So like, yeah, Chris, you know, you're living the life and you're well experienced with this, but honestly, the way people react, they shrink their dreams. We've been taught to shrink. So I'll literally ask them, "What's your rich life?" And they'll go, "You know, I always have dreamed of having a beach house.

It's not like I need a big one. It could be a small one. It could be a shack. It could be half flooded, but you know, it would just be kind of nice." I go, "What the hell? Why are you shrinking your dreams in this hypothetical example? The point is a rich life, not a small life." So what you just did naturally is actually a great example of what I wish people would do, is that we are motivated by big dreams and by vivid examples, not by naturally shrinking our dreams to something that seems modest, but actually will not motivate us three days from now.

Hello, and welcome to another episode of All The Hacks, a show about upgrading your life, money, and travel. I'm Chris Hutchins, and I'm so excited to have you here today for another return guest appearance from none other than my good friend Ramit Sethi. He's the author of I Will Teach You To Be Rich, a bestseller that is sold over a million copies worldwide.

I'm a little partial to the second edition, which happens to feature me and my thoughts on credit cards on page 37. He's also the host of the I Will Teach You To Be Rich podcast, where he goes behind the scenes with couples who share all the intimate details of their finances to get his advice, and his Netflix show, How To Get Rich, just dropped yesterday, which I am excited to binge this week.

Now, if you're not familiar with Ramit's work, you may think all those titles about getting rich feel a bit used car salesy, but that assumption is definitely not true. In all of his work, he focuses on helping others define a unique version of their own rich life and make the best financial decisions to start living it.

Back when he was on episode nine, we talked a ton about how to start living your own rich life, so go back and check that out if you haven't. But since then, he's worked with over a hundred couples to talk about money, so I wanted to dive deeper on that topic.

That means best practices for couples managing their money, building a shared rich life vision, moving from asking each other $3 questions to $30,000 questions, the red and green flags you might want to look out for in your own relationship, and a lot more. So let's jump in right after this.

Ramit, thanks for being here. Thanks for having me. Congratulations. Netflix shows out. How do you feel? I feel... It feels surreal. I still cannot believe that I can turn on the TV and see myself. And I remember filming every one of those scenes. But when I watch the scenes, I know the setting, I know the street, I know what's going to happen.

And then I see my dumb face walking across the screen in this beautiful cinematic part of How to Get Rich. And I go, "What's that guy doing there?" So it still feels surreal, but it is amazing that so many people now are watching the show. I'm excited to dig into it, but let's jump in first to some of what you've been learning talking to people, which I know you started writing and it's not a two-way medium as much as you've been experienced now.

So with all the conversations you've had with people about money, and specifically with lots of couples, what do you think one of the biggest misconceptions people have when it comes to managing money with your partner? Well, I think the biggest mistake that I see with couples is a lack of a shared vision.

And the way that it manifests is not two people coming to me and saying, "Hey, we have a lack of a shared vision." Nobody ever says that. You know what they say? They go, "Why does she spend so much at Target?" Or, "Why doesn't he ever want to talk about money?" That's how it comes up.

So it's really transactional. It's almost focused on these little jabs about what the other person is doing wrong. And they come to me often and they'll be like, "I think I know the solution." I go, "What is it?" They go, "We need a budget." I go, "Oh, really? Have you ever kept a budget?" They go, "Yeah, in 2007, I kept a budget." I go, "How long did that last?" "Three weeks." I go, "You're crying.

Your partner's looking away. None of you want to talk to each other. And you really think a tactical budget is the solution?" No. And that's where the conversation really starts. And where do you go from there, right? You're seeing these jabs. Is it about solving the jabs? Is it about digging deeper?

How would someone listening to this apply this if they're like, "Well, we're not on the same page"? I always start by asking, "Tell me about a time in the last month or two where you were not on the same financial page." And I do that very intentionally because it's very easy for couples to start speaking in platitudes.

"He always does this. She always says that." And actually, those are really just stories that we tell ourselves. We create stories about each other. He's considerate. She's busy. And that's maybe true. It may be situationally true. But what I really want to do is take a specific instance. We went out, we celebrated our son's birthday party, and then we got in a big fight on the car ride home.

I go, "What happened?" And I really make them walk me through it like a movie. I want to know scene by scene what's happening. As they say it, you can hear people replay their version of reality. And there's a famous study that I remember studying in social psychology. I think it was a Harvard-Yale football game.

Harvard-Princeton or something. Two schools that are not very good at football. Let me put it that way. And the crowds from each side were asked, "What happened in this football game?" And both of them had radically different opinions about the referees and the integrity of the players. And that's exactly what happens with these couples.

So we start there, and then from there, we expand the conversation. And in over, I think almost 100 conversations you probably had, if not more, what's changed? Have you evolved your thinking of how to have these conversations or what people should do or how people should act? Yeah. I mean, you can hear it.

Episode one, I actually lost my temper in episode one. And I regret it. There was a person on there who was saying some things that I really, really did not agree with. And I actually lost my temper. And I apologized in the episode because that's not cool. I've become a lot calmer because I've seen so much.

So that's number one. Two, I can read things that are beneath the surface. You ever listen to Loveline back in the day with Adam Carolla and Dr. Drew? So they would get a caller and within five seconds, they could identify certain things about that caller just by the tone of the person's voice.

And it seemed like magic, but now I can understand it. So for example, there are little verbal and behavioral tells that we all have that tell us a lot about money. If somebody's using a debit card, they probably have credit card debt. They may not even realize why, but they have credit card debt because intuitively, they don't want to put more money on the back of their balance.

If somebody says something like, "I grew up poor. I'm not afraid to be poor." Again, that tells you a lot about the socioeconomic way they grew up and how they view money. So there's class, there's gender, there's a lot of different things that come to play. And you can hear the patterns after listening to a few episodes.

