“We only have $2k saved… but she can’t stop shopping”
Kevin and April, a couple with $302,000 in debt and only $2,381 in savings, work through April's shopping habit and avoidance. Ramit uncovers emotional drivers behind the spending and pushes them toward actual change instead of temporary fixes like freezing her card.
Questions this video answers
$335,300
$44,268
Savings: $2,381; Debt: $302,000; Total net worth: $79,949
$11,596
Chapters
Are your kids poor?
No, they're not. Because we're not.
Let me ask April that, actually. What would you consider yourselves, financially speaking?
We're not like, broke. We're not like, poor poor. But at the same time, I mean, we're barely making ends meet.
So, like, what would you call that poor?
For me, I feel like you're poor if you can't go. Like, if you have to check price tags or like, not being able to go out or I don't care about them. And so I don't see how much we're spending. Like, I see that it's not a lot, but then it accumulates and then he's unhappy.
And why are you upset?
Because I'm the issue.
Meet Kevin and April. They're Both in their mid-30s, they have two children, and they've been married for 12 years. Recently, Kevin learned how money worked, and suddenly he's in a big hurry to take control of their finances. The problem is that April has no interest in it. She avoids talking about money. She continues to overspend, and this is causing a big problem. As you listen today, I guarantee there's going to be points that you're frustrated at. I know that I was frustrated. What I want to do is encourage you to listen, to push through, because there are some real insights that you can gain from this conversation. I have a lot of admiration for the guests who show courage in coming on here and talking about something as intimate as their personal finances.
I ask you to respect that. And of course, I'm not going to.
Put up with any rude comments on my social media. Instead, I ask that we have some constructive comments. A few years ago, one of my friends sold her company and made pretty good money. And we were talking, I was congratulating her and she said, yeah, but I don't know what to do with the money.
Now I know what you're thinking. Boo hoo, what a sad situation. I'll help you with that. Okay? Okay, okay.
But in reality, that actually is a challenge that a lot of people face. You've even heard them on the podcast. I said to her, well, good news. You've actually met someone who specializes in what to do with your Money. This Saturday, February 3rd, I'm sharing 25 surprising things you can do when you make more money. Doesn't mean you have to sell a huge company. You could just increase your salary, get married, and have two incomes.
Whatever.
I want you to work the muscle of dreaming big so that as your money grows, so does your rich life. You can Only get this imagination, which my friend desperately needs, but she doesn't listen to this podcast. Anyway, @iwt.com podcast newsletter, let's get to our conversation with Kevin and April.
We were at the house, and I was asleep, and he was awake checking, I guess, the bank. The bank statement. I heard him say something like, oh or like something frustrated. And so then I woke up fully, and he told me about the whole. That I overspent and that I needed to figure it out because we were, like, past, like, I guess, negatives. We went to work, we came back and Hope. I was thinking he wasn't so mad, but it was the opposite. He was so, like, very mad.
And then what happened?
Well, he got a piece of paper and a pencil and told me to figure it out how we're going to pay for the credit cards.
What'd you do?
I tried to ignore it at the beginning, and then I was just like, huh? And just avoiding it. And, yeah, the paper was there and I was there, but I wasn't really doing anything.
And then you started to do it. What happened then?
Well, I realized that we were, like, in the negatives and that I did go past what I was supposed to spend. So I was trying to get money here and there to see how we can pay it off while we're still there.
That's the situation right now.
Just don't. Got paid was the house. Otherwise, the credit cards are still there.
How much did you overspend on the credit card?
Like a thousand more from what we agreed that I was going to spend.
Which was how much?
500.
Okay, so instead of 500, you spent 1500 in one month on the credit card?
Yes.
Okay. All right, Kevin, what was going through your head when you logged in at night?
The frustration came because that's a discussion we've had repeatedly for the past couple of months. And once again, we were in the same situation. We were in the red. Like, in a. In a dark red. I figured it out the past couple of months by moving money out of the savings. Unfortunately, this time I'm not. Hopefully, this time by her doing it, she's going to open her eyes and be like, whoa, what kind of situation are we in?
