, when you have brought up comparisons to your past life, what are you really saying? I don't like living in the Midwest. It never is going to feel like home. The four years I spent in high school, it doesn't make this my home anymore.

I mean, I want to know that we're going to, in a few years, maybe we could move to another place and try something different. And I'm unhappy a lot here. It's a different environment. It's people. It's just, it's hard to meet people. So I guess I think more that I'm not happy here. Yeah. I think that's honest. Jimmy, that's no surprise to you, right? You've heard it before in different ways. Yes. Okay.

And you can understand the crux of the difficulty here, which is, Dana, you're saying, I'm not happy here. But first off, this is...

generally where Jimmy grew up and if we are wide enough geographically. So it's kind of like someone... It's like somebody saying like, I don't like Indian food to me. I'm kind of just like naturally insulted. I'm also like, you have the worst palate in the world. You don't like Indian food. What's wrong with you? Get out. But even more importantly, all jokes aside, it is... Jimmy's like... Jimmy who sees himself as a provider...

So, well, I can't afford for us to go to Northern California or to take these vacations. And so what is he to do about it? Spend a bunch of money on certain things just to reinforce to himself that I have money, even though it's racking up debt, and then avoid talking about it. I still feel massively guilty because I have all this debt. Yeah.

Frequently, she has accused me of not acting like it bothers me. And it does bother me. I just don't show it like she does. How do you show it? She probably doesn't even see it because it's usually at night when I can't sleep. What can I do? What can I get rid of? What can I sell? How can I make extra money? I'll tell you, Jimmy. I knew you were poor growing up before you told me you were poor.

I knew you were poor before Dana even told me you were poor. And one of the big clues was this idea that if I need more money, I'll just grind harder. I'll just work more. How many times have you said that in your life? Frequently. It's a common belief among people who were raised poor. Because that's all we have is our hands.

I had my college roommate pass away this year before she turned 60. And that threw me... When someone your age that you've known forever, all of a sudden you're like, I'm the same age. What if tomorrow I get... What that did for me was like, I want to spend it all now. I'm just going to... What she would have done if she had known, would she have gone on trips instead of investing her money? It's that really tough call now between...

living like your rich life in the time that you have, not knowing how much that time is versus what if I live to be 102 and I'm in some decrepit nursing home. Her death really put me in this position to think about how to spend it when you have it at this age. Dana lost her dad, her friend, and her favorite uncle all this year. Her desire to do things went into overdrive. And so...

Dana, if you ask her, I have heard this many times, let's sell everything and just start doing stuff. Yeah.

Oh, I would absolutely want to do that. I have no problem selling everything. I moved around so much. My mom was not... No, we sold stuff. When we moved, you got a suitcase, maybe your teddy bear. We had to sell our dogs every time we moved. So I'm not attached to things. As an interior designer, I love beautiful things. I love decorating houses.

But I don't have to have that stuff. Things that are beautiful. And when I see it, it's almost like there's this... I can't describe it. But it's almost like this pain you get when you see something that's just magnificent. But I would rather those experiences come... Those things happen in the form of experiences. So I absolutely would sell everything tomorrow and just travel. But that's, I realize, unrealistic...

That you can't do it all the time. Not in the position that we're in. But would I do it? Oh, yeah. She wants to live close to water. So I actually threw something out at her like a month ago. I said, hey, there's the Carolinas. That's close to water. All right. So you're open to that. What do you think about that, Dana? Just conceptually. The Carolinas or just the fact that he's willing? I already know you don't like the Carolinas. So let's just put that aside. But the fact that he's willing.

I think that's wonderful. We'll open up their conscious spending plan after this.

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Let's take a look at their numbers. Keep in mind that Jimmy has two kids at home, so packing up and leaving is not realistic today. Their assets are $637,000, which includes a house, three vehicles, and farm equipment.

Investments, $636,000. Savings, $35,000. Debt, $448,000, including $77,000 of credit card debt, a $6,500 car, and $365,000 mortgage. Net worth, $859,700. Dana, read off your combined gross monthly income, please. This number. $18,782.

That's a lot of money. It's deceiving. Hold on. Before you go on and minimize it and tell me all the reasons it's not real, just everybody look straight at your cameras. Did you know that you make $225,000 per year? Yes.