And so once you start to realize people aren't on the same page about certain things and they've play by played, kind of walk through this, what's the process for healing, if you will? How should people get on the same page? What are your kind of protocol or recommendations for how couples should operate around money for a healthy relationship?

I like the way you describe it, a healthy relationship with money. A lot of us think about a healthy relationship with food or a healthy relationship with our partner or our kids, but we don't usually think about a healthy relationship with money. We just think of money as this thing that's always been, for example, guilt-inducing or anxiety-inducing, and we don't realize that there's actually another way to live.

So sometimes it's just asking people, what would it look like to feel good about money? And they're just stuck. They never thought of that. They never even realized that they were feeling bad consistently. And so for them to even think about feeling good is totally foreign, but they could do it.

Intuitively, all of us know what it would feel like. They start by saying what they wouldn't do. "Well, I wouldn't worry. I wouldn't agonize over buying a pack of gum." I go, "Okay, okay, okay. Now tell me what you would do." Because people love to identify themselves by what they wouldn't do or what they don't like.

I go, "What would you do if in your rich life?" They go, "Well, I wouldn't worry about shopping at this place." I go, "Okay, now tell me what you would do." And that is much harder. So part of the premise is to help people start to rewrite the next chapter of their life.

Oftentimes, the same money beliefs we grew up with, I call them invisible scripts, are the ones we carry into our 20s, 30s, even 40s. Things like our parents saying, "We can't afford it." You hear that a thousand times growing up, you start to really believe it. It's axiomatic. And one day, let's say you have a good job, you're making $120K a year, and you have money in the bank.

And then you realize, "Why am I agonizing over the price of broccoli?" And it's not "rational," but it's real to you. So I want to help them rewrite their narrative and rewrite the next chapter of their lives. And how do you rewrite that? Because I imagine people listening, I know I'm one of them, have had that same problem.

And sometimes it's not "I can't afford this." It's like, "I know I could buy the..." I know from listening to your show, which I've done quite a bit of, blueberries seem to come up a lot. Rich people are obsessed with berries. By the way, I am obsessed with berries too, because when I was a kid, we rarely got them.

They were super expensive. And so when I got them, it was like, "Oh my God, eat them fast." And if I dropped one in the sink while I was cleaning them, I would feel anguish. And now I have to tell you to be able to get blueberries or raspberries and put them in my hand and wash them and eat them without counting how many there are, it feels incredibly rich to me.

That just shows you how emotional money is. I could buy all the raspberries I want. And I still am like, "Oh my..." It's like a jewel. "Oh my God, look at this beautiful raspberry. I get to eat this thing." It's a great example of how money emotions carry with us.

Let's say you're at a place and you know that oftentimes you can get a nice pint of rad blueberries for $3.99 and they're $9.99. It might not be that I don't feel like I can afford blueberries. It might be that I just feel like this is not a good deal.

Well, I think a lot of your listeners are like this, right? They love the deal. They love the hack. And I'm all for that. There's a time and a place where that makes a lot of sense. In your 20s, certainly you have more time than money for most people.

And you're like, "Okay, I want to find the best airfare deal." Love it. Totally get it. I did the same thing. I get it. But at a certain point, there's a phrase from an old self-development book, which is, "As I got wealthier, I couldn't afford to do certain things." Now, think about what that means.

This person was referring to mowing the lawn. For spending half of their Saturday mowing the lawn. As they became wealthier, they couldn't afford it because they wanted to prioritize time with their son. And so for me, I can't afford now or I choose not to spend my time booking flights and trying to get the best deal.

For me, the best point system is to be able to afford the flight that I want to take. That's really hard. That's really hard because a lifetime of optimizing, it feels like a win, right? You're like, "I got one over the bank. I got one over the airline." But you may be winning the battle and losing the war.

And that war really is, "What is my rich life?" If you were to articulate what's your perfect week look like, I bet you spending six hours saving $110 on a flight to New York probably is not part of it. Yeah, but it sounds like if you can identify, I know you kind of have phrased this in $3 questions and $30,000 questions.

It's not that I shouldn't spend the optimization energy on a Saturday afternoon. It's that there's probably a place in my life where I could spend it that isn't going to save me $3 in blueberries, but might add 20% to my business this year or might be spent evaluating other opportunities for a career that could double my income.

So I would say it's not stop optimizing. It's just... Would you say it's more about figuring out where the optimization can have the most impact? I think it's about elevating yourself to the level that you are at. When you need to save 50 bucks at the age of 22, it makes perfect sense.

The problem is that most of us get stuck there. And we don't realize that as your wealth increases, your psychology needs to correspondingly come along. So wealth, by the way, could increase by your income going up, your investments going up. Your time may simply shrink because you have a family or a busy career or a sick parent.

And so you can't keep operating at the same level with everything. Now, if it's your hobby and you're like, "I actually love to do flight hacking." Great. But don't deceive yourself and say like, "I'm doing this to save money." What we need to do is really adjust our view on the world.

That's the crux of these $3 questions versus $30,000 questions. We agonize over $3 questions like, "Should I buy the extra large coffee? Should I get the cheesecake? Should I flight hack this thing?" Versus if you have a business, a $30,000 question or even $300,000 question is much better time spent.

Yeah. And I think I'll push back on the flight thing because I think you could probably optimize away your family vacation for the year, which might be $5,000, $10,000, which for a lot of people might be a huge impact. I agree. But I think I just have to get over.

It's not worth trying to find the cheaper berries or not get them, but it's so hard. Let's do this. So I never find success in telling people to get over it. It never works, right? Like, "Hey, get over this emotion you've felt for the last 35 years. It's stupid.

That doesn't work." So instead, what I really do, especially in around the first half of my conversations with people, is I really go deep on, "Where'd that come from? What does it feel like to you when you get the $75 savings on a JetBlue flight? And how does it reflect on your partner?

