“We have a $1M trust - but a $30k budget”

I have something to show for it in numbers, but what do I have to show for it in real life?

I'm constantly trying to make sure that nobody thinks I'm here for the money.

It would still feel like I was asking parents' permission because they're the ones that set it up for me.

I don't feel entitled to the money that we're spending.

I wasn't expecting to get emotional about it, but I feel as though I haven't felt worthy of having that.

Why is that? Because your parents helped you?

Being raised with a kind of Depression-era mentality left me feeling like if I don't save, I won't have.

And that was scary.

I instantly knee-jerked to defensiveness and feeling like she's questioning why I want to spend $50.

Holy shit. Can you just imagine?

30 years.

Basically, it should be a shit ton of money.

Today I'm speaking with Kate and Keith. Kate is 45. Keith is 53. They have a very fascinating story. They live part-time in Hawaii, part-time in Maine. Right now I'm looking at their conscious spending plan and you can download your own free copy at iwt.com/csp. Looking at their numbers, it's honestly quite puzzling. Their net income is listed at $30,000 a year, but their fixed costs are 126%. That's a huge red flag. It means they spend more than they make. But then we look at their net worth. They have assets of $1.2 million, $552,000 invested and $206,000 in savings. That's a huge amount of cash alone to have in a savings account. Their debt is $71,000, which gives them a net worth of $1.8 million. These numbers just don't make a lot of sense. Who makes $30,000 but has $552,000 of investments and $1.2 million in assets? I wanted to understand all of their numbers, so I brought in our partners at Facet to analyze their numbers and help them understand their exact options customized to exactly what they want in their rich life. I am not a member of Facet and have an incentive to endorse Facet as I have an ongoing fee-based contract for cash compensation based on this endorsement. All opinions are my own and not a guarantee of a similar outcome. Facet is an SEC-registered investment advisor. Investing involves serious risks, and past performance is not a guarantee of future performance or success. My opinions are included and should not be interpreted as a recommendation or research regarding any investment or investment strategy, legal or tax advice. The Facet-provided scenarios discussed are based on inputs provided by Kate and Keith and are based on industry-standard assumptions. This information is for illustrative and educational purposes only.

I looked through your financials, Kate. You've earned an average of approximately $13,000 per year over the last decade, and you are now inheriting $1 million. Do you think you're ready to handle it?

Um, no, probably not. Otherwise, I probably wouldn't have reached out to you. So I feel as though I need to have a better understanding, a better education in order to make the right choices because otherwise that money won't get touched.

Okay. Keith, what about you? Where are you in this?

Uh, that's a good question. I'm constantly trying to make sure that nobody thinks I'm here for the money.

As in you are worried about people thinking you're like here to latch onto that?

Yeah, and it's weird because nobody thinks that. It's just this weird underlying current, you know, I don't wanna make a wrong step and have somebody question, you know, like, did he only do that because we have money? Or, you know what I mean?

If we have an awesome conversation today, like 10 outta 10, what would each of you walk outta here with?

I would have a strong sense of a plan. It feels like right now there's all sorts of puzzle pieces and no cohesive way of understanding how they fit together. Mm-hmm. It feels like in order to understand what's possible, I need to understand how to organize it all.

Okay, a plan. Got it. Keith, how about you?

I think I would walk out of here with a wife that feels like she's got her plan in order and she doesn't have to stress about it, and we can go out to dinner and not worry about, about what we're spending on dinner.

Okay, let me read back what you both told me because it's really important for me to know what you want to get out of this. So Kate, you said 10 out of 10, we have an amazing conversation. You would walk out of here with a plan. Keith, you said 10 out of 10, amazing conversation. Kate would walk out of here with a plan. Yeah.

Okay.

What's the tenor when the two of you talk about money? How would you describe the feelings you have?

We have plenty of paths of talking about money that end up in hurt feelings or defensiveness. I have two kids from a previous marriage, and Kate's an amazing person in their lives and is very generous, and that's not really the issue. But the issue is when something comes up and I say I want to throw $50 at one of them for thing or another, and Kate asks a perfectly innocent question like, why? Or, is there something else we could do? Like, could we get them a gift or something like that? I instantly knee-jerk to defensiveness and feeling like she's questioning why I want to spend $50.

And then what happens?

I get defensive and closed in, and she senses that, and she gets defensive and closes in, and then we kind of wrap up the conversation and wait till the dust settles.

Do you spend the 50 bucks?

So I have like occasionally over the past few years done some web development and I will often go to that money before taking out of our money so that I don't have to ask for permission. I will tell her about it. I'm not being secretive or anything about it, but I'll just take from that money and do the things I want to do, whatever they happen to be., so that I can just do it because it's my money and I don't have to ask for permission or anything like that.

Would you say it works?

It works because we don't talk about it.

Okay. Sounds familiar. Sounds familiar to a lot of couples. As long as we can avoid talking about money, we're okay. It's when we talk about it, that's when the fights start. Okay.

I wouldn't call them fights.

Well, I mean, yeah, you know, one person asking a question, the other one interpreting it another way, then both of you retreating and not talking about it. That sounds like a fight to me.

