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Visit yamava.com/palms to discover more. - Welcome to Radical Personal Finance, a show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now while building a plan for financial freedom in 10 years or less. My name is Joshua Sheets.

I'm your host. Today on the show, I want to share with you some of the building blocks of a good, rock-solid financial plan, but I would bet that they're not what you think they are. See, for many years, I worked as a financial planner, which means that I talked to people about their money, and we talked about their financial goals.

And what I learned in that process of sitting face-to-face with hundreds and hundreds of people talking about their money is that frequently, the goals that we have with money are disconnected from the actual goals that we have. See, we sit down and we say, "I want to have a certain amount of money.

"I want to have an amount of savings in the bank. "I want to have an income of a certain amount." But we don't stop and think about why we want to actually have that money. I want you to imagine something. Imagine that you set a financial goal. I want to have a million dollars.

I want you to picture what a million dollars of physical cash looks like, physical bank notes. If you're having trouble picturing exactly how big that is, let me give you a couple of mental images to help you. Let's assume that you're going to do this with $1 bills. A million dollars of $1 bills would create a cube of about 4 feet by 4 feet by 4 feet.

So picture a pallet, an ordinary pallet, which is 48 inches by 48 inches, stacked up about 48 inches tall with $1 bills. Or if you prefer your currency in $100 bills, you could fit a million dollars in a relatively modest-sized briefcase. I think it's like 43 inches tall. If you were going to stack it all up, take them out and set them beside each other, then you can fit it into a briefcase.

But I like the idea of a pallet of $1 bills. So picture in your storeroom, your pantry, your garage, somewhere like that, you sit down and you put a pallet on the floor and you start stacking $1 bills. And you stack and you stack and you stack and you stack until you reach a pile that's a 4-foot cube.

Now you have a million dollars. You've achieved your financial goal. So here's my question. Now what? Now what? What are you going to do? Maybe your goal is $10 million. Okay, put 10 of those in your garage and assume that you've achieved that. Now what? Now what are you going to do?

When you start to think about this, you realize that the only point of establishing a monetary goal that can be measured with numbers is to actually use that money to accomplish something, to achieve something that's important to you. So what are you likely to want to accomplish when you have achieved your monetary goal?

Now some people's vision of what they want to accomplish is to sit on the beach and do nothing all day. That's fair. Lots of people enjoy sitting on the beach and doing nothing all day. In my experience, the kind of people who want to do that for the long term aren't usually the same kind of people who actually accumulate any significant amounts of money.

If you want to sit on the beach and do nothing all day, you can find millions of people all around the world doing that on a daily basis, living day to day, hand to mouth, making just enough to fill their bellies with some food and sit on the beach and do nothing all day.

So you don't actually need a million dollars to do that. Sometimes people say, "I want to travel the world," or, "I want to take that stack of a million dollars and turn it into a beautiful house." And these are all fair goals, but I want you to really think about it.

Put it into a physical sense. Imagine those pallets of bills sitting in your pantry. What are you actually going to do with them? Over the years, I've gone through these exercises myself, as I've worked through them with individuals, I've found again and again that there are a few common themes.

And I want to expand those themes because I believe that if you understand what those themes are, then you will be able to do a better job of spending your money in a satisfying way. Today I want to begin with one of what I call the big three. These are the big three questions, the big three decisions that you will want to make before you engage in any hardcore, numbers on the paper, financial planning.

The first question for you to answer is this. Who do I want to live with? Who do I want to be present in my life? What are the people, who are the people that I want to be surrounded with in my day-to-day life? This is the first question for you to consider.

If you're a particularly dedicated student, I'd encourage you to take a moment and write it down on a piece of paper. Put this into your journal. Open a note on your phone and start writing down the kinds of people or the specific people that you want to be involved in your life.

Make a note of the people that you want in your life. Because I believe that one of the best uses of money, and in fact, one of the first sets of decisions that you should make before you even think about the rest of your money is, who do you want in your life?

And in the rest of this show, I'm going to give you various expanding ideas, expanding questions, expanding examples to expand on this theme of things that you might want to consider. We begin with those people that are the most intimate in your life. For most of us, the most intimate people would involve some form of a romantic partner.

And I would encourage you that this is one of the decisions that will make the biggest difference in your life. Meeting somebody that you want to spend your life with, maintaining a good relationship with the right person, the kind of person that builds you up, the kind of person that complements you in your uniqueness.

