Social Media Money Myths: Build Financial Freedom on Your Own Terms

Gen-Z Financial Planning Tips

Struggling to save for your dreams? Financial freedom might not be about that fancy car. In this episode, we chat with award-winning investor and author Anne Lester of "Your Best Financial Life: Save Smart Now for the Future You Want."

We’ll:

• Redefine financial freedom and explore how to achieve it on your terms

• Learn mind tricks to boost your savings effortlessly

• Debunk money myths perpetuated by social media

• Learn actionable steps to feel empowered on your financial journey - no matter your age!

Links:

You can buy Anne’s book here- https://amzn.to/3z4XDGh

For more information on Anne - https://annelester.com/

Time Stamps

00:17 Meet Ann Lester: Financial Expert and Author

01:01 The Inspiration Behind the Book

02:06 Understanding Financial Struggles and Solutions

06:25 Exploring Different Money Types

07:11 The Oversubscriber: Managing Subscriptions

12:45 The Splurger: Avoiding Impulse Spending

15:44 The Hedonic Treadmill: Consumption Creep

21:09 Understanding Money Archetypes

21:24 The Crypto Bros Phenomenon

23:33 Automate Your Savings

25:35 Combating Consumption Creep

30:25 Evaluating Luxury Splurges

35:51 Final Thoughts and Takeaways

• Transcript

  Introduction to the Podcast

  Welcome to me financial the podcast designed to inspire your financial life. Hello everyone. And welcome to the podcast. I am Michelle Moses, your host. I am a certified financial planner, a realtor and a former e commerce store owner.

  
  Meet Ann Lester: Financial Expert and Author

  And today I have Ann Lester on the show and we are going to be talking about her book.

  Ann spent 20 years as head of retirement solutions for JP Morgan, and she is the author of your best financial life. Save smart now for the future you want. A book to help younger savers find long term saving success by overcoming their behavioral biases. Anne is also a media commentator with coverage from the likes of Bloomberg, Barron, CNBC, Forbes, Wall Street Journal, and the New York Times.

  And Barron's even featured Anne on their cover for her outstanding career. Welcome and thank you for being on the show. Well, thanks so much for having me. Yeah, well, obviously you have a lot of financial experience. [00:01:00] And so I'm very interested.

  
  The Inspiration Behind the Book

  Why, like what holes did you see in the marketplace? Cause we all know, I mean, you could go to the self help section and there are a million.

  self help financial books. What were the holes that you were seeing that then inspired you to write this book? Well, I, I guess on the one hand, I felt like none of them ever were talking to me. And, you know, by me, I don't mean, you know, Ann Lester cover of Barron's blah de blah. I mean, like the, the kid who, you know, kept maxing out a credit card and didn't know how to stop mistakes.

  Um, I also think that the way that we often convey financial information, even though we're, we're, and I'm talking about we in the financial services industry think that we're, you know, being relatable and talking at the right level for people. It's still full of jargon. And the second, I think a reader doesn't understand something, they immediately feel small and [00:02:00] stupid.

  And. That's the worst place in the world to try to make financial decisions from.

  
  Understanding Financial Struggles and Solutions

  I do think in the last couple of years there have been more books coming out sort of by peers, right? So, you know, you've had a raft of books in the last sort of three to four years by sort of peer to peer kind of things, and you're seeing a lot of that content on social media, and I think a lot of that stuff is great, too, because I think it's very relatable for the audience, but I guess I'm trying to do something a little bit different, which is be relatable, be human, um, acknowledge that people struggle, not sound like I'm lecturing people, um, and, and show that it's possible to overcome some of these mistakes, but also do it with the background of having worked in this industry for almost 30 years.

  Well, and I love that you're being transparent that you've worked in the industry and even though, you know, you go to work and you're learning all of these. Things that the spending is a completely, and the saving, I guess, uh, I, where I call the tire meets, uh, meets the road with like the budget. [00:03:00] Uh, that was hard for you.