Okay, and what's the resolution? Has there been one?
Probably tonight or tomorrow. We're good to pay 90% of it. We should be good.
Okay. Okay. Okay. All right. So there is money. You found a solution that almost covers it, and if there's 10% left, you'll get to it next month. Is that correct?
Yeah. That's not what I want. Because for the past what we've been debt free. Like, truly no credit card going month after month for the past nine months.
Now, what was going on before nine months? How much credit card debt did you have, love?
Like 10k?
Yeah, 10 probably. So traveling and things for the house. We had recently bought the house, and so we were getting things.
But the same dynamics overall?
I would say yes.
Wait, what do you mean by when you buy a house? That's it. There's no additional cost whatsoever. Everybody told me that on the Internet.
Oh, like accessories for the house.
Did you not have money set aside for that?
No, not. No.
What was the most expensive thing you got for the house?
The couches, I guess. No, the mattress.
How much?
Like 1k, right? Something like that.
Hold on. Kevin, thank you for not speaking. Speaking up. April, I want to ask you, were you the ones who made the purchases?
We both did. Yes.
Okay. When you buy stuff, do you look at the price.
Sometimes? Yes.
Okay.
I mean, yeah, majority. Yes, but it accumulates because, like, let's say I buy a top for, like, 20 bucks and. But then I have to get jeans and something that matches.
Okay.
Shoes.
I don't mind. I get the feeling you think I'm going to judge you for buying an outfit. Am I reading that correctly?
Because it's multiple outfits and it's. That's the reason why we're here.
Okay. Can we recalibrate what's going on here? I feel like you're playing defense against something I haven't even said. You're worried that I'm going to come and berate you. I wouldn't be good at my job if that's what I do. My goal is not to come on here and tell you you're wrong. My goal is to help you come up with a solution to what's going on here. Is that fair?
Yes.
Okay. So I'm not here to criticize. I'm here to help.
Okay.
Tell me about the travel.
So Kevin's from Europe. Our firstborn was born there. And so to me, I feel like they should always go to, like, their roots, never forget where they come from. Since that was, like, my first year teaching, I felt like I deserved, like, the entire sacrificing nights and graduating at, like, 30 with two kids. We. I decided to go to Europe with the kids for the summer. And so Kevin only went for, like, two weeks, but I stayed there and we rented a car for the two and a half months we were there. And we went to visit Other cities.
How was.
Was amazing.
Yeah. What was your favorite part of that trip?
I think just being back there and reliving the experiences that I had with. But now with the kids, where we got married, the park, the food, the restaurants, everything. Getting on the. On the Talis, on the railway, the train. Just because they were so obsessed with it.
Yeah. How old are the kids?
One is 10 and the other one is seven.
I love seeing the smile on your face when you kind of talk about these expansive things about traveling and taking the kids.
I love it.
What part did money play in the planning of this trip?
Not much. It was just like a swipe and forget about it, like, until we come back. I didn't even think about anything, to be honest. I was just like, shopping and going places.
Okay, and what happened when you got back and you looked at the credit card bill?
Oh, well, shocked. It's easy to just swipe and not think about it. And then once the numbers are there.
It'S like, oh, here's what we've learned so far. April is an avoider. You can hear it loud and clear.
She doesn't know what they spend.
She doesn't know what the bills are.
And even when Kevin realized that she'd.
Overspent again and he handed her a piece of paper to figure it out, what did she do? She simply sat there with the paper in front of her. You can notice that she seems hesitant and at times embarrassed. And so what I tried to do is I try to recalibrate our conversation because I really need her engaged.
Finally, I noticed that when we talk.
About her clothes and her kids, April lights up. Very important. Keep that in mind as we continue on.
Don't go anywhere. We'll be right back after this.
Let's get back to the conversation.
I was pretty much minimum wage. I was mid level management in retail, so that's not much.
How much did you make per year back then?
50.
50,000. Okay, so what was life like back then?
We were living at her parents.
Wow. Okay, hold on. Now, now, now I'm like, I did not know this. You were making 50k. And April, were you working at the time?
No, I was at school.
You were at school. Okay, what type of school?