What does your partner say?" And they're over there rolling their eyes. You can see them on the YouTube video. And I go, "Okay, that's cool. I understand. I'm not judging them, right? I'm really trying to get them to express because most of them have never been asked about it and they've pretty much been mocked by their partner, et cetera.

So I'm just like, "Tell me more. Where does it come from?" And then we start to examine what is their rich life? And if their rich life is, "I want to go to Bora Bora," or, "I want to be able to stay home with my kids for a few years while they're young." I go, "Cool.

I love that vision. That's beautiful. Tell me more about that." And then we start to try to bring the things together. Is this thing you're doing serving your vision today or is it not? And a lot of times you find out that the vision and what they're doing on a day-to-day basis is totally misaligned.

I had somebody who drives miles to save money on gas and it's just not serving them anymore. It's not even part of their vision. And again, this goes back to the lack of a shared vision. Most of us don't have an individual vision of what our rich life is.

We're really vague about it. "I like to travel." And we certainly do not have a shared vision that is vivid and specific. How would you tell someone that's listening saying, "Okay, I want this. I want an individual and a shared vision." What are the steps to create that vision?

What does it actually look like? Is it written down? Is it an idea? Yeah, it's written down. So it starts off with just people all intuitively know what they love. So I do a quick little exercise. We can do it right now. Money dials. Let's talk about it. So what, Chris, is the thing that you love to spend money on?

Very few things, but I do like food. Food. Okay, great. And what do you love about it? I think especially right now in a world with young kids where travel isn't what it used to be, right? We used to... I mean, at one point, we quit our jobs and we just backpacked for eight months.

This is just not an option with two small kids. So I think going out and getting to eat at lots of different restaurants... I get so excited when a new cuisine or a new place opens up. It's like, "I want to do that because we're getting a little bit of that cultural experience while we can't travel." So that's something right now I feel like I'm willing to spend money on.

Okay, love it. So that's your money dial. Food. By the way, that's the number one most common money dial is eating out. So you're in great company. Number one is eating out. Number two is travel. Three is health and wellness. Four is convenience, which happens to be mine. And then there's many other money dials.

Now, my second question, and the reason I call it a money dial, which you can turn up or turn down, is Chris, if you could quadruple the amount you spend on eating out, what would it look like and what would it feel like? Before you answer, everybody listening and watching, I want you to do this with us.

So remember, what is the thing you love to spend money on? And get as specific as Chris did. He had a big smile when he was talking about, "I get excited about the restaurant opening." That's question one. And now question two, what if you could quadruple your spend and turn that dial?

Go ahead. So I know the answer to this because I just seem so obvious. I think most people listening maybe at one point in their life have done a cooking class. If not, and you like food, I would encourage it. And when you do that, especially when you're not taking like a technical pastry making, but you're taking kind of more of a cultural experience maybe while you're traveling, you're sitting down with someone from a country teaching you their food because this is the experience I want out of cooking.

It would look like if we were going to instead of go out and spend money on an Indian restaurant, I'd love to hire an Indian cook or chef to come in and do an Indian cooking class. Are you trying to hire my mom right now? Hold on. I'm about to negotiate a deal right now.

How much are you willing to pay for this? Where is she based? She'll come to you. Depends on the price. Yeah, I know. She's got a son who represents her well. Quadruple though. She's got to do it for less than four times the local Indian restaurant. I think we might have a business idea here.

But yeah, that's what that would look like is every time if we want to go have a Lebanese dinner, let's go have it with a family at a house, cook it at our house. I don't care where, but more than just order from a menu at a restaurant. I love that.

What a beautiful answer. Okay. I'll tell you what I love about that answer. First of all, you've clearly thought about it. Okay. I love that. That's actually quite rare. When I ask people what would it look like to quadruple, usually they haven't thought about it. And then their first initial answer is very linear.

They almost always with food say, "Well, I'd probably be eating out four times a week," which is possible. But I love that you went multidimensional. It wasn't just quadruple the quantity. It was the changing the quality. And you went to the experience. I want to have the cultural experience.

I want to have a chef come in or we'll go to them and teach us, create an experience. There's so many different ways to think about expanding your vision of what you love. And so if you're listening to this, food is a great example. Chris just gave us a phenomenal way to think about what would it look like to turn that dial up.

If it's travel, you can imagine you might go to different destinations. You might stay at different hotels if you're a hotel person or fly on a different seat. You might bring loved ones with you and treat them. There's so many different ways to expand your vision. Now, the whole point of this, why are we even talking about money dials, is that how can you create a vision for what excites you about your money if you only think about money in terms of restriction and anxiety?

And that's how most of us think about money. I ask you, "How do you feel about money?" They go, "I feel guilty. I feel overwhelmed. I feel stressed." I go, "Okay, well, what do you talk about on a day-to-day basis?" They go, "Can we afford Target? Why do we spend so much on asparagus?

How come my partner never reconciles this and that?" I go, "Yeah, that sucks. All you talk about is negativity and reactivity." We got to be able to have a vision so that we can spend extravagantly on the things we love as long as we cut costs mercilessly on the things we don't.

So that, Chris, is how I start off, really help people create their vision, is to find out what they're already excited about and then ask them themselves to articulate what turning that dial up would look like. And do you also ask them what you would turn the dial down on?

Yeah, but not till way later. Because I want them to get super excited. So usually a common example, everybody loves Italy. It's like the safest destination. We just did an episode on Italy. So much good feedback. Go back and listen if you haven't. It's like a gimme. It's like a comedian making a fart joke.

You're like, "Okay." You know you're going to get that response. By the way, I'm not equating Italy to a fart joke, but I am saying whenever you talk about Italy, everyone's got a big smile. Hell, we even took our parents as part of our honeymoon to Italy because we know everybody loves it.