  And so you wish that really hard. Yeah. You wish that a book like this would have been there for you at that age? Absolutely. And and for me, the really key, like the thing that unlocked all of this for me was. Understanding that it wasn't, I mean, it wasn't my fault I was spending all this money. Like, of course, on some level it was my fault because I was doing it, but I didn't understand that I, and it's easier for me to say now, this, this many decades on, that I just have poor impulse control.

  Like, I just do with money and food. Like, I don't have poor impulse control anywhere else in my life, but for those two things I do. And, You know, accepting that and understanding that and then building guardrails around myself have have really been transformational. And I learned a lot of that as I was building financial products, right, target date funds, to help other people save.

  But it also helped me understand that that I could forgive myself for those mistakes, that I didn't have to keep Putting myself into the same place to [00:04:00] try to make a better decision, you know, I'll put temptation in front of me and then I'll make the right decision. And, you know, that's, that's kind of silly, right?

  Well, and don't you think that as a society that we think that that's, what's going to happen when I, what I view it as just a visual is that you have to come down and you just need to accept. where you are and what you are. And that, you know, I have poor impulse control around these two items. And that is just the hand that I'm dealt.

  And there's just such a relief in that, right? I'm just, I'm just saying that, and it's not being a victim. It's just that this is just the hand that I was dealt. This is how I am. And so what are some small steps that I can take to help me with this because it's obviously going to be a lifetime of getting better at it, right?

  Is that kind of the thinking? 100%. And I think the, the, I hope the comfort my readers feel hearing, yeah, it's okay. Like we got this. Yeah. Nobody's perfect. And it's like, you know, [00:05:00] you get these emails or, you know, even on social, you see everywhere. I made this much and I'm doing this and I overcame this.

  Whereas I think what needs to happen and what people really relate to and love is when people are just being human and they are realizing, like I got an email from a coach and she was having a hard time and hat, you know, is talking about all this. Stuff that she went through with this relationship and how she had PTSD from it.

  And, and she was really surprised at the, uh, response. And I'm like, yes, because we are all flawed. We are all just trying to do better. And I think anytime you can be told, like, it's okay, I mean, you don't wanna sit there and wallow in it because then you don't feel good, but at the same time, just accept how you are and then just kind of go from there.

  It's. It's just such a freer way to live, right, than trying to like power through and be something different all the time. Yeah. This is not something you can grit through or bootstrap through. I don't think. No, no. And it's, it's a lot like food. I always talk about food and, and money, like [00:06:00] the same, they're the same.

  Yeah, they're the same. Yeah. I mean, it really is. It all applies so much, um, in the same thing. So anyway, I really applaud you for the, for the approach that you're taking to this. Cause I think that we need. Oh, so much. Yeah, I just think that we need more of it, especially online, you know, when you're getting everybody's a roll, uh, that, you know, just not everything is perfect.

  So, okay, well, let's kind of go into the book.

  
  Exploring Different Money Types

  Uh, I thought it was really interesting, um, that you had like the different money types. Can we talk a little bit about like figuring that out or and what they are? Absolutely. So, you know, the classic two biggies, right, are spending and savers. So you're a spender, you're a saver.

  I actually try to break that down a little more in there. This may not surprise anyone. More spenders than there are savers in the world. Um, it may be fun to spend. Well, and there's so many different ways to spend, right? And you know, my race, [00:07:00] this isn't a super scientific thing, right? I didn't do decades of research into your brain on money, but, but, but I have found that these resonate with people and it's really trying to align the way people are spending with some common behaviors.

  
  The Oversubscriber: Managing Subscriptions

  So when I talk about is the over subscriber, right? And this is, I think, Has always been true, right, ever since the first person came up with a magazine, but it's so much easier now to do oversubscribing because so much of it is invisible to us, right? I actually literally just went through my phone, like, last week and went, Whoa, I'm still paying for that?