Jimmy? Nope. Okay. Thank you for maintaining my average of 50% of people don't know how much they make. All right, Dana, go ahead. Tell me all the reasons that it's not real. It's variable. What else? So to come up with a number, I just averaged out a year, but the money comes in very differently than that. I mean, I've had a $40,000 month. I've had a $5,000 month.

So? It's not consistently... Well, it just feels like that number... I mean, the total is right. But the way it breaks down monthly doesn't seem right. But it's still real. It's still real. Yes, it's still real. Yes. Dana, come on. This is like... When I'm walking around and at the end of the week or the day, I look at my number of steps and it's like some days are 6,000, some days are 22,000 and it averages it out. That number is still real.

That's a great example. Yep. I agree. You make $225,000 a year, which is a fantastic income.

especially in the area that you live. Fixed costs are at 69%. However, we can see that there's a massive disparity here. The mortgage, which is being paid for in full by Jimmy, and Jimmy's fixed costs, just so everybody knows, are 97%. So basically, all of his income is going to fixed costs. Specifically, I'm going to highlight a couple of big ones. The

The mortgage, which is $2279, nearly $2,000 a month in debt payments compared to Dana paying zero on the mortgage and on debt. Jimmy's paying $700 for groceries. Dana's paying zero. Explain that to me. It's not her debt. So she shouldn't have to pay that. And I just had paid the mortgage before. You both live in the house that you, Jimmy, are paying the mortgage for, right?

Yeah. Yes. Okay. Have you all discussed how does it work? She pays for the play and I try to pay for the not play. It has evolved down further. I pick up some other things that balance out in our minds, at least up till now, where I cover all the insurance for everything that

house, cars, etc. I don't pay that monthly. I pay that in a lump sum. And then I picked up a lot of those smalls and the electrical and I picked up the trash. And I hadn't seen it as an issue. Maybe it's because we've just been doing that. Is there any objection to Dana paying towards the mortgage at all?

I'm not saying you have to. I'm just asking if there's any objection to it. Just hadn't thought about it. Okay. Jimmy? I'd never thought about it. What? It's like the biggest expense on here. What do you mean you never thought about it? I understand, but that's just how it was at the old place. Okay. And even though it basically doubled, I just never thought about it. I can contribute. We could split the mortgage.

Everybody go look at your CSP right now. Go get it right now at IWT.com slash CSP. It's free. The rest of you, um, what the f*** is going on with you? Why do you keep splitting up expenses like this? One of you paying the mortgage, the other paying for eating out, one paying for childcare and all kids expenses, which by the way, almost always happens to be mom and the other paying for home renovations. Why?

Stop doing this. When one of you is paying 97% towards fixed costs, that's not fair. It also doesn't scale because certain expenses will get more expensive. And I know you're not sitting down to recalibrate on a monthly or quarterly basis. Or who are we kidding? Ever. Anyway, let's keep going so I don't have a freaking heart attack on my own show. You have four or so years of debt payments. Okay, and that's a lot of money. It's like 2,000 bucks a month.

Jimmy is spending essentially more than he makes every single month. He's down by around $1,000 a month every single month. Yes. That's a problem. Meanwhile, Dana's like, there are people around me dying and I'm ready to sell it all and hit the road. You'll see that there's a problem here. Yes. So without even getting into all the numbers, what do you all think is...

Two or three potential solutions here. Selling it all and going on the road. See, I knew you'd finally see my way. Yes. Well, actually one, it may even sound petty. I'm glad she's finally paying quarterly taxes because I was covering the taxes. Okay. That makes no sense, but I'm glad about that too. What else? Short of asking for help from Dana, I don't see any other solution. There's no solutions? No.

other than asking for help from Dana. Okay. Dana, you're in an interesting position here because your husband has $80,000 or so of credit card debt. Much of it accumulated in secret. You discovered it in secret one, two, three times, which feels particularly bad for historical reasons in a past relationship that you had. Yes. And at the same time,

You love talking about money. Money feels good to you. You grew up looking at stock charts. You want to go on vacation. And understandably, you don't want to wait until this debt is all paid off for you to begin traveling, etc. Okay. In fact, you said... Right. Correct. During screening, you said...

