Confused About Money? Watch This First

All right, so here's the thing. I've been teaching personal finance for decades. I've written multiple books, made hundreds of videos, helped tons of people. But in this video, I'm going to lay it all out for you. Every personal finance fundamental you need to know from start to finish right now. If you feel confused about money, if you don't feel like you're making or keeping enough of it, that ends today. This is about the timeless fundamentals that guide how money flows through your life. And how you build the rich life you actually want. So let's get into it. Fundamental number 1, you need to know where your money goes. Now, you might think you spend $300 a month on groceries or $400, but if you actually look at the numbers, you might discover it's more like $600. And we haven't even included eating out. The truth is most people have no idea what they actually spend. In fact, I find that when I ask people how much they eat out, whatever number they tell me, the truth is actually 3 times higher. And that's not a moral failing. It doesn't mean you're a bad person. It just means you lack awareness. Look, you certainly don't need to track every penny. Instead, you just need to see how much you're spending in just a few key categories. So by tracking them, seeing those numbers in black and white, you you can often uncover $100 to $500 a month easily that you didn't even know you were spending. And I've seen firsthand how many people avoid this type of work and these conversations, not because they're hiding anything, but because it feels overwhelming. What do I track? Do I track the price of onions? That sounds like a lot. No, you don't have to track that. In a relationship, one partner might not realize those $9 charges are adding up, The other might not notice how much they're ordering delivery. The fix here is to understand your numbers together. It builds transparency, teamwork, and it makes every future money conversation easier. So here's what I want you to do. Grab your last 30 days of statements from your bank and credit card. It will automatically be sorted into categories. If you want to get a little extra fancy, you can download the raw data and categorize it yourself. Pay close attention to transportation, food, especially eating out, travel, subscriptions, and if you have children, any kids' expenses. Now, don't overthink it. We're just trying to get a rough sense for where your money is actually going. Just in the last 30 days, you will be shocked at how the money actually flows. That $500 that seems to disappear every month, you're about to find it. Fundamental number 2: Your spending plan should reflect what you truly value. Budgets mean you are looking backwards. Ooh, what did I spend last month? What does that tell me? And now I need to do this for the rest of my life. No thanks. But a conscious spending plan, or CSP, looks forward with your money. It's like freedom. It lets you decide where you want to spend a lot and also where you don't care to spend much. With a CSP, you only need to focus on 4 key numbers. Fixed costs, 50 to 60% of your take-home pay. Investments, 10%, the more the better. Savings, 5 to 10%, the more the better. And my favorite category, guilt-free spending, 20 to 35% of take-home pay. That's eating out, travel, buying drinks for friends, whatever you want. Once you make your money fit into those 4 percentages, You can spend it however you like. Now let's test this in real time. You think your fixed costs are 50% of your paycheck? Okay, maybe. Pull up your statements and run the numbers. I have to tell you from looking at thousands and thousands of people's spending that most people wildly underestimate their fixed costs. They'll often think they're spending 50%, 55%, but often when we look at it, it's closer to 65% or 70%. And that's just on rent, cars, and food. When you exceed that 60% number for fixed costs, that's when you start feeling stressed out. That's when you start saying, where's all my money going? But you often don't even realize you've already spent the money before you even get it. Now, good news, you don't need to build a perfect spreadsheet. We're just going to get really honest with ourselves. Once you know where that money's going, then you can start redirecting it with intention. So this conscious spending plan allows you to proactively plan where you want your money to go and actually how you want to use money to feel excited. You want a weekly date night or guilt-free sushi? You want to go on a $10,000 vacation? Fantastic. Your CSP allows you to build that while still saving and investing and even paying off debt. It also accounts for real-life complexities like irregular income, shared finances between partners, and even unexpected expenses. So if you haven't already done it, download my free conscious spending plan template below. You don't need to get it perfect. Just plug in your regular numbers, what's coming in, what's coming out, and you will quickly see where the gaps are in your spending. Okay, now take it one step further. I want you to look at your net worth. Your net worth is a simple calculation. The CSP actually does it for you automatically, which shows you your assets, what you own, minus your liabilities, what you owe. And that's it. This net worth number will tell you where you are and how you are tracking. It basically lets you zoom out and benchmark yourself. You don't need to track it every day, but knowing that number— sometimes it's