  Like, I thought I canceled that two years ago. Not really. Um, so these things sneak up on us and it's a hard thing to acknowledge sometimes that it seemed like a good idea at the time and then it kind of fades, like I didn't need two robocall killers on my phone, I was paying for two of them, I don't know why, but I set them both up and there they were charging me, you know, four bucks a month or whatever, not, not huge amounts of money, but you know, Yeah, but it all adds up.

  It does add up. And, um, so, [00:08:00] Some of the tricks that I have for managing that is, you know, and some of them are easier than others, right? One is just make an appointment with yourself once a year to do a cleanse. You look through your statements on your credit card, you look through your phone, and you know, if you have an Apple phone, at least you can go see those subscriptions and apps.

  And you know, it's, it's pretty easy to go, whoa, whoa, whoa, why am I doing that? Well, and I liked how you said at the beginning of that one was that it was a woman that you had Said was the example, and that she lived with roommates and she saved money and had a job and, you know, all of these things. But the over subscriber was the, the part that was kind of leaking the money.

  So it was like she was very responsible for 75% of it. Um, but just this little one, and I think just this little part I should say, of her life. And that's what I think is so interesting is that you can do so well in different parts and make all these decisions. And let's be real. I mean, the oversubscribe, I mean, that's not, [00:09:00] it's, we're not talking about like huge, you know, binge shopping or anything, but these are just like little things that you can do, right?

  To save some money every month. It's, it's the hundred dollars or $200 a month, right? Mm-Hmm. that, you know, it's. easy for us to say this. It's so hard if you're that 25 year old to realize that actually that will make an enormous difference in your life. Right. I have a little example somewhere in the book about how much your, your, your takeout lunch is costing you.

  Right. And, and I don't want to sound like a preachy boomer, but like, You know, brown bagging it occasionally is a great way to make sure you hit your savings goals. You know, so it's, it, it is that a hundred bucks a month that is actually going to make a big difference. Just back to the food analogy, like it's that a hundred calories a day that makes you put on however many pounds it is a year, seven pounds or something.

  I mean, like, it's, it's really small. Yeah. It really is. And one of the tricks, in addition to making an appointment with yourself, which is, you know, kind of like you got to do it, right? That's a little hard. Uh, uh, a hack that I have in my, my book about, uh, subscriptions that I [00:10:00] actually do this myself. And I will just say with the massive caveat, do not get an extra credit card for this purpose.

  But if you happen to have more than one, if you sign up for anything, make sure you use the card with the closest subscription date, because it will tell you. that your card is expired and you have to renew it. And that is a very useful time to stop and say, why the heck am I subscribing to this thing anyway?

  Do I really need it? Right. Um, and I do one of the, I do one of the hacks that you have in there too, where I subscribe to like Disney plus for a few months and then I'm like, okay, everybody, we're going to end the Disney plus. And now we're going to go over to, you know, Hulu. And, and, you know, like we switch, we don't do them all at once.

  We do one at a time. And that is one of the hacks that you have in your book too. And I tell people that, and they're like, Oh, that's such a good idea. And I'm like, really? I'm just cheap. I don't want to pay for all of them at the same. I can't watch that much TV. Well, and it does also speak to the way [00:11:00] we watch TV now, right?

  Which is that you can like watch a season of something. So I'm watching something now on Apple TV and I'm going to finish it. And I'm going to turn it off until the next season's released. Like that's okay. Right. That's really okay. If they're going to make it that easy and low have such low barriers to jumping in and jumping out, then we should be taking advantage of that.

  Right. It's a great way to save some money. Yeah. Although they'll probably listen to this and be like, Oh, now we need to release. I don't think so. Because, because they're all. You know, I think about it from the company's perspective, right? Of course, they want everybody to sign up for everything and stay on it all the time.

