“He makes 3x more, but wants to split everything 50/50”

It sounds like we're at a funeral, like the Crypt Keeper is about to roll open the going on here.

I tend to be a little bit more selfish as it relates to money.

I feel like I have to justify what I do with my money constantly.

Have you ever lied to Robin about money or hidden anything from him, financially speaking?

Yes.

Doesn't seem like a healthy relationship dynamic or a healthy relationship with money.

I don't know how to speak up for myself. I think I just kind of, like, shrink back, and so I give the power to him.

Has there been a discussion about a prenup?

It's something that is certainly on my mind. I'd be devastated about it. A, that I'm getting a divorce, and B, that my money's going away.

Okay. Katie and Robin. Katie wrote the application, and she says we come from extremely different financial upbringings and backgrounds. He makes at least three times what I make. We're trying to figure out how to manage our finances together. We're also planning on getting married, moving, and possibly starting a family, all in the next 12 months. When I brought up my stress about my financial situation in comparison to his, he wants to keep things 50, 50. She says, overall, we really don't fight or argue. We discuss things in a healthy way. Well, that's not true. If it was discussed in a healthy way, then you would be splitting things 50. 50. Healthy doesn't just mean you don't yell at each other. Healthy also means you get to outcomes that are equitable and feel good for everybody. She's 28. He's 35. Household income, $325,000. And look at the split. $250,000. Him, $75,000. Her. Her fixed costs are 118%. So she's literally spending more than she makes every single month just on fixed costs. This right here explains so much of the stress that I see in the application. So we're going to need to work on how they are splitting expenses. Katie, where were you when you applied for the podcast?

I remember I was in the public parking lot about to go get our groceries for the week, and we had just moved in together, and we had been talking about finances, and I was just maybe a little bit frustrated about some of the financial dynamics at the time. And so I was like, can we apply to this? Can we try this out? And he was like, sure, why not?

What exactly were you frustrated about?

I think I was probably frustrated with how we were splitting finances before we moved in together. We split things almost 50, 50. And then when we moved in together. I was like, hey, I. I really can't afford 50% of rent, so can we do this a different way? And so we had a very long conversation, and we ended up splitting rent 60, 40. But then everything else, though, was primarily 50, 50 at the time, and I was spending a lot more of my income compared to how much he was. And it was just kind of frustrating that way.

Okay, can we actually recreate that conversation? The one where you all talked about switching away from 50 50?

I think we were sitting at our, like, kitchen bar, and you had pulled out a spiral notebook, and we're going over all the different options.

Sorry, who started this conversation?

Katie brought up the conversation, and I provided a little bit of structure of hearing what she wanted to accomplish and trying my best to give that structure.

All right, let's do it. Katie, you brought it up. Go ahead. What'd you say?

So our rent is $2,500 a month. If we were to split that 5,050, that would be, what, $1,200. Which is about the same as my rent was before. But I was definitely struggling with that. So if we could try to figure this out in a way that I'm not struggling so much. And, like, is there any way that we could do this in, like, a percentage way rather than, like, a 50, 50 split?

If we're paying 2,500amonth for rent, then what's a number that you're more comfortable with doing?

Probably around a thousand.

Okay, so if. If we come to some sort of, like, compromise and say it's a thousand a month.

Right.

And I'd say pay the other 15amonth. Tell me how exactly. That'll like, alleviate finance for you. Like, where does that extra money go to then?

That extra money would be able to go towards my savings. I would finally be able to put some money into savings and into my Roth IRA. But that would be only about $200 a month. But that would still help.

I'm definitely open to the thousand dollars or somewhere around there. I just want to make sure it's going to be used in a productive way. Let's say, hypothetically, going forward, it's 1000 1500. Right. What is the other budgetary? Groceries or utilities or those things? Is it 50, 50? Is it 75, 25? Like, how do you see that?

I would like to split it similarly, where I'm not paying 50, 50 towards the groceries, even then that I make a lot less. So 50% of my income going towards groceries is a lot more for me than it is for you.

So I'm definitely open minded in that space too. What would you propose or have an idea of how to split those up?

Then I guess we could start with 60, 40, and see where we go from there.

