“I’m 8 mos pregnant & all he talks about is the cost”

Anytime I spend money, it's all guilt full. Like there's never a moment that I think, I deserve this.

Today, meet Jason and Megan.

I'm trying to keep up with him and with lifestyle, but I also like, know that I can't actually afford that.

We should be able to have some agreements on how this works.

He's a 40 year old COO, she's a 34 year old flight attendant. And their finances have gotten very sloppy.

We have not done an excellent job of executing the post pay cut plan.

Can I actually afford this? No. But am I still gonna do it? Yes.

But what's really stressing them out. Megan is eight months pregnant.

The maternity rule for work, it was like, I'll take three months off. And then it was like, I'm gonna take six.

Oh.

The company gives me 12. Oh, now it's 15.

How much is the baby gonna cost? I would like to have a doula at our birth. Where is that money coming from?

Can they make the changes to their finances and their relationship to work together.

With baby coming, how do we figure out how much work is needed from each of us to support the family?

Do you have a plan?

No, I just don't go to work. That's the plan. Plan.

All right, let's take a look at the CSP. Wow. $3,000,000 in assets. But of that $3,073,000. $3,053,000 is from partner one. Partner two has $20,000 in assets. Hugely unbalanced. Okay, it can work. Just something to Note. Savings at 27k, pretty low relative to the other numbers. And then debt at778,000, which is fine with all the rest of the stuff. So total net worth of $3.1 million. Okay. At age 34 and 40. Extremely impressive. But kind of odd. Like why is there only 27k in savings when you have $3 million in assets? That's odd. Just. Just to clarify, when you have $3 million in assets, those assets cost money. So if this is real estate, which I assume it is, you know, you get one repair that's $20,000. So people who have a lot of assets should have a lot of liquid money to be able to maintain those assets. This is something that you have to remember as you start to get more money and you start to buy more things. I'm talking about assets. You have to remember those assets aren't free. They take maintenance, they take staff, they take all kinds of stuff. So it's a bit odd, but we'll figure that out. Wow. Okay. Income is 21,000amonth gross. But of that, 17,000 comes from one partner who I assume is the person writing the application. What the hell? Debt payments at 1,200 bucks. Why? Why do you have debt? Why do you have credit card debt and you have 3 million bucks? Makes no sense. It makes zero sense. Okay, I'm going to give a fresh perspective on the csp. First off is they're not really saving and investing very much at all. On the other hand, this couple may have very consciously decided, hey, we're going to be asset rich. We're going to invest or buy a lot of assets and we love our guilt free life. We love traveling or buying cool stuff, eating out five times a week, whatever. And maybe that's what they decided to do. It's okay. If you have $3 million in assets, you can make certain decisions that you would not make if you're making $50,000 a year with basically no net worth. So I have a lot of questions to ask, primarily about, number one, what are all these assets? Number two, why do you have such low savings relative to the other numbers? And three, where's all this guilt free spending going? I just want to know. Looking forward to speaking to them.

We were in the midst of discussions about what's going to happen when baby comes from a lifestyle change, income change, and expense change. So we're actively talking about that together. I was asking Megan, what's your plan for when baby comes? What does your employer offer? How is income going to change? Because I wanted to plan ahead and know what, if anything, I need to do about it. So we started there and had to ask that question lots and lots of times.

Why?

Because I couldn't get a straight answer.

He didn't like my answers.

What were those answers, Megan?

They were, well, I can take this much. And then I kept learning more of how much. So I didn't have a concise answer originally. And then I learned what the maximum benefit is and what the maximum amount of time I can take is. And that's where I emotionally landed.

Yeah.

The way I would describe it is I learned about her plan through overhearing her explain her plan to her friends. So originally it was, I will take the first three months off basically through winter. And then the next friend, it was, yeah, probably about six months I'll take off and then I'll go back to work to some degree. And then the next one, it was a year. And then the last was 15 months. Wow. And so my eyes just got bigger, bigger Bigger.

And when you say they got bigger, why? What's the implication?

The longer there's a lack or low income is the larger problem that I'll need to solve or a bigger dollar amount I need to cover, meaning her.

Income will cease and you're going to have to be the sole income earner and that becomes stressful.

If she just said, I want to have baby and not go back to work. Cool, let me work on that and I'll see how possible that is. And. And I'll come back to her with the impacts.

Right.