  But like, would they rather have you do zero or would they rather have you jumping in for four months, watching the show you want and jumping back out and knowing that people will forget. So another hack that I have too, is checking the credit card offers because a lot of times you can subscribe to, you know, Paramount plus and get three months for free.

  Um, and so then I'll put a little, um, thing on my calendar that I need to cancel it after the first or, or I'll just watch what I need to watch and then cancel it right away. I don't care. Um, but there are a lot of [00:12:00] credit card offers on like Chase and American Express that you can activate on your card and then you'll get it for free.

  And I think the trick there that you say is actually Figure out a way to make sure you prompt yourself to step off, whether it's just knowing, I just want to watch this one show. That's all I want to watch. I'm going to watch it this weekend or this month and then I'm done. Um, or put a calendar reminder.

  And I just did that the other day. I signed up for something and I was like, I don't know if I really want this. I want to check it out. And I used it twice and thought, nah, I don't want it. And I, and I had the little flag in my calendar saying, remember to unsubscribe from this. And I did. Yeah. And that's why they have the free trials and all that, but yeah, you got to put it on your phone or your calendar or something.

  So yeah. Yeah. Okay. So anyway, what are some of the other money types? I think we're, we are both, uh, Maybe we were part of the oversubscriber crowd. Yeah, yeah.

  
  The Splurger: Avoiding Impulse Spending

  There's, I talk a bit about splurgers and I suppose if I, if I put myself in a camp, it would be the splurger and maybe, maybe I do that with food too, but it's like you, you're really, really good.

  You're buttoned up. You got this one thing and then you go boom and bust out and like overspend. Um, [00:13:00] And I think that that is are we talking like a trip or just close, you know, like a trip is one thing where it's thousands of dollars or could it just be like dinner? Well, I think, I think everybody's got like, this is not one size fits all, right?

  It's like, can you observe patterns of behavior that you fall into? Whether it's saying, I'm not going to go out. I'm not going to go out. I'm not going to go out. I'm going to be super careful. And then when somebody says, Oh, do you want to go out? You just totally bust loose and spend three times as much as you meant to like that.

  Okay. Just like a diet. Right. And I think the splurger, you know, where you might get into trouble is, and I've learned not to go into clothing stores without lists. Like, I need a new pair of jeans. I can't buy them online. I'm going to go try on a pair of jeans and then there's three cute things in the store and you buy all three cute things because they fit and they look good and like, why not?

  Right? And, and so it's, it's the, the splurging I think is the, you start with a thing that is awesome. A legitimate plan to maybe budgeted for [00:14:00] expense and then you slide into more other, you know, my husband once said the most expensive words in the English language were while we're at it. And we were renovating.

  Um, I was going to say, when you're doing a house, that's exactly where it can, right? You just, you just, you just go crazy. And, and it's so hard to understand where you just have to stop and say no. And It's super easy to do. It's super easy. And I think it's hard. I was actually, um, I've been thinking about this a lot, uh, over the last couple of weeks.

  I saw somebody online talking about what social media and just movies in general and how, um, it started, you know, like let's take sex in the city and how much luxury and living this luxurious life has become the norm, even if you're poor and that even if you don't have money, you're supposed to be driving a certain car and have these sunglasses and that, you know, Carrie Bradshaw in, you know, Um, that series was supposed to be poor, but then she's [00:15:00] wearing all these gorgeous outfits and designer and she's living in an apartment by herself and that we think that this, uh, we have this vision of what life is just supposed to be like, and that social media and all of these movies have just really done us a disservice because we are so out of alignment with what it truly takes to do that.

  And, uh, and have that. And we all are trying to attain this like perfect life, uh, in that we aren't even satisfied, you know, with, with other things. So I think the splurger would kind of go into that too. Absolutely. And that's a big concept in, in my book. And I'm sure you talk about it with your clients too, which is maybe not in these words, right?

