151. “Our gas is about to get shut off, but I refuse to sell any of my 7 cars”

If you've recently discovered this podcast and you've wondered, how can I get Ramit to answer my specific money question, There are two ways to do it. Number one, you can apply to be on this podcast although we are already full for the rest of the year. Number two, you can join my Money Coaching membership in this program. We do a ton of cool stuff I want to make sure you know about it. We do a monthly live call with me where I cover some of my favorite money topics that I can't go into publicly in as much detail as and I break down our members conscious spending plans. Plus I answer your questions live. We also have tons of virtual events coming up that cover every aspect of living a rich life. For example, our new event Money for aging Parents is coming up at the end of October that is included for all Money Coaching members. You get access to our library of all past calls like how to find an extra thousand dollars a month and how to do a rich Life annual review. Plus we have a Money Coaching community group where you can see inspiration how other people are spending their money and get your own questions answered if you.

Want to get help.

If you want to meet amazing other people in money coaching and you want to build your rich life faster and bigger, you should check out Money Coaching today. Go to iwt.commoneycoaching to join right now. That's iwt.com moneycoaching foreign.

On our mortgage, getting a shut off notice for our gas account, you know, our electrical accounts in payment plan is just. Everything is so overwhelming for me. Megan, I've asked you multiple times to, you know, try to help out more, you know, look at different job opportunities and I get the same answer. Oh, I'm comfortable where I'm at but we need more and I just can't do this myself.

Do you think that Megan understands the severity of your situation?

I don't think so, no.

I listen but I don't listen at the same time where it's like, it's become like a repetitive conversation.

We get by and that's just what we're doing. And I'm tired of getting by.

Peter, what if Megan never changes?

I couldn't deal with it. I just, I'm not doing this anymore. I'm still young, we got no kids. Maybe it's time to move on.

Meet Peter and Megan. They're in their mid-30s, they don't have children and they are in very serious financial trouble. Peter wrote me in his application saying he was at the end of his rope. He didn't know what to do. Maybe he would even be better off alone. Now, as I go through today's conversation, I ask them questions to try to figure out what's really going on. I have a feeling you're going to be frustrated. I know that I was. But I want to emphasize to you how important it is to treat all of our guests with respect, including on any social media comments. That's what I expect for the couples who are brave enough to come on this podcast and share their numbers and their entire financial lives with all of us. Now onto the conversation with Peter and Megan. I started by asking them what would be an amazing place that we could get to by the end of this conversation. And I want you to listen to their answers because they provide a huge clue as to how they both see their current situation totally differently.

Just knowing how to properly handle money, how to put it in, like, different areas like bank accounts, like IRA type of things, savings, stuff like that, to better our future to where we're going to be happy.

Okay, Peter, how about you?

I just don't want to be so nervous and I'm tired of being overwhelmed about everything I was hoping for. Put a little fire underneath Megan's. I feel like I tried talking to her before and, you know, just kind of. I feel like I get nowhere.

How come the answers that both of you gave me are so different.

Two different minds, I guess.

I feel like whatever I say is like, yep, no problem. Okay. I, I just not. Not getting any help there.

So you feel that Megan is disengaged with money?

Absolutely. It's. It's tough. I feel I can do a little bit everything myself, so I just need, I need help.

So it's like I want to help him more, but it's just, it's very tough when he's very, like, single minded and him doing it, which I am fine with. If he wants to take full control of it, he can because I don't know how to handle that kind of stuff. For me, it would just be when the bill is due, you pay it whether there's money in there or not, because I don't want them to go into like, like you owe money. So like with a credit card, then you start accruing more interest when you miss your payment or with the utilities if you go too long without paying, then you get the shutoff notices, then that's a little bit scary. We've never had that happen before. But I just don't want to see that little piece of paper that says final Notice your utility will be shut off.

Okay.

It just scares me.

Why are you willing to go as far as letting your power get turned off before you make a change?

Well, I would prefer it not to get shut off.

Okay.

I'm gonna. Hopefully I'm gonna do something and I'm gonna try my hardest.

Why Hopefully? Why try what? What is this?

It's me doubting myself.

Take me back to being a kid. What do you remember about your parents and your relationship with them, especially as it relates to money?

Nothing.

They never talked about money. Okay. What else?

Nope, never talked about money. Never showed that we were struggling or anything. Always everything was fine, bills were paid. So like I said, they never, like fought about it, never discussed it. So I never knew anything about it. My father was self employed for years. He had a landscaping business. So with him it just never seemed to like money come up or anything. I still remember as a child, and he still does it to this day. He has usually a lot of cash like this in his pocket. So I never thought we were ever poor or anything because he would sit there and just take it out and pay for something. So he never discussed finances with me at all. He just had everything situated. Like, when I was 16 years old, I got my first vehicle, which was one of my father's vehicles. That was a hand me down, only way I can get it was if I had a job.

Did you like making money back then?

Well, I was a child, so I didn't quite understand. Was just, okay, it's in a little box in my room. I need it, I need it. I don't, I don't. Because he never set up a bank account for me, never had me go down until I really started. I think it was, I think when I worked at Blockbuster. This is going back years now where that's when I had to have a bank account where I was like, yeah, I'm getting the paychecks every week. They gotta go in there.

Did your mom work?

She did, but she was also, when she was in like her mid to late 30s, maybe she was disabled. She had a neuromuscular disease which basically prevented her from working. She would basically be standing up and just fall. So she collected disability Social Security. And my parents divorced when I was eight years old.

Oh.

Again, never had talking about money with either one of them, even when they were divorced.

When did the two of you meet? High school.

High school, senior year.

When you dated, did you talk about money?

No, we dated very young. We dated our senior year of high school. And I Moved out pretty early and got an apartment. I think like a week before I graduated high school. It was all just kind of figuring it out as we go.

And you bought a house, correct?

Yeah, yeah, we own a two family house. Rent out one side. It's a duplex.

Okay. How about when you made that purchase, did you talk about money then?

I did that all on my own.

And what age were you married at?

27, 28. 10 years dating. 10 years married.

When did you manage your own money, Megan?

I don't think I ever did. Not that I can recall.

You think maybe that has something to do with what we're talking about today?

Most likely it just. I don't know how to discuss money, how to basically pay bills properly. I need an insight on how to do this. That's my issue.