Sure. I mean, it is.

Can you tell me what you do for a living?

We have been wedding photographers from the beginning but had to downsize that business because of health issues that I've been experiencing. So we still do freelance photography work, but it's more like smaller scale portraits and proposals. And then Keith had been working as a handyman before he met me, and so I joined him in that. So we just started transitioning into being in Hawaii half the year and Maine half the year. And so in Maine we do the photography more, and in Hawaii we do more of the contractor type work.

Okay, so you have handiwork. Part-time and wedding photography part-time. Those are the two jobs. I just want to get to your numbers. Alrighty. Kate, can you read off the words in bold and then the number in full next to that? Let's do that for this entire box, please.

All right. Assets, $1,205,000. Investments, $552,000. Savings, $206,000. Debt $71,207. Total net worth $1,891,793.

Okay, great. And let's go down to your income here. Keith, can you read off your combined gross monthly income?

I think it says zero.

Yeah, but then your net has another number. What's the net?

It says $2,500.

Okay, so It would— you couldn't calculate the gross, so you just put the net, right?

I have no idea where we got those numbers.

Okay.

Kate?

It was so hard. I, I just took the last year and figured I would just use that as the answer because it changes year to year and it feels difficult. And so I took the last year and I just went through and added up everything that we brought in from that. And then I started getting really confused and I kind of lost steam and just said, well, I'm not sure, so I'm just gonna fill in what I know.

All right. So you have $2,500 a month take home. That's combined $30,000 a year. Have you always made $30,000 or did that change?

Nope. We were making significantly more before I got sick and hope to get back there.

How much were you making at the peak?

I would say at the height we were probably just over $80,000.

Okay. So $80,000 versus $30,000, significant difference.

Okay.

Do you mind if I ask about the illness that you've referred to?

Sure. I got sick with COVID about 2 and a half years ago, and that basically ended up in what is clinically called long COVID. But is chronic fatigue syndrome. So I haven't been able to have the physical energy to sustain a lot of work.

Mm.

Oh my gosh, I'm so sorry.

Thank you.

How do you make that work with the two businesses that you run?

It's essentially where Keith comes in. His involvement allows me to keep working. So if there's something that I am not having the capacity to do, he steps up and takes on more. And so that's been something I'm super grateful for.

Keith, what was it like for you when Kate got sick and you realized for the time being you had to step up? What was that like for you?

It felt good to be able to be in a place where I could do that and know that we were in a place financially that we weren't gonna lose anything. That felt good. It also feels good as a partner to be able to say, you take what you need and I'll cover this. We had a lot of great fill-in photographers, but realized that I didn't really enjoy wedding photography as much as I enjoyed working with Kate.

Yeah.

Well, that's sweet. It's really quite beautiful to see teamwork in action. I'm sorry you got sick, Kate, but I really appreciate the way that the two of you function as a team. It's really cool.

Thank you. I appreciate it. We've come a long way and I'm super grateful for the journey despite having had to take it.

Did you have medical expenses from the time of long COVID until now?

Yeah, my parents have been covering them, which I recognize how privileged that is and am grateful for. So they have taken all my medical expenses.

Wow. Do you have a sense of how much that costs?

Somewhere in the ballpark of, depending on the year, $25,000 to $30,000.

Okay. Per year? Yeah. Okay. Got it. Okay. Can we just talk about your net worth for a second? Your net worth is $1.8 million. That's quite striking compared to an income of $30,000 a year.

Yeah, it blew me away.

How you were—

you didn't know it.

No.

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Zocdoc.com/Ramit. How'd you get $1.8 million in net worth?

A lot of privilege. My parents have set me up in a way that I didn't have to incur a lot of debt, so I didn't have college debt or a lot of the traditional debts that people would incur— auto debt, anything like that.

So they paid for your college. Fine. They paid for your car? Yes. They pay for your medical. We know that. Housing.

They pay for that in a roundabout way. Yes. Because when I first took out a home loan, I got a traditional mortgage and then lost my job. And so I took a private mortgage out through them.

Through your parents? Yes. What was the interest rate they charged you? 3%.

3%.

Yeah. I kind of liked that they charged you interest at all.

That's cool.

It had to be legit because they were advised that if it's too low, then it's considered a gift with the IRS.

Yeah.

So it had to be somewhat legit.

Okay. So yes, you had a lot of help from your parents.

I understand that. But that doesn't automatically mean you have $1.8 million. Did they put the money in your investment accounts?

They put the money in my trust. So that, but no, the money from the investment accounts is from, I'm just a saver and I sold my house and made a profit and so I put it in an investment account and.

Mm-hmm.

That's pretty cool. Yeah. So I have always, before Keith, lived really minimally and just stockpile.

What's happening right now, like with your body language, you look very embarrassed, like you're on your back foot. Why is that? Like, even right now, in this very second? Yeah. Why do you have a smile like that versus a smile like this?

Because I haven't really, like, allowed myself to enjoy a lot of things in life. And so I've definitely done a lot of changes in the last year. Keith can probably attest to. But I have something to show for it in numbers. But what do I have to show for it in real life?