  
  The Hedonic Treadmill: Consumption Creep

  There's something called the hedonic treadmill, right? Which is basically consumption creep in the hedonic treadmill. hedonism, right? Like seeking pleasure, right? You, we all seek pleasure, but you get used to it. So, you know, you, [00:16:00] you get a raise. You think, great, I can afford a new car. You buy the new car.

  And then two or three months later, you take the new car for granted and it doesn't make you happy anymore. Like it didn't change your life, right? Now there are some things that are truly life altering. Like if you're in a dangerous neighborhood and you move to a safe neighborhood, right? Or if you're in a really sketchy place where the power keeps cutting out, like, Like, absolutely, there is a threshold of, like, that you will stay happy above, but, but once you hit a pretty, I'd say, modest level of comfort, these things stop making us happy.

  Anybody who's ever gotten a promotion at work who just thought, oh, if only I got that promotion, I would love my job. And yeah, guess what? Your job is still your job, right? Even after the promotion. And so, I think one of the, the trickiest things, and I think maybe splurgers are really prone to this is, Is linking, right, that purchase with the emotional rush of the satisfaction, right, the happiness, the attainment of this thing that maybe I would say [00:17:00] you ought to spend some time thinking about is it really what's going to make you happy or is it just kind of fixing some other some other thing, you know, so I think that hedonic treadmill is a really scary thing.

  And that's another thing I talk about in my book. Like, if you're not aware of that as a, as a concept, you just slide right onto it. A lot of everybody else around you, because everybody's doing it, right? Oh, I can afford a bigger place. Oh, I can afford nicer vacations. And you keep creeping up and up and up and up.

  And you do a couple of things, right? One is, you're spending a lot of money. Um, two, you're anchoring your lifestyle at a pretty high level, which is going to require even more saving to replicate once you retire, right? So it's a very dangerous habit to get into to save, uh, not to save. More as your income goes up because you're just always chasing more and more and more and it'll never be satisfying, right?

  And and when you buy the bigger car or the more expensive car the oil changes are more expensive the cat that you know The tires are more [00:18:00] expensive stuff like that that you just really need to get real about And the insurance you get a new car The insurance is more expensive and sometimes it pays to just be cheap in some areas so that you can spend and others and I think that we as You It's a society, uh, I'm just speaking to Americans in general, I guess, but, uh, we think that financial freedom means just, I can just go spend whatever I want, whenever I want it and do whatever I want.

  And I really think that we need to redefine financial freedom as being more feeling free in yourself, that you are grounded in the decisions that you're making, that they're right for you. Is that, do you agree with that? Like I, I, I think this, I this term financial freedom has just gone off the rails and we need to bring it back to your heart and what you feel good in life about.

  I agree with you and I actually have kind of stopped using that phrase, even though me too though, it's kind of catchy and buzzy. Mm-Hmm. I like to think about financial [00:19:00] security. Yeah. Um, and I think what you said about aligning. How you're spending your money with your values is really important. We don't pause enough and think about that.

  And as I'm talking to especially younger people, um, about how to save money, it's like, I'm not trying to latte shame you, right? I'm not saying don't go to Starbucks every morning and get that latte. I'm asking you to save money. Think about, not to sound all Marie Kondo, right? But like, is that actually giving you joy?

  Is that a meaningful part of your day? I was having this conversation with somebody specifically, and they were like, Oh my gosh, that first cup of coffee in the morning. I go to the same place every day. The barista knows my name. I don't even have to tell them what I want. It just like makes my whole day then.

  Yes, please go keep having that experience because it's clearly the like the touchstone for you having a good day. Maybe don't go back in the afternoon for the second one. Maybe brown bag twice a week, right? Maybe so, so anchor the way you're making, I'm going to say non discretionary spending decisions, [00:20:00] right?

  Like, like, We will all live without a latte, right? You can make yourself a cup of 50 cent Keurig or, you know, you can, you can find coffee for a lot less than that fancy coffee drink, but. But are you really going on and on about whatever your purchase is and feeling it? Yeah. That it, it adds to your life and it takes practice.