What do you think's behind that? The fact that you've never managed your money on your own. What does that tell us?

That I've always seemed to, like, rely on someone else?

Yes. Who was it early on in your life?

Well, my father. For paying bills?

Yep.

But again, he never gave me money because I had a job.

Still provided a roof over your head, Right. Even though you weren't earning much back then, Even as a teenager, right?

Yep.

And then. How about now?

Now it's relying on my husband.

Even though you're not earning that much, you still have a roof over your head, right?

Yes.

See any similarities?

Yes, I rely on other people versus myself.

Can you tell me a time where you were not on the same financial page?

Probably bills. Basically it's just trying to get like a credit card bill or a utility bill paid, but then it's looking at the bank account, realizing there's not enough money in there. So then the panic and freak out happens, and then Peter sits there and starts to try and figure out how to get money in there to help pay that bill. And it's like I try my best to finagle things and be a little frugal with money every now and then, but sometimes it's just not enough.

What happens then?

Then we get into a little bit of a disagreement about it and we just leave it alone. And I'm like, okay. I'm like, well, what do you want me to do? I'm like, is there anything I can try and do to help? He's like, I, I, I don't know. He's like, just getting overwhelmed, trying to figure it out. And it's like, I don't know how to help. That's the issue.

How Long have you struggled with money?

Probably a while.

My whole life.

Why are we talking now?

Things are getting deep.

Like what?

We're just falling behind on everything. And I got, you know, letters coming in, my credit's going down. And as Megan said, I mean, we've gotten shut off notices and I mean, I just, I'm at the point where that I like, about to give up.

What does that mean?

Yeah, I. I don't know. I, I just. It's like I'm trying to take care of everything and like I said before, I just need the help and I ask for the hope and I feel like I get no answer. And I mean, we're just behind on everything.

Do you think that Megan understands the severity of your situation?

I don't think so. No.

I listen, but I don't listen at the same time where it's like, it's become like a repetitive conversation to where it's the same thing over and over and over again. And I guess I just kind of like block it out, like, okay, if I don't hear it, it doesn't exist type of thing. Even though it does exist, it's just I have to change my mind frame.

Because you said just a few minutes ago you said, you know, it's not like we're getting close to any shutdown notices, any electrical thing. That would be really scary. And then what Peter just said is getting shutdown notices.

Yeah. Which I have not seen.

We're a month behind our, on our mortgage, getting a shut off notice for our gas account and you know, our electrical accounts in, you know, a payment plan is just. Everything is so overwhelming for Megan. I've asked you multiple times to, you know, try to help out more, you know, look at different job opportunities. And I get the same answer, you know, like, oh, I'm comfortable where I'm at and that really annoys me. You know, I took the chance and went to a new career, a whole different. A whole different trade. And you know, there was life changing for me and made a big difference for us, but we need more and I just can't do this myself.

Yes, you have said that all before and I do understand it. But like you said, I'm just comfortable there, which I am. I've been there for 17 years now. It's like I know the ins and out. I'm afraid of going someplace new and having to start over again, possibly have a lower pay than what I have now because of minimum wage. It scares me to go to another job. It really does.

Honestly, this is difficult to listen to. They're in debt, they're getting shut down notices. But Megan doesn't seem to care. Her answer is I'm comfortable there Some clues that I noticed. Peter basically came on this podcast so I could convince his wife to get a different job. Megan has been subsidized for her whole life. She grew up with her dad taking care of the money. Then she got married young. Peter became the person taking care of the finances. We see this on the podcast all the time. One partner, sometimes both, have no real consequences for their financial behavior. What does it really matter? They still have a roof over their head. Power is still on, at least for now, but because they don't have any skin in the game, they don't change. Hold that thought. We'll be right back. Real question for you. Do you know how often you're supposed to see your primary care physician? How about the dentist? How about a dermatologist? A lot of us just wait to get a text from the dental hygienist to know it's time to make an appointment. But your health is important and we talk about going from defense to offense with your money. What about with your health? Why not make your life easier and Book this year's appointments today with zocdoc. Zocdoc is a free app and website where you can search and compare high quality in network doctors and click to instantly book an appointment. They have over a hundred thousand doctors across every specialty from mental health, dental, primary care and more. Just filter for the doctors based on your insurance, your location, even ratings and find a doctor who's a good fit for your needs. Plus, Zocdoc appointments happen fast, usually within 24 to 72 hours. Instantly click through your options, book the appointment and you are good to go. If I needed to find a new doctor today, this is what I would use. Stop putting off these doctor's appointments and go to Zocdoc.com ramit to find and instantly book a top rated doctor today. That's z o c doc.comit z zocdoc.comit there's this myth that if you rent, it means you haven't made it. I don't really believe that I rent and I want you to know that you are not a failure if you choose to rent. In fact, I want more freedom right now than buying a 30 year mortgage. But if I'm spending thousands of dollars a month, I want to get some of the perks that homeowners get. And that is where built comes in. Bilt is a loyalty program for renters. You pay your rent through BILT and you can earn points for it. Think about it. You're earning points for your biggest expense every single month. And you can redeem those built points towards flights, hotels, Lyft rides, or even future rent payments. BILT has evolved into a complete rewards ecosystem where you get rewarded for the first time as a renter. And it's easy. Almost any payment method is compatible. So you can start earning right now. I wish I had had this when I first started living in New York. Plus, BUILT recently announced that homeowners will be able to get rewarded the same way on their mortgage in 2026.

So stay tuned.

Join the loyalty program for renters@joinbuilt.com Ramit that's J O I N B B I L T.com Ramit and make sure you use our URL so they know that we sent you. Now, back to Peter and Megan. Let's take a look at their numbers, their assets. $447,000 investments, $42,000 savings, $3,500 debt, $215,000 for a net worth of $277,700. P Peter's income is about $83,000. Megan's income is about $31,000.

It's just. It's tough in my mind frame. I am. I'm like, stuck where I am and I can't get out of it. I've tried looking at other jobs, seeing, like, what else is out there, trying to better manage our money.

How many applications did you send out.

When it was six months ago, it was like three of them. We got into a big, huge fight and I stopped because I got frustrated.

I think you stopped because there's nothing really at stake here.