Okay. Can I pause you? I'm just going to come out and tell you right now. So what I saw were Katie raising a concern, which I appreciate, being proactive. That's pretty cool. I noticed, Katie, you didn't have a clear grasp of your numbers. There was phrases you used where you gave away your power. I don't know if you caught that. You said things like, could we try? Is there any way we could? Dot, dot, dot. I also observed the dynamic where Robin basically took on the role of, okay, what would you like to do? Which can be good. I like getting the input from your partner. I didn't hear a lot of validation. I heard it once, and I also didn't hear Katie saying, well, what do you think is fair? And actually getting Robin to come out and be specific about what solution he might make. The final thing, which surprised me was, well, if you spend less on rent, what are you going to do with that money? Because I want it to be productive. What do y' all think about those observations? I could be wrong. Tell me what you think.

I feel like that's pretty accurate. I feel like that is how it typically goes. I feel like a lot of times I. I bring up financial concerns, and I don't necessarily feel confident bringing up those concerns. And then that is so much of his world. That's what he's used to talking those terms. And so he just kind of takes over the conversation. And then I kind of feel like, oh, I don't know how to speak up for myself. And I. I know he's not doing that on purpose. He's not trying to overpower me, but I think I just kind of, like, shrink back. And so I give the power to him. And I want him to say it. I want him to be the one to suggest, I'll take this because I can afford it.

Okay.

Yeah.

Robin, I truly want it to be like a positive experience or moving of the needle forward.

Right.

Do you guys think that the recreation that you just did was productive?

It was productive.

Okay. Robin?

Yeah, no, not so much.

Okay. And was it. Did it build connection?

I don't think so.

Yeah, I agree. It sound like we're at a funeral. Like, the Crypt Keeper is about to roll open. Like, what the going on here? No fun, no jokes. I love this roof I'm so happy we're protected from the rain. Thank you. And then, like, hey, let's figure out how we can still be protected from the rain, and I don't have to pay 98% proportionally of my income. You know, we can have some fun with it. That's just my style. But you can choose your own style, right? We want to end. We want to start with love. We want to end with love. It didn't feel like that, right? It felt like logistics. Would everybody agree?

Yeah.

Okay, cool. So that was very helpful for me to understand where you're all coming from. Let's. Let's keep working. I want to understand more about what's going on here. Can you think of a time in the last six months where you were not on the same page with each other, financially speaking? How come both of you just started smiling?

There's several.

All right, each person. Gimme one.

She wanted to do something sweet for my birthday. A ski trip to Colorado. Knowing that it costs X amount of dollars and the financial picture leading up to that and what it actually costs out of pocket stressed me out.

What are we talking about here? How much did it cost?

It probably costs about $3,000.

$3,000? Including airfare, Lyft ticket, taxi, drinks, tax tips. Oh, no. Oh, wow. No, give me the real number. Don't bullshit me.

Oh, God. I don't even know. The airfare, the Airbnb, the Lyft tickets all ran about $3,000.

All right, so it was like 6,000. All right, fine. Katie, how come you look so uncomfortable right now? You don't agree? Tell me if I'm wrong. I'm wrong. Tell me.

I booked this trip and I spent $3,000 that I did not have immediately. And I had a plan. I knew exactly how many shifts I needed to work to pay it off, and I was planning on having it completely paid off before he ever knew about it. And then I got sick, and I didn't get to work all those shifts, and I carried a balance on my credit card to the next month.

The part where she mentioned I paid for it when I didn't have the money makes my head spin.

You talked about this before, I imagine.

Yeah.

Okay. When did it come up that you had a conversation about the cost of this trip?

Probably a couple weeks before we left for the trip. We had both worked really hard to get me out of credit card debt, and he had kept saying how proud of me he was that I was out of that credit card debt, and I was talking about doing this ski trip. And he was like, well, hey, I don't want you to keep spending money on this. Let me know what I need to pay for so that you don't carry a balance. And then it got to the point where it's like, oh, I am still carrying a balance and I need to tell him. So then I ended up telling him, like, hey, I still have like about a thousand dollars that I have not been able to pay off of my credit card that I'm carrying over to the next month. And I'm super stressed out.

Katie, did you feel guilty?

Yes.

Okay, you mentioned you felt stressed. Was there a thrill around? I paid off my credit card debt. I'm going to plan this trip. I know I don't have the money, but I have this three step plan to make sure that it's all paid off before he ever knows about it.