If you're thinking, oh, boo-hoo, another high net worth couple that's struggling, listen closely. I want you to pay attention to how Kate talks about this wealth. It's honestly heartbreaking. See, everyone thinks that if they could wave a magic wand and have a million bucks, that all of their financial problems would be solved. That is not true. And what Kate is feeling is real. The impact this has had on her husband and her marriage is real. This is why I always say how you feel about money is highly uncorrelated with the number in your bank account. And even if you magically had more money, that would not solve all of your money problems. Now, Kate, when we talk about her childhood, she learned some very conflicting views about money.

Listen in as she describes them. Okay, hold on a second. I'm going to put these numbers back up on screen. Okay? Look at these numbers here. In this net worth box. When you look at these numbers, what do you see and what do you feel?

I think there's so much opportunity. I remember saving Christmas money as a 10-year-old, so I always had a big goal in mind. I wanted something for my future and I have done that. And so I'm proud of that. I think where the mixed feelings come in is that I haven't allowed myself ownership.

And notice, Kate, that you're tearing up. Where are these tears coming from?

I don't know. I guess a mixed, uh, a mixed sense of just extreme gratitude and a sense of, I guess, worthiness. I wasn't expecting to get emotional about it, but I feel as though I haven't felt worthy of having that.

The numbers, they look what, too big? That you, Kate, are not worth being almost a multi-millionaire?

Is that it?

Basically. Why is that? Because your parents helped you?

Yeah, I had a lot of— or have a lot of privilege that most people don't.

And, and therefore Can you finish the sentence for me?

Therefore, I have it a lot easier than a lot of people. I haven't earned that. I didn't, I didn't do something to, to be rewarded with that.

It's just luck.

Well, maybe. I mean, it is lucky that you were born to your parents and born in this country and born healthy, all those things. But didn't you tell me you were saving at the age of 10?

I mostly did that out of fear.

Mm-hmm.

I mean, this goes back to my family story, but being raised with a kind of Depression era left me feeling like if I don't save, I won't have. And that was scary. And so it was more a learned behavior than anything else.

Do you think it's possible for you to feel worthy of your money?

Ultimately, yes. And I know that because I've been doing a lot of work around it and I've shifted the needle quite a bit. And so I have no doubt that I can continue to do so and no doubt that I'm on the right path.

Okay. But you're not quite there yet, it sounds like. No. Okay. Keith, anything you heard just now surprise you?

No.

I think that Kate rationally understands and believes that she's worthy, but emotionally doesn't understand that or feel that.

Right.

All right.

Let's keep looking at your CSP. All right. We have your fixed costs at 126%. So that means that you are spending more than you make every month.

Yep.

Okay.

What do you feel about that?

I feel like it's scary because that's not a situation that has occurred to us before.

So you're telling me before when you used to make like $80K or so, you were making more than enough?

We were making more than enough and we were investing.

Okay. Okay. And now you're not. You're spending more than you make. Your fixed cost total is $3,148. Looking at the numbers, it's quite interesting to me. The rent is nominal, $1,250. I mean, you have a car payment of $150. What is that, gas?

That's gas.

Yeah.

Yeah. Groceries are $600, phone $200. Nothing is alarming at all. There is a $643 debt payment.

What's that?

Right before I got sick, we purchased land that was going to be our future dream home.

Okay.

And then summer home. Yeah. Things got derailed, but we took a loan out for that.

What's the interest rate?

It started out at 5%. It'll be bumping up 2% and then it'll go up 4.25%.

How, how big is the loan?

7.

I think the original loan was, uh, $80,000. And what we did was took $80,000 of our investments and put that into a separate account. With the intention of after the interest rate went up, we could have the option of using that investment to then pay it off.

Okay. That's why you have $206,000 in savings.

In part because we didn't know where to put it.

All right, fine. So you're spending more than you make, but the reason is not that you're spending some crazy amount on food or rent. It's that you don't make a lot of money. Okay. Right. Do we all agree? Yep. Yeah.

Okay.

And yet you have $1.89 million of net worth. Quite interesting. Keith, what do you make of this?

Kate does the finances. She takes care of it. And I, I never understand how our finances work.

Have you ever like wanted to get involved in the finances?

No, it's nice not having to deal with it. I, yeah.

Okay. And has Kate ever tried to get you involved in the finances?

I think she wants me to be a part of it because of the situation. It's just this weird emotional thing for me. I've just felt like I guess maybe I felt a little out of place.

Hmm.

Tell me more about that phrase.

I don't want to be making decisions and have some person that doesn't exist essentially question my motives for why I'm forcing a decision one way or expressing an opinion on another way. Okay. I don't feel entitled to the money that we're spending.

Don't you make it?

Yeah, and I know that makes no sense, but because I came from a place that is very different than the place that Kate came from, I just feel like we're living a life that's twice as expensive as the money we're bringing in. And I guess maybe I just didn't want to upset the balance.

Um, Kate, did you want him involved in the money in the beginning?