I want to get my bachelor's degree.
Okay, got it. So you were not working, you were staying at your parents, so you had, I assume, no rent, Is that correct?
Very minimal.
200. So it wasn't anything.
What about childcare expenses?
The kids were in school, so it was free.
Okay, so your expenses were pretty Low?
Yes.
And what was life like? Like, were you fighting about money?
No. It was amazing.
Whoa. Tell me more.
Well, because my parents would. I mean, if we ever want to go eat, they would pay. Or food, they pay. Like, the only thing we needed to pay them was like 200amonth. And so the entire paycheck was for us.
Okay, what'd you do with the money?
Clothes. Or when we went out.
And then what? What happened? Like, why not stay there forever?
No, because it was time to move on. Just the kids were growing, we were my parents. House was too small.
Okay.
So once I graduated and I started my job, that's when we bought the house. And reality hit our faces.
What was that reality?
That I, a little by little, goes to like a whole bunch of like thousands on death.
Huh.
And, well, yeah, that it's overspending.
This so interesting, because when you were living with your parents, you had less money, way less money. But your expenses were very low, like almost zero. So then your income, household income, increases a lot. Yes, but your expenses went up.
Yes.
And what else changed? Or what else stayed the same? Something about your spending, April.
Well, my spending increased.
Yeah. Why did it increase?
Because I was making more.
Uh huh. And what does that mean to you?
It means like being able to swipe it and not think about it.
Yeah, because I worked hard and therefore. Finish the sentence.
Work hard so you could spend hard.
Oh, whoa.
Okay. Damn, that was impressive. I thought you were going to say I work hard so I deserve to treat myself. But you said, work hard so I could go hard. Spend.
I have that in my classroom. Work hard so you can shop harder.
You have that sign in your classroom?
Yes.
What? What do you think? What lesson does that communicate? Wait, what? Hold on. What age are you teaching?
Nine year old, third grade.
Say this sign again for me, please.
Work hard so you can shop harder. In the little library of my classroom.
Sometimes I have to spend four hours digging out a clue from someone's great grandmother. And then other times, there's a sign, literally a physical sign.
Well, it took like another year to now actually pay everything off.
And when you finally paid it off, did you know that it was paid off?
Yes, because we. I froze the other account. Where? Like the credit card that I used, it's frozen and it's to not be used.
Okay, who did that? You or Kevin, the freezing one?
Me.
Okay, you froze your own account?
Yes, I still have it, but I don't use it.
Why?
One, like the interest are way higher on that one. And then we ended up getting a different one, ones that we're currently using. A Chase and a Wells Fargo.
Wells Fargo, yes.
Kevin read your book, and he. And it was one of the, like, the good ones that have the points or, like, the better interest.
You know, Wells Fargo takes advantage of people who look like you and me. You know that? Yeah, they do. They're predatory. And they were fined by the government billions of dollars for going after minorities, people of low income. Kevin knows after he read the book. Did you read the book?
I did.
April, how about you?
I got to chapter one or two.
Okay. Further than most. Okay. At least on this show. Okay. All right. So you froze the account. You have a new credit card, the one that you're. That you have stayed out of debt until just now?
Yes.
Would you say that you're here because Kevin wants to have this conversation, or is it you as well?
Kevin wants it, and I. I mean, I want it too, because I can't go on like this.
How come?
We have two kids, and I want to say for their education, but because of my overspending, we can't.
Okay, that's a good reason. But just to push on that for a second, you said we can't go on as we've been going.
Yes.
Why not? It doesn't seem that bad.
We're breaking even, and we can't give the max that we could for the kids.
I think. I think we've worked very hard. Well, we went through a lot of stuff. We worked very hard to be where we are. And yes, we don't have. We are not high earners. But this shouldn't be our life right now. We shouldn't be bickering. We shouldn't be fighting over stuff, you know, and then during the application, I've been trying, like your book recommends, to have your money dates, to have the money conversation, and it's a complete shell. Complete shell closing down, and I cannot approach it.
What does that mean? Shell? Describe that to me.
That April completely closes down.