So people go, "I love to travel." I go, "Where would you like to travel?" And they just go like, "Oh, I just like to go anywhere." I go, "Uh-uh. You're going to tell me exactly where you want to go." I force them to get specific. And so we end up with them saying, "I want to drink Italian wine, watch the sunset in Rome and be staying where we can see the Colosseum." I go, "Now, that is a beautiful vision.

That is really specific. And my final question, who would you take with you?" So suddenly, they've articulated, they can almost smell it, right? Now that they have that vision, I take a look at their numbers. And everyone is required to submit all of their numbers to me so I can see their net worth, income, debt, everything.

And you can see it too. I pop it up on screen. Can you imagine being able to see a couple who overspends by $4,000 a month every month and they didn't even know it? That happens on the pod. Or a couple who's got a net worth of like $6 million and they agonize over an extra $100 a night for a hotel.

That also happens. Once they know that they want to go to Italy and see the sunset, it's actually much easier for them to themselves make decisions about what to cut back on. And that's one of the cruxes of how to get people to change their behavior with money. What happens if my money dial, I'm fortunate because I know my wife would say something similar about food, but let's say she didn't care about food and her money dial is clothing.

What happens then? We talked about building a vision and your money dials, but what if they don't align? Well, that's okay. They don't all have to align. That's actually a big relief that you and your partner do not have to see eye to eye on everything. But it does help to see eye to eye on a few big things.

So let me give you a few examples, including from my own life. So I love really nice hotels. My wife likes them, but she doesn't love them like me. Okay. I love them. And so we actually have, we've discussed this a lot and we've come up with a solution that works well for us, which is, you know, when we travel, sometimes we are going to, we go, it's a special occasion, it's an anniversary, et cetera.

So jointly, we're going to stay at this beautiful place. But sometimes we're going somewhere and she's like, you know what? I'm perfectly happy with the ordinary place. And I go, Oh, but that city has this awesome resort. I want to stay there. And so we've talked about how do we want to reconcile that?

And in our case, we go, I will pay the difference personally, because it's valuable to me. And for her, she doesn't really mind it at all staying anywhere. Other times we go somewhere and we're like, Hey, we don't actually need to stay at a fancy place. We're perfectly fine.

We're going to be in and out. Cool. We'll stay at a more modest place. That's fine. But the key is we're talking about it. And we're acknowledging that we've got differences in certain areas and coming up with a solution for it. More often than not, couples are not, they don't even know what their money dial is.

They don't know what they love and what they don't love. And so everything becomes an existential question. Why do you want to stay at a on-property Disney hotel? I don't want to, it's $1,200 more. And it's purely transactional. And if you have to go through life fighting about transaction after transaction, you've made a wrong turn way back there by not identifying the key things that are important to each of you.

You mentioned that you could just use your money for the nice hotel. Do you think it's helpful for couples to have some money that's their own and some money that's theirs together? What's your perspective there? 100%. So the simplest way to set up joint accounts is one joint account, which is used for all joint expenses, rent or mortgage, utilities, cell phone, all that stuff.

It pays off your credit card. It goes into joint savings, all of that. But I also recommend having a little bit of individual money that each of you can do whatever you want with. And I think that's really healthy. And a lot of people, they prefer to have a little bit squirreled away in their own personal savings.

Fine. Other people want to spend it on their hobby. Fine. In my case, it would be really nice hotels. Also fine. It's no questions asked money. You get to do whatever you want with it. That is, in my opinion, a really healthy way to approach a hybrid system of joint and individual money.

And is there a target for how much you put of your earnings into that amount? And does what you make matter at all in this scenario? I think it does. Proportional is always a good way to think about how to set up your account. So if one person is making three times what the other person's making, it's fair to say that one approach, which I think is pretty healthy, is for them to pay more for joint.

Now, how you negotiate, how much goes into your individual accounts is up to you. But if a person is making three X more, it's likely they take a little bit more in their individual accounts as well. Also keep in mind that the person who's earning less should not be totally burdened and be spending 90% of their money on rent because the higher earner wants to live in a nicer place.

That's not fair either. So the model we use is we have one shared checking account. All the income from everything goes in there. And all the credit cards get paid. We have our own credit cards and we kind of spend on them how we will. But we're not really keeping track of who's spending what and it works.

Is that okay? Are there problems we're overseeing or we're missing of giving people a little more freedom because it's all commingled? This is a great question. And you are one of the few people who says, "Hey, it's working for us, but what problems are we not seeing down the road?" That is an amazing question.

So overall, if it's working, I say generally, that's fantastic. What we want to do with money and account setups is to make sure, as you pointed out, that we're not setting ourselves up for a big blow up down the road. So here's some things to think about. I know you had kids.

Before, you may have said like, "Hey, we know how to spend. We're married. We don't have kids." And when you have kids, obviously things change a lot. One person might say, "I want to buy a really expensive stroller or this type of food, et cetera." And the other might not.

You can do two things. One is you can change the way your accounts are set up. Two, you can just have open regular conversations. I call them rich life reviews. You do them once a month or in certain times, once every two weeks, and you just realign. And you don't have to agree on everything, again, but you can find solutions to make it work.

I do think that some things to keep in mind going forward would be big changes in income. Let's just say you start making 4X what you're making. You might go, "Hey, I want to step it up. I want to stay at this place, or I want to fly this type of thing," or whatever.

And your wife might not. That's worth a discussion. But aside from that, if it's working and you have regular conversations, I say thumbs up. It's funny. I haven't thought about this. There's a book called The 80-80 Marriage. I don't know if you've read this. Yeah, we've talked about it before.

Yeah. And I interviewed Nate and Kaylee Klemp with my wife on episode, I think it was 43. I'll link to it in the show notes. But one of the things that I never processed until now was whether you apply this concept, which is basically that instead of everyone playing the tit-for-tat game of "We each get $100.