Okay. Just so you understand, that means no more of this. No more of this. No more this. This changes. You know, I need a new job, whatever it is. Right.

And.

And let's go through the impacts. And then she'll come back and say, well, okay, maybe I could do this. Right. And then I'll have another scenario. But what's been difficult is without a plan and then time to plan, it becomes impossible to solve that, and then that makes it impossible to come up with changes or get ahead.

Right.

So here we are at what's we do, like seven weeks or something?

Yeah. Baby's coming out in seven weeks.

I want to hear from you, Megan. Tell me about your perspective on these discussions.

Did tell Jason that I wanted to have a baby ages ago, and in the last five years I've been financially preparing for that. And once I learned the finer rules and what I could actually do is when it became more of a conversation and more of like a. I don't actually think I need to. My income doesn't really impact our lives very much because we've focused on putting more money into my 401k and saving for my lonely future rather than our together future.

So what if Jason asked you, like, how long do you want to be home? It seems like from his perspective, he's not getting a straight answer. Is that accurate or do you see it differently?

I would say initially, yes, it's accurate. But. But my answer of I will go back by baby's first birthday has been very steady for the last six months.

Oh, okay. So your answer is one year? I want to stay home.

Yep.

And then I'm back to work. Yep. If you had to do an educated guest right now, what capacity would you go back at after a baby's first birthday?

I would go back at 50 to 55 hours a month, whereas 1:20 is full time that we've calculated in the past.

Okay. Does that work, Jason?

It's very doable. It's not going to like screw anything up. But it does have impact in stuff you plan for ahead of time. Right. So what you're going to do or what additional income do you need to come up with? Or what, what do you need to turn off for a time?

So you're saying, hey, if she goes back at 50%, probably we can't afford to do all the things if she was working 100%. Right. Fact.

Yes.

Fine. Do we all agree on that?

I don't agree with that because we're adding this new factor of a baby in. So can't we go back to doing all the things we've already added, like a whole nother variable? So whether that's child care costs, like if I'm working at 100% time, where is this baby going to be? Do I want to be away from this baby? I don't want to be away from this baby for 100% of what I have been doing in the past.

Yeah, but we also, we also have some, some ideas, like what amount can you work without introducing childcare cost? Right. And. And how can we work that out?

Do you guys find that you talk about certain things and spin a lot, but don't make decisions?

Yes.

Wow. That's shocking.

Whoa, Ramit, whoa.

What I asked is, can we all agree that if one of you is not working at a hundred percent, then you can't spend the same as if that person was working at a hundred percent? Seems like pretty basic math to me. If one of you is not making as much money as you used to, you can't spend as much.

Facts.

I agree with that statement.

So let's. Let's talk about how we got to this position. So I can already tell Jason, you're the optimizer, you love the numbers. Right.

And Megan traditionally been very good at it. I can, like, set a number for what full time is like, how can I swing this? And how can I flex in my savings?

I'd rephrase that to be. Megan will run. Run the numbers to figure out how little she can work to get everything she wants.

True. Okay, I agree with that. Actually, you're right. You're right, Jason.

Meaning you try to be as efficient as possible. You want to work as little as possible and get the maximum financial benefit.

Correct.

Fine. Nothing wrong with that. Okay, that's good to know.

With baby coming, lots of things are different. And some of these decisions, well, some are happening. Right. We don't have a choice. They're going to come. But what we really want to understand is how do we better plan and then execute what comes next. Primarily with income. Is a. Is a big one, Right? How much does Megan need to work and then, you know, do I need to change? And when. And then what needs to change in lifestyle and expenses? In the past, we haven't had to be so diligent because had much higher income. With adjustment to lower income, we did have to make many, many adjustments and say, what do we cut out? How do we make this work? And I feel like this is the next step of that.

What adjustments did you make when your income went down?

So Megan took a side job, and we started renting rooms in our house to get additional income. And then we also cut back on a bunch of spending. So, like, travel with fewer trips. We cut back on some subscriptions to expensive subscriptions. We cut back on attending live sports and events and. Yeah, what else?

I think we only really cut out two subscriptions.

What subscriptions?

Well, we gave up one theater.

Okay, okay.

And you gave up symphony.

Oh, okay. How much are those? Out of curiosity?

Each of those is in the. Probably a thousand to two thousand bucks a year. But we also gave up. We had season hockey tickets.

Oh, yeah. I didn't like that one.

That's expensive. That was like 17,000 here.