Ah. So tell me, you say what? And then what is her reaction?
I try to approach with my beautiful spreadsheet. Did not work.
What? Hold on, hold on. Let's let that settle for a second take. This man takes a lot of pride in his spreadsheet. Okay, so you. And. And for anyone watching, April just completely touched his heart. Like that's. That's their third child. And then she rolled her eyes. Amazing. So you have a beautiful set of spreadsheets.
Yeah, it just. It's just a recap of our spending for the Month.
Okay.
We tried talking about it from there. Didn't really work. There is no really reaction. And at some point, there are emotions coming in from. From her, and I'm like, oh, I did something wrong.
Emotion. Like, what kind of emotions?
Tears.
I cry.
Why?
I don't know. Just seeing it. Like, I see that it's not a lot, but then it accumulates, and then he's unhappy. I'm upset also, so I cried. But then the next month is the same.
And why are you upset?
Because I'm the issue.
Is that true? How so?
Because I'm the one that goes to the store with the kids and where the purchaser purchases purchase.
Yeah.
So I'm the one that's buying the stuff.
Kevin and April had an interesting situation where they were living with her parents, and even while they had low incomes, they were paying almost nothing for housing and childcare. And they described that as amazing. But then when they started earning more and their kids got older, they moved out, and that's where the problems began.
What do you make of that?
You remember how I talk about people being artificially subsidized? This right here is an example of that. Because they never really had any expenses, they never had any skin in the game, so they never had to actually figure out how to make financial choices within their means. This is one of the reasons that I insist both partners talk about money and engage with money. You cannot just have one partner doing it because the other one then becomes artificially subsidized. Not only that, one day, when one person gets hit by a bus, that partner is left grieving and totally defenseless.
Right.
Both partners have got to be involved. So what happened here with Kevin and April is they got released to the world, and they didn't know how to spend their money in a responsible way. Now, I don't mind that they didn't know. I don't mind. None of us are born knowing how to handle money. But what really matters is if they, and specifically April, wants to change. If she does, I can help her. If deep down, she doesn't actually want to change, there's absolutely nothing I can do for them.
So what can I help you with? You're here, April. What can I help you with? And then Kevin will ask you the same question.
Well, mainly for me, the financial commitment of not overspending.
I think I had kind of a mini midlife financial crisis or something like this. And, like, when you run the numbers, you're like, oh, like it's not as bright as it looks. So we need to do something about it. And so we started.
Hold on. Let me get this straight. You were making close to minimum wage for a long time. No problem. Life was good. You were living with her parents. Right.
When you don't save and you don't invest and you don't put Anything into your 401k, you have more money.
That's true. That's a very good point. All right, so then you move, you get a house, but still you're not fighting. There's no problems. But it was only when you started to get educated about money.
Yes.
That's when the fighting started.
And I'm. I'm not going to lie. I'm usually the one initiating.
Okay, so this is quite interesting, April. When you think about getting educated about money, what does that mean to you?
To have goals and to stick to them.
But what happened when Kevin got educated about money?
The fighting began. My crime began.
Yeah. So can we. Can I ask that question again and you give me an honest answer? What does being educated about money mean to you? What happened?
Well, like, it was an eye opener where, like, I didn't know I was spending that much, and I really need to be committed to saving.
Yeah. Would it be fair to say that, like, are you committed to saving?
I feel like I need to, and I have to.
Okay, that's a no.
Well, yes. Like, I need to save and I need to stop buying things.
You ever hear people say, like, I need to go to the gym? Yes. Do those people go to the gym?
We don't.
So can I ask the question again? Because I. I asked, April, are you committed to saving money? And your answer was, I need to. Just like, I need to go to the gym.
Yes, I'm committed.
I don't know what that means. It's just a word. Look at my face. Do I look convinced at all? No. Are you convinced? The way you're talking about it, I mean, halfway.
Yes and no.
You can't make a big change if you don't believe in it.
Yes. Yes.
That was fast. What. What just changed in the last 10 seconds ago? What happened?
Well, yes, like, I, I, I am, and I need to, and I have to, and yes.