No, I was like, yay, I finally got someone who will just let me do it. Because normally my relationships had kind of been the reverse, where it's like they I was always the one that was told I was kind of the drain or the drag. And so being in a relationship where I was told you can be in charge felt so much safer to me. And so it definitely rode that for a while. And then I was like, Keith and I have this amazing relationship where when we come together, we do stuff that is greater than what we do when we're apart. Imagine if we could do that with our finances. How cool. And so I felt like we have this great opportunity to be partners in this. And that's part of my dream, which is why I wanted to start down this journey.

Okay. Let's take a look at some other numbers. I understand you're in the process of selling your house.

Yes.

Can you tell me how you came to that decision?

Ooh. When the pandemic started, we ended up spending more time at the family vacation home, which is a couple hours north of here. And so going on almost 5 years, we haven't really been using our home. We went through iterations of let's rent it out, or let's do short-term rentals, or let's just have it there when we think we want to go there. And just finally came to the realization that it's not doing us any favors. And if anything, it's causing stress and a drag, um, financially and emotionally. And so we decided to switch up our life pretty drastically. And we also felt like the house is worth a lot more than when we bought it. And there's a really good opportunity there that we could be making that money work for us in better ways than the house is working for us.

Gotcha. Okay. Sounds reasonable. How much do you expect you'll make once you sell the house?

I ran the numbers and then went conservative and came up with $550,000.

Nice. So you'll take home $550,000 after you sell the house?

Yes. We tried to fill out the CSP in anticipation because it's already under contract and deal's done. So I filled it out as though it was already transferred. And so when I say what our house payments are and zero in utilities, that is as of 2 weeks from now when we are not in a house.

Okay, great. So then When you are paying $1,250 a month, that means you don't own a house. Correct. That's your Hawaii rental. Yep.

Yeah.

Okay. And then your guilt-free spending indicates you negative 26%. Here's the question I wanna ask. Do y'all like spend money on anything fun?

Yeah, we actually did this exercise for ourselves for 3 months factoring what we spent eating out.

Good. What'd you find?

We found in the first 2 months it was just above $800, and then we decided we were gonna try and change that. And because we realized— it's not that we don't enjoy eating out, but we realize that a lot of the time that we end up eating out isn't because it's an intentional plan. Yeah, it's because, oh, we didn't get around to figuring out what we're gonna do and now we're hungry.

Totally. So were you able to cut it back?

Yeah. I can't remember what the number was, but it was a couple hundred. Okay. So more like $600,000.

I like how matter of fact you are about some of the money stuff.

It's quite striking. Like, okay, you're like, yeah, I track my numbers. Like, of course I ran the numbers on this. I know it's going to be $550K. Boom.

Matter of fact.

Oh yeah, we started looking at our numbers for eating out and we dug into why and then we decided to cut back. So we did like, boom. That's the kind of energy that I love to see with money. I noticed that when I compared that to the way you talk about some of the other money stuff, there's a lot of facial expressions, there's a lot of references to privilege. You notice the difference in how cool, calm, and collected you are over here versus how, uh, much agony there is when you discuss some of the other parts of money?

Yeah, 100%.

Okay. Okay. Okay.

Good.

How are you currently covering the difference between what you earn and what you spend every month?

That would be from our savings.

Okay.

You take from your savings, you cover your expenses. How does it feel to do that?

I think in the beginning it felt uncomfortable and not smart. I've tried to kind of tone down my anxiety around it because I recognize that, well, when you looked at net worth, it's not like we're in a really scary place. So I feel like there's opportunity to make some of our investments work for us to help cover the difference.

The way that you're spending is basically how every retiree spends. Are you aware of that?

No.

Okay. So most people don't think about this at all. They don't really think about how retirement works. When you retire, you make basically $0. So your income goes all the way down. So how the hell are you going to pay for monthly expenses? You draw from your savings, you draw from your retirement.

That's basically what you're doing right now.

What do you think about that?

It's an interesting question because I think a version of myself from a few years ago would have felt really uncomfortable with that. And the version of myself today feels a lot more comfortable with it. And I've had some challenges, and I'm okay with being kinder to myself and accepting the ability to do something like that.

Did you catch what Kate just did? A lot of people do it on this podcast. Notice the wording. She said, well, I'm better than I was 3 years ago. Of course you're better. That's like me saying I didn't know how to walk when I was a baby, but now I know how to walk. Yeah, I've gotten better. People answer this way when they know that they are not actually realizing their potential, but they don't want to admit it. So instead of comparing themselves to what other people at their level do, they'll say, "Well, I'm better than I was a few years ago." It's like I'll ask someone, "How do you feel about being in $10,000 of credit card debt?" "Well, it's better than when I had $40,000." Yeah, it's better, but we're not comparing you to yourself of 5 years ago. I'm comparing you to other people who have no credit card debt. To live a rich life, we have to be honest with ourselves and the people around us. And that means being very careful about who we compare ourselves to. I want you to listen to yourself and catch yourself when you do this. Sure, some people are too hard on themselves, but a lot of people are too easy on themselves. If I ask, how do you feel about having $10,000 of credit card debt? It's actually not a good answer to say, "Well, I used to have $50,000." It's a great answer to say, "Look, I'm proud of how far I've come, but I know that $10,000 of credit card debt is not acceptable. And here's my plan to work it out." We all know somebody who does this, somebody who minimizes issues and compares themselves to how they used to be 10 years ago. If you know this person, send them this episode and then DM me. I'm curious what their reaction is. In my 20s and 30s, I did a lot of stuff on my own. I was very philosophically against middlemen. We even did events like Forefront where hundreds of people came to our conference and we planned it all ourselves. We booked the space, we planned the activities, we secured speakers, we sold tickets, we ran the event. That was a really big learning curve. But over time, I have learned that there is value in paying for people who are really good at what they do, and that's why I use Upwork. Recently, my team and I have hired a content editor to help with emails, a graphic designer for a new product, and a developer who's helped us update our website. Posting a job on Upwork is easy.