Yeah, I mean, I was really proud of myself for getting out of the credit card debt. We were starting to talk about his birthday, so I was like, okay, I can, I can come up with a plan to do something for his birthday. But at that point, it was close enough to his birthday that I couldn't really save up and then purchase. I had to purchase and then pay off. And so it did make me very anxious to carry that balance and to get into credit card debt again.

Why don't she's taken to the zoo, It's a lot cheaper.

Because he had said multiple times that he wanted to go skiing.

Ah, okay. All right. So he said it. So you were like, this is gonna be something nice. I'll pay it. I have a plan. And then life got in the way and you got into credit card debt again. Are you still in credit card debt?

No, it's paid off now.

Okay, do you see any problem with this or is this normal to you?

No, I see a problem with it. I don't want to be in that cycle.

Have you updated your Pinterest board for your wedding to instead of reflecting roses, it now has carnations in it?

No, absolutely not.

Absolutely not.

Okay, I love that question.

So, Katie, have you ever lied to Robin about money or hidden anything from him, financially speaking?

Yes.

Okay.

This was another thing that came up within like the last week. We had talked about my finances and everything like that. And I had mentioned that I had want to do a series of facials before the wedding. And he was like, I don't think that that's the best allocation of money right now. And I was kind of like, well, I really Want to do this? And he's like, well, maybe in a couple of months. I was just like, all right. And I went ahead and booked the appointment, and I. When I got the facial, and it was like 200. He texted me while I was in the middle of the facial. He was like, where are you at? Like, I thought you'd be home by now. And I thought afterwards, I was like, just running errands, that's all. And then get. I got home, and he's like, so you mean you're at the med spot? I was like, yeah, I was at the med spa. I got the facial that I probably shouldn't have spent money on, but I did.

How did he know?

Location on her phone?

Man, I feel old right now. Is this what people do? Like, people are not only tracking, but you're, like, looking at it? This is crazy. There are so many things about this story that surprised me. First of all, I didn't know. How much did you say it cost? 200 bucks.

Yeah.

Okay. And do you do that once or, like, 10 times?

I would ideally like to get it done once a month up until the wedding, but I only did it once.

Okay, 200 bucks. So that's number one. I didn't even know that. Second of all, this location sharing is blowing my mind. And then I guess we should probably come back to the real issue at hand, which is, oh, like, spending money and not telling your partner and then not being honest about it. How did you resolve this?

He was kind of like, that's up. I was like, yeah, that was really sh. Tty of me. And then we just talked about it. He's like, I don't even care that you went to go get the facial. At the end of the day, just don't lie to me about it.

Robyn, is that true? You didn't care that she got that facial?

No, didn't bother me.

Did anything about this bother you?

The secrecy that tells me fundamentally that there's some sort of disconnect as it relates back to money, and whatever that core issue is needs to be revealed and then addressed.

Yeah, I agree. I have to say, I would be pretty upset. I don't mind that my wife spends money differently than I do. In fact, she loves self care. So everything you're saying, Katie, she and you would have a awesome chat. But money is one of those things that is so intimate that inherently it is sensitive. Right. Most of us are highly emotional about money. Men, women, everybody. And in an intimate relationship, the stakes are kind of high. Lying alone is Like a just big. No. No. But then when it comes to money, oh, it sets such a bad precedent. And Even though it's $200, it's not about the amount. In fact, if anything, in your lifetimes, you will be dealing with amounts that are a hundred times that size. Mm. So I find this to be pretty serious. I find it to be something that I'm really glad we get a chance to talk about today because obviously there's something deeper beneath it. It's not just about getting some self care treatment. It's about something more. Katie, what do you think it's about?

I feel like I have to justify where. What I do with my money constantly. And so when he was kind of like, well, I don't think that's a good way to spend your money. When we're trying to save and like, spend money on a wedding, it's kind of like, well, dang, I don't get to spend much money. Like, I don't have all that much to be able to, like, spend on the things that I want to. I don't have that freedom. So I think that's kind of where it's done from. I felt like I had to justify it to him, so I'd rather just not say it.

Have you ever said that to him?

No.

Why not?

Because. Can I get emotional and I'll cry?

I don't mind crying.

Yeah.

Why? Why haven't you said that to him?