positive, sometimes it's negative— is one of the clearest signals of your financial progress. That's all built into the CSP template. Fundamental number 3: Automation makes your financial success inevitable. Can I tell you something? Financially successful people do not log into their accounts every day, not even every week. Why would they? Look, I don't have any apps on my phone. You think I want to sit there? Oh, what's my password? Two-factor authentication checking. Fuck that. Why would I do that? My systems are running in the background. That's like somebody opening up the wiring in their house. Oh, hey everybody, let me get my Phillips screwdriver out because I need to check, is the wiring correct? Every day. You don't need to do that. You set things up so that they just run. And if there's a problem, you will be notified. Let me show you how to automate your money so that you are spending less than 1 hour per month on everything because your rich life is not lived on your freaking phone or on a spreadsheet. Your rich life is lived outside with your friends, family, and loved ones. Step 1, set up direct deposit from your employer to flow into your checking account. Your checking account is your central hub. It's like your email inbox. Step 2, From that checking account, you can schedule automatic transfers. Here's how you do it. 5% to 10% from your checking account goes to a high-yield savings account. This will be your emergency fund and short-term goals like taking an awesome trip. Then a 10% split between your 401(k) and Roth IRA. Again, I'm overly simplifying here. It depends on a bunch of tax stuff, but basically 401(k), Roth IRA if you're eligible, and you can invest that money in simple index funds. I really like target date funds, for example. Step 3, set up all your recurring bills like rent or mortgage, utilities, phone subscriptions to autopay. Now, ideally, this is autopaid on your credit card, but sometimes you have to use your checking account directly to pay things like rent. Set these bills up to be paid off in full every single month. Step 4, enjoy that 20 to 35% of guilt-free money that's left over for you to spend on whatever you like. It could be getting your nails done. It could be getting a massage. It could be going out with friends, movies, whatever. This is your fun money, and you know that you can enjoy it guilt-free because you've already automatically handled your bills, your saving, and your investment. Now, once this is in place, your entire financial system is on autopilot. Your savings, your investing, your spending. It's all happening automatically. And you only need to check in once a month just to make sure it's working. And every 6 to 12 months to make any adjustments. This is what people mean when they say pay yourself first. Every time I get a paycheck, money automatically flows to savings and investing. Paying myself first automatically. You can do this this weekend. So I recommend you block off the time, literally block off the time on your calendar and set up your automation flows. You can use my book, specifically Chapter 5, to set this all up totally automatically. And once it's done, you will not have to think about paying bills, remembering to save every month, or certainly logging in to an account. It just happens for you. This is one of those key decisions that will be responsible for making hundreds of thousands of dollars for you. Forget about checking how many slices of bread there are on that loaf at the grocery store. Do this. It will be worth hundreds of thousands of dollars. It'll be the most profitable setup you ever did. Fundamental number 4: Maintain control with simple, repeatable systems. I think sometimes we have this myth that we need to try harder. I need to try. I need to be better. Notice that? Be better. Because in America, we have this puritanical streak that says, if I spend money, I'm bad. But if I save money, I'm good. Can we stop it with this bullshit? If you want to spend money on something you love and you can afford it, amazing. If you can't afford it, then don't spend it. Save until you can afford it. I don't care whether it's a cashmere coat or some expensive kid's toy. It doesn't matter to me. Your rich life is yours. But the thing is, it's not about you just trying harder. Can I be really honest with you? If that was going to work, it would have already worked. What we need are simple, repeatable systems so that when you're tired or grumpy or sleeping or traveling, your money is still doing the right things. Now, once your system is in place, the beautiful thing is you don't need to micromanage every transaction. You just need a monthly check-in to keep things running smoothly. One of the most powerful rituals I recommend is the monthly money meeting. In this money meeting, it's not about checking every receipt. It's about checking in with each other, feeling confident, and moving forward with clarity. My wife and I do this every month. We have a shared Google Doc. We track our goals. We review any key spending areas, not every little line item. But any big changes, we always start with a compliment. Always. That's because I want to connect you feeling good with your money. And we talk about what we want to do next month, what's coming up. Sometimes we go, oh man, we really overspent on that one. Let's cut back a little next month. Sometimes maybe we realize our grocery spending needs a little adjusting. Maybe our guilt-free spending is creeping into a little bit high territory. No problem. It