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I want to get to the bottom of Kate feeling scared about spending money. So listen, as I ask them about their experiences with money growing up, let me understand a little bit of how you grew up, Keith.

I'd like to start with you. What did your family say about money when you were young?

I was an only child. We didn't have money discussions. I was fundamentally not taught about finances or money or anything like that.

Did you go to college?

I didn't go to college. I had started a masonry company and was doing very well that I was running with my then wife, and it was very successful, making a significant amount of money, but spending a significant amount of money. 2008 happened and we lost our house. We filed for bankruptcy, lost cars, trucks, lost basically everything, ended up in a rental unit. And it was a horrible, horrible time. The business dried up and we were struggling, went through divorce after that, took some pretty serious control of our finances and did really well with getting my credit up to a good point and dealt with being in a good place financially to get my own apartment and have my son living with me and like doing well in, in the driver's seat.

When did you become a passenger with money?

When Kate and I moved in together.

So you were just like, okay, she's got it.

There wasn't a decision. We didn't sit down and be like, hey, who wants to be in charge of money? We got together, we started living with each other, and Kate would make comments that would make me realize that I didn't want to have that kind of conversation. And it didn't feel like she wanted to have that conversation. She was taking care of the money and I was fine with that.

It's funny, this is how most couples slide into certain roles, and often it's the money person. That person is often the one who makes more, although not always. But almost never do couples sit down and say, okay, let's have a structured conversation about who's going to do this and what about that. It's just like, oh, I got this. Like, oh, do you have a savings account? No.

Oh, well, we should probably do this.

And then the other person starts to kind of like back off, and the other person kind of goes forward and those roles are established. And gosh, it's so much easier to get it right from day one. It's possible to recalibrate it, it's just hard.

It's harder.

But if you both have a vision, you know, like, this is what I want in our relationship, this is what we want, it can be done. Kate, I know with your parents, they were quite wealthy. How did they make so much money?

My dad started a company when I was 5 years old, maybe, and it grew into a multinational corporation. It's environmental consulting. He calls it luck, but there was a need and his company filled that need and he did well. So I figured they obviously had means. I knew that they were paying for my college. I knew that they were paying for my brother's college. I had no concept of their net worth. I had no concept of how much money my dad made on an annual basis. I had no concept of how much money they spent. All I had concept of was what I was hearing. And that was stuff from my mom, like, I don't think we're going to be able to spend much on, on your Christmas gifts this year. Goddamn it. And my mom intercepting the mail when my dad would order a pair of jeans and then wrapping it and calling that his Christmas present.

What is that? So she has a scarcity mindset?

Oh, big time.

And did that come from her mom? Yes. Okay. Yeah. So that's passed down. Grandma to mom, mom to daughter.

Wow.

Like clockwork. Like right out of a textbook. Trace it all the way back to the Depression era. Maybe even generations before that. Yeah. Haunting the way it works.

Yeah. And on my dad's side, a sense of guilt around money. He came from a really poor coal mining town in West Virginia. He was one of the few who made it out of that town, and he seemed to have a sense of guilt around that. And so has always lived below his means because they feel like they can't show their wealth.

Oh, really? Do they feel Like, I'm worried about, quote, what others will think about my having money. Straight from what you wrote. Yep. Passed down just like a textbook from dad to daughter. You want to rewrite these scripts or what? Absolutely.

Okay.

I think it's time. I think it's time for both of you to rewrite your scripts. The beautiful thing is at least you're conscious of them. It's quite hard to find out what scripts are invisible. That's why they're called invisible scripts. They're not obvious. But you've already identified some really powerful ones. Gosh, now that we understand how we got here, let's talk about the future. You shared that your current vision of this chapter of your life is to live part-time in the Northeast half the year and half the year in Hawaii. What is the vision for the next 10 to 15 years? Tell me more.

I guess we've committed to doing that for the next 5 or 6 years. We have family in Hawaii, so until the kids are through school and on their own, being a part of that family. And then beyond that, whether we choose to keep doing the Hawaii thing or choose another location, it'll probably maintain where we're splitting our time between places. But ultimately, I think Keith and I share a vision of wanting to have a sense of place and community and purpose.

Let me ask, if you had unlimited permission, how would you spend your time and your money?

It's a hard question to answer because I don't know that I've given myself permission to ask that question.

Well, I'm giving you permission. Go ahead. I don't know why you need it from me, but if I have to say it, I'll say it.