We can spend $100." If you could elevate to, "We know no one's trying to overspend the amount of money that we have as a family. We're trying to make sure that we have good times and we can do our own things," but you assume best intent effectively, and you have healthy conversations, maybe that could be something that works.

100%. But remember, most couples don't have a vision together. So they go, "Yeah, of course, I trust my partner. We have kids together, etc. But I just can't get over how they always spend so much on this." And again, they attack the tactic. They attack the symptom. And what I want to encourage people to do, and what I do on the Netflix show and on the podcast is to zoom up and say, "What kind of life do we want to live together?" Some people, their rich life is to be able to pick up their kids from school every afternoon.

Beautiful. I love it. Okay, so what do we want to do with our money to ensure that? Because if you're spending too much on a mortgage or a truck, then the other partner might not be able to do that. And so that is where we want to start. What's the vision?

What does our rich life look like down to what does our perfect day look like? And then let's use our money to try to create that. So obviously, you need two people to create a shared vision. Do you need two people to be the money manager in the household or do you think it's okay for one person to be like, "I'm going to manage all the investments and track the expenses and do the budgeting," or is it helpful to have both people?

No, you cannot do it alone. This is a really common thing. People will say, "Oh, well, she's the money person in our relationship." I go, "Red flag," because just like you will almost never these days hear someone saying, "Oh, he's the parent in this family. She's the parent." That's not how it works.

Both people have to be involved. It is that foundational. So unlike emptying the dishwasher or gardening in the back, watering the plants, which typically one person will do, just natural in a couple, money is much more like parenting. We've both got to be involved. We've got to have a vision.

We've got to talk about it. And we've both got to put some skin in the game. That doesn't mean that both of you have to be sitting there tweaking your asset allocation. First of all, you shouldn't even be doing that. But one of you is probably going to be a little more knowledgeable and comfortable with investments.

Okay. In our relationship, that's me. But we still look at the numbers. We talk about what it means. And she knows. And when we got together, I told my wife, "Look, it would be really easy for me to be the money guy in our relationship. That's what I do for a living.

I know how to do this. My systems are bulletproof." But I told her, "I want us to both do this." And I insisted on it because one day I'm going to get hit by a bus. And the worst thing I could do would be to leave her defenseless, especially against some 1.5% AUM bullshit charging advisory service.

I would come back, okay, from heaven or hell. And I would be so pissed. I told my wife that. And she was like, "I would never do 1.5% AUM. Love you, babe." The other thing is you need two sets of eyes on your money because these things get complicated, right?

How should we spend? Am I doing it right? I just need someone to check me. And third and most importantly, it's just more fun. Why would you want to go on this journey alone? This is a rich life. It's not about budgeting. It's not about paying your bills on time.

That's a classic myth people have. They think managing money means paying bills on time. Wrong. This is about creating a rich life. And you want to do it with your life partner. It's just more fun. A lot of times I get emails from people saying, "Oh, I really want to get my spouse involved," but they're just not that interested.

It sounds like one tactic is create this rich life together and excite people about money with what it can do. Are there other things you've seen work well to get people involved? But wait, hold on, hold on. Yes. But I don't want to skip this because we can't just skip over like it's not fun.

Yeah. Your partner's probably not involved because every time you both talk about money, it's a fight and it's some meaningless tactical question. "Oh my God, I can't believe you got the expensive pickles." Who the hell wants to talk about pickles for the rest of their life? I wouldn't even want to have those conversations.

So I would say to everybody listening, the last time you talked about money, the time before, the time before, was it a transactional question? Was it a negative question? Was it something accusatory or was it a dream? "Hey, you know what? I've been thinking, what do you think would make this rest of this year amazing for us?

Oh, we're planning to see our family for the holidays. What if we took a day before and just did something for the two of us? Have you ever had that kind of conversation?" And so I talk about it all the time, but I've tried to model it. That's why on the podcast and the show, you can actually hear me showing couples.

You could see me showing them how to do that. Look at the excitement right now. That's the kind of energy I want people to bring to it. So yes, that's number one. And recalibrating your relationship always is hard. Your partner might be like, "This is really weird. Why are you talking like that?" You go, "You know why?

Because I've realized that when we talk about money, it's not really fun. And I want it to be fun. I love you. And I want us to create this amazing life together. Will you sit down and do it with me?" That's compelling. So that's number one. Two is, I like people to save for something that they can do that's really fun this year.

It could be an overnight trip camping. It could be an amazing trip to Thailand. It could be a meal at a restaurant that you've both wanted to do. But that's a really fun way to make the connection that spending money can be something that is part of your rich life.

Totally different than, "Oh God, we got to pay this bill." So I hope everybody's hearing over and over, start with the positive. Start with the vision. Start with using your money to live the rich life and all the restriction and cutting back and all that stuff. We could deal with that stuff later.

But I do want to talk about it because I'm imagining a conversation between a couple being, "Okay, what do we want to do? You know what? It'd be really nice to go on a trip to Italy, let's say. Everyone wants to go to Italy. And it'd be great if we could bring our family there and with us and we could experience it with them.

But it'd also be nice if we could be there for a few days on our own before. Maybe we even have someone who could take care of the kids so we can really enjoy it." It's like, "But when it comes down to it, we still have to pay for that trip.

And we don't have the money to pay for that trip right now. So how do you get back to reality when you've designed a rich life that you want, but you just practically can't afford it right now?" Okay. I love your example. First of all, no one ever gets that specific in their example or that big.

So like, "Yeah, Chris, you're living the life and you're well-experienced with this." But honestly, the way people react, they shrink their dreams. We've been taught to shrink. So I'll literally ask them, "What's your rich life?" And they'll go, "I always have dreamed of having a beach house. It's not like I need a big one.