No, there's a lot at stake. I just don't admit it to myself.

And when situations like this arise, Peter, you pretty much handle it somehow.

Yeah.

Does that strategy work?

Obviously, no. I mean, we get by and. But that's just what we're doing, and I'm tired of getting by.

Okay, can I ask you, do you get by? Are you losing money every single month?

Yes.

After I started messing around with the CSP and, you know, kept on updating it and, you know, like, oh, we forgot this, and, you know, we need to put this in there. And it's like all of a sudden now it's like, yeah, yeah, we're losing money.

Yeah, you're in the red every single month.

Yeah.

Okay. So does it work? No. Thank you. Sometimes the first Thing we have to do to make a change is to acknowledge that what we're doing is not working. It's really hard to just give a point blank answer like you just did. So I totally applaud you for that. Megan, is it working?

No. Because even when he put it into, like the calculator, I think we were like 70, 80% in the red. Yeah, it was an eye opener. Then it was okay. Now we really have to figure out where to be a little more frugal with the money. How to cut coupons in a matter of speaking, to save that couple of dollars, to hopefully help save in the long run, or if there's a really good deal on something, get it type of thing, and hopefully it all works out.

I just want to cut in here to point out two things that I just heard from Megan. First, hearing that they're in the red every single month, on top of the debt, on top of the shutdown notices, her solution is we need to cut coupons. Now, this is a typical response for someone who's never really engaged with their money before. They'll often present very simple solutions to complex problems that have built up over many years. Now, if Megan is serious about changing, I can show her the total picture of the situation. I can show them how they need to cut more than coupons. But I'm not sure she's ready. And that's because of another thing she says. She says, hopefully it all works out. This is typical of people who grew up religious and or feel that they have very little control over their lives. They don't make a plan because in their experience, they don't really have much control over what ends up happening. They live for today. They rarely think about a plan for next week, much less next month. Certainly not next year. Personally, I don't want to use hope for anything important to me. If there's something that's important to me, I want to take a candid look at the situation. Where am I today? I want to make a plan, always leaving a comfortable amount of buffer. And then I want to use overwhelming force to get there. Okay, let's continue. And I have to tell you that this is the part of the conversation where my jaw really started dropping.

I gotta say that luck, we've been pretty lucky with stuff. And I think that's why she keeps on saying that.

The Pontiac.

Every time something goes wrong, all of a sudden something works out for us. You know, I. I'm on Marketplace like crazy. It's one of my addictions. I hit a Big home run. And that's how I paid off the Corvette. I bought a vintage car for $6,000 and wound up selling it for, like, 25,000. I sold the car for. To a guy in France, you know, and, yeah, I didn't put much money into it. And I've been a mechanic my whole life, and I consider myself a fixer or I could fix anything.

Can you fix your financial situation?

Well, that's the only thing I can't fix. That's why I'm on the call with you.

Okay.

We can fix it.

Yeah, eventually.

Got to have confidence.

Okay, tell me, Megan. I like that confidence. Knowing what you know, how can you fix your financial situation?

Goes back to getting a better job.

It's that simple.

Not always. It. It's getting a better job, learning how to, again, spend money differently.

Okay. You have cars. I understand. When you bought a car, multiple cars, did you talk about money then?

I did. I think we have a total of, like, seven vehicles. Big into cars. I remember going to work, and I. I bought a Corvette. And so I kept on driving by, seeing this car, and, you know, you know, I try to let me know everything that I'm doing, and I. I saw this car. I was so excited about it, and I told her I was gonna buy it, and she got a little nervous about it. I was like, yeah, I was like, you know, it's no big deal. I can take care of it. You know, I could pay for it. And, you know, next thing you know, I wound up purchasing it. Got a great interest rate on it. At that time, my credit was great. Everything was doing good, and purchased car, no problem.

How much was the car?

It was. It's. It's a older Corvette. It was. I think, at the time I purchased it for, like, 25, 000.

Okay. What was the interest rate?

I was at like 1.8%.

Oh, that is a good interest rate.

Yeah.

Okay. Home run. Is that car paid off now?

Yes, that car is paid off.

So you have seven cars. What other kind of cars do you have?

I have a Corvette. I got a Chevy Silverado pickup truck. I got two 1963 Chevy Impalas. I got a 20 Subaru Crosstrek, and Megan has a. A Jeep Wrangler and the Harley. Oh, yeah, we have a brand new Harley.

Brand new means what?

Yeah, it's old now, so. Right. 20.

22 years old.

22.

Okay. How much does a Harley cost when you bought that thing?

That.

Well, so that was a CVO. So that was, like, almost 40 grand.

Oh, what's the CVO? Is that the model?

Yeah, yeah. Street Glide CVO. It's like the top of the line early.

That was 40 grand. Yeah. All right. So I understand that your transmission just blew out. Megan, since we last spoke, so this is actually an interesting moment for us to talk about it. First off, sorry that car went through that.

Thank you.

How are you going to handle a situation like this?

Me? I have no idea. It literally just happened a few hours.

Did that fall to Peter?

Yes.

Yeah.

Play this out for me. How would it normally go? Because I'm sure you've been married a decade, things come up, things break. So, Megan, in this case, your car broke down, so you come home, you tell Peter, and then what typically happens?

I was a mechanic for 14 years. That's my little side hustle. I have a garage, and I'm calling up the junkyard. DeMarta, pull up a transmission and swap it out.

How much will that cost?

I would probably get one for about three to four hundred dollars. Okay.

And out of curiosity, why not just give Megan one of the other cars?

The other cars are, you know, you got two vintage cars and my Corvette. I. My Corvette, I drag race, so that's not even street legal.

Okay.

And the truck is too lifted to get in and out of the truck?

Yeah, the truck. She could drive the truck tomorrow. That's no problem. But, yeah, she doesn't feel comfortable driving it.

Okay. So you don't talk about money that often. You haven't really talked about it much. When you do talk about it, it's, hey, I'm going to go buy this $25,000 car.

I'll be honest. I've spent a lot of money on. On my race car. And that was in the past. And I've been really good on that.

It's expensive.

How serious is this?

Extremely.

What would you be willing to do to change your financial situation? I'm going to ask each of you. Peter first, then Megan.