Go ahead. I, I think there's a, there's a sense of wanting to still have work, doing something that we're passionate about. It gives us a really good sense of purpose and drive, and we don't wanna lose that. But needing to work for a paycheck is not something that would be part of that vision. So doing something that we enjoy, something that we're directly impacting someone else, whether it's fixing something in their house that, you know, an elderly couple that can't do it on their own, or taking photographs and documenting someone's love story, gives us a lot of joy, but then being able to take breaks from that.

I pause you. Do you find yourself getting lost in your own story? Yeah. A rich life vision is crisp and compelling. Like, I love that you just said work should be optional. That's powerful. Telling me about fixing somebody's nails in their house or something, I truthfully don't care. I don't think you care either. Can you give it to me again in 1 or 2 sentences? If you had unlimited permission, how would you spend your time and money?

I would spend my time being a part of community and enjoying the parts of life that are meaningful to me. So when we're in Hawaii, being a part of the culture and learning about the culture, whether that's through food or entertainment or volunteering, Mm-hmm.

Keith, you wanna add anything?

Yeah, I would, um, I spend my time with, um, friends and family. I would try and, um, spend my time more with strangers as well and try and make new friends. Um, and then as far as how I would spend my money, I, I would spend my money on, on those things like taking friends out to dinner or having friends over for dinner. Oh, and also travel, like I would love for us to travel carefree.

Out of curiosity, can I ask, like, when was the last time you spent money on friends, taking them out to dinner?

We took family out to dinner, to a really nice dinner a couple of months ago.

Okay, cool.

I love that. So, you know, people's rich lives have clues. So if someone tells me like they want to travel, but they haven't traveled since 1979, maybe you just don't like traveling. It's okay. It's okay to admit that. When you tell me I want to spend money on friends and family and you go, oh yeah, 2 months ago we did it, that's a great sign.

I guess it was yesterday, actually.

Okay, great. You also shared with us that your dream is to travel more, do passion projects, uh, work for joy, not because you have to. The travel, you have a sense of where you would go?

Is this me or Kate?

Well, you guys are married, right?

So we'll travel together, hopefully. Um, I'd like to think outside of the box because travel for me has always needed to follow a script or something, and I don't know why.

Uh, like what?

Like you go away to a, to a foreign country and you stay in a hotel and you go and do all the sites, and that doesn't necessarily resonate with me actually. And Like, our honeymoon was an example of— that was the only trip we have ever taken, or only trip I've ever taken, where I went someplace, only one place, stayed put, and just like chilled out and just relaxed and had a great time. And the concept of like, oh, what if we like chartered a sailboat and like did a 3-week sailing trip? That would be really freaking cool. Like, why does the travel have to fit some kind of script? So I'm shifting what that looks like from what it used to be.

It's quite a powerful metaphor for life. You know, this idea of like, I have to do this scripted thing. So many of us grow up thinking this myself. I had invisible scripts, go to college, get a job, blah, blah, blah. And I think in your case, there are a lot of stories, Kate, since you were young, follow this path. And that path actually doesn't even seem like it even came from your parents. It came from their parents. So you're still being informed by somebody who grew up in generations back and, you know, all these stories that were told in the Depression, which are just not relevant anymore, especially to somebody with your kind of wealth. So I love that you apply that to travel. I think you could apply that to your money in your life as well. Okay. Can you all do it? Like, could you go travel to whatever, Australia, whatever place you want to go to tomorrow? What's stopping you? How come it got so quiet in this room? What the hell's going on right now?

I definitely need to gain a better sense of confidence because of my health. So that's a kind of elephant in the room for me.

Totally fair. Is there a sense of like what you might have to do or how long that might take?

And how long it might take? Not sure. What I have to do. I think that's subjective. Like, I feel like, um, yeah, I'm definitely taking some good steps to heal and making some amazing progress. But regardless of that, I think I can still have the sense of confidence I need to anyway. Like, if I maintained my level of health right now for the next 10 years, I still think it's entirely doable to have meaningful travel experiences. It just means that I have to be willing to commit to paying a certain amount to make it more accessible for me. What does that mean? Like renting a, I don't know, a golf cart so that I can get around the resort because I don't have the energy to be walking everywhere.

I'm sorry, is this like some like hypothetical? Because like this seems— if this is what's stopping you from taking a trip, Like, we can knock this out in 5 seconds. Is it— can't— it can't be that you can afford a golf cart. And actually, the resorts you could go to already have golf carts. If it's a health issue, I totally respect that. I'm not going to push somebody to travel when they're not well enough to go. But if you're telling me, hey, I have to manage my health carefully, I can't do the same things I could have done 10 years ago, I need to be thoughtful, it might cost a little bit of money, that's a different story. So can you clarify for me which one it is?

It's definitely, I like travel looks differently for me because I have to build in a lot of buffer. A plane trip will take a lot outta me and there'll have to be some days where I do nothing and have recovery. And then there's just some unknown in that. Well, and this is where I think the confidence thing comes in. Am I gonna be okay? Because I just have a fear story of like things looked pretty grisly a couple years ago, and a fear of, of being back in that place and in a place where I don't have access to what I need.

