“I grew up on food stamps. At 24, I’m about to get paid $215,000 per year”

I feel like he's a little stingy. Oh, he's not stingy towards me if I ask, but his attitude generally makes me feel that I shouldn't ask. I don't feel like the money that I have for myself, even the money that I earn, I don't feel like it's mine. I feel like it's Niles to give to me. If Niles just agrees to something that I propose, I don't feel like he wanted it. I feel like he's just giving in to me, which makes me feel like even more of an asker.

And after talking now, what do you recognize about that pattern? What are you doing when you go down that path?

I'm avoiding the money, getting rid of it as fast as I can. There you go, not learning any valuable skills. I want to learn how to advocate for myself better and not resent Niles, who I feel like is just losing with any choice that he makes.

Megan, you need to be able to ask for what you want when it comes to your money. He's not going to read your mind.

That strikes me as true and uncomfortable to think about.

Megan is 24, Niles is 28, and their lives are about to completely change. Until now, Megan has been a student earning almost no money. Anything she earned, she gave to Niles, who would save it for her, in part because she admits she used to be irresponsible with money and also in part because she doesn't even trust her own financial judgment. But now she's about to start earning more, a lot more, even more than Niles makes. She's finding it hard to even believe it, and it's starting to cause issues in their relationship now. This is an answer Niles provided during their application process. I want to read it to you really quickly. Here's he wrote, the women in Megan's family are either not financially healthy or do not work. And Megan is worried about becoming powerless despite earning a high income. I'd like to encourage you to listen to this and also to watch it on YouTube where you can see their body language and facial expressions. Just go to YouTube, search for Ramit Sethi and follow my channel there to get all podcasts in full episodes on video.

This is I Will Teach youh to.

Be Rich and I'm Ramit Sethi.

Early on in our relationship and early on in college, you know, Megan had financial aid and I had financial aid as well. And I was working a minimum wage job. So this is before, you know, I was supporting us, but Megan accrued you Know, a considerable amount of credit card debt, considerable means.

What?

That was like $10,000 or something, Megan?

I don't know. I think it was like $8,000.

Okay.

Yeah, yeah. So with, you know, no way to pay it off, so it constantly was accruing, and it was in collections and all this stuff. And so, you know, I. I didn't really trust her with her money. And I, you know, as part of that, the rent, to me, it wasn't going to be like one of those things like, oh, I'm going to pay it back that you're going to have, like, I'm saving this money so you can get it back in the future. But it did feel like it was more secure in my hands. Typically, that wouldn't go directly to the principal. Like, I was mentioning, it would go into my savings. So, like, if she needed the money, I always felt like she could take it out, though. I don't think we had a conversation about that at the time. And that was. Like I said, I felt more secretive about the money. I suppose this is earlier on in our relationship, because. I don't know.

Hold on, hold on. Let me make sure I understand. So Megan was an undergrad, taken out loans, ran up $10,000 or so of credit card debt, couldn't pay it off. It started growing. Going to collections, things like that. You two had met at that time. You were together. Niles, you said, okay, I don't really trust you with your money. Therefore, what was your conclusion?

Give it to me and I'll keep it in savings.

But it was, give it to me under the pretext as rent. And like Niall said, we didn't have a conversation about that. And I think the first time that I heard that, that was why he decided to make me pay rent, so that he could, like, hold the money for me and it would be safer than if I had had access to. It was this past week.

Whoa.

Yeah.

Why? Why was it Getting ready for this call?

Yeah. Yeah.

It was secrets coming out of the vault. And what was that like when you heard that?

I was like, you know, that's fair, because I definitely have come a long way with. With my money and my approach, but I was still like, that makes so much sense because of the dynamic that we have now, which is like, I don't feel like the money that I have for myself, even the money that I earn, I don't feel like it's mine.

Whose is it?

I feel like it's Niles to give to me.

So you make the money he holds on to it and you need to ask for it back.