17. How much?

17,000.

$17,000 for hockey tickets?

Yeah. Remit. I agree.

Wait, wait, wait, wait.

Look at your face. That's my face, too.

No, no, no, no, no. I'm not judging. I just don't know anything about this. So $17,000 for two seats? What are we talking about?

Yeah, two seats, 44 games. They're like 200 something bucks a piece. Per seat? Per game.

Is this, like, in a box?

No.

Holy.

Yeah, that's pretty. That's pretty standard here. Like, the. Almost the entire arena goes for that much.

Did you say $17,000 per season? Yes. Man, I had no idea. I would have been wildly off every single person who's listening, including my friends. Like, I have friends who are agents for, like, baseball agents and stuff. They're like, this guy is so fucking dumb. Wow. I appreciate it. I get to learn on this show. I get to learn things I would have had no idea about. That's amazing. All right, so you cut back on those things. That's cool. And was it difficult for you to have these discussions and to make the decision?

The stuff with the houses is difficult because I want to get more income there. And Megan's like, get everybody out of here. This is my space.

What about for you, Megan? Was it difficult to make those Decisions?

No, I didn't want hockey that badly. Hockey's lame.

So you, you took a pay cut. What was the salary before and the current salary?

The. The before was depending on performance for the year was 350 to 450. Okay. And after? It went down to 185.

Wow. Wow, that's a significant drop. What happened there?

So left. Left a. A job where people turned evil and went to a place where people were good. But it was from a larger publicly traded company to a startup.

Was the evil company a whole life insurance company?

No, not that evil.

Okay, not that evil. Okay. So got it. So that's a big drop. Makes sense. And then, you know, we heard that, Megan, you had been kind of cutting back on time. And just give me a sense of the scale. What if you're working a hundred percent time, what are you making versus 50% time?

4,5K down to like 2K a month.

Okay. The scale is like you cut your pay by 30,000 or 40,000. Right. Meanwhile, we're over here talking about, you know, you cut your pay by 300,000 or 200,000, something like that. Okay. All right. So big changes. Got it. Jason wants certainty. He's the planner. And as the person who's the money guy in the relationship, he wants to know concrete numbers. How much are you going to work? How much money you're going to make? Just give me the numbers and I'll plug it in the model. He chases Megan for the answers. Megan avoids the answers. As you can see, they've entered into the chaser avoider dynamic. What's interesting is how cagey Megan is. Most avoiders just openly avoid conversations about money. Or they use a variety of techniques. For example, getting mad and saying things like, can't we go a single day without talking about money? Megan does this trickle truth sort of thing by saying, I want to stay home for five months. No, six months. No. 15 months. Now, understandably, no first time parent knows exactly what having a baby is going to look like. But importantly, you have to be able to make at least some assumptions, which you can always change later. Am I going to stay home for one month or two years? We need to be able to put something down on paper and then we can change it if needed. That is how you make a plan. So from my initial conversation, it looks like Jason just wants a number and Megan doesn't want to give it. But I suspect it's more complicated, especially when Megan reveals she's talking about a few things. Thousand dollars difference. Welcome back. Let's keep going.

The first time Megan and I had a really good, productive financial conversation was prepping to buy the house.

Fantastic.

Yeah. Because we wanted very different things in a house. I wanted it to have downside production and cash flow and do all these different things. And she's like, I want a house for the family. And so we, we had a really good discussion of what we each wanted. And then we looked for what was out there that had everything we wanted. And then we ran all the numbers, made sure we had the, the down payment, made sure we could have a backup plan that, hey, if something really did change, this mortgage is covered no matter what.

Yes. Hey, for everybody listening, all you, all you real estate denialist freaks who always argue with my basic premise to all I want you to do is, is run the numbers on the biggest purchase of your life. I hope you're listening to this couple. You don't need to earn $600,000 a year. OK. All you got to do is simply run the numbers. Okay. Good job. I'm very proud of you both. So here you are. It's kind of interesting to me. You already went through a $250,000 plus pay cut and aren't we only talking about like losing a few thousand bucks Now?

Here's the thing. We, we have not done an excellent job of executing the post pay cut plan. There's been several. Something happens over the past few years that are. Yeah. That make things difficult. Like Megan got injured and was out of work for majority of a year. I was hit and run and somebody flipped my truck. So then I was injured and had no vehicle to commute in and had to do that.

We've had a series of floods in our condo.