Yeah, it's like when you're in that place where you don't even know if you'll be able to travel anymore, you don't even know what's going to happen, and then you start to see a light, like, oh my gosh, I feel a little bit better. I'm not the same, but I still feel a little bit better. But it's hard for your mind to catch up and be like, I have gotten better. Let's just play it out, if you don't mind. I'm gonna gently push you on this. I want to emphasize, nobody here can make you do anything you're not comfortable with. And trust me, I would never push anybody to spend money or do things that they don't feel good about. Okay, I'm gonna take that off the table right now. So if I'm like, hey, you're gonna go skydiving in Costa Rica for 6 weeks, obviously that's off the table. What would it look like if you were able to build up your confidence for traveling, something that's important to you, just one step at a time?

Like physically, what does that look like to physically, mentally, all of it?

I think maybe I've already been doing this. I mean, going to Hawaii was kind of a big fricking deal. And I definitely got a lot of confidence from making that happen and being able to do that trip. Continuing to take small trips and, you know, like, let's drive somewhere for the weekend is definitely a confidence builder and a whole lot more comfortable and safer to me than going to a foreign country where, you know, everything is a little bit different and I'm not sure how to navigate. So I think I can start building from there.

I love that. Do you think it would be nice to have some help in this journey in terms of emotional, or what kind of help? Well, let's say you decide to go the other side of the island. I don't know. Or let's say you're in the Northeast and you decide to take a day trip and stay somewhere nearby. Are you planning that whole thing on your own? Yeah. Seems like a lot for someone who's not confident.

It is, but I feel responsible for that in a way.

Because you got long COVID, so you're responsible?

No, uh, because I had a lot of control issues that, that made it, uh, unappealing for my partner to be partaking in those things with me. Um, and so I recognized that it was a lot easier and safer for Keith to just back off and let me do it. And at the time, I wanted that because It made me feel better having that level of control.

Is that serving you anymore?

No.

You want to change it?

You know that moment where you're just sitting there eating your breakfast and then you remember something you did in 4th grade and you go, fuck.

For me, I remember getting absolutely roasted on YouTube not long ago for calling something an emoticon.

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R-A-M-I-T. It made me feel better having that level of control.

Is that serving you anymore?

No.

You want to change it?

Yes, ultimately yes. I would like it to be not just me who's doing the planning.

Okay, so what would that look like? Perhaps in that answer, Kate, you shouldn't even be the one answering it.

Keith? Oh, can I answer? That's great, because I know what it looks like. It looks like Kate letting go and letting me take care of it, and and not going in and fixing it after I've done it.

Let's do an example. Kate says, I'm feeling like I want to take a one-day, one-night trip somewhere just to build some more confidence, to feel better, somewhere relatively close by. Keith, can you help? So Keith, in the old days, what would happen?

The first thing that happens for me is I get anxiety because I know what this process looks like. Kate has much more experience in it. These are our roles, right? She does the trip planning and the finances, and I do the things that I do. That aside, though, there have been several times where I've been like, you know, I can do this, or she's gotten to a frustration point and said, can you do this? Either way, I have begun the process of doing it. It takes me longer because I don't have the same skill set that she does, but I go through it and deal with it, and ultimately Like, let's say it involves me looking for a rental car or booking a flight or figuring out where we're going to eat.

Mm-hmm.

I'm not using the correct discount site, or I'm not recognizing that there's fees for a particular thing and, and we shouldn't be paying the fees for an extra bag. And so we should go with this airline. And well, our rental car company, this one gives us a discount and this one doesn't. And so all of those kinds of things.

And what does that feel like to you, Keith?

It just feels like I wish she would've done it herself in the first place rather than me doing it. That's what it feels like.

Hey, are you recognizing any patterns when you do that to Keith from what your parents have done to you?

Yeah, I can see the pattern.

What's the connection?

Well, it's maintaining control. Yep. And taking away a level of participation and agency in the process.

It's disempowering and Mixed messages. Hey, I would like you to do this, but also you got the wrong rental car, the wrong thing. Why didn't you use this site? Oh, and one last thing, just like your parents want to optimize their taxes for whatever bizarre reason, you want to optimize discounts. Why? Both of you trying to save a marginal amount of money, but in the process of losing the most important thing of all, which is connection. With the people you love. So many similarities. We all do it. We all behave in the way that we saw our parents behave. And sometimes it's great because our parents were great models, and sometimes it's not, and we don't even realize it. Keith, would you be able to do it if she asked you to help plan like a one-day, one-night thing?

Oh yeah, of course I could. There is an aspect of frustration with me about it because I don't have the same skill set, and I know that Kate does. And so it would be much easier if she would do it But yeah, of course I can.

Well, I think maybe we just rewrite that script. Like, all right, you're not as good at travel planning as she is. Okay, so what? The first time you do it, you're gonna, you know, pick a restaurant that's closed and you guys are gonna get there in your rental car and you're gonna realize, oh my God, it's closed. And you're gonna laugh and you're gonna joke, and then you're gonna get on the road and find the next restaurant and it's gonna be a funny story for the rest of your life.