I make more. On paper, it looks like I should help him, but I don't feel like I should. I guess because it had happened three times, I just thought maybe I'm throwing good money after bad because the second time I had to shuffle some things around and we'll get to that and tap out a loan from his 401k and make some changes. And I felt like I made it too easy to

and nothing changed. And so I'm afraid that it could happen again. I know he doesn't want to. I know this time is really hard, but I'm afraid to trust him with the money. I understand. I understand. Just a hypothetical here, Jimmy, if Dana offered to pay like $50,000 of your credit card debt off, what would you say?

I really don't know. I know how she feels about it. So I would be very hesitant to take it. Okay. All right. Because I really don't want to lose Dana. Yeah. Being divorced after 30 years of marriage and a whole family and life, I'm holding on to my kind of just in case, like if I put everything in,

And I know I'm supposed to be all in. I get that. But it's scary. They seem stuck. So far, we cut $150 from their groceries and removed two lines from their cell phone bill, saving another $150. But that's not going to solve the debt problem. I urged them to think bigger. And that's when things got even more uncomfortable. Well, looking back up at the assets, I think some of that farm equipment can go. Oh, talk about that.

What is farm equipment, first of all? What are we talking about? Lots of things that run on wheels. Wait a minute. That's how I would describe it. A guy who may have never been on a farm before. Yeah. There's things out there with the steers. Apparently, they require a lot of things to feed them. So he can sell all that stuff. So part of the change is we have some ground. And I'm seeding that to alfalfa.

which is a consumable for cattle and horses and stuff that people like to pay stupid money for. So I can't really get rid of the stuff because I'm shifting it to something that's going to make money. How much is the equipment if you were just to sell it tomorrow? $12,000, $15,000. Am I the only one? $15,000. Let's say $12,000. Let's just be concerned. $12,000. He has a collection. I didn't understand it, but that's just of these...

farm signs. They're like from companies and they're big. Okay, I won't get... I know I'm doing this wrong. They're these big signs that... Okay, so if you were to go past a tractor dealership, they're lighted signs. I have like eight of them. What does it say? One says Gleaner. One says White. One says Agco. Just one says Gale. And then I also have older...

when they use metal signs. I have some back that are close to 100 years old. These are like collectibles? Actually, yes. That's what she's getting ready to say. She knows how much I absolutely love these signs. I used to have the lighted signs on my whole barbara's list. It's okay. It's okay. How much are they worth? That's all I want to know. It depends in the area of $10,000 to $15,000, depending on who's there. And they're gone or going to be gone. They are?

They're going to be an auction. Oh, all right. Great. $10,000 for the signs. We're at $22,000, right? That's a lot of money. And there's more. What? Tell me. All the pedal cars. I didn't know about them either. What's that? They're like little baby tractors. They're going to the auction too, though. They're right on tractors. Okay, here's a crazy thought. But it's self-serving.

We have 10 acres. We don't need 10 acres at all. There's a second road that goes back to the barn. And instead of planting alfalfa, I would just sell off. I mean, land has... I don't know enough. This isn't my thing. But I don't see why we have all this land. If we don't have steers, I know it's hard because people in Michigan and this area, they like to have acres of stuff. Just say the idea.

Sell it. Amazing. Don't know if it's a good idea, but I love that you propose that. So let's just catalog so far what we've heard so far. Because we started off with $150 a month saved on groceries, which I applaud. Great job. Nice. But now we're talking about heavy equipment. We're talking about $10,000 in signs and potentially some acreage, which may or may not be available to sell. This is big money.

Jimmy, I want to check in with you. Let's just start one by one. And then let's talk about the whole thing. Selling the signs you said is already happening, correct? Yes. Okay, great. The farm equipment, what do you think about that? Well, after my initial cost of about $1,200, I will make $6,000 to $8,000 a year off the hay as long as we live here.

I don't have an initial cost after that. Now, it will go down some because it won't be as productive on year seven as it is on year two. So if I sell that equipment, I no longer have the ability to make that income. $6,000 a year, roughly? Yeah. For like four or five years, something like that? Yeah. Okay. So...

In your estimation, you've already spent money on the equipment. It's about to start making the most money that it's going to make. So keep the equipment, make the roughly $6,000 a year. And then when I'm done, I get rid of it. These pieces of equipment are devalued as far as they're going to devalue. I got you. The tractor is already 67 years old. What about gas and maintenance and stuff for these things?

About 100 gallons a year for that. Non-road diesel is about three and a quarter right now. All right. That's not much. I understand all the math and I understand the logic about, hey, it's about to start making money. What do you think about Dana's suggestion to sell the equipment? Are you a yes or are you a no or are you a maybe?