All right, I'll take you at your word. I appreciate that. Cool. That makes my job easier. All right, Kevin. So you got educated about money. You shined a light on what was going on, which previously, it was like having an attic where you never go up there, and it's like, ah, who cares? There's nothing up there. And then one Day you go up there and you're like, oh, my God, there's like 30 rats up here and a spider web. And it's just like, this is insane. What happened then when you shined the light?
So the first thing I wanted was for her to start following me along, you know, not to be. Not to be alone, talking about it, and for her to. For her to understand what some of the stuff means. And so I tried to ask her to read your book. The book sat on the night on her nightstand for a month. And every other day I was like, all right, so maybe one chapter a week. All right, did you read it today? Did you do? And Nothing. And so at some point, I gave up.
Looking back now, when you approached her excitedly about this book, what do you think her perception was?
That's a good question. Why should I keep going? It's hard for me to put myself in that place because after reading it, I saw the benefits of it, and we were not in the same mind space at that moment.
I think, well, let me rewind for a second. Let's pretend I came to you five years ago and I gave you this book. I said, you really should read it. So cool. What would you have done?
Not read it?
Why?
Because there was no point for me at that time.
Whoa. Why is that? Why would there have been no point for you?
Because that did not come to any realization that I needed it.
Okay.
Everything was going pretty well.
Wow. I think you're very perceptive. Now, let me ask the question to you again. When you handed that book to your wife and you asked her to read it, what do you think her experience was?
What was she feeling the same? Why would I need it?
Because.
Because everything seems to go well.
Right.
But the part I do not understand is that before reading your book, the numbers were showing something different. And so I was like, all right, let's get. That's the first step to get help.
You know, what if she's not ready to get help? What if she doesn't even see the need for help?
Then that's also a reason we applied.
So for April, when you say everything is going fine financially for her, let's just assume that that's true for a second. We're going to check with her in a minute. Describe that. How are things going fine for April from her financial perspective?
She can go shopping when she wants. She has been used in the past to eat out on the weekend, and that's what was happening. I mean, there was zero consequences to any of the behaviors.
Things Are fine, even though I know I need to save for the kids. We need to save, but it's not happening.
What would she tell herself to reconcile those two things?
I can do it later.
Bingo.
I can start later.
Yeah, I'll get to it later. We all do that. Oh, I'll go to the gym later. I'll clean the house later. I'll organize my desk later. And on and on. That's so normal. That's as human as it comes. Now let's check. Check with April and see if any of this is true. April?
Yes. I think it's. We'll come back to it later. Or we can start later.
There's no real reason for April to read the book. If I put myself in April's shoes, I'm thinking, life was great until my husband read this godforsaken book called I will teach you to be rich. Then he started concocting this elaborate spreadsheet, trying to get me to sit down and look at these stupid numbers. We get in fights all the time about money. I'm good. I'm exaggerating. But what do you think of the basic point?
Yes, I agree. And then he bought the journal, and we sort of started off and we didn't finish it. I don't know. I think it was for me, like, my dreams were about traveling while his were, like, about stability or investing. When I thought. Or when I think about money, I don't think about that. I think about, like, the happiness, about going places.
How do you think Kevin feels that you won't engage with him on money?
I'm in denial or just not interested.
Allow me to be the person who is very direct with you. Kevin is telling you that he needs you to be interested in money for your family.
Yeah.
And at every turn, you are rejecting him. How do you think that that makes him feel?
Upset.
What else?
Angry. Angry at me? Frustrated with the situation. You want to ask him, how do you feel, Kevin?
Defeated. I'm gonna say defeated. It's just feeling alone, you know? The same way you've been feeling alone for a couple of other stuff. I feel alone in there. And it's the way that we could, like, together, we would make so much progress much faster. Here we are dragging back, and.
I.
Don'T know, I have the feeling there is no long term, you know?
Yes.
Like, it's the short terms. Oh, let's spend that. I don't know, at the mall.
Let's go.
Let's go eat out. Friday, Saturday, Sunday. But in my mind, like, it's amazing. I would love to go to Disney, to Africa, to Bora Bora, to Europe, to Italy, wherever. But like, this year, we're not going to be able to go on vacation. And that's sad. That's extremely sad to me.