These are low stakes.

So just the way that Kate, you want to build up confidence, is the same way that Keith has to build up confidence. Both of you, how do we feel about this, this idea of potentially getting Keith involved in this very worthy goal of building up some more confidence around your rich life?

I think it's a great progression. Ultimately, my desire would be that we're collaborating. Mm-hmm. Because I think the experience will be that much richer for the both of us if we're embarking on a plan that excites us both.

I think that would be great. I think you probably work towards that. First time, maybe it's just like, hey, can you help plan something? Anything less than $3,000, like whatever you think. I just want to relax. Keith, could you take and run with that? You have a, an amount. A basic vision and then you're off to the races. I like that. Okay, so we talked about travel. What else? Is there anything else that'll be part of your rich life, like in the next 12 months?

Yeah, I want a new pickup truck.

Okay. Do you have the money for it? Obviously. Oh, okay. What's stopping you from getting it?

I think the hesitation kinds of things that we were just talking about. Should we buy new or should we buy used? Can we get it? Can we get this one here? Can we get one with more mileage that has less money? Money on it. Can you know, all of those types of things that cause me, and have caused me in the past with similar types of things, to throw up my hands and let her take the reins with it.

My candid feedback on this is that you could probably afford a truck, but I wouldn't get one right now. I wouldn't get one until you have your accounts set up correctly. I wouldn't get one until you both feel empowered with money around smaller purchases. I wouldn't get one until you're both actively involved with the finances. A truck is a big purchase. It's not just a one-time thing. It's—

no, it's not that big.

It's not big? How much would a truck cost?

Like, I think the one we're looking at, it's like $36,000.

That's a lot of money. We got to understand this: you two have avoided money for a long time. In fact, your entire relationship, Keith, you've been in the back seat. So getting to be partners doesn't start with making a $36,000 purchase.

You all have to build up step by step.

That's why I'm talking about small steps. Taking a one-night trip, that's a small step. Maybe next time you go to the health food store, let's get dessert. I'm just talking about ways for you two to meet as partners, build those skills, and then you certainly have quite a bit of money to be able to dream bigger than you ever thought. How do you feel about that?

Yeah, I mean, that all sounds great. The truck is also a practical decision too, for wanting to do the handyman business and not being able to do it out of a Chevy Bolt.

Okay.

How do you feel about the fact that you— that truck is more than you earn in a year?

Yeah, I mean, that's, that's also a— yeah, I, I feel complicated about that.

How's that sound?

I guess I'm here to try to uncomplicate things. Like, y'all have done a nice job of tying yourself up in cobwebs. I'm here to try to help you simplify things and get to the core levers.

Yeah, I guess it's a situation of like, one of them has to happen, right? I can't run a handyman business out of the back of a Chevy Bolt.

Do you need to run a handyman business?

Well, so we're talking about money, and I mean, I'm fine not running a handyman business. We can figure something else out.

I feel like that's the first thing is like, what's our rich life? Is it running these businesses?

Multiple? It's a great question.

That's first. And then we get down into the how. We don't buy a truck and then we're like, oh, I don't even want to do this business now. Let's talk about something that I noticed on the CSP under assets. You wrote not including trust. So tell me about this trust and tell me when you got access to it.

I don't know when my parents set it up, but I learned about it in my late teens. And at that point they showed me a statement from it, and I believe it was around $800,000.

It was $800,000 in your teens?

Yes.

What? Yeah. And I was told that it was to be used for medical and education.

Okay. What's the current value of the trust?

This is what I think is really bizarre, because the current value is $1 million.

What, like 20+ years later?

It's almost 30 years.

Okay, hold on. Do we have access to this? Can we, can we open it up?

We can.

All right, show that on screen. I gotta find out what is up in this. Where is this trust invested in? Holy shit. Can you just imagine, as you're pulling that up, I'm just 30 years. So if it was $800K, let me just do the math. $800, 1.6, uh, 3.2, 6.4. That's 7. Basically, it should be a ton of money. Where is it? Holy fuck. What in God's name is this? Oh my fuck. Oh my God. Hold on.

I need to jump in here because I am freaking out looking at these numbers. Quick math shows that over a 30-year period, $800,000 invested, even if you don't add another cent, would turn into about $6 million. $6 million. But today her portfolio is only worth around $1 million. What happened to the $5 million? We're going to find out in part 2. Next week. I am not a member of Facet and have an incentive to endorse Facet as I have an ongoing fee-based contract for cash compensation based on this endorsement. All opinions are my own and not a guarantee of a similar outcome.

My parents have always taught me that money is evil, so there's a lot of shame and a lot of emotion wrapped up in my parents and their expectations.

I started just doing math. I couldn't understand why we weren't looking at $5 million.

Overall, looking at this trust, I am absolutely flabbergasted at the returns over the last 30 years. It's cost you millions.

I still don't feel like I have control over it.

This power dynamic has her acting as if she's a 12-year-old girl.

Okay, do you know why you don't have millions and millions of dollars more? I don't know. You know, you're an adult, fully fledged adult. You run a business, but the minute it comes to this, you revert back into childhood.

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