doesn't mean that we're bad people. It just means, hey, we noticed it. Let's make a couple of changes. And we always give each other a high five or a hug at the end. Again, I want you to feel good about your money. This is not a chore. It's not one of those things that goes, ah, we're going to talk about money today. No, it's we get to talk about money. We get to connect over our rich life and we're going to do it thousands of times together in our relationship. This is a ritual. And once you stop avoiding money and you stop fearing money, you can actually start to enjoy it. So here's what I want you to do. Open up your calendar right now. Block off 1 hour this month for your monthly money meeting. I recommend you do it in the morning. I made a big mistake. I used to schedule my meetings for the evening, and by that time we were tired. We bumped the meeting and it was horrible. So I learned my lesson. Do it in the morning. It could be on a weekday. It could be on a weekend, some time where you have a little bit of quiet time. For the two of you. Now, if you are single, block the time off for yourself. Have that conversation with yourself, but have it. Now, whatever you do, I want you to treat this meeting seriously. Treat it like a meeting with your boss, because in this case, you are the boss. So grab a coffee, open up your CSP, and ask these three questions: What's working? What needs adjusting? And what's coming up next month? If you want to see the exact agenda that my wife and I use for our monthly money meetings, you can grab it in a copy of my newest book, Money for Couples. You will see exactly what what we use, what to say, what to do. This one simple habit will make you feel way more confident about your money and it will make sure that you are progressing every single month. Fundamental number 5: spend on what you love by eliminating what you don't. Simple. If it doesn't make your life better, cut it. If it does, think about how you can actually spend more guilt-free. You know, I don't know why, but in America we are raised with this idea that we need to cut back on everything. Cut back on lattes, cut back on groceries, cut back on eating out, cut back on this, Cut back on jeans, cut back on thread. What the fuck kind of world is that? First of all, it's depressing. And second of all, it's ineffective. It's that this advice hasn't worked for 50 years and yet people still keep following it. Be honest with me right now. Has trying to cut back on everything worked for you? No. Here's my approach. We start by identifying the things we love and we make a plan for how we can spend even more. Guilt-free. Then we look at what we are spending on that we don't love, that doesn't work for our rich life, and we go, hey, I'm going to ruthlessly eliminate it. Let me show you how to start. Start with your invisible expenses. These are subscriptions you forgot about long ago, like that free trial from 8 months ago, fees you didn't realize you're still paying. For example, anyone paying 1% AUM is probably paying hundreds of thousands of dollars. You don't even know what I'm talking about. I'm not even getting into that in this video. Find my other one. Or insurance. You know, your old buddy who used to eat gum and stick it on the bottom of the freaking desk. Now he sold you a whole life insurance policy. It's really good. You can actually withdraw from it whenever you want. Principal, it's getting ripped off. Okay, you're getting ripped off. Once you find these expenses I just referred to and you have no idea what I'm talking about, then you will be able to eliminate them. And oftentimes when I work with people, they can eliminate literally hundreds of dollars like that. Imagine hundreds of dollars freed up every single month. Now you have money to spend more on the things you love. This could be savings, investing. It could be going out for a date night once a week or twice a week. And this is where money dials come in. This concept of money dial, your money dial is that thing you love to spend money on. Mine is convenience. The most common money dial is food. People love to eat out, experience food. There's travel, there's health and wellness, there's generosity. You get to choose. One reader of mine cut back on random subscriptions and online purchases and used that money to fly business class for the first time. I love that. That's what intentional spending looks like. You see the principle? Now let's make it happen for you. Go through your last 3 statements, and I want you to cancel 3 discretionary expenses that just bring you no joy at all. They're not serving your rich life. You could live without them. You'll probably forget about them 10 days from now. Then, and this is key, make a plan for that freed up money and deliberately increase spending on something that lights you up. This is how you create your rich life today. But a rich life is not just about joy and even spending. It's also about protecting the life that you are building. If you have a partner or children, you want to make sure they are protected. Imagine that something happened to one or both of you, you want to know that the rest of your family is taken care of. That's why I want to tell you about Fabric by Gerber Life, this video's sponsor. 