I feel like I'm doing everything that I can. Yeah, I can cut back on eating out. And, you know, I didn't ask you.

I didn't ask you to justify it. I asked you, how much are you willing to do in order to change your financial situation?

I'm willing to. I'm willing to do a lot, but there's certain things that I can't do. Like I can't get rid of certain vehicles and stuff like that.

What else?

That's pretty much it. That's. That's where I was scared about. I've listened to one of your podcasts, and it really hit home. I was at work, and you were talking to a guy who had a lot of motorcycles, and I'm not willing to sell what I have.

Okay. You said in your pre interview, you said, I heard the episode where you told someone to sell his motorcycles. It's my biggest fear. I can't sell my toys.

Yeah, I think that's it.

Is that true?

Yes.

Is your biggest fear selling your cars, or is your biggest fear running out of money and getting divorced?

Peter's referring to episode 78 with Alex's five motorcycles. But we also heard the same thing in episode 75, the COVID nurses, where Dan used to be working at Walmart, saw a car, and that became his definition of success. Now, putting all that aside, is this a joke? They're in debt. Peter tells me he's stressed out beyond belief. Megan won't get a new job. Then I find out he has seven vehicles. And not just any vehicles, not even just a Corvette, but a Harley. All right, let me take a deep breath.

I need to calm down here for a second.

I understand that in America, cars are a huge sign of success to a lot of people. I get that. Just because it's not my thing doesn't mean that Peter doesn't truly value it. It's totally fine. Your rich life is yours, but my rich life is mine. But to Peter, when I even bring up the topic of cars, he preemptively tells me he won't sell them. Because to him, selling one of those vehicles is like chopping off an arm selling seven of them. In many ways, it's like his identity dying. Now, I understand that. And I understand these cars are part of a rich life. But in order to live a rich life, you have to be able to afford the things you're buying. And I can tell when people are not ready to make a change. That's because when I asked, how much are you willing to do to change your situation? You notice that he responded with pauses and qualifications and yeah, buts. That's not promising. We'll be back after these messages. When I talk to new business owners, I hear a lot of the same motivations.

I want to make extra money.

I want more freedom. I want flexibility. But I will tell you something that I've never heard. I want to start a business so I can fill out a bunch of tax forms. That sounds like my hell. The good news is you don't need to be a tax expert to start your own business. Instead, you can Use Gusto, this episode's sponsor, Gusto is online payroll and benefits software built for small businesses. It's all in one. It's remote, friendly and it's incredibly easy to use so you can pay, hire onboard and support your team from anywhere. They offer automatic payroll tax filing, simple direct deposits, health benefits, workers, comp, 401k matches, you name it, they can help. Plus, it's quick and easy to switch to Gusto. Just transfer your existing data and get up and running fast with no hidden fees and no surprises. Try gusto today@gusto.com ramit and get three months free when you run your first payroll. That's three months of free payroll@gusto.com ramIt Once more gusto.comit.

I know that some.

Of us think better when we write our thoughts out. But for a lot of us, including me, I'm better when I can of think. Think out loud. If that's you, I recommend you check out Whisper Flow to save you tons of time to bring your ideas to the page. Whisper Flow turns your voice into clean final draft writing inside whatever app you're already using. Email, Slack Docs, even text messages. And it works on Mac, Windows and iPhone. So instead of spending all of your time responding to messages, especially while sitting at a computer, you can hit a hotkey, speak, and the text appears. It's accurate, it's fast, it's all formatted so you can get back to work. Here's what my friend said about it. Whisper is amazing because it learns the way you speak. So you can send this rambling note as a text message and it kills all the filler words and it perfectly formats it for you. They said it's much better than using the Apple voice to text feature. The spelling is way better. If you want to buy your time back and get back to what matters, check out Whisper Flow. Try it for free at whisperflow AI ramit. That's whisperflow AI/ramit w I s p r flow AI/ramit or click the link in the description below. Let's get back to the show. Next in the conversation, I moved on to their other expenses.

All right, fine. Your insurance 330. Your car payment is 1198. What is this?

Car payment. So that is my Subaru and the Harley.

Why are you breathing so heavy right now?

Stressed out.

Why?

Don't know. It's just overwhelming through it together.

How many years have you been stressed out about money?

Since I moved out on my own. Okay. I mean, I moved out a week before I Graduated high school, had my own apartment.

How do you think that stress affects your health?

Oh, it's not good at all. I know that for sure.

All right, I agree. Hate seeing you cry. I hate seeing you stressed out, breathing difficult. I don't want this. It's not good for your health. It's not good for your relationship. The fact that we're talking about this right now, as I'm staring at a $1,200 a month car payment is blowing my mind. It's like in your head, you've created this mental prison, and you've put yourself inside of it. And you know what else is inside that prison cell with you? Seven other things. What are they? I don't know. You created your own prison cell, and you said, I'm not leaving without my.

Toys.

And you're in that prison.

Look at that.

Wiping away tears as we're sitting here talking about how stressed you are, how bad it is for your health, how bad it is for your relationship, and you're just looking out through those bars going, somebody help me. Get out. You can get out anytime you want. What's going to take? Changing the way you look at money.

It feels like I got to start all over, though. Sell everything.

And what's the alternative?

I. I don't see that. I see that helping out where we're at right now, and it's only going to get back into that same situation.

Two separate problems. One, it's like the house is on fire. Let's deal with the fire right now. Let's put the fire out. That's problem number one. Problem number two, what are we going to do about the apples that we bought yesterday? And now the fridge burned down and we need some new apples. That's problem number two. Two totally separate problems. We got to deal with the fire first. Put that fire out, and then we will deal with all the other problems. Second, you have to change the way you think about earnings, about speaking with Megan about your expenses. Right now, you built your entire life around a few inanimate objects. I'm not trying to demean the fact that you've accomplished something amazing with these vehicles, the Harley. That stuff's impressive. But another way to look at it is if I did it once, I could do it again. But I need to put this fire out, and that's how I look at it. Let's keep going with your expenses. You pay $1,000 a month for debt. What kind of debt is this?

It's a credit card debt.

How much is the credit Card debt?

I think it's about 40,000.

40,000. Okay. At like, what, 27, 28% interest?

Yes.

Okay, so that's essentially just growing, right? Yes. And how much do you pay for your shop?