Yeah. Our place is flooded three times and insurance only covered one time. So the second two were self insured. Okay. So you know stuff like that.

You're basically saying, look, when we made like over half a million dollars a year, if things came our way, we could deal with it. We had plenty of cash flow at this time. It's getting tighter and tighter. We still have cash flow, but getting a little stricter. We're not particularly great at following that plan, but we can't be thinking the same way as when we were making multiples of our income. We have to be tighter, right?

Yep. You have to be tighter. And when these things happen, we will need to do something. And sometimes those things go on credit cards and then we have to fight the credit card machine.

Megan, what is your central challenge? I mean, it sounds like you Have a vision. You want to stay home for a year. You want to go back at 50% time?

My challenge is not living in my realm. I've had enough windfalls where I can wipe out all my credit card debt, and it's fine, and then they just fill back up.

Do you have credit card debt right now?

Yes, I have $13,000.

Oh.

I just looked at all of my other money sources. I'm like, could I just take all this and pay it off? Yes.

Why don't you?

That. That's a great question. Because maybe. Maybe bitcoin's gonna come up for me, and maybe I'm gonna be a whale.

Yeah, maybe.

I do think that's an interesting question to ask you. Ramit is like, in those situations where. Where you can redirect, would you redirect, or would you only redirect if you have confidence that you're not going to get back in there?

I'm kind of confused here. Do you two combine your incomes?

No, we live separately. Why financially? This is the first time he ever let me know how much money he makes.

What?

No, that's not true. We ran all the numbers together for the house. So way back in 20. 19. 2020.

Okay, that's acceptable.

You're all married and having a kid, right?

We're not married. He's my. He's my lover.

Okay.

Of eight years.

Why are your finances separate? Out of curiosity? I guess because you're not married.

Yeah.

No.

Haven't had a need or reason to.

Okay. And you own a house together, or is it separate?

His name's on it.

Yeah. My name's on it.

Yes.

Do I feel entitled to it? Sometimes.

Okay. Do you pay for it, Megan, Emotionally. Notice these peculiar responses that Megan keeps giving me. Now, we need to acknowledge that Megan probably grew up with some unusual messages about money. And she's about to have a baby, and they're talking to me for the first time about this intimate topic. So I don't mind people being nervous, but I think it goes much deeper than that. Megan is an avoider. And avoiders have a series of conscious and unconscious techniques they employ when conversations make them uncomfortable. And you're going to hear lots of them through today's discussion. Now, before we hear Megan's answer, I need a quick favor from you. Hit that subscribe button because it really helps my team and me grow this podcast. How about financially?

Financially, yes. Traditionally, yes. I just direct deposit money account from my paycheck.

All the expenses come, basically, and I pay for it.

Why is Your financial situation more confusing than mine. That doesn't make any sense. I have, I have a very complex financial situation, but I have simplified it a lot. Okay, let me make sure I understand the relationship status. So unmarried, own a house that's in your name, Jason. And having a child. Any plans to get married or combine finances? It's fine either way. I'm just asking.

No.

Okay.

If, if any benefits there are to combining something like I, I guess I have a bit of a expectation that there's. There's probably going to be a need with baby to have some sort. To have Megan have access to funds. Typically though, she'll just take a card of mine. We don't actually go change accounts and stuff. It's just like, hey, take this card.

In general, you can definitely go through life without combining your finances or getting married. Of course, I would never sit here and tell you you have to get married or you have to combine. I do think that you will find that over time, especially with a little one, that your lives will structurally be set up to like be individualistic and even diverge. And it really helps if you were to have your finances combined because it actually helps you make these joint decisions. Like right now there's a lot of like negotiating and going back and forth and part of the basis, and part of the reason for that is that you're not actually operating as a unit. You know, it's like, what can I get away with? And like, hey, I need clarity on your number so I can plug it into my calculator. Like it's not together. One of the easiest ways to change that is just to put your money together. Now it becomes very tricky because putting your money together without being married has all kinds of implications and co mingling. I get all that plus the property and you know, all. There's all kinds of stuff. The simplest thing, not saying you have to do it is simply get married, combine your finances. That is the simplest thing. But I'm all for people having alternative perspectives and alternative views. That doesn't bother me at all. We can make it work.

I think the simplest is here's a card to an account that has cash in it. Spend what you need.