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Now let's get into building wealth because the sooner you start investing, the more you're going to have. Fundamental number 6, The way you get rich is by investing. I know this sounds obvious, but let's really dig into what this means. Do you know how many people tell me, I can't start investing because I don't have enough money, or only rich people invest? I'm like, hold on. My head starts shaking, explodes like a video game. I go, listen closely. The way you become wealthy is by investing. You have it reversed. You don't need a finance degree. You don't need to be reading The Wall Street Journal every single day. You don't need to be some mythical priest with this priestly knowledge. This stuff is actually pretty simple. Ordinary everyday people can invest right now and can get amazing results. And it's inexpensive and automatic. No, you don't need crypto. No, you don't need meme stocks. You don't even need to sit and look at the computer every day. Oh, what's the P/E ratio? Nobody cares. What you do need to understand are a few key principles. The earlier you start investing, the more you will have. In fact, I've seen people who start early in their 20s, even with $50 a month, who end up with more money than people who invest triple later on. That's because compound interest works in a very counterintuitive, powerful way. So if you've been putting off investing until now, don't worry. Let's get started right away. Here's what I want you to do. Pick a day this week to open up a Roth IRA. Put on your calendar, set aside an hour. Now you'll have to look into something called Roth IRA eligibility. Are you eligible to open up a Roth IRA? Let's assume you are. Within that Roth IRA, that's like a room in your house. You need to have something to do in that room. Is it a bathroom, bedroom, kitchen? You need to pick an investment inside of a Roth IRA. When my family asks me where they should invest, one of the things I suggest is something called a target date fund. Fund. It's simple, it's low cost. You basically pick the fund based on the year you're going to retire. So if you're going to retire in 2065, 2065 fund. So there's a Fidelity 2065 or Vanguard 2065 or Schwab 2065. The way it works is you set up an automatic monthly transfer from your checking account into that IRA, and then you instruct the Roth IRA to buy the target date fund for you. You don't have to get this perfectly. You just have to get started. And you'll be amazed how good it feels to say, I am finally investing. Fundamental number 7: Increasing your earnings unlocks new possibilities. You know, at a certain point, there's a limit to how much you can cut, but no limit to how much you can earn. It's a little ironic that so much of personal finance advice is about cutting back. Oh, here's the technique I use with a clothespin to squeeze out extra toothpaste. But at a certain point, how much more of that can you do? How much more can you cut? There is no limit, however, to how much you can earn. It is interesting that very few people talk about increasing your earnings. It's almost always assumed that we are given a fixed pie and therefore we need to hoard it, protect it, get angry at anyone who taxes us. No, I believe I can earn more. If I want to take an amazing trip, I'll earn more. No problem. I want you to have this abundance mentality and then I want you to have the skills to actually increase your earnings. Imagine making an extra $500 a month. For a lot of people, that would be transformative. How about $5,000? I've seen people go from $45,000 to $90,000 without even changing companies. They learned how to negotiate. Others have started side hustles by taking a skill they already had and monetizing it. Could be writing, photography, tutoring, walking dogs, organizing closets. Truly, this is the ultimate cheat code, because when you earn more, you can flow that money into your system. That means you can save more, invest more, and even spend more on guilt-free things you love. So here are 3 levers you can pull. Number 1, you can ask for a raise using my briefcase technique. This has helped tens of thousands of people increase their earnings at work. I'll link the video below in the description. Next, you can start a side income using skills you already have. I'll show you how to do this quickly with my Earn1K program. I think now is a particularly good time to use it. Or finally, you can freelance for even 5 hours a week and that income really adds up fast. So let me get you there. Choose one option to earn more. Don't try to do them all. Just pick one that feels the most doable and take that first step this week. If it's using the briefcase technique or clicking the link below for Earn1K, take that step this week because the moment you start earning more, you can expand your vision of what's possible. Fundamental number 8: Money is a shared responsibility. The number 1 mistake I see couples make is assuming that there's a money person in the relationship. You know, just like there's a person who empties the dishwasher and waters the plants. Wrong! At first, this seems efficient, right? Comparative advantage. One person doing the thing they're best at. But over time, this is a horrible idea. Money is not like emptying the dishwasher. Money cuts across everything. It's much more like raising kids. And over time, if you have one person managing the money, it builds resentment, it builds power imbalances, and eventually full-blown arguments over minute irrelevant things like who spent too much at Target. On my podcast, I see this dynamic play out again and again, and it silently erodes trust in that relationship. So there's a better way. You don't have to agree on every line item. Both of you don't have