If you're watching on YouTube, you'll notice that we've added a commit counter. Guys, just saying I need to commit does not do anything, okay? I can't go up to the top of a building and say, I want to fly and then jump off a building. It's meaningless. It's just a word. When you say things like, I need to change, I need to save more, we need to do this. I shouldn't buy that you know what you're doing. People do that because they feel guilty. And saying those things is a way of self flagellating, of punishing themselves because they've been bad. The problem, of course, is that guilt is not an effective emotion for behavioral change. And over the years, we are very clever at how we adapt to get the things we want. I want to buy a new outfit, but deep down, I know that my husband or my wife told me we can't afford it. Ah, I know what I'll do. I'll tell myself for two months, I shouldn't buy it, I shouldn't be bad. And then after doing penance, I'll buy it anyway and then tell myself that was really bad. I need to be good next month. Does this sound weird to anyone else? It's really weird to me. And it's exactly how so many of us do things in America.
Let's get back to Kevin and April.
April has just learned that Kevin feels defeated when he talks to her about money. Listen to her reaction.
How do you take that, April?
Well, upset too, because we're partners and we're supposed to do things together.
What did he say when he told you how he felt?
Defeated.
What else?
Upset, basically. Upset with me?
Not sure he said that. What exact words did he say? Well, he said defeated. That's one. What else?
I don't know. It's a whole bunch of things. Like things that I should know, but I don't. I don't follow through.
I think if you really want to change, step one is to actually listen to what your partner is saying. I'm not good at this. I know I need to do this. You're repeating this old story. Would you agree?
Yes.
When Kevin comes to you and he talks about money, and then you instantly go, I know I need to save more. I know it's my fault. What does it get you?
I mean, where?
I'm in the loophole, but why do you do it? What strategic thing does it get you at that very moment?
I guess he doesn't. Doesn't force it or like, tries to go past it or, like, avoids it for next month.
Exactly. And so what does that get you?
Screw up ticket for next month.
It gets you a huge sigh of relief, doesn't it?
Yes.
And I think that it allows you, as you put it, a ticket, get out of jail free ticket for the conversation to end. Because now it's about you. That allows you to not confront the real issue, which is the need to engage with money. That seems highly destructive to a relationship where you want to grow together.
Yes.
What if you could do that?
I mean, I hope I can.
Let me ask the question again. What if you could do that?
It would be amazing.
Okay.
What's stopping you overspending on unnecessary things?
Why?
Because I just want instant gratification instead of like long term.
Now we're getting honest. Let's talk about your family. What do you remember hearing your family talk about when it came to money as you were a child?
My dad's a big saver. He doesn't really like to do anything because he just likes to save.
Okay.
So my mom was a stay at home mom until I was in middle school and then she started working, but before, when she was in Mexico, she was a teacher.
Okay. Like you.
Yes. Well, my mom likes to also save, but she also likes to shop.
Okay, keep going.
Macy's, Sears, 5, 7, 9, every.
All of them?
Yes.
Like, how often would you go shopping at the mall?
Like, once a week.
Once a week. Okay. How do you feel about those memories? Like, how do you feel?
Oh, like heart warming memories and awesome childhood.
Yeah. There's a lot of love in those times with your mom. Yeah. You still go shopping with her?
Yes.
How often?
She's my go to shopper, like once a week.
Oh, still. Okay, this is interesting. Where do you shop now?
At the mall still.
Like same place.
Same places? Yes. Sometimes she buys me stuff and other times I buy it myself.
Huh. Were you spoiled as a kid?
I'm not spoiled, but like, she. They would buy me stuff.
Kevin, what was that look on your face?
Yes, she was. Based on the size of her closet. I've never seen a closet like this.
Wait, this closet that you currently have?
Yeah, yeah, yeah, yeah.
Can I see this closet? April, please will you take this computer into the closet? Would you be willing to do it?
Sure. Yes.
Oh, my God. Amazing. Hold on. I have to take a deep breath. Okay. Okay, April, take us with you, but let's go slowly.