This practice of meeting and maintaining a high-quality relationship with a romantic partner is bar none one of the most important and best decisions that you can possibly make. So let me begin first to those who do not yet have an appropriate romantic partner. I want to encourage you that it's perfectly fine, and in fact, I advise it, for you to put it down as an actual goal, an actual thing that you want to accomplish.

And to pursue this with focus. There are a few ideas when it comes to finding and attracting a suitable spouse. There are a few ideas that people often take to extremes where they ought not to go. For example, there is an idea that you should be whole in and of yourself.

You should be a whole person. And that you shouldn't come to a romantic relationship expecting your partner to make you more than you are, or to fill in your gaps, etc. Is this true? I think it is true. That you should be a whole and independent person. And you don't want to expect your partner to try to fill in some weakness that you have.

But that doesn't mean that you're not going to be expanded, that your capabilities are not going to be expanded, that you're not going to have a more satisfying life and lifestyle if you can find and attract an appropriate partner. One of the marks of a good relationship is often that there's synergy.

One plus one is something more than two. And if that's the case, then you're better off first quickly becoming a whole person, and then as quickly as possible attracting an appropriate spouse. So, could you or should you spend money on making that happen? Sometimes yes and sometimes no. But here I would encourage you that if you are unmarried and you desire to be married, or if you're looking for simply a romantic partner, ask yourself if you can't spend a little bit of money to improve that process.

Ask yourself if you shouldn't spend a little bit of money to improve that process. It's funny, I think sometimes I find myself being the guy, kind of the anti-frugality guy, frequently telling people, "Listen, why are you saving so much money and neglecting something that is also important to you?" I frequently find myself talking to people and saying, "How nice of a car are you driving?" Like it or not, people judge you by the car that you drive.

"Do you dress well?" Like it or not, people judge you by the way that you dress. "Are you involved in activities that are going to be appropriate to helping you establish and expand your social circles?" These things often cost money, but they are good uses of money. Spending money on dates, spending money on going to places where you can find dates, these are good uses of money.

And then if you desire to marry, spending money on getting married, whatever that entails, is a good use of money. If you're thoughtful and careful, this can be some of the best money that you spend. What about people who are already married or already in some sort of romantic relationship?

Well, in this case, I think some of the best money that you spend is making sure that your marriage has the things around it that will put the best probability of it thriving. You should be happy to spend money on strengthening your marriage. That could mean everything from living in a certain place, living in a certain style of life, living in a certain home.

It could mean things like prioritizing the cost of a babysitter so you can go out on date night or arranging quarterly weekend getaways, whatever those things are that are appropriate for you. Spend money on your marriage. This should be a high priority. Spend money on your marriage. I always love the turn of phrase that Zig Ziglar had years ago.

He called it courtship after marriage. Strangely, marriage is one of those things where I very rarely have to tell someone to, "Hey, go ahead, spend money on someone you're seeking to attract into a marriage relationship." But then all of a sudden, the date nights get cut out, the fun gets cut out, and we wonder why the relationships lose their spark.

If you can spend money and improve the quality of your intimate relationships, do so. That's a good use of money. Now let's expand out. The next most intimate relationships that we have usually involve those relationships with our children. As people grow, especially as parents age, they often find themselves wanting very much deep, high-quality relationships with their children.

I believe that some of the best money that you can spend is on cultivating the relationships that you have with your children. This begins in the very decision to have children. There is a strong, strong antenatal trend in our societies. This last year in the United States, the lowest birth rate in recorded history.

The lowest birth rate in recorded history. And when you ask people why, frequently they list financial concerns as one reason why they don't want to have children. When you study what people say about not having children, they say, "I just don't feel like I'm prepared. I just don't feel like I'm ready." And often they cite finances as a component of that.

There's no question that children place new pressures on your finances. They place pressures that are very, very strong, and those pressures come at you in many, many ways. And yet it's one of the strangest trends of our time, the fact that there's often more money available to you and to me in our lives than at any point in human history.

And there's more money available to us for our children than at any point in human history. And yet as the richest generation in the history of the world, we find ourselves looking around and saying, "I can't afford to have children." I personally don't believe in the concept of waiting to be married until you can "afford" it, and I personally don't believe in the concept of waiting to have children until you can "afford" it.

There is a balance. I, of course, would advise many people and say, "Why don't you establish yourself before getting married?" I would tell people often, "Why don't you work extra so you're not living hand-to-mouth before you add more mouths to the table?" But those changes should be very, very short, and at least 80% of the time, the people who are worried about it are the ones who don't have anything to worry about in the first place.