Exactly. And I hate asking for it.

What does it make you feel like?

It makes me feel powerless. And it goes back to, I grew up with a single mom who was, we were really poor. She, she still makes $10 an hour, and she did throughout my childhood. And we had to ask for a lot of help. Like we had food stamps, we had the Salvation Army Christmas gifts. I had discounts at all of the after school activities. Everything was subsidized somehow. And I feel like it made me feel lesser than my peers for sure, because I didn't see them having to ask for the help. It makes me feel like all of the work that I've put in to graduate and get this high earning job, which I felt like was so honorable, is for nothing because I don't think I'll feel like the money's mine.

So if we stop talking right now and you both went back to the way you were doing it, you're about to start making a lot more money. You would presumably hand that check over to him and then would you have to ask for it back if you needed to spend money?

The other day we were talking about this and I said, even if I get fund money, I don't know that I'll be able to spend it truly guilt free because I feel like I back ow him for the years, the six plus years that he's been supporting us. So if anything comes up that we would pay for together, like buying a new couch, I feel like I would probably use my money for that. I don't know that Niles would consider doing that too.

Have, have you asked him if he thinks you back owe him?

No.

Okay. Want to ask him?

Do you think I'll back o you?

No, definitely not.

Do you believe him?

I don't believe him because this all stems from me. Like the rent, the rent issue. You know, I said, I can't pay you rent anymore because I don't have enough money and I'm just going to have to borrow money from you after I pay you rent for a few months. You know, a few years ago when I was living off financial aid. And I feel like I still feel that his change hasn't been genuine because I had to bring it up. And I felt like he was kind of oblivious to the whole issue the whole time. I think there's some skepticism. Yeah, I want to know that he was thinking about it too.

And it's really challenging because then it feels like we can't have A conversation about really anything without there being skepticism around, like, hey, you know, I feel this way. How do you feel about it? What. What do we come into agreement with, you know, based on our two perspectives? So it can definitely be challenging because it's. It doesn't really feel like there's a path forward if we can have some trust around that.

I mean, you're engaged, right? You live together. There's got to be some trust. But if you can't trust what each other is saying, especially if, you know, if you, Megan, can't trust what he's saying, that's going to make it challenging. So what do you think that's about? That lack of trust?

Maybe it's my pride that I don't want to accept the change, that I just want to be upset about it enough to mention it. And then what would that get you? Nothing.

No, it would get you.

So maybe the other hand.

Maybe. Do you find yourself ruminating on money conversations in your relationship?

I definitely do. When we're having them, I'll dredge up some old stuff that I'm sure Niles doesn't want to listen to anymore and be like, you know, remember when you made me pay you rent and I had no money and.

Yeah.

All of our other history that's since changed.

Okay, so he. He, quote, made you pay rent. Made you means what did he say? Pay me or you have to get evicted?

I don't know if you would have evicted me, but you certainly asked me to pay you.

Yeah, because it went from us renting two separate apartments in the same town to us living together and me paying for the same apartment or same price. And so I felt like, hey, you have 600 extra dollars. Like, might as well send it to me so I can save it for you or for us in the future.

I didn't have extra dollars. That was my only dollars. I literally have no income right now. I have negative income.

Okay, what's the situation right now?

Right now I'm in school, and I'm graduating, and my job doesn't start until October, but I've accepted a job, and Niles pays for all of our stuff. And it's been like this for four years. I've been in school for seven years.

Okay. This is law school. Okay. Oh, congratulations. Just out of curiosity, if you had not moved in with him, Megan, how much would you be paying in rent?

Yeah, I would be paying at least that much, and I would have certainly had to take out loans.

Yeah. And the funny thing is, Niles, in a Way you were suggesting that out of the goodness of your heart, you really wanted to help Megan. It seems like. Am I reading that correctly?

Yeah, I mean, you know, definitely that was my goal. I think at the time, I didn't feel like she was ready to take the feedback about her spending habits. I think so, yeah. I definitely should have been more open about it.