That's not on there. I pay almost 500 for the shop.

Where's the money come from?

The shop pays for itself.

Does it make a profit?

Yes, the shop does.

Where's that income?

I leave that strictly on the shop.

How much does it make?

If I had to say, on average, I'd probably say the shop makes what, two grand a month? Give or take. If we had to like, average it out month to month. And that's at like, high end of it.

Yeah.

And is that the money you use to buy the vehicles?

Yes. Either, you know, help to help out for that stuff, or I consider it like free money.

What's that old example of Nero fiddling while Rome burns? Have you guys heard of this example? You know, someone's just like, fiddling on the roof while the entire city is burning behind them. Anybody feel like that's what's going on here? Ah, working on these cool cars in the shop. Meanwhile, house is burning down.

When you put it in that perspective, yes.

The shop is my. My safe. Even it. I. I could have the worst day at work and worst day at home and go there and it's like everything's okay.

Okay. All right.

It's your Zen time.

And supposedly, according to this, you can spend up to $521 a month on guilt free spending. But you and I know that number's not accurate.

No.

How much are you spending on guilt free spending?

I couldn't tell you.

Megan, can you tell me?

800 to $1,000 a month.

@ that point, we're just.

Guessing. You need to cut your expenses somewhere.

Else. Phone, I.

Guess. Yeah, your phone is way too.

High. Well, we have four.

Lines. Why watches? Why is it that everyone I talk to who's in financial trouble has watches? What is this? How many? And then they have iPads with. With cellular connections. You have that.

Too?

Yes. Wow. So this is a new thing now. Everyone who has tens of thousands of dollars of credit card debt has Apple watches and iPads with cellular connections. Never fails. Do you all know why you have those.

Things? For me, it's nice to see the time. And who texts me? Because if I'm at work, like, talking to a customer and Peter texts me like he needs me to call him or something, instead of me being rude and flipping my phone out, I just flip my wrist real Quick, see it, respond back, and continue on with my conversation. I've done that plenty of.

Times. That's interesting. How come I don't have that? And I have a company with employees and people texting me all over the place. How come I don't have.

That? I feel like it's one of those gratification things, just something to.

Have. Something to distract you from the mundane.

Life. Yep. I've heard you say it.

Before. Yeah. What else do you spend money on that distracts you from the mundane life? Watches. What else? IPads. What.

Else? Going over your friends.

Houses. Okay. Where's the money in.

That? Buying beer to bring.

Over. Yep. Eating out. What.

Else? Spending stupid money on dog.

Toys. Definitely. I mean, what do you have in your house? What kind of stuff do you have? If we looked at the living room, the closet, what would I.

See? Honestly, not.

Much. No? No, just a saltwater tank.

That. Yeah, the saltwater tanks. Big.

Expensive. How much did that.

Cost? Oh, I don't want to.

Say. I mean, well, the tank and stand were free, so that.

Helped.

Yeah. Is anyone going to tell me the answer? I find it hard to believe this. A guy with seven cars does not want to tell me the price of a freaking fish.

Tank. I think we got to have at least like, three to four grand in.

There. This is a new.

One. We already know from this podcast that 100% of parents who have credit card debt cannot say no to their children. That is a done deal. It's documented. We know it. But today I finally crystallized the fact that almost everyone in credit card debt has multiple Apple watches and also an iPad with a cellular.

Connection.

Why? It's mass luxury. It's the feeling that you've bought something really nice, but also it allows you to disguise your luxury purchases with functional reasons. You heard Megan do it when she said I can use my watch to respond to texts instead of being rude using my phone. Same thing when parents tell me their kids need an iPad with a cellular connection so they can stay in touch. Look, if you can afford it, fantastic. I want you to spend extravagantly on the things you love. But many of the people that I talk to simply cannot, period. Look at this. This is my iPad. It's five years old, works perfectly fine, gets the job done. But even if I had a brand new one that I bought yesterday, I can afford it. I couldn't stop thinking about this example. And the other day I was thinking about how so many people on this podcast overspend, specifically on cars and housing. But I never Ever hear someone overspending on things like luxury hotels, which happens to be something that I like to spend money on. Why? I was thinking about it. Number one, houses and cars are visible. Deep down, we want people to look at us and think that we are doing well. And in America, you do that with your house and your car. If others cannot see it, what's the point? Number two, it's what people around us do. There's mimesis at work. It's not satisfying to buy the most luxurious custom made umbrellas in the world if no one else is doing it. And this is where culture and class come into play. If, like Peter, everyone else growing up around you idolized cars, you're probably going to idolize cars as well. And number three, you can finance houses and cars. Almost everyone does. But very few people are financing a $2,000 a night luxury hotel. Here's my point. We mostly buy what other people around us buy. We mostly value what other people around us value. That's fine. That's human nature. I don't mind it. But in order to buy these very nice things, you need to make sure you can afford it. And to speak to a couple where they're getting shutdown notices, wages are being garnished, but they are unable to even contemplate selling these luxury.

Vehicles. This is mind blowing. I guess what I'm asking for is for either of you to draw a line in the sand. Because what I heard from the two of you was a lot of kicking the can down the road and a lot of I hope things change. I know they won't get like that. I don't mind. You know, you go to Vegas, you want to play a game, you hope you win the slots or something. All right, have fun. 20 bucks. Great. I don't hope that my power is going to stay on. I'm not leaving that up to chance. I want to.

Plan. I want to know what is.

The line in the sand where we're going to make a change, a serious change. I'm begging for that from either of.

You. I don't know. I really have no idea what.

Is the real issue.

Here. I don't want to change. I'm stuck in my.

Ways. You sound very confident saying that to.

Me. It's unfortunate, but I.

Am. Doesn't seem like it's that unfortunate. Not unfortunate enough for you to.

Change? No, but it's getting.

There. When? When will it be.

There? Hopefully soon. When it actually clicks in my head. And after this conversation, it's gonna really start to Sink in. And it's gonna make me think of. I suck. I don't know what I'm.

Doing. Are you guys happy with the way your lives are.

Going?

No. Because if you are, I will give you a couple of small tweaks. You can save a couple hundred bucks a month and we can go on our ways. You tell me. If you tell me I'm almost 40 years old, I'm getting shut off notices. I'm spending more than I make every single month. We can't get aligned on money. And we need to make a big change. And I'll help you make a big change. I will go where you want me to go. But you tell.