The money that you spend on your children will often be some of the highest payoff money that you'll ever be able to spend. The money that you spend on the actual care of your children, the things that your children need, many people find that as they age, they're so grateful they've done it.

Very frequently, when you talk to an older, wealthy person, you will find that most of their care, most of their attention, most of their time is oriented around things that they want to do with their children and their grandchildren. This is natural and normal, but if you know that you're going to end up there, then put in the time now, spend the money now to get the best results that you can.

I can't tell you exactly how to spend that money. That's up to you, but I do know that it's some of the best money that you can spend. If your children are older, out of your house, make sure that you live appropriately close to them, or in an appropriate way, you've gotten the best relationship that's possible for you.

Some of the best money that you can spend is in enhancing and developing the relationships that you can have with your children. That money might be spent in moving to another city or buying a place in another city so you can regularly visit your children. It might be spent in simply going closer to where they are.

It might be spent in a vacation home where you can invite your children to be with you. But being together with your children is a great use of money, and very rarely will you ever make a mistake when you spend money on being appropriately close to those that you love.

What about your parents? One of the best things that you can do to improve your general sense of happiness and satisfaction is live at an appropriate distance to your parents. Sometimes this means as close as possible, right next door. Sometimes this means farther away than where you are right now.

Think carefully about where you'd like to live with regard to your parents, and prioritize living there as a really good use of your money. Make sure that if you want to be closer, you're closer. Whether that means you move mom and dad closer to you, or you move closer to mom and dad, or arrange some third option, do it.

If you need to be farther away, do it. If you need to limit their influence, do it. If you need to encourage their influence, do it. Prioritize with your money the relationships that are most important to you. Let's move on. What about your circle of intimate friends? Your circle of intimate friends can be one of the most powerful influences on your life.

This is something that's worthy of your attention, your time, and to the extent you're capable of it, money. Attention and time are usually the things that are the most necessary. Friendships require cultivation. They require time. They require effort for you to arrange those circumstances. When you ask many people what's the time in their life that they enjoy the most, frequently they will hearken back to some form of college experience.

I don't think that in the main this is because they were drunk all the time. I think this has more to do with the social environment in which they lived. If you think about college, it's a time of intense socialization. Yes, there are certain demands on our time. We're required to work, we're required to study, etc.

Those demands are modest in the main, but more importantly we're often together with other people and we can filter and sort ourselves to be with people that we like. Our schedules are unencumbered by other obligations. Therefore, we can engage in all kinds of planned and spontaneous social events. That intense socialization leads to some of the happiest memories of our life.

Frequently we don't have a lot of money. Our car might be broken down. We might take trips on a shoestring crammed all in one tiny little junkie car to go away for spring break. We might do some wacky adventures, go hitchhiking across the country, etc. But that socialization, that focus on enjoying relationships with other people can be very pleasurable.

Then we go and get involved in the more normal adult life and there tends to come this intense social isolation. Instead of being together with other people, we wind up more separate from them. The friends that we once had based upon affinity are often replaced by friendships that come from we work together, coworkers.

"Hey, let's go out and grab a drink because we've been working late and because we're coworkers." Those people that we really like, we mean to get around to calling them. We mean to get around to seeing them. And yet, unhappily, it often doesn't happen quite so much as we would like.

This can be changed though with attention. You can emphasize to yourself the importance of your friends and then you can start to focus on cultivating those relationships. If you don't have a base of any friends to start with, you can start by focusing on making some new friends. If you have some old friends, then focus on bringing yourself together with those friends.

This may mean Thursday night poker. This may mean Saturday afternoon barbecues. This may mean barbecues at the park where the children can come along and where they can be entertained so you can actually hang out with your friends. This might mean an annual retreat, going ahead and renting the nice ski cabin so that everyone can get together and be together for an enjoyable experience.

But these things are worth spending money on. These things make life worth living. It might mean flying across the country to surprise someone, spend a day with them. It might mean, I would say, the cost of contacting someone, but in our day and age it doesn't cost anything more other than time and attention to pick up the phone and call somebody.

Prioritize time and togetherness with your friends and make sure that you're with the people that you like. Let's expand outward. What about neighbors? I think one of the best things you can do is spend your money to build around yourself neighbors that you like. Finding people who reflect your values, finding people who reflect your ideas, your ideology, that look at the world through a lens similar to yours.