How old were you at that time, Megan?

I think I was like, 20.

I'm not sure what's going on yet, but I am getting potential red flags. Let me start with the innocent explanation. Maybe Niles saw that his girlfriend wasn't great with money. He offered to have her live with him at a steeply reduced rent, and he took that rent money and put it into savings.

Okay.

If that's the case, it's pretty generous. On the other hand, it's not like she was a kid. 20 years old is enough to make binding decisions. Sure, maybe she wasn't good with money. Megan even admits that. But if you start off a relationship with one person holding money for the other because they're bad with money, it's very easy to continue that pattern. It's almost a parent child relationship, which you definitely do not want in a partnership. All right, now don't let anyone tell you that money is simply a tool. Money, like any technology, is never neutral. It has built in bias. It influences and is influenced by society. Money represents power. It's all of those things. Megan tells me more.

I feel like Niles has the power of money over me, even if it's my money. Like, every time I get a windfall of money, like a tax return, I don't know, I feel like I need to put it towards our wedding and down payment savings. And I just feel like Niles doesn't have that same consideration where his money's already accounted for.

Have you asked him if he does?

Yeah, we've talked about what he's going to do with his bonus coming up.

And how much is the bonus?

Maybe $15,000, I think.

So what are you going to do with it?

My plan is, you know, whatever we've already accounted for with. We have a very tight budget. So if there's things outside of our budget, you know, typically when we're close to a windfall like this, I'll be like, okay, we'll put this towards that. And then, you know, whatever Megan needs for her surgery, $2,000 and then the rest straight into savings. Not really any specific plans for it. Probably for our down payment that we are saving for.

Okay, Megan. So, yes, There. There you go. He told you what he's going to do with that $15,000 bonus. What's your reaction?

My reaction is that that came after I had the conversation of your money not being tied up in the same way mine was. And? And I gave the example when we had this discussion ourselves of his bonus last year. Like, he bought an espresso machine, a camera. It was like, $10,000 for, like, just fun things.

Whoa.

What? Which one? Wait, which was more expensive?

The espresso machine.

How much?

It was $3,500.

Wow. You use it every day?

For both of us.

That's cool. All right.

Yeah, we love it.

Okay, so what's the problem? Just so I understand, I mean, it's his money, right? You guys are not married yet.

Yeah.

So he made a bunch of money, he spent it on an espresso machine, which benefits you, and some other stuff. What's the problem?

I guess the problem is now if I need or want to buy something for myself, I don't feel like that money is mine. Like it's in his savings account.

It's yours. Like the two of you.

But no, if Niles just agrees to something that I propose, I don't feel like he wanted it. I feel like he's just giving in to me, which makes me feel like even more of an asker. I feel like he's a little stingy. Oh, he's not stingy towards me if I ask, but his attitude generally makes me feel that I shouldn't ask. He's not comfortable with it.

Okay. Niles, would you agree with that?

I think historically, yes. I think historically, because of that, I guess I'll say lack of trust related to. Because, you know, some of the dynamics that we had in the past, I felt like I had to manage her money for her in those conversations. The dynamic is obviously very different now. She's much better at managing her money, but I think we still have some history around that.

I would say so. So you two have co created this dynamic of, Niles, you're the responsible one with the money, and Megan, you're the irresponsible one running up the credit card bills and et cetera. Fair.

Yeah.

I'm the instigator. Niles can ignore what we need or want, but I mentioned it.

Okay, so who calls you the instigator?

Me. The problem is I feel like his money is his and my money is his. Like, this summer, I earned the same salary that I'll be paid when I start my job. So I made like $30,000 after taxes in 10 weeks, which was great. And I sent Nile $17,000 for our savings, like without him asking. I just feel so guilty about our situation that.

Did you go Catholic?

No.

Where, where does all this guilt come from?