Like, do not move the camera.
Fast. Let's go really slow through the house and just take us to your closet. Oh, okay.
So. Okay, so.
Whoa, whoa, whoa, whoa. Okay, this is, like. This is the greatest moment of my life. First of all, show us the shoes. Okay.
I like to wear flats.
Okay. Okay, okay. Okay. Just. Let me just. Hold on. I need to take a deep breath. So this is your closet, April?
Yes. Yes, it is.
Okay, so let's start from one side. Just break it down for us. What are we looking at?
The dresses.
Okay.
That I've bought that I'm going to tell myself that I'm going to wear because I have to.
You notice the tags?
They have tags on them?
Yeah.
Yeah. All right, what's next?
Pants. Short dresses. Blouses.
Okay.
Comfortable T shirts.
Okay.
Regular T shirts. Other short sleeves. Glasses. Now it's mixed. My leisure pants. What's that working out?
Oh, okay. Yeah. Okay. Just relaxed. Okay. Leisure wear.
The sports ones where we used to go to the gym. The shorts are summer clothes, and my winter clothes.
Winter. Wait, where do you both live?
Well, my point exactly.
Wait, where?
In Houston, Texas.
So, April, if you can just, like, step out of the closet and just give me a full look inside it. Yeah, Perfect. So. So right here, this per. This is perfect. When you look at this, what do you feel?
Happiness.
What else?
Memories that we've had. Wearing the clothes. I don't know. Feeling nice, looking nice.
When you come here in the morning to get dressed, how do you feel?
Happy, Joyful. Like, I just look at the clothes and I'm like, oh, I did a good job buying it. Or, you know, all right, let's.
Let's go back to the area you were sitting. Kevin, did you want to add anything to what April just shared?
No. I mean, it's overwhelming enough as it is, I think.
Is that the word you use to describe it?
Oh, it's too much to me. Unnecessary.
Unnecessary. Wow. That's kind of interesting, right? Because to April, that's one of April's points of pride. And, Kevin, to you, you're saying it's overwhelming and unnecessary. Gosh. Do you think that that might have anything to do with the way that both of you see money?
I think we see it completely differently, based on the upbringing, based on the culture, based on a lot. And we need to. How do you say it in English? Cross that bridge to be together.
You know, that was Incredibly fascinating. In America, it is somewhat intimate to invite someone into your house. It is extremely intimate to talk about your finances. It's a thousand times more intimate to invite them into your closet. It's funny. My wife, Cassandra, runs a personal styling business@nextlevel wardrobe.com. and she tells me all about the psychology of people's closets, how it represents their memories, their aspirations, like wearing a fancy dress one day or being able to fit into a pair of jeans from eight years ago. And she tells me how much overwhelm it produces for people literally every single day. I learned from her how profound the psychology of our closets really is. That's why you saw me getting so excited for April to show me her closet, because I know that it reveals so much about what she values. And in fact, I'd say it's the first time she's really opened up to me today.
Well, my dad doesn't really like to. When we were little, he would like to travel. As we got older, he started to get boring. So he just stays home and everything. With him, it's like, oh, well, how much did this cost? How much is this?
It's all about cost.
Yes.
Okay. How does that make you feel?
Well, at some point, I did have that into consideration growing up, but then I started making my own money, and I was like, let me get it right.
Can I translate? Tell me if this is accurate. Dad was obsessed with cost. I always had to tell him how much? Everything cost, cost, cost, cost. Now that I earn my own money, I'm never thinking about that again.
Yes.
All right. What. What else happened as you got to be a teenager with money in your family?
I had a job since, like, 15, but it was just to cover, like, whenever I would go out with my friends and otherwise. My parents paid for everything. They paid for school until I got married. They paid for the car, the insurance, the phones.
What did they say no about?
Hardly nothing.
Okay. They never said no.
Not that much, no.
Do you ever say no to your kids?
Not that much, no.
Is that a problem or not?
Yes. It's because then they grow up and they're a me.
What does that mean?