Me we do. We need the.

Help. Yeah, we definitely.

Do. Now, I'm going to ask the question again. What are you willing to do in order to make a.

Change?

Anything. Be honest. Don't feel pressured by.

Me. I've worked so hard to have what I got. I don't want to lose it. I grew up not having anything and it just beats me up getting this far. I've changed jobs and I got a great job now I'm in the union. Great pay, you know, pension plans and, you know, everything. And I got annuity and stuff that I've never even known what was. And I'm still kind of learning about and. And it's just. It's tough to give up the stuff that I work.

For. And Megan, you said you're willing to change anything. Tell me more about.

That. If I have to change my job, I have to change my job if it'll make things better. It's just trying to find a field which only thing I've ever done Since I was 16 years old is retail. So it's trying to find a job that's not retail is kind of what scares me because I know non retail jobs pay better than retail. I only have some college. I never completed college. So it's like I found a field that I like, have to have previous experience in it, have to have a college degree in it. And I'm like, well, this doesn't do any good. I know I can probably apply for it, but I don't want to go for it and then get heartbroken because I don't get it. It's like I want like basically a guaranteed job, if that makes.

Sense. No, it doesn't make.

Sense. Well, I just don't want to like quit my job and then go to another job where I'm only going to be there for, we'll say a Couple of months before I don't like it, and then not be able to get my old job.

Back. Megan, I still don't think it's.

The field that's the problem. I think you just don't want to change jobs. You told me that.

Right? Peter doesn't want to give up any of his seven vehicles. Megan doesn't want to get a new job because she's comfortable. But there's also another part of this story that you don't know. Let me rewind and tell you how we got here. Peter and Megan really wanted to talk to me. They wanted help. The first time we got on a call, they had a number of AV problems. It wasn't working out. So I finally said, you know what we're going to call it, and I ended the call. Now, after that, they specifically reached out to my team, asking for another conversation with me. Please note that in Peter's application, he wrote, I'm only 37, and I don't want to lose our home. I'm getting to the point where maybe I'm better off by myself. He also wrote, it's causing me to not want to be home. I'm working crazy hours just to pay minimums. It's kind of been a problem for over 10 years and has only gotten worse every year. I just want to give up. I can't keep going on like this. And when Peter wrote asking for a second chance at talking, he. He said, I'm desperate. I'm now getting my wages garnished. I was happy to get on another call with them because I want to help them. Which makes our conversation even that much more puzzling. How can they be so eager to get my help? But then when we get here and we start talking, they're not willing to change a single thing. We'll move on right after this quick break. What comes to mind when I share these specific moments? Renewing your passport. Scheduling a dentist appointment. Replacing that light bulb that's been out for six months, and you're not sure what's the right bulb. We all procrastinate on weird stuff, and taxes are usually right at the top of that list. We wait until the last second that we get overwhelmed. We got to pull all this paperwork, and we're panicked because the deadline is approaching. That's why I recommend guilt. Now that tax season's over, this is actually the best, best time to get ahead. If you run a business or you filed for a tax extension, one small move right now could save you thousands later. Gelt is not just another CPA firm. They helped one of my colleagues rethink his entire tax setup. Now he's saving more than he spends on tax prep. With Gelt, you get a proactive year round strategy, not just a one time filing. Credits, deductions, business structure. It's handled. And their tech platform makes it easy to stay organized. You'll also get access to Gilt's full tax library with guides on retirement plans, QBI and more. So if you've got a business or you filed for an extension, this is the window to take control of your tax plan. Head to joingelt.com ramit to book a consultation. And as a member of my community, you get to skip the waitlist. Again, that's joingelt.com ramit join G-E-L-T.com ramit taxes don't have to be a task with Gilt. They can be a tool to build wealth. Okay, let's jump back into the.

Conversation. Peter, you filled out the application.

Correct?

Correct. What was going through your head when you filled out the application to speak to.

Me? I was extremely overwhelmed, didn't know what to do. I listened to the podcast like crazy at work, just panicked. And I was like, I need help. I have no one else to ask for.

Help. So if you change nothing, we end our call and the two of you change nothing, what happens? Fast forward for me, a month, six months and a couple of.

Years. It's going to be living paycheck to paycheck, struggling, not being happy, trying to figure out how to pay bills, have a utility shut off, have the electric shut off or the gas shut.

Off. Then.

What? More credit card interest and then it goes into collections and then it hurts the credit.

Score. Who cares about a credit.

Score? I do. Because I want to buy another house. Don't you need a good credit score for another.

House? Yeah, but what are you talking about? A new house? You don't even have enough money to pay your current.

Bills. No, like when we actually can, like do it. Like once we get.

Ahead. So what else happens if you don't change anything? Power gets shut off, electric gets shut off. What.

Else? House gets foreclosed, Then we have.

Nothing. Where do you.

Go for lucky? A family member's house where we can stay until we get back on our.

Feet. What would that be.

Like? Very uncomfortable. Dogs love to figure out what to do. The cars, if it's a worst case scenario, sell them. Or if worse comes to worse, live at the shop. Won't be comfortable. But it's a roof if we can't find a family.

Member. Okay, Peter, what do you think? What happens in a couple of months or 18.

Months? This is where I get so frustrated. None of that would ever happen. I refuse to let that happen. And it's just me hustling and putting in more hours and doing everything possible to change things.

Around. No, it does make sense though, because it's like putting it on paper with again, we're 70, 80 in the red. And it's like seeing that, it's like, no, I don't make enough money to help get us out of that. With the credit card debt and the shutoff notices and utilities and the mortgage, it's his paycheck, basically covers all of that. Mine's just kind of like play money. Like the little extra if we need something for a.

Bill. Okay, Peter, what do you think hearing.

This? Ah, I don't even know what to say. I, I get so upset because like I said, my, you know, my side hustle is, you know, my shop. And one Saturday, you know, Megan gets paid bi weekly. One Saturday, I'll make her whole paycheck. And it just, it beats me.

Up. Did you all see what the application.

Said? Megan has.

It. No, we never have any money left. And my wife needs to make more money. She went to school and has a dead end job job. She gets mad at me because I call it a high school kids job. I probably think that calling her job a high school kids job is not doing you any favors.