Maybe the fact that I was bad with money.

My dream is we would stop describing ourselves as bad with something. I'm bad with money. I'm bad with my fitness goals. I'm bad, bad, bad. We give ourselves these labels and then they often become self fulfilling prophecies. I'm bad with money. Then I overspend. One month.

Six.

See, I tell myself I am bad with money. No, let's reframe it. I haven't yet learned the skills of money or investing, but I'm making a plan to do just that. And you have lots of options. You can DIY it, use my book and use my journal, or you can get help with my money coaching program directly from me@iwt.com moneycoaching but please do not settle for. For calling yourself bad at something. You haven't built the skills yet. But if it's a priority for you, you can.

I want to make sure I understand where you grew up with money, because some of the numbers I saw, you know, obviously you're very good at what you do. You're about to make a lot of money and you're about to enter a level of socioeconomic status that you have not been at. Fair?

Definitely.

Okay. So I want to equip you to know how to think about money at that level, how to talk about money at that level and how to behave with money at that level. All right, Megan, you mentioned you grew up poor. Salvation army, food stamps, single mom. What do you remember about growing up as it relates to money?

A lot of stress, living essentially day to day or week to week. My mom making some of the poor choices that I made when I accrued the credit card debt.

Like what?

Like she. I think she was going to file for bankruptcy when I was like a young child, like less than 10. And I remember she like ran up her credit cards before that and was like, oh, I'm gonna file for bankruptcy.

You know, might as well just charge it up.

Bad choices. Yeah.

Okay. And, and what else do you remember about money? Do you, when she talked about it, what do you remember her saying?

A lot of scared emotions. I would say uncertainty, not knowing if she could pay the mortgage. And. And I remember her asking for family members a lot. And she even tried to make me ask. She would try to make Me ask my other family members to give us money. And she didn't like that? No.

Why not?

I was embarrassed and ashamed probably.

How old were you?

I was probably around 10.

Wow, that's young. Young to be asking a little girl to do that. Amazingly mature of you to realize, like, there's something not right about this. Okay, what happened as you became an adolescent, as you went to high school, what happened?

I think I started to take on my mom's problems. I feel like my mom is. She's great and she was a great single mom, but she's not a con, a sophisticated consumer of really anything. She didn't finish high school. I felt like she didn't get the chance to do.

Yeah.

Because of how she grew up. So I feel like I own her problems. And a lot of our conversations now, you know, I'm trying to figure out, like, how she could get this work that her house needs done and how she can afford it and whether she should, you know, buy this car with this payment. And I feel like I'm in charge of all that stress for her.

So on your conversations with her, how often would you say you're trying to help her or, sorry, find solutions for her?

A lot. Even if she doesn't explicitly ask me. When she tells me anything about money, it's always negative, and I always makes me feel like she just put the burden on me.

It is kind of interesting that she's taken on the parent role with her mom, but. But in her financial relationship with Niles. By saying that she's bad with money and letting him manage her money, Megan has willingly taken on the role of a child.

How did you get into college?

Myself, I applied. Yeah.

Did your mom support you?

She was indifferent. I feel like, you know, she was proud that I did that, but she didn't really know what it meant. I found a lease for myself and I figured out how much I could pay with my financial aid and I moved myself. I just said, like, you know, next Friday I'm moving, and I left with all my stuff.

And this was like age 17. 18.

Yeah.

Wow. Have you taken a second to reflect on that?

No.

I mean, as you say it out loud, how does it strike you, a 17 year old, 18 year old packing themselves and deciding how much they can afford? How does that strike you?

I feel like if it was anyone else, I would be like, wow, what an incredible achievement. Or, yeah, I guess it took some strength, but since it's me, I just, I don't think about it like that.

How do you Think about it.

I guess I still feel ashamed that I had to do that.

Ashamed because of the family that you came from?

Yeah.

How do you feel about money?