Well, that they're gonna overspend and not think about the consequences. I'm doing the same things that I grew up with. If we would go to the pharmacy and I wanted a candy, it was never a no. It was like a okay. Get it?
Yeah.
And so that's what I'm doing with them. I tell myself no, but then I don't want to break their little hearts.
April, do you think that they think more things are better?
Yes.
Is that a good or a bad lesson for them to learn?
Bad lesson.
Why?
Because it shouldn't be like that. It should. They should be happy with what they have.
Okay, and. And what about all the things in your closet?
It shouldn't be like that.
When you said that, you knew you weren't telling the truth. Right. Are you happy with money?
No.
So why are they going to be happy?
Yeah, they're going to be upset.
What else?
They're going to be upset that their parents didn't teach them, didn't guide them for the proper ways of dealing with money.
April is very good at telling herself stories. All avoiders are. But they can only sustain those stories because they don't really face any consequences. If Kevin got hit by a bus and April had to figure things out without the support of her parents, she would figure it out in about 11 month. She would have to. But she doesn't have to.
So she doesn't.
She uses a lot of shoulds. I should spend less, we should save more. But they're all just words. She even does it when I ask about her kids. Do they believe more things are better? Yes.
Is that good? No. What's going to happen?
They should be happy with what they have. But really, Mom's not happy with money. So how are the kids ever going to be?
Kevin, I'd be curious to hear about your upbringing when it came to money. Where'd you grow up?
In Belgium.
Okay, what's the financial culture like there?
There's zero. You don't talk about 401k. You don't really talk about investing. Over there, you have a cost of living that is, I think, lower. But your salaries are much, much lower because you get like, what, 60% taxes or 50 something deducted from your gross. But at the same time, you have healthcare, you have retirement, so you really don't have to worry about that. And my great. My upbringing was 00 when it comes to money, except for my grandfather. My parents got divorced very early on and they fought about. How do you call it? Child support.
Oh, wow.
So I had zero basis when it comes to money.
So when you think back to money as a kid, what did you feel back then?
It's sad. It's sad because you don't get what your friends have used to play soccer. Yeah, Like, I was the only freaking kid without a branded shirt, without branded shoes. And I'm like. And then you see your parents fighting for like, what was it, 200 bucks? Buy me clothes to go to school? What the heck?
Okay, so what year did you move.
To the US so 2016.
Okay, so you moved here 2016.
Before that, we stayed for five years in Belgium. Her and I married.
Oh, got it. Okay.
But the weather was too depressing, so we moved back. But for my parents, not really much. My dad. My dad would spend all his money drinking, so.
Okay, how about your mom?
She would try to make ends meet as much as she could. And a little bit like April, she would try to buy stuff to make me happy, you know? Would be what, PlayStation, Internet. When it was fancy to have Internet.
Did it work?
I was not happy. Now, I don't want that for my kids ever. For them to have the same feeling of. How do you call it? Deprivation? To feel like, oh, am I poor?
Are your kids poor? No, they're not. You laugh.
No, they're not. Because we're not.
Right?
Because we're not.
Let me. Let me ask. Let me ask April that. What would you consider yourselves, financially speaking?
Well, we're not. We're not, like, broke. We're not, like, poor poor. But at the same time, we're not making. I mean, we're barely making ends meet.
So, like, what would you call that?
Poor?
Notice the huge disparity between how they characterize their own finances. Kevin laughs at the idea of them being poor, but April has a totally different definition of it.
We'll be right back.
Let's take a look at their numbers. You can follow along with your own free conscious spending plan template@iwt.com CSP was.
This the first time you've truly engaged with your household finances?
Yeah, to be honest, yes. I don't, like. I don't know what company we were on with the electricity or Internet. I. I don't know any of that, and I never. I don't care about that. And so I don't see how much we're spending.
Kevin, why don't you read off the word in bold and then the number next to it.
Current assets, $335,300.
All righty. Next.
Investments. $44,268.
Next.
Savings, $2,381. And debt. $302,000. Total net worth, $79,949.
All right, let's look at income. All right, this one's going to be April. April, what is your combined gross monthly income?
11,596.
That means that you make $139,000 a year.