It could be that basically the envelope system, which is like, we agree that every month there's X dollars in the account relating to these categories, yourself, your personal care, perhaps baby, perhaps whatever responsibilities you focus on. I'm focusing on these things. Yeah, you could make that work, no problem. How do you deal with things like, say like eating out or the Hockey tickets, for that matter, who decided on that one? Because clearly one person wants them and the other's not as into it. How. How do you decide on those kinds of things?

If it's something small, usually we'll either just do it or. Or she'll ask. She'll ask or whatever. Hey, what about this? And then it's usually like, yep, fine, whatever. Let's just do it.

What about the big things like the hockey?

Then we talk about it and try to figure it out.

I guess, like with my most. My most recent car, it was a discussion, where's the money coming from? How are you going to pay for it?

I usually guess, Megan, what do you want? I want this. How much does that cost? I don't know. Great, let's figure it out. We figured that costs this much. That means this many dollars per month. Wow, that's way too much. Cool. I think that this much would be doable, I think. And you can get something like this for that cost. Right.

And Megan, what. What is with the I don't know response?

In my mind, I just think it's always going to work out. I don't feel like I'm ever going to be homeless, carless, or any dire straights situation.

One thing that Megan has available to her is a fully scalable income mechanism. With this, you know, with these kind of multiple roles, it's like you can work more nearly infinitely. Right. And if you want to change your income and buy a car in the next three months, you can just max it out and get over time and.

Okay, we've also, like, planned this. I see enough people who I work with who are divorced, and by the time they raise their kids, they go their separate ways after 20 years. And they are the women who stayed home with the kids, flew minimally, and now they have no money for retirement. So I've always known that. I've expressed those concerns with Jason in the past, and him and I were always on the same page of protect my future self. So I've always been really grateful for that. But also, like, it's been part of the plan to make sure that future self is taken care of.

That was probably the first financial discussion we had, was very early on it was, what are your finances? You know, and we kind of had that chat and, you know, do you have a match? Are you using it? We had that chat early on, and so I encouraged her to max everything. I was like, don't worry about stuff that we need to pay for. I'll take care of all that, and she did, like, an excellent, excellent job at that.

The way you set up your finances will affect the rest of your lives, in my opinion. The way they're talking about their accounts, where Jason basically gives her an allowance without combining income, is going to set them up very poorly going forward. Who wants to have to ask their partner for an allowance? And who wants to have that conversation 300 times a month for groceries and diapers and a car and stuff? Starbucks. Jason has taken on the role of the money guy in this relationship, and he's even continuing it with his idea of how to set their accounts up. And yet he's frustrated. He can't get a straight answer out of Megan. He doesn't quite see that when you don't both have skin in the game, it's very hard to recalibrate that relationship. This is why I insist both partners participate in a monthly money meeting. Sure, one might take the lead on investments, but both of you should be actively involved in the finances. We'll open up their conscious spending plan after this. Now back to the show. Okay, let's move on to the csp. Megan, can you read the word in bold and then the combined number next to it.

Assets, $3,073,000. Investments, $859,095. 70. Savings, $27,455. Debt, 778,835. Total net worth, $3,180,715.

Okay, great. And I want to point out that Jason has a net worth of $3 million independently. And, Megan, your net worth is $172,000.

Yes.

Got it. How do you all feel about those numbers?

Not good enough.

Not good enough. Okay.

Anxious.

Oh, wow. Why. Why is it all. Why is it so negative in here right now?

For. For me, it's. Cash flow still feels really tight.

It.

It just feels unsure, unstable, Anxiety provoking.

Can I.

Can I ask a couple questions? Because I want to understand these numbers. So it says that you have $3 million of assets. Can you break that down for me?

Uh, yeah. So that's. We have a. We have a condo. We have a house, cars, and then business. Condo's like 400ish, something like that. Houses, like a million ish. Businesses. Million ish.

Cars.

What the.

How much are these cars worth?

There's too many.

They range the most. Most expensive ones, like 60, 70. Most are in the 2025, something like that.

How many cars are we talking about?

I think it's seven, including Megan's.

This can't Be real. You have seven cars.

Eight with Megan's.

Is this a joke?

No. I wish it was for me.

Why am I here? Hold on. Do you know I have a. You know, I have a master's degree, and I'm here talking to a couple that's worried about cash flow. I have eight goddamn cars. What the is going on here? Why do you have so many cars?