It can be a small one. It could be a shack. It could be half flooded, but it would just be kind of nice." I go, "What the hell? Why are you shrinking your dreams in this hypothetical example? The point is a rich life, not a small life." So what you just did naturally is actually a great example of what I wish people would do, is that we are motivated by big dreams and by vivid examples, not by naturally shrinking our dreams to something that seems modest, but actually will not motivate us three days from now.

So that's number one. Number two, it's natural that you come up with some things you want to do that you can't afford now. That is a good sign you're on the right track. A rich life is lived today and tomorrow. So we did this exercise. My wife and I did it together.

It's the 10-year bucket list exercise. Love to share it with everybody right now. We sat down and we pulled out two pieces of paper. And you can do this. It's really fun. There's basically very few numbers involved. And you go, "Hey, in the next 10 years, what can we do that would make it an amazing, rich life?" And so you each take a few minutes and you write it down.

Some of them can be just for you. Some of them can be together. And then we compared notes. So we had some examples of learning a different language, et cetera. And each of us go back and forth. And this is where you get curious. "Oh, wow. You want to learn Spanish?

Would we do it in Mexico City? Would you do it alone? Oh, you want to go skydiving? That's for you. No, thanks. I'll stay on the ground." And we've identified one of our things that was big. It was the equivalent of the Italy trip. And for us, it was a 10-year wedding anniversary abroad.

Well, we want to save money for that. So what we did was we did a back of the napkin calculation. Let's just pretend it's going to cost $10,000, just for easy math. Okay. We know it's going to be roughly 10 years from now. That means we need to save $1,000 per year.

Okay, great. We now put that money automatically into a sub-savings account. And we know for a fact exactly when we will have enough for that dream trip of ours. That's how you do it. I mean, that assumes you had the $1,000 a year to set aside, right? So you talk about cutting costs mercilessly.

Is the other aspect of this trying to go in and see where you're maybe not getting that much value? This is a conversation my wife and I had the other day. We were walking in the neighborhood, and we were like, "Well, if we had $5,000 extra a year to spend on something, what would we be excited to spend it on?" Great question.

And then we said, "If we look at the marginal $5,000, if we look at what we had to cut out of our budget, are we getting as much joy out of the first $5,000 to go as we would from the next $5,000 to spend? And if not, then we should absolutely just cut that $5,000 and swap it out." And then we threw savings as a third option.

It's like, "We have $5,000. We could save it, we could spend it, or we could spend it more optimally." And did this get you anywhere? No. What a surprise. I mean, it's a good conversation. I'm shocked. I'm so shocked. The minute you said the word "marginal," I was like, "God damn it.

This is going nowhere." So two people who are too smart for their own good, this is a great example where I love that you brought it up and talked about it, but I actually, for most people listening, they're not going to use the word "marginal," and $5,000 would actually be very meaningful.

So I totally agree with you that there are places we can look in our own spending and optimize it, 100%. That comes after identifying what you love. So I use the CEO strategy. You can cut costs, you can earn more, you can optimize your existing spending. Optimizing would be setting up a reminder once a year, check your insurance, negotiate your cable, check all the benefits on your credit cards and evaluate whether you really need them, evaluate your subscriptions, and many other tools that are available that can help people do that.

That right there can often save you well over $1,000 a year, well over it. Now, here's the key. Everybody forgets. If you save $1,000 or $2,000 a year, make sure you redirect that money to the places you want, otherwise it will simply get sucked up by day-to-day life. And that's a lesson that I learned from someone who's very wise.

He's a little older than me. He told me, "Rameeth, when you have kids, if you don't prioritize your relationship with your partner, your kids will suck up every minute of your time. And it's great to spend time with them. Of course you love them, but you've got to set pillars in the ground for you and your partner.

And that's the same with money. If you don't prioritize where your money flows, and it's not flowing to something that's part of your rich life, it will simply get sucked up by random expenses and you will have no idea where it went." So you brought up budgeting a lot.

Is that at least a practical way to get a sense of where you're spending if someone doesn't have a good sense of it? If you want to budget for the last 30 days of your spending, fine. That's fine. I'm not a fan of budgeting. It doesn't work. It's very difficult for people.

It makes them feel bad. And worst of all, it's backwards looking. It doesn't really tell you anything. I much prefer to have four key numbers to track and then get on with my life. So the four key numbers are fixed costs, which should be 50 to 60% of your take-home pay.

And that would include your mortgage or rent, utilities, insurance, any debt payments, auto, everything that's fixed, groceries that stay roughly the same every month. Next would be savings. That would be roughly 5 to 10%. Next would be investments, roughly 5 to 10%. Of course, the more the better because you can turn a dollar into many more.

And finally, my favorite of all, guilt-free spending, 20 to 35% of take-home. Now I love that last one because suddenly, if you go out to a really nice restaurant or you want to get a babysitter one night so you can go out with your wife or whatever, you don't have to feel guilty.

You don't have to feel anxious. You don't have to worry about getting the $9.99 blueberries because you go, "I already hit all my other numbers. My fixed costs are already being taken care of automatically. My savings, my investments, all that is automatic. I have allocated this money for us to spend on the things we love, whether it's food, a beautiful coat, an Uber so that you can go have a nice time, whatever." That is being intentional with your money.

So four numbers, those are straight from my conscious spending plan. That's the numbers that I pay attention to. It's funny because when I say budgeting, I don't actually mean budgeting. It's like I mean kind of what you're describing there. It's like having a grasp of how much you spend each month on fixed things and how much you spend and how much is left in between.

But you know the difference? The difference is that when people... First of all, when people think of budgeting, they already hate it. It feels horrible. It feels like a lot of work, which it is, and it's mostly minutia. I don't track the price of snap peas. It's not worth the time.

People who budget, they spend more time recategorizing stuff and plugging numbers in and checking it all than they do actually living their rich life. That's backwards. The hard work of a rich life is creating the vision and becoming basically financially fluent, knowing what a savings rate is, understanding your asset allocation.