  Is it just a habit, right? And it does take practice, right? I think it takes a lot of practice, but I think if you can just in that instant, and I can talk about some of these other hacks, right? Like. Can you make yourself pause just for a second before you click by, before you pull the trigger on whatever decision you're making?

  Because that pause is what lets a little bit of daylight kind of get between you and the impulse that your sort of fast brain is driving you towards and gets that rational part of your brain in just a second to say, Whoa, what are you doing? Like, I thought we said we weren't doing that today, you know?

  Right, right. Sorry, I didn't mean to eat that. You know, again, it's with me, it's food. Or leave it in your, or leave it in your cart and then sleep on it. And if you can't, if you [00:21:00] can't stop thinking about it the next day, then yes.

  I didn't really want it. I was just bored. Absolutely. That's a great tip. That is a great tip. Yeah. Okay.

  
  Understanding Money Archetypes

  So how many archetypes are there? Bunny types. How many money types were there in the book? Off the top of my head, I think there's seven. Yeah. There's quite a few. So it's not just spender and saver. And that's what I wanted to point that out.

  I can't. I can't. I can't. I think that's a good thing.

  
  The Crypto Bros Phenomenon

  I call them crypto bros, right? Cryptonauts. Um, and I did some focus groups, uh, around some survey work that I did a couple of years ago. And they tended to be overwhelmingly male. They tended to be super, super, super geeky about finances and following all kinds of stuff online.

  And they were the people that were doing the GameStop stuff and the cryptocurrency trading and the, And I think it's the same personality type that really geeks out about like fantasy football. They're just not interested in football and so they do it with money, but it's like mastering the minutia of all these little tiny [00:22:00] facts and wanting to be on the inside and having an idea and it's really dangerous.

  you know, really dangerous how easy it is to get sucked into again, making money decisions for reasons that fundamentally are unrelated to like building sustainable wealth and just trying to get a quick buck or what it sounds like something that you're deriving your self esteem from rather than just having self esteem.

  And that is very dangerous because you're just not going to get it right all the time, especially with money. I mean, you're just saying, Oh, sorry. If you're, if you're doing fast trading that statistically. You're overwhelmingly more likely to get it wrong, right? Yeah. And I think that, and I, that's one of my tenants, honestly, with money.

  And when you're learning, you've got to have some grace for yourself because you are going to mess up. I just put in quotes, mess up, uh, just because you're just learning what's in alignment with yourself and what you feel good about. And when you start wanting to know everything and you're going to be in the know, like not [00:23:00] everybody can be in the know like that.

  You're just, you know, You're money is all about figuring out what's right for you and what makes your heart sing, and so you gotta be going from that rather than Yeah. The, there it sounds like they're more like the gambling, like, oh, I feel good if I won, you know? Yeah. Mm-Hmm. . Well, and it's, again, it's the same geekiness.

  One of my cousins is a, is a, he's Canadian, he is a professional money manager in Canada, and he's a. Super deep baseball geek, and I'm like, yeah, the brain gets the same guy. Right? That really wants to know every single statistic and like understand how it all fits together. But you know, this, he spends his life doing that stuff.

  Yeah. Yeah. Okay.

  
  Automate Your Savings

  So I want to switch gears a little bit, uh, just because there's a couple things in the book that I definitely want to get to. So, uh, what, what are ways, so one of the things in there are what are some ways you can hack your brain to make saving savings easier? So we, I think we touched on one of them, but the first one is automate, automate, automate.

  Automate. Make it automatic. Have the money. Make sure the money doesn't go into [00:24:00] your pocket, basically. And I, again, I am somebody whose money literally burns a hole in my pocket. The second I have it, I'm like, oh goody, what can I do with it? And I learned I have to put it somewhere that I can't see and I can't get to very easily.