Right. We, we got into a huge argument over that. And, and I realized that was really, you know, beating her up. And I do apologize, and I've told her that before, but it's. Yeah, it's.

Tough. You grew up poor.

Right? I grew up very.

Poor. Where? Midwest, east coast.

Where? Brooklyn, New.

York. Yeah. All right, so hustling, how many times by the time you were 18, did you hear the word.

Hustle? That was it my whole.

Life. You still have that.

Right?

100%. I'll hustle, I'll work harder. I'll never let it get to that position because I'll just keep working. I'll work 24,7 as hard as I need to.

Right?

100%. Does it.

Work? Gets his.

Buy. Yeah. You said something interesting. You said, we get lucky, we fall down, then something comes.

Up.

Yep. But then you also said, but I'm tired of.

It. It's, it's exhausting. It's very.

Exhaustive. You've kept it up until now. You want to double the grind and Hustle twice as hard for the next five years. Can you do.

It? No. Getting.

Old. When you both kind of play out, what's very likely to happen in the next 18 months? What do you both hear from each.

Other? Nervousness. Questioning the future. What could happen? What can.

Happen? What.

Else? I'm.

Scared, yes. Petrified at times because I don't want to lose anything because he did work hard for it.

All. You're both scared. You even describe it as petrified. But you're also both very comfortable. Have you noticed.

That? I guess to an extent.

Yes. Not an extent. You're comfortable in your job, which you've stayed at for over a decade. Peter, you're stressed out. You're telling me phrases like, I just can't keep going on like this, but you're so comfortable. You just do what you know, which is to hustle. You tell me point blank, I won't sell the cars. That's everything I've worked for. So you're scared, even petrified, but also.

Comfortable. I mean, if. If it came down to it, I have no problem selling the.

Car. When does it come down to it? I don't know what needs to happen in order for you to be like, holy, this is serious. Does the power need to go.

Out? The house being.

Foreclosed? Okay, so the house needs to be foreclosed before you go, oh, my God, we need to make it to my.

Shoe. It would not get to that.

Point. Okay, I'll tell you what. Why don't we look at your numbers and let's. Let's talk through it. Maybe it'll shed some light on this. What happened when you did the.

Csp? Did the CSP together, and I felt like Megan was more focused on the games on her phone than the.

Actual numbers because I play my games a lot, and I don't pay attention to a lot of.

Things. Why is.

That? The games are my outlet on life, and it helps me calm down, relax, and get my mind going straight from going everywhere. But even, like, when I did look at the papers, it was very, very confusing to look at and just see all of, like, the red and the black. And I'm like, I. I don't understand any of this. Unfortunately, it was very confusing to me. But again, seeing all the red kind of put it into perspective. We're screwed in a weird way where it's a lot of.

Debt. Do you want to understand.

It? I do. I've tried looking at it, and I just. I don't understand much of it. Like, I'm trying to, like, look and see, like, what does this mean? And I just. I'm not very good with finances and, like, understanding.

Numbers. All right, let's take a look. Let's take a look at your gross monthly income. Megan, what is this number? Number here? The combined gross monthly.

Income. That's the numbers before.

Taxes? Yeah. What is. Read the number.

Off. 9000.

486. $9486. So did you know that as a Household, you make.

$113,000? No, I figured it was like 70,000 a year or a month type of thing. Or a year. Whatever you want to call.

It. Peter, did you know that you make.

$113,000? I honestly thought I was under. I thought we were about.

80,000. And let me guess, a few weeks ago you were like, if we just make 25,000 more, all our problems will vanish, right? Well, here you go. The Lord has delivered. What do you say? We're.

Screwed. Did the problems.

Vanish? Are you telling me that maybe, just maybe, the way you feel about money is highly uncorrelated with the amount in your bank.

Account? Is that what you're telling.

Me? I knew this was.

Coming. That's so.

Shocking. So seriously, though, what do you make of the fact that you didn't know how much you made and it actually turns out to be more than both of you thought, and yet you are still in financial.

Trouble?

Gary, what's the lesson.

Here? That I have no idea what I'm doing when it comes to money and.

Finances. What.

Else? I just assumed it was all sunshine and rainbows and everything works.

Out. Are you willing to get a new.

Job?

Yes. All right, that's.

Good. My income doubling or tripling would make a big.

Difference. What is your job right.

Now? I work at Petco, so I just work on the floor. Cashier.

Stock. How long have you done.

That? Maybe 17.

Years. You make $30,000 a year? What do you think about.

That? No, it sucks. I admit that. It.

Sucks. Why are you still.

There? Because it's a nice.

Job. It's comfortable. It's a little frustrating for me because we. We've done this before. I. I feel like, you know, she's like, oh, yeah, you know, I'll look at a couple jobs, and then it's the same thing.

Again. Do you know why she doesn't.

Change? Because I'm stubborn and stuck in my ways and comfortable. I'm a.

Moron. No, you're not a moron. I don't believe anyone who comes and talks to me is A moron. I think you're actually responding very rationally to the situation around you, Megan. Peter, do you know why she has not made a change with her.

Career? Yeah. I feel because I just wind up taking care of.

Everything. Yeah. There's no consequences. Why would anyone change? Roof is still over the head. Food is still coming in, still eat out. Why change? Got the phone working, got the games. You know, the job market is fantastic right now. Are you aware of.

That?

No. Why don't you take this.

Seriously? I do. I just. Like I said, when he talks about it, because we've talked about it so much, it just gets frustrating and annoying that when I get frustrated, annoyed, I shut down. I don't talk, I don't acknowledge. I just. I sit there and.

Quiet. Peter, what if Megan never.

Changes? I couldn't deal with.

It. Well, it's been over 10.

Years. I mean, I've told her before. So I was like, I just. I'm not doing this anymore. It's tough saying it again. But, yeah, I've been at the point where that it's like, I'm still young. We got no kids. Maybe it's time to move.

On. I want to stick it out with him and go from there because I love him to all ends of the.

Earth. You love them enough to engage with.

Money? I get frustrated because I tried talking to Megan, and she comes out and says that she's worthless and everything like that. And I reassure her that that's not it. It's just gonna try a little.

More.