There's like five to 10 big wins in life. Nail those. You never have to track the price of Reese's Pieces Peanut Butter Cups. You shouldn't. That's a $3 question. The $30,000 question is, "Hey, what's our savings rate, and can we increase it by 1% per year?" If you do that, that's worth actually over $300,000.

It will make up for all the coffee you ever buy in your entire life. So a little bit ago, you mentioned there are a few things you hear that are red flags. I'm curious if there are any other things that people should be listening for as ways for them to say, "Oh, you know what?

Maybe there's an opportunity to improve." But also the counter of that are, I don't know if it's a green flag or a checkered flag, but are there things that when you hear people doing, you're like, "Oh, they're doing it right in this area." Well, you mentioned what you and your wife just are talking about money.

That's a huge red flag. The fact that you are just talking about it regularly while on a walk is awesome. Awesome. You're talking about it proactively. The two of you are having conversations. That right there, it normalizes talking about money. For everybody, that's why I encourage a monthly Rich Life Review.

I have a structure for it. You always start off with a compliment. I really appreciate that you always book the best flights for our family. I know that I never have to worry about the flights we're going to take. You do an amazing job. I love you. It's such a beautiful way to start off talking about money and to really set the intention.

It sounds a little formal, a lot of people going, "That's weird." I really don't care if it sounds weird. I want you to feel good. I want your partner to feel good and for you two to be connected. Other green flags I see are when couples look at each other and they often say, "What do you think?" Huge green flag.

In many relationships I speak to, I'll hear one person talking and the other will share their piece. After an hour or so, I'll ask one of them, "Do you ever ask your partner questions about money?" They'll go, "No." I go, "Do you ever ask your partner questions at all?" They go, "No, not really." I go, "Did your mom or your dad ever ask their partner questions?" "No." These things are passed down.

Can you imagine being in a relationship where your partner never actually asks you a question? That's a red flag, but a green flag is when they pause. They say, "What do you think? Gosh, I'm stuck. Can you help me out with this one?" That is when you know you've got a solid foundation.

If there are things that you realize, and we talked about this earlier, where you're like, "I grew up and we always said I can't afford it." You said you can't just change. You can't just say, "Get over it." Is the practice just knowing where it comes from and understanding if that's why it is?

Does that just make it better? What's the way to move forward? Let me give you an example from a couple that I spoke to. This is a couple where the husband was going on a trip to New York for work, and he invited his wife. He said, "Let's make a fun weekend of it." She said, "Okay, where do you think we should stay?" He had this hotel that he was going to stay.

Her first question, "How much does it cost?" He said, "I don't know. It's like 300 bucks a night," which for Manhattan is quite reasonable. She said, "That is outrageous. I won't do it." They got a different hotel in Chelsea, went there for the first night, and then went back to the other Moxie the next night.

Then they went throughout their stay in New York. You know what she said to me? She said, "We wanted to get Broadway tickets, so we stood in the last-minute ticket line." This is for people who typically come from out of town, they get the discount tickets. Fine. The only problem is they're multi, multi-millionaires.

I had to find a way to show her that she was not living her rich life. Her rich life was not, she told me this, was not taking hours of her limited trip to New York City to stand in a line to save 100 bucks and get whatever tickets are left.

Here's what I did. I'm a master of Indian mom guilt because I'm Indian. I said to her, "Okay, imagine the family behind you. They came here from Wisconsin. This is their one and only family trip to New York. They're hoping to get those Lion King tickets. Then the multi-millionaire couple in front of them snatches the last ticket.

How do you think they're going to feel?" She was almost starting to cry. Now, we were having a good time with it, but what I wanted for her to see was the stakes of her decisions. By only looking at the cost, she never thought about how much she could have left for the doorman at that hotel, how much she could have tipped for a server at a restaurant, and what kind of experience she could have gotten with her husband.

That's what I want people to see, which is the stakes are high and it's not just about saving 50 bucks. Nobody's going to look back and say, "Wow, I optimized for $50 on my trip to New York City." It's going to be what kind of magical experience did I create with the people I love.

One thing I try to do, especially when it comes to travel, is remember how much the trip costs when you're making these small decisions. You're going to New York. You're going for, you said, $300 a night. They're there for, let's say, four or five nights. You're spending over $1,000.

Flights, maybe another $1,000. All your meals, maybe you're spending another $1,000. You're spending $3,500. When you look at it in that perspective, you think, "We're spending $3,500 to go on this trip for four days. Do we want to make a decision about one little thing for saving $100 when we lose part of our vacation?" If you're spending $3,500 for three days, $1,000 a day, do we want to spend our $1,000 a day to be in New York in line?

I think that having a holistic vision is a beautiful way to do it. It totally changes the dynamic instead of, "Should we go to this restaurant?" It's like, "What's our vision for this trip?" I'll give you an example. When you're going on a trip, not everything has to be the best.

In fact, in my experience, picking the one thing that is magical and then the rest can be totally normal, ordinary, is a great way to approach it. The approach I try to take is, "What would make this trip magical?" On a recent trip, we went to Japan. We didn't want to eat at any fancy restaurants.

We'd done that a couple times. We just wanted to eat at ordinary places that we found and that we had tagged. That's it. Food was not an expensive part of our trip whatsoever. That actually is a huge relief to talk about that ahead of time. Be like, "Hey, what would make this magical?

I'm actually not feeling the need to go to X, Y, Z, or we can't afford it." Cool. That's totally fine. But pick one thing that would make it magical. It could be a food tour. It could be a behind-the-scenes thing that you find on Airbnb experiences. Whatever it may be, that to me is something you will always remember.

Yeah. I like that idea. I don't know if you know the peak end part of travel. Yeah. You want to have the peak experience, and then you want to have the end be great. I like that. Actually, what it really reminds me of is creating rules for the important things in your life.