  And then it like disappears and I don't think about it. So it's setting up a separate high yield savings account for your emergency fund. Right. But have that deducted automatically from your paycheck. Which is very easy. Yeah. Well, and if it's, if it's automatic, then you know that you're going to get an overdraft fee if you overspend or, you know, it's going to take that extra step to stop it.

  So that makes sense. Well, and it's kind of out of sight, out of mind. Right. And, and, and it, I. In my view, you know, having that sitting on the home screen of your normal bank account where you can see all the balances is like, maybe that's not the right place for it because it's always sitting there. And at least if you're like me, it's always going, Hey, you really could afford that thing.

  Right. And that's for emergencies, right? Not for like, Whoa, I really saw that nice pair of shoes that I wanna get. Right? Like, that's not what that's for. And that's same thing [00:25:00] is true, and that's, I like to assign things for my money. And I like to do, that's why I like to do a budget, is because then I assign things to the money.

  And, uh, there is nothing that gets you from, Hey, I just made a ton of money to let me assign this to, you know, redoing my house and savings and all of that to, oh, I'm poor again in five minutes. I mean, honestly, yeah, it takes five minutes and then you're like, oh, okay, my mindset totally changed and I need to go make some more money.

  I've already spent that. Yeah. Yeah. Even though you haven't certainly, I know I have a plan for it. You have a, you have a plan for it. Okay. So what are some other ways that we could make savings easier?

  
  Combating Consumption Creep

  So, and then the second one that I talked about that, that I already mentioned is, you know, how do you combat consumption creep?

  Like if you're just starting out, you know, typical advice that I would give somebody is you long term need to be Thinking about saving 15 to 20 percent of all the money you earn, and that will be for retirement, that will be for your down payment, that will be for your, like, that number covers, like, the things that you need to have saved money for in life.[00:26:00]

  Big ticket items, right? Buying a new car, right? You can put all that under that umbrella. If you're just starting out, I don't think it's, unreal to say that you probably will struggle to do that just because if you've got student loans, if you're living in an expensive city, even if you've got four roommates, like it's just going to be rough to say, sure, I'll just take 15 or 20%.

  Right. You can't, you can't do it. Right. I think that's unrealistic. So, and when you get out of college, I mean, it's just shocking. I mean, you just don't realize how much it costs. To live. You know, I just remember talking to my girlfriend and being like, God, I thought I made so much money. And it just goes and you know, all of this stuff and yeah, you just shock and you don't take it home like you think, oh, I have this number, and ISS like, wait a minute.

  The federal government, state government, social security, health insurance, it's just gone. Right? Yeah. You do not realize. And so I think for a couple years you're kind of living in shock and like just. Trying to figure out how to make your life work with the money that you're making. Exactly. So you, you spend a little bit of time learning how you have to live [00:27:00] within your means.

  And if you're like, certainly me and many people, you make a few boo boos along the way. Maybe you run up some credit card debt, right? And you're like, well, can't do that. Maybe you do buy now, pay later. And it's like, well, can't do that. So you learn a few things and then you start, you know, as you work for a few years, most people, not everybody, most people start getting raises because you become more valuable to your employer.

  And this is the trick that lets you start saving appropriate amounts. It's not original to me. It's called Save More Tomorrow. And it's relatively pain, painless to promise yourself that when I get my tax refund, I am going to save half of it. When I get my raise, I am going to, Bump up my savings rate for at least half of that.

  I get to live a slightly nicer life. I get to have a few things I can't afford right now. So you feel better about that. And you start pushing your savings rate up from maybe zero or 1 percent or 3 percent to 5 percent to 7%. to 10%. And [00:28:00] in five or 10 years, you will be saving that 15 to 20%. Yeah. But it's, it's so painful to deprive yourself of stuff you want right now.