Perhaps there's a danger in surrounding yourself with too much of an insular experience where all your neighbors just think exactly like you do. It's good to have a little variety. But if you don't like your neighbors, you might want to consider changing them and moving somewhere where you have more in common with people around you.

It might mean moving from the country to the city. It might mean moving from the city to the country, from the left coast to the right coast to the middle of the country. Wherever it is that you feel comfortable, do your best to surround yourself with the kind of people that make you feel comfortable, that will add significantly to the quality of your life.

Next, coworkers. Think carefully about your coworkers and your work environment. You're going to spend a significant amount of time with your coworkers, perhaps more than anything else that you're doing in your life. Your coworkers will be an ever-present reality. Make sure that you like them. Make sure that they're the kind of people that you want to be around, that you want to emulate.

Because if they are, that can be a tremendous, tremendous source of joy and happiness in your life. You might be able to spend some money on this. It might cost you a little bit to look for a new job. It might cost you a little bit to move for a new job or to replace a set of toxic coworkers with another set.

But being surrounded by coworkers that you like will make a major, major quality of life improvement for you. So focus on it. Be in the kind of environment that's a good fit for you. If a wild, scrappy entrepreneurial startup is for you, get there. If a staid, laid-back, conservative company is for you, get there.

If riding on the open range is for you, get there. If being in the middle of the city is right for you, get there. And you can expand outward from there, thinking of all of the other people that are in your life or that can be in your life.

But focusing yourself on people and being willing to spend money on people, this is some of the best money that you'll spend. I want to use two extreme examples to clarify why I think this is a useful thing to do. I know that these are caricatures, but I believe that sometimes extremes or caricatures can be useful to help illustrate a concept.

I want you to imagine, first of all, our wealthy miser. Our wealthy miser is somebody who works, works, works, spends nothing, lives in a shack, never has time for other people, never spends money on other people. It's someone who is not surrounded by love but is surrounded by money, sits at home stacking up his gold coins, filling up his mason jars and sticking them in the ground.

This is our wealthy miser. He doesn't have a lot of room for people in his life because he's focused on working and saving and making money and making money. Yes, he's got some parents somewhere that he once knew. He's got an estranged sister somewhere. He has a divorced wife somewhere that he doesn't keep in contact with.

He's got a couple of estranged children that he doesn't have any relationship with, but he's got plenty of money, and he sits and counts his money all day long. Now, imagine our other caricature, that of the joyful socialite. The joyful socialite is surrounded by family and friends that love him and that he loves.

He's got a loving wife with a rich, close relationship, the kind of people that make you feel weird because they touch each other all the time, and they just seem so happy together. He's got a house full of children, and, well, of course, his children aren't perfect. But he enjoys being with them.

He enjoys the hustle and bustle and enjoys seeing their success. He prioritizes his friends. At least once a night, there's another family in his home for dinner. Weekends, there's people in his backyard. Once a quarter, he schedules a trip with his buddies. Once a year, an annual reunion with his college friends.

Regularly, he's with his parents. Regularly, he spends time to invest in other people. He spends time with his friends everywhere. His co-workers love him and respect him. His neighbors appreciate him. They even take advantage of him sometimes. They take his tools and don't return them. But he's not worried about it because he knows he's got relationships with them.

I want you to imagine both of those men at 65 years old. The miser has plenty of money, but his relationships are suffered. The rich social life has spent all his money on his friends. He's got no money, but he's got lots of friends. Imagine that both of them are diagnosed with terminal cancer and they're given five years to live.

Which of those men would you rather be? Which of those men do you think would be able to reflect with greater satisfaction on his life? If you had to choose between them, which of those would you choose? The good news is you don't have to choose between them. They're caricatures.

They're unrealistic. You can have a strong social life and also accumulate money. You can have money and also accumulate friends. But to the extent that you can spend money on rich, fulfilling relationships, I believe that's some of the best money that you can spend. And if you had to choose between them, I think you'd be more satisfied by having a life full of the people that you love than by having a life full of gold coins or full crypto wallets.

Whatever monetary token you wish to refer to. Life is but a vapor. Here today, gone tomorrow. And the stuff of life, the richest, most rewarding stuff of life, comes from our relationships one with another. As you consider what you wish to do with your money in the coming year, ask yourself, "How much of my money am I spending on others?

How much of my money am I spending on the relationships that are important to me? How much of my money am I spending on people?" Reflect carefully on it and make sure that you're happy with the amount. And if the number is the wrong number for you, don't wait to be rich to change.

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