So I have my own 10 money rules. My wife and I are starting to create our joint rules. And so for example, when we travel somewhere, we talk about where we're going to stay. We talk about how long. So we have one rule, which is a minimum of four days because leisure is the ultimate luxury to be able to slow down and not have to rush around.

We recently got a photographer when we were in Japan to take some photos of us, and we just loved it. We're like, "Wow, we're always going to remember this trip because of these awesome photos." And so we go, "Cool. Let's make that a rule. Every time we travel somewhere, we're going to get a photographer so we can remember that experience." Again, these can be really inexpensive things.

One person I know, the day they land, they go out to eat. Love it. Simple example. Could be 15 bucks. But the idea is you're coming up with these rules together and really creating that vision. That is when you've built a beautiful connection with your partner. Do you have any money rules with your wife?

So when we had our last conversation, I can't believe it was almost 2 years ago. It was an early episode of the podcast. You shared your personal money rules, and we talked about coming up with them. And I know we probably sat down and made up a few, but I wouldn't say I committed to any to the point that...

You can list yours off, right? "I know this one. I know this one. I know this one." I think we kind of generally agreed on a lot of things, but I don't think I've written them down. So maybe that's some homework. Because I'd like to... The reason I like money rules...

I say this as someone who hasn't put them in stone, is that it just makes the decision go away. Yes. You make the money rule of, "I am never going to care about how much berries cost," right? Let's say I make that rule. It's like, "If I want blueberries and the big box is $8, great.

But if the tiny box is $9, doesn't matter. You got to buy it because you committed in advance." Yeah. And you choose those rules knowing that you can easily afford it. No one's going, "Oh, my rule is I'm going to fly private every day and you can't afford it." That would not make any sense.

But for you, the price of blueberries is irrelevant. It's totally irrelevant. Now, I would not have made the blueberry rule when I was 17 years old. I couldn't have afforded it. And for a lot of people, they're like, "Who the hell cares about blueberries?" Cool. Not your rule. But I love the idea of coming up with these rules and writing them down.

It also becomes a really fun exercise to do together because it's dreamy. It's aspirational. And you can agree on something small to start. And as time goes on and finances allow it, you can expand it. That's really part of a beautiful, rich life. I think the one rule we do have, and it's our version of not having personal savings buckets, is just that anything under $200, you don't ask permission.

That's your worry-free number. Awesome. Now, I think we've had an offline conversation at one point about, "Is that number the right number?" So we won't go there. No, it's not. But... But it's great that you set it up. That's 99% of it. Who cares? The number itself can be tuned, whatever.

It's like a savings rate. "Oh, should it be 5% or 7%?" Okay, we could figure that out. That's math. But the idea that you even know what a savings rate is or a worry-free number, and you've set it up automatically, that is amazing. That's a green flag right there.

The funny thing, though, is because now my wife and I have both become a bit of an optimizer, a bit of a hacker of sorts. And so my version of it and her version is, "Well, I could spend $500 without any questions. As long as I have the intent of returning more than $300 of what I purchased, the net amount will probably end up being $200." And so I remember she definitely said, "Hey, if you notice that there was a $600 charge, don't worry.

Most of it will get returned. It doesn't matter." Or you'd say, "Oh, I want to buy an iPhone." It's like, "Well, if I do the Apple Play plan, it's only $100 a month. So I'm not making $1,000 purchase. I'm making $1,000 purchase." I'll tell you what I like about this, even though I find that a little odd.

But hey, it's your rich life. It's not mine. So what I really like about this is the two of you are talking about it regularly, and you have a good attitude about it. The fact that you're laughing, and I can tell that you and your wife laughed about this, and you joke about it.

And you're even making jokes about the optimizer thing. That is cool. That's how it should be. And so, so many times when I talk to couples about money, or if you're listening right now, money does not feel like that. It feels tense and rigid, and like you're walking on eggshells, whether you're solo or with a partner.

And in order to become confident with money, like you are, Chris, the way you're talking about it, you got to be competent. You got to know what a savings rate is. You have to have talked about, "Hey, what do we feel comfortable on?" And it's okay if your number is different than somebody else.

Fine. It's your rich life. But I love you modeling what excitement and confidence and competence looks like. For someone listening, there's an arsenal of episodes in your podcast they could go listen to. Is there one or two you'd want to suggest someone who's heard this conversation, kind of comes from the attitude of, "I like to optimize.

I like to organize my life," should go and start off with as a good intro if they haven't heard your show before? I've got two episodes that I want to recommend to people. First off, episode 20, "My wife is going to divorce me unless I can stop being so cheap." It's absolutely fantastic.

If you or your partner is a high net worth person, or one of you is cheap in the relationship, or sometimes both of you are cheap, listen to that one. Also, in episode 80, if I add any more to our $50,000 of credit card debt, he will ask for a divorce.

This is a cerebral and deeply psychological episode where you're going to learn that money is rarely just about the numbers. It goes much, much deeper. Those are some that I would highly recommend to people to start with. But also, you should definitely, like I said in the intro, go check out at least the first three minutes of the show on Netflix.

Yeah. I'd love it if you go to Netflix. The show is called How to Get Rich. Watch the first three minutes and send me a note about what you think. Send me a note. You can DM me, email me, tweet me, but watch the first three minutes of How to Get Rich on Netflix.

It is a different way of looking at money. Yeah. I'm excited for the show. Ramit, any final parting advice or places people should stay in touch with what you're working on? You can follow me on Twitter, on Instagram. I am doing a behind-the-scenes pop-up newsletter of what it was like to shoot a Netflix show.

A lot of people are like, "How did you get the show? What's it like shooting? Is it real?" I'm doing that at iwt.com/netflix for the next couple of weeks. Cool. Awesome. Ramit, thank you so much for being here again. Thanks for having me.