More. But, yes, I absolutely love her, and I know she knows it because not that long ago, we almost got a divorce and we worked through.

It. Was that related to money? No. What I want you to see is that you have delegated the responsibility of money and probably other parts of making decisions to somebody else in your life. Almost like when somebody's injured in a wheelchair and they can't walk for a while, and then they finally get up, their legs have atrophied. They need to rebuild those muscles. Well, your ability to make those decisions and to manage money has atrophied. It's actually never been built in some cases. And it actually makes perfect sense.

Because Peter's over here saying, I'm overwhelmed. I need.

Help. But you are not picking up the ball that he's tossing to.

You. No, I'm more or less dodging it.

Exactly. And do you know why you are able to dodge.

It? Because I.

Do. You do. But why are you able to, like, let's say, Peter, God, Forbid. Got hit by a bus tomorrow. What would you.

Do? Probably have to sell everything in order to.

Survive. Oh, wow. So you would.

Suddenly. Peter, what's that reaction you just.

Had? Yeah, it's.

Frustrating.

Why? Yeah, because I worked my.

Off. Peter, in this example, you're.

Dead. Who cares about.

Your.

Exactly. Are you guys. Is this a joke? Right now Peter's looking down from heaven going, no, not the.

Corvette. Oh, he would haunt.

Me. Who gives a about the.

Corvette? It's gone. Scrap that.

Thing. I would be haunted by.

Him. What is shocking to me about that is for the first time in over 10 years, Megan would be taking action and being decisive with money. None of this, hopefully none of this trying. It's like this is what I need to do. Why is.

That? Because I have nobody else to rely.

On.

Wow. It's all.

Me. So you're telling me you could.

Turn on a dime like that, sell everything, Basically fix up all your finances in a matter of like three or four.

Months? All it takes is your husband.

Dying in a grotesque death. Is that.

It? It's. It's super frustrating to me because.

I don't want to hear the same old it's frustrating story. I've heard it. Talk about the future. I know you've told.

Her. I know she didn't listen to.

You. I don't care about that anymore. I'm focused on the.

Future. Can we make a change without.

You having to die or.

Leave? Yeah, I hope.

So. Okay, then how are we going to do.

It? I, I don't know what to do. I, I did everything I could.

Myself. No, you.

Didn'T. Yeah, I changed jobs. I, you.

Know. You didn't do everything you could think of. Not even close in your head. You have an invisible box around your vehicles. That doesn't count. How much could all your stuff be sold for if.

Necessary? Oh, probably about.

40,000. So you're telling me you've done everything you can except for selling $40,000 worth of.

Items? It would kill.

Me. That's not what's going to kill you. Losing power, losing.

Electricity. I would find another.

Way. What way? Tell.

Me. Well, you said I, I, I do side jobs and I. Yeah, I, I couldn't sell my vehicles. It's not.

Fair. Fair to.

Whom? It's not fair to.

Me. Okay? I can't change.

That.

No. Why are you so content to live so small? I don't understand. Why. Why are you so content that your entire life is all about a bunch of random vehicles? You bought stuff. Just stuff. Sure, I'm sure these vehicles are meaningful to you. I'm sure you dreamed about cars since you were a kid. I have nothing against cars, okay? The inanimate objects you've bought. These freaking vehicles that are sitting there, they're costing you your health. They're costing you your marriage. They're costing you your financial.

Security. I don't understand how you can.

Be content to let vehicles be the whole purpose of your.

Life. I'm just nervous that, you know, get rid of them. It fixes something for a little bit. Then it's, you know, back at the same.

Situation, you can tell that this isn't about cars. Earlier, I said that selling one of these cars would feel like Peter cutting off one of his arms. And now you can see what I mean. He's breathing heavily. He's talked about divorce, he has late notices, but he won't even entertain the idea of selling one of his seven vehicles. This goes a lot deeper than it appears. And what is especially frustrating to me is his focus on the second order effects. You'll see that when he says things like, I'm worried we'd get back into this situation again. They're in grave danger right now. Personal danger, physical danger, financial danger. You can't worry about what might happen later when your house is on fire. But he can't think that far ahead. He's living in the moment, retelling the same old stories, unwilling and unable to make a change. He says that he's tried everything, but he hasn't really tried anything at.

All. Another way to say it would be, oh, my God, Megan, I'm so excited by this. I didn't realize that we actually have a path out of being stuck. If you can get a job, which I would love to see you do, and I have total confidence in you, I can start selling vehicles, put.

That towards our debt, and we could.

Pay it off even faster. Start to save more, invest more, take trips, do the things we love. We could actually get out of this black hole that we're in. Megan, you look a bit.

Disconnected. Well, the only tricky part is with the phone, which I know we need to get rid of the watches. I know it's frustrating, but with his shop, he needs the Internet down there because of the security.

Cameras. You're about to go bankrupt. Your husband has talked about divorce multiple times, and you are stuck on $50 a month for Internet. Are you sure that's the right place for you to focus your attention right.

Now?

No. Where would you two like to go from.

Here? I'm just at a loss for words right.

Now. I want to help you guys. I'm just not sure if you really want my.

Help. I'm sensitive to the fact that money is political and there are systemic forces that make it extremely difficult for lots of us to succeed in our culture. But they're almost 40 years old, they're on the verge of divorce, their wages are being garnished, their lights are about to be turned off, and they're not doing anything about it. I believe that you can acknowledge the need for systemic change and simultaneously acknowledge the need for personal responsibility. And Peter and Megan are not taking any responsibility whatsoever. In order to make a change. Here's what they would need to do. Number one, get honest with the situation. They're in the red. It's getting worse every single day. Number two, what are the fastest ways to alleviate pressure? Sell the watches. Sell the $4,000 saltwater fish tank and immediately begin redirecting all the money from those sales and the garage towards their living expenses. Number three. Finally, the bigger changes. Sell the vehicles. Megan focuses on getting a new job that pays more and both of them start to spend time and attention on rekindling their relationship. I wish I could share their follow up, but we reached out multiple times and never heard back. Peter and Megan, I wish the best for both of you and I still invite you to share an update from our conversation. Thanks for listening to I Will Teach youh to Be Rich. I'm Ramit Sethi. Please follow the show on Apple, Spotify, or wherever you listen to podcast 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.