to do every single thing together, but you do have to get on the same page about the vision and you have to talk about money regularly. Schedule a 30-minute money conversation with your partner. Keep it low pressure. You don't have to get into talking about taxes and investments on that first meeting. It's just what do we want our rich life to look like? Paint the picture. Get excited. If you want the exact steps, you can use my Money for Couples book to show you how to have these conversations. I want you to remember this. It's not just about bills. It's not about taxes or even investments. This is about building your rich life as a team. So the theme of that meeting? Connection. Getting this one fundamental right will change your relationship forever. Fundamental number 9: A positive outlook on money makes you more confident. Now, you might be following all the right advice— saving, investing— but if you keep telling yourself, "I'm just bad with money. I'm not going to have enough. Oh, what am I doing wrong?" You've already lost the game. What a depressing life to go through all of your years agonizing over the price of bell peppers, tracking all this shit on some spreadsheet with 48 tabs, actually accumulating a lot of money, but feeling horrible every step of the way. Y'all want to do that? Want to keep going through life feeling bad, feeling behind, not even recognizing when you're actually doing well? I don't. I like winning and I like feeling good while I do it. How about you? I think that if we repeat these beliefs like, "I'm bad with money," or, "We can't afford that," in a way they become self-fulfilling prophecies. You hear them enough, you start to believe them. You believe them, you start to pass it on to everybody around you, including your kids. Over time, these small beliefs compound. They leave you brittle. They leave you small. They leave you playing defense. In fact, they can actually cost you millions of dollars over your lifetime because you're always on defense versus playing offense. So let's rewrite that script. I want you to start by identifying your money type. Are you an avoider, optimizer, worrier, or dreamer? I know a lot of people watching this video are optimizers because I know right now you have 13 tabs open with different YouTube videos on asset allocation and what's happening in the marketplace today. What is Vanguard's report on inflation for the next 10 years? Freaking optimizers, turn off the computer and go outside, touch some grass and have a nice order of fries. All right. I can't believe I'm saying this, but guess what? I'm an optimizer too. So sometimes I need to take my own freaking advice. Each one of these comes with its own strengths and challenges, but you got to know your money type because it will help you understand your default patterns. And if you're in a relationship, your partners. Now let me show you how to figure out which type you are. I'll make it very simple. Avoiders ignore money. They ignore their bank accounts. They kick the can down the road. Optimizers tweak their spreadsheets down to the penny. You are probably in the FIRE community. Worriers obsess. They worry about money, but they rarely actually make a plan and take control of their money. And dreamers have big visions. But no plans. For dreamers, success is the next gig, the next deal, the next thing, but they can only continue dreaming because usually somebody is subsidizing them— parents or a spouse. Now, once you know your type, you can start working with your instincts, not against them. Like, I'm always going to have some optimizer inside of me. Okay, it's there, but I can add on new layers of spontaneity and adventure. Now that you have an idea of your money type, let's rewrite your negative money script. Instead of, "I'm bad with money," try this one: "I'm learning how to be confident with money." Instead of, "We'll never be able to afford that," say, "We can't afford that today, but let's build a plan to afford it tomorrow." And most importantly, I want you to act like a confident person would act, even if you don't feel it. Sometimes confidence doesn't come before action, it comes from action. Why don't we try it out together? Repeat after me. I'm learning to be great with money. Say it out loud. I'm learning to be great with money. You're already acting like someone who's good with money and you're just getting started. Next, prove it by taking one small, bold action this week that your future self will thank you for. Here's an example. Click subscribe on my videos. If you're already subscribed, thank you very much. Get one of my books. Start reading them right now. You just rewired your money mindset and you've taken the next step to invest, automate, and spend on what you love. That brings me to fundamental number 10: Live your rich life starting now. Sometimes I think people interpret the word rich in a really bizarre way, like rich has to be having some billion-dollar yacht. You know, I was living a rich life when I could Freaking take a taxi instead of a subway August ride in New York City. Cost me $10 or $15, but that felt rich to me. But you've got to decide what a rich life means for you. Not what your parents think it is. Not what some Instagram post says it should be. For me, a rich life means flying business class on every flight over 4 hours. It also means buying any book that I see that looks interesting. Those are vastly different amounts of money, but they're both meaningful to me. For you, it might mean not having to look