I feel like that would hurt his feelings. That's not what he wants to hear. I know. He doesn't want to make me feel like that.

So your response is to, I guess, protect his feelings, take on the burden yourself.

Yeah.

And then go and spend it on the thing you want and lie about it.

Yeah.

Doesn't seem like a healthy relationship dynamic. Or a healthy relationship with money. Katie's decision to book that facial, even after Robin said to wait, reminds me of the concept of revenge sleep. Have you heard of this? It's when someone stays up late at night, not just because they want to, but because it's that one time of the day that they have control of their time. Take the average person by the time their spouse is asleep. By the time the kids are in bed, they're exhausted, but maybe they have that tiny sliver of time, so they stay up watching tv, scrolling on their phone, doing something else for themselves. Even though they probably know it's not good for their health, it's not good for their day tomorrow. What Katie's doing is the financial version of. Of that and when she feels like she constantly has to justify where every dollar goes, it's a horrible feeling that evokes something called reactance. Where we rebel against these rules that are set upon us. It's not really about logic. It's about autonomy. And in this case, autonomy in part looked like swiping her card and not telling Robin about it. Now, I'm not justifying it. I'm simply looking at what's behind this action. Now, the problem is, even if you understand what's behind it, lying is a real problem, especially with money, because money is incredibly intimate and it is so shrouded in mystery. When you lie about money in a relationship, it destroys trust. So when I find out one partner lied to the other about spending, I want to know where the disconnect came from. I'm going to ask that exact question when we get back from the break. You ever wonder how we get this podcast live? Every single week with guests from around the world, with ads, integrated newsletter copy, social media. How does it all work behind the scenes? Well, we use a tool called Notion, which is the sponsor of this week's episode, to track everything that goes into this show, including the follow ups that we often get months later. If you want to know how to track complex projects, let me show you what it looks like for our podcast. Notion combines your notes, documents and projects into one space that's simple and beautifully designed. Unlike other specialized tools that have you bouncing between tons of different apps, Notion is seamlessly flexible, making it easy to get to work. The fully integrated Notion AI helps you work faster, write better, and think bigger, doing tasks that normally take you hours in just seconds. Notion is used by over half of Fortune 500 companies, and my podcast team loves using it to organize our production calendar and keep up with projects, make sure nothing slips through the cracks. Try Notion for free. When you go to notion.com ramit that's all lowercase letters. Notion.com ramit to try the powerful, easy to use notion AI today. And when you use our link, you're supporting our show. That's notion.com ramit Everywhere I turn, everybody's talking about tipping. Oh my God, there's a culture of over tipping. Tipping is so expensive they're ripping me off, expecting me to flip the screen around and pay 30 cents for my coffee. Why is it that so many people are obsessed with minimizing how much they pay a barista who's making minimum wage? And and yet you don't apply that same logic to other expenses in your life how many of you, for example, are paying 1% to a financial advisor and you don't even know how much that's costing you? I remember this young woman reached out to me, early 30s. She goes, hey, Ramit, am I getting ripped off? How much am I paying? I go, I don't know. You tell me. How much do you think that this advisor is going to cost you over the next 30 years? She says, maybe 30,000. The correct answer, $315,000. How can you be so obsessed with minimizing how much you're giving to a barista or a waitress versus paying 1% in fees to a financial advisor? There's a better way. It's called a flat fee. That's why I've partnered with Facet, a service that offers affordable, accessible financial planning. With Facet, you get flexible access to a team of financial planners and a team of professionals providing guidance across retirement planning, tax strategy, estate planning, and more. And instead of taking a percentage of your portfolio, there's an affordable flat membership fee. Now, a lot of people can manage their finances on their own. Just follow chapters three, six, and seven of my first book. But if you are getting closer to retirement or you have a complex portfolio, or you just want a second set of eyes on your specific financial plan, then I highly recommend you check out Facet. You can book a free call@facet.com Ramit, speak to them and decide if it makes sense for you. Check out their membership options@facet.com ramit Again, facet.com rameet F A C E T Sponsored by Facet Facet Wealth Inc. Facet is an SEC registered investment advisor headquartered in Baltimore, Maryland. This is not an offer to sell securities or investment financial, legal or tax advice. Past performance is not a guarantee of future performance. Terms and conditions apply. Where do you think your disconnect around money comes from?