I used to own and operate a. An automotive business, so I had cars and tools and stuff for that. And then with kind of work changing and stuff, I put it into, like, sleep mode, but have not fully wound it down.

Oh, wow.

Yeah.

So like, when you said we haven't really cut our spending commensurate with our income going down by $300,000, you were referring to the eight cars. All right, we'll get back to that. Investments are What?

I have 7K in crypto.

Okay. What else?

Most of it is index funds. Please tell me. God.

Yeah, mostly.

All right, and then savings is whatever. What's the debt? Break that down for me.

Debt are. Yeah, two mortgages. And then on. On my side, there's like, 26k on the credit card right now.

Let's go to income real quick. Jason, what's the combined income?

21,408.

Okay, so that's $256,000 a year. Did you all know that that's how much you make?

Definitely. Yes, I know that.

I didn't know. For me, I told you, I didn't know how much he made till recently.

In your case, you have a slight justification because, you know, you're not married, I guess, but if I was having a kid with somebody, married or not, you know, I would know their finances. I would have done a triple drill down into their investments. I. I would have been like, you invest in this dog fund. They have a 1.5% front end load.

What the.

But that's just me. All right? We all look for different things in our partners. At $256,000 a year, how is it that you all have, like $40,000 of credit card debt?

LUDs, wrecked car, all that stuff.

All right, so accidents, that's one thing. What else? Megan, why do you have credit card debt?

Because I carry too much. I don't live within my what I make.

Also, you're working less than you were, but not changing expense habits.

Correct?

Yeah.

Haven't changed.

Yeah. So to me, again, the costs and things stay the same, but the work, variable works went down.

Right.

So my. My encouraging is variable work. Get it back Up. Right.

Well, I think the larger problem is that you are the one having to tell her to get her income up. That's really the problem. Why is Megan not in charge of her own independent finances if the two of you are not married?

I'd argue I am. But I also feel in the moments where there is a question of who should pay for what. If Jason doesn't have a card for me to use for a household expense, or if there's no room on a credit card, I will just cover it.

If that is what's getting you, in part, into this credit card debt, that's just sloppy financial management because a couple making $256,000 a year should not have the issue of there's no room on a card. That's crazy. Okay? That is. That's insane. If you're going to live independently, not married, that's totally fine. However, you got to have a really defined set of rules, like an SOP. It would be like a McDonald's franchise.

Sounds perfect.

An SOP is a standard operating procedure. It is a manual for how to do a task. McDonald's employees have tons of SOPs, which is how they can hire someone who walked off the street and have them making fries very quickly. Same for airline pilots who religiously use their checklist. I love SOPs. I have an SOP for when I rebalance my investments. I have an SOP for how to handle unexpected income. My wife and I have an SOP for who loads the dishwasher and who empties it and when.

Oh.

Oh, no, Ramit. That's so unromantic. Things should just happen. What are you talking about? Think of the things you do repetitively. It could be who mows the lawn or goes to the gym. It could even be when you talk about money, which, as we both know, is never. Which is why I shared my exact monthly money meeting agenda in my new book, Money for Couples, available for preorder now. The point is, you can systematize and schedule the important things to you, which leaves you abundant free time to use guilt free for the things you love. Is anybody seeing the similarity between the conscious spending plan and creating SOPs for your life? Am I the only one who's becoming enraged and starting to sweat while sitting in front of a camera alone at the fact that more people don't use SOPs? What the hell is wrong with me? Let's get back to this episode. Yeah, I love a good SOP in the household. SOP for who empties the dishwasher. What time? Sop who's doing the dishes, the laundry. Like, write it down. Don't leave it up to romance. And certainly not like, oh, let's talk about it. Because the last thing you want to do is like, babe, can you give me money for formula 409? No, just SOP it, make an agreement, and then if you need to revisit it, revisit every six months. What concerns me is the fact that you're all okay with having, like, credit card debt. With a baby on the way. Shit's about to get real.

I don't know if we. I don't know if I'd say okay with it. The bigger. The biggest chunks are. What? The unexpected stuff that wasn't budgeted. Like, we. We got. We got rid of all the student loan debt. That was a big one. Right? Then we got rid of all the credit card. And then it's like the next. The next thing. But it's. It's. I. I look at it as 100% income related because it's hard to go down and then stay down.