Personally scared. Not good. I feel good about it, hypothetically. Like, I can. I can look at, like, you know, houses, ferment in a place that we're moving and look at our conscious spending plan and say like, yeah, we could afford that. And then whenever it gets down to it, I'm like, we should live outside of the city and pay a fourth of that price because it's scary to think about having to owe that much.

So you went on to college, you started. What'd you charge the credit card for?

First of all, was it a Wells.

Fargo card or a Bank of America card?

It was a lot of store cards.

Fuck Old Navy or Gap?

Well, there were multiple. One of them was furniture.

Yep.

What?

That's what I'm thinking of.

Yeah, like what? Just tell me. That one.

It was West Elm.

Jesus Christ. Yeah, I certainly have 10% off your first purchase. So. Cool. I just saved $12. Okay, what else?

It should have been Walmart, not West Elm.

Okay.

My taste was a little higher than what I could afford.

Is that true? So in other words, you were shopping at West Elm when really you could not afford it?

Yeah, when I couldn't afford Walmart for sure. Wow. Okay. Nordstrom.

Wow. Fine tastes.

I know.

Fine taste for an 18 year old with no money.

Yep.

Where'd you learn this stuff, by the way? West Elm. Nordstrom. I bet you did not grow up going to those stores.

Well, I just told you that before my mom filed for bankruptcy, she decided to charge up the cards. And I think she had taste that was, you know, a little better than maybe she should have.

Champagne tastes on a beer budget, they say.

Exactly. Yeah.

Okay.

And I think I needed to fit in with the people around me or at least feel like I could. And that kind of buying stuff from places even though I couldn't afford it gave me some kind of worth that I think I was missing.

Did you understand how credit cards worked?

No. And I, looking back, I'm shocked that I got one because I had no income.

Yeah, so you would charge it and then you'd get these things in the mail and it would say some number, the minimum. And how would you even pay that? You weren't making that much from your loans.

Yeah, I would pay the minimums for a while and then I wouldn't pay at all from my financial aid.

Hence collections. Right, okay, got it. Okay. So you ended up charging about $10,000. It went to collections. What's the status of those now?

They're settled and paid.

So, Megan, you're like a living example of the person who basically gets hooked on credit cards.

Yeah, but I'm not anymore.

When did you start to realize that the way you handled money was not working?

Probably when I had to settle the credit cards. So I think I went from an approach that was careless, and now I think I'm overly careful and extremely shameful, not buying anything. I think it just shows my mom felt the same way that I did, which is like scared about her abilities. And our whole family is just. They're in the same situation where, like, there's a lot of people asking for money. You might need to send it to somebody. So if you don't have any, you could be the asker and not the payer.

And is there a sense in your family that it's totally normal at some point you're going to run out of money and you're going to need to ask other family members for sure.

Yeah.

Yeah.

So we give when we can because one day we're probably going to be need to be the ones asking.

Yeah. And I feel like it disincentivizes you from being the successful person who keeps any money because you're just going to get asked.

Yeah. Well, are you the most successful person in your family?

I think I'm going to be the most high earning person.

Okay. And does everybody know that.

I don't exactly share how much I'll be making.

Well, do they say, like, oh, Megan's like a lawyer?

Yeah. They're very proud.

Yeah. Yeah. Oh, that's cool. And. And is the implication positive for you or is it like, Megan's a lawyer, she thinks she's better than us. Like, which one is it?

It separates me more than I would like. So the latter.

Okay. A lot of patterns repeating. I caught something you mentioned about your mom to the way she grew up. Do you think she grew up poor as well?

I know she did. Yeah.

So her lessons from her family were probably quite similar to the ones she taught you.

For sure. My grandma worked in a gas station and lived in like a trailer and they're all from the deep south. So really this is just a common experience.

Yeah.

I feel like there's a lot of poverty.

Yeah.

Where we live. And she met my grandpa because he used to come into the gas station and buy lottery tickets and he. She told him that, oh, no, my.