I think a little bit with respects to upbringing and just my background of what I do for a living, being in the financial field.

Katie, same question to you.

I make a lot less than he does, and so I have to be a lot more careful with what I spend my money on. I don't have that same freedom.

How long have you been living together?

10 months.

All right, and then how long until the wedding?

Six months.

All right, so you combined some income when. When you moved in together shortly afterward. Okay. Robin, what's that transition been going from single guy, high earner to now combining income?

It's been an adjustment thinking about we versus I, you know, I'm 36 years old now and every day of my life financially, it's been me, me, me. How can I make sure that my financial futures is okay today? And how make sure my financial future is taken care of tomorrow and down the road? And bringing her into we is a major adjustment.

What does it feel like when you think about it?

Stressful. I won't say tedious is the right word because it's not something that I dread per se doing. It's almost as if this is such a foreign concept that I need an outside force to kind of knock me on the head a little bit.

Stressful. Why?

Well, I do notice that my individual monthly expenses go up because I do pick up the tab, like if we go out to dinner, things like that. So, you know, the credit card bill is usually a little bit higher than. Than it had been historically. It's not the end of the world because I enjoy my time and spending money on us, and I have a little more financial freedom to do that and do those things with her.

Is it hard combining income?

I would say it's hard because I'm about eight years older than her. So I did have a head start. Right. That's nobody's fault. When I look back and hark back to when I was, you know, in my early 20s, my priorities with money, I'm maxing out my 401k or trying to. I'm maxing out my Roth IRA because I was under the income limit. I'm maxing out my hsa. Right. That was my priority. We had met going back those three years ago, and she's come a very long way. Didn't have her 403B set up, didn't really have a savings account of much to speak of, and did have the credit card debt. When she had initially said those things to me, I'm like, oh, my gosh.

How.

How do you not have these things already? Like, at least in motion already. It was shocking.

Okay, that's really helpful to hear. I have to tell you, I have a lot in common with some of your views. When I met my now wife, I had been earning money, a lot of money for a long time, and I was single. And like, I had my own way of doing it, saving, spending, like it was dialed in. And then when we got married and moved in and we had to start talking about money, that was challenging because for the first time, I had to kind of like talk about my decisions out loud. And then we saw money differently and then we had differences in incomes and in experience with money in jobs, and it was all hard. It was really hard. So I can hear a lot of my early self in the way that you're describing this situation. Let me hear from you, Katie. What does it feel like to bring your incomes and expenses together?

I'm still living paycheck to paycheck, and I'm still struggling where I had hoped it would be. We can share the burden of the finances instead of it being, like, feeling like I'm still living paycheck to paycheck and struggling to pay off my credit card every month.

Robin, are you nervous about Katie's relationship with money and how that might affect both of you, financially speaking?

Yes.

Why?

I don't want maybe some of the repeats that she's explained so far to keep cycling back over and over. And I also want financial security. That's why I got into the industry that I'm in in the first place. I have a vision of what that looks like, but it's only ever been as an individual instead of a partnership. So that really throws a huge dynamic that I welcome. It's one that I also don't know how to wade through the minutiae, per se. We eventually do want three kids, and I want them to be able to pursue whatever their interests might be and give them the financial means to do so. As it relates to Katie and I, I want us to be able to look back on our life together and realize that we accomplished the things that we wanted to do that require any type of capital to do it. And I think any type of misallocation of money might impact that type of thing right there.

Okay, Katie, how does that strike you.

Hearing that I want the same thing? I think we have a pretty shared vision in that regard. I would like to have financial freedom and not feel like I'm living paycheck to paycheck or that I'm having to constantly count my pennies. I don't want to have to constantly be stressed about where money is coming from.

With that ski gift example that we talked about, didn't you bring the stress on yourself?

Yeah.

Okay, so talk to me about that, because you said you don't want to be stressed, but then your very behaviors brought that stress upon you.

I knew that was what he wanted to do for his birthday, and so the only way I knew how to make it happen was to take on that stress. I'm not at the place to be able to do that, so I shouldn't have done that. All right.

That's a pretty mature approach. I appreciate that. Katie, are you a people pleaser?

Yeah.

In your relationship dynamics, in your financial dynamics, as you turn 35, 40, 50, 60, how do you think that people pleasing might show up?

I know. For now.