You're gonna have to change the way that you both interact with money and probably create a new framework for how you deal with your finances individually and together. This doesn't make any sense to me. With the income, if you guys were making, like, 100k, okay, I would be like, we gotta slash and burn. But you're actually making, like, way more than that. So there's something going on here, and I can already see some of it. Let's look at the fixed costs. Fixed costs are at 62%. That's pretty good. You're at 20% for your housing costs. Not bad. Not bad. All right, fine. Transportation is 400 bucks. Oh. Plus fuel. That's 1,029. Okay, fine. Debt payments are killing you at $1,204 a month. That's a lot. In fact, just for easy math, let's zero that out. Watch what happens to the fixed cost. Number drops to 53%. Okay. So that's good to know. We could tackle the debt no problem. Yep. Groceries at 715. Okay. Clothes at 40. Phone at 178. And subscriptions at 336. If we actually look into the breakdown of how each of you is spending your fixed costs, Jason, you're at 61%, but Megan, you're at 66%.

Mm.

So your blended average is 62%, but, Megan, your number's actually high. Yes, that's a problem. If the two of you were married, then we'd be having a discussion about how to do this as a team, but with the assumption that you're going to continue as is, then what? That implication is that each of you needs to be responsible for your own finances. Agreed.

I think our intent is that we. We build this plan as a team.

Okay.

So for example, when, and I think maybe this is obvious, but when her income goes to zero, her fixed costs come to mind.

All right, so you are approaching this as a team. That's actually great clarification. Cool.

Yes.

All right, so if that's the case, then then that raises some very interesting questions on your fixed costs. Then probably Jason might need to shoulder some more of Megan's fixed costs if that's the case, because your income is way higher.

Yep.

Like just to put. Put the numbers out there, Jason makes 17,000amonth gross, and Megan makes 4,000amonth gross. So something to think about. Let's keep going down the list. Investments are at 2%. Are you doing some pre tax investments? Yes.

Yes.

How much are you taking out for each of you?

Mine's like 13.7.

13.7%?

Yes. Percent of gross.

And what about you, Megan?

Mine was at 11 and I just reduced it to the company match at 7.5.

Right. So that's great. That offers some margin to play with. We can look at all that stuff later. But right now your post tax investments are basically very nominal at 2%.

Fine.

Your savings are at 3%. You're saving 200 bucks a month for your emergency fund and 150 for your gifts. So you basically have three months of emergency fund. That seems a little low.

Agreed. Yeah. We've had to tap the savings for, you know, the stuff that's been happening. So that seems bad. Yes, exactly.

So you have to tap it. You also are at the sort of low end of a emergency fund and you have a baby coming. Plus income is going down. A lot of risk at once. Let's focus on what matters that you have a lot of risk. What the. Your guilt free spending is 33% and I believe that. Is that true?

Yes.

4,600 bucks a month on guilt free spending.

Yeah.

What do you all spend it on?

That's where we have like the theater tickets are in there. Sports ticks. That's the eating out budgets in there.

Theater should be plural. Sports should be plural.

Just have to say, I love, I love this show. I love this show because like, I talk to people who have like, they bought a $78,000 truck and their income is $60,000. Okay, I have that and I have a couple you who has ballet, multiple theater tickets, and $17,000 for hockey tickets. Like, this is the most diverse show on the Internet. I love it. Everybody who's always leaving comments over me, boohoo. Always talking to rich people. Well, actually in this case, you guys are pretty rich, but we also talk to people from all country, all over the world, all over the socioeconomic spectrum. I love it. What do you all think of this CSP plus a baby?

I've never seen a CSP like it.

Every CSP is different. It actually to me is like the fingerprints of your life.

Yeah.

It really shows what you value. And here it's clear ballet eating out. Like, it's very clear now. Can we fit it? We'll talk about that. But I can sure see who you are from this csp. It tells me so much. Megan, what do you notice about the csp?

I don't think it's all encompassing. Like when we list out the things that we guilt free spend on, it's. It doesn't have all the things that I think about and all like the goals and the things that get that are going onto credit cards. Like, my epic pass is coming up. So like for our ski season and also any traveling we do, we're still doing like a lot of very cool things. And there's like the occasional Michelin star restaurant. And that's not in the budget in general, but also just like I don't feel like it's accounted for. I want more detail.

Well, you want more guilt free spending is what you want.

I want more guilt free spending. Yes.

That's good to know. I think that that's a pretty candid answer. How would you address that?

In years past, I. I would write out a list of all the things. I put it in order of priority and.