Well, I don't know. I'm going to jump to the property thing because I don't know that we would be allowed to split the property. Let's find out. Maybe. Let's play out both scenarios. Let's say you are and let's say you're not. Let's talk about all options here. So if we were to sell the property, other than one piece of equipment to clear snow, because it snows a lot here, I could sell almost everything. Are you struggling with feeling like that's failing again?

I just know I can make, I know what I can make on that. No, I mean, having to give up something that your family does that you've done that your grandpa did, and then to not even dabble in it. Does that feel like you are losing some heritage? Maybe, but it also sounds kind of boring not to have that stuff to do. Boring means what? I'm not being overly productive. It's, um,

I don't know, maybe this goes back to that hardworking thing that you're talking about earlier. I don't know, I just, I like to have stuff to do outside and these are all outside things. There's plenty to do without doing those. And then what about the fun things you wanna do? So I would go so far as to say, and again, it's me, we can make a lot of money on this house and property. We've already, there's already easily another, we got a phenomenal deal on this.

The selling amount, I'm not considering how much the other costs are, but easily $250,000 profit. Dana, look at Jimmy's face. Dana, look at Jimmy's face. What do you see? Is he hearing you at all? Oh, I'm hearing everything she's saying. Are you really hearing it? Yes, I am hearing what she's saying, but I'm also going to the... And then we can buy a house that costs just as much someplace else. I know there's a school district thing.

But the rental idea makes me think it's just until she graduates. So I know that's another five years. On the other hand, maybe someone's going to tell me that this property and this house will continue to increase in value. And that's not a good idea. The market's different everywhere and I haven't given any thought to it. And it's disruptive. I understand that. Yeah.

What just happened in that back and forth? Jimmy, what did you hear Dana saying? Let's do something different. That may not be what she said, but that's what I heard. Well, you got to understand Dana though, she's either full throttle or she's off the gas. But I can change.

I think we need something that brings us together because everything has been pushing us apart. I think of it as like a Venn diagram. And that little intersection is so much smaller than I thought we were going to be. Yeah. And I want to see it bigger. Jimmy, do you agree with Dana's sense of urgency? Not as much, but I also haven't had the losses she's had. Mm-hmm.

And by saying that, that's not saying I'm unwilling to look at it that way. I'm probably going to lay in bed tonight. Well, how much of this is, like you said, legacy? You didn't use those words, but that's what it is. Legacy. Expectations. But if I really want the end results that I say I do, I don't know. I think we ought to look into seeing if we can sell the property.

That's actually a lot of options. They could trim their fixed costs, which they should do anyway. Dana could pay for some of the mortgage. They could sell the farm equipment, the steers and the collectibles. They could sell off part of the farm. But that is where we hit a snag. We got stuck and I couldn't get the conversation to go any further.

I learned from our conversation that I need to really work on developing a new version of rich life and not trying to get the old version to fit in to the new one. And that I'm also going to look into the post-nup. And I think that will just give me a level of comfort. So all in all, it was really helpful and worth it all. So thank you so much.

So what I learned, I need to look outside the box, look for bigger things, different things that I can sell and not lock myself into something. What surprised me is honestly just how personal Rameek is. And I didn't know what to expect. I mean, yes, I've watched videos. I've listened to podcasts, listened to the book, but

You just never know until you actually talk to somebody. It's actually a lot of fun. What I'm going to do is I went out and took stock in everything I have out in the barn, and I found a number of things I can sell that should add up to about $6,000. And I'm going to get that sold and put it to the debt and then do more digging. Thanks. Let me just tell you what I would do.

I would have a series of clear conversations about the rich life. I would use the IWT journal, which would help them get out of their heads and really design a rich life with specificity that excited them both. Based on what they told me,

I would simplify so much. I would sell all the farm equipment, collectibles, anything around the property, and if possible, part of the property itself, then pay off the debt immediately. Next, I would recalibrate the relationship, including having Jimmy take on more financial responsibility, and I would split the expenses much more fairly. If I were Dana, I might consider a post-snub.

And finally, I would start making moves in anticipation of when the kids are old enough to leave. That might mean selling the entire place and renting now, using that money to invest, or it might mean building up a larger savings account. And with a few years of planning, they truly could live their rich lives. ♪

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.