  And it's relatively easy to make a commitment to yourself. You can even automate that commitment on some, in some financial institutions. And again, if you have that coincide with when you have a little more money, you don't even notice you're saving more, right? So it's that is getting raises or you get bonuses or anything like that.

  And or people come into money in different ways. Right. And that is a great, a good question that I get a lot is, you know, what should I do with this? And my answer is always you should do everything. You should save some of it. You should spend some of it. You should save. Then also put some away for like maybe an emergency fund or a new car or something.

  That's more of a midterm goal. Yeah. You know, or you might wanna give some of it away too. And it doesn't have to be a lot, but you know, I like to help the animals, so I'm gonna give $25 to the animals and so do it all so that [00:29:00] you are getting. It's all about the essence of what you want because we're always dreaming like so big of like, Oh, if I could just support the art museum and, you know, like all those things and do all of this, but if you're doing it on a small level, you're going to be like, oh, okay, I'm doing it.

  I'm not doing it huge, but again, it's just those small little tiny steps, like, you know, I'll making those little habits. And I think that's what is most common of people that are financially successful is that they do do it all. And they do it all as they're going. I think that's a terrific point. And I, I talk about the importance of starting to save, even if it's only 1 percent or, you know, 10 or 20 bucks a week or whatever that number is for you, because It actually does add up and you start feeling better about yourself and then you flip the script in your own head from I can't do this to hey I'm actually doing this right and then then it starts getting a little bit fun right and then you're like whoa I am I am this [00:30:00] other person I am and I think you're doing it.

  I am a saver. I am somebody who invests in their future. I am someone who can afford to give a little bit to the, to the causes I believe in. I don't just have to sit here and complain about how I don't like my life. Right. So it's a very empowering thing to start doing. Yeah. Yeah. You're flipping the script from being a victim to actually, yeah.

  Taking control of your life. Yeah. It can start in the tiniest, tiniest of steps. Yeah. Okay.

  
  Evaluating Luxury Splurges

  And so then the other question that I have about your book is, what are three ways to determine if that luxury item is worth the splurge? Oh, I think we've touched on a couple of them. Did we already? Oh, we're already covering all this we're talking for.

  It's like, make a list. If you don't, Think you need it before you see it. You, you, you probably don't need it. You, you just don't. Like, I've heard that from people. Like, they go, I don't need anything. If I go to the mall, then I think I need things, but I don't, they're like, if I stay away from the mall, then I don't need anything.

  Well, uh, you know, advertisers and marketing people have [00:31:00] spent, you know, decades and decades and decades understanding the way our brains respond to like stimulus and the internet is a bad thing. Social media is a bad thing. Right. We get bombarded with, you know, perfect life. Seductive images that then, then, then we really think we need XYZ and I think your, your, you know, put it in the shopping cart and think about it is a great one.

  If it's not on your list, don't buy it, right? I think that's particularly important. Grocery store food. But in anything, right? If I go into this one clothing store I'm thinking of and need a pair of jeans, like I walk in and say, I'm only looking at jeans. Please don't show me anything else. I will not buy anything else.

  I'm not going to try anything on. Okay. Every once in a while I slip up, I buy it. But so you're saying that luxury basically changes based upon where you're, you know, cause I'm thinking like, Okay. Boats or so it could be luxury jeans and that you're paying a lot for and that you're having to budget for.

  So make sure that when you go in there that it's really what [00:32:00] you want and that you're in love with them. And that you can actually afford it. And okay, the jeans are a very finite thing, but let's just think it's a really attractive, like I'll keep it small, right? It's a really pretty dress or a suit jacket, right?

  Are you going to have to dry clean that thing? Because then your cost just went up, right? Like how are you going to have to take care of it, right? Your expensive car versus the less expensive car, right? Servicing that sucker is going to cost three times as much over, you The 10 years that I hope you're going to own that car or 15 years if you're me, because I'm cheap and I drive until they throw a rod.

  But, but, you know, like how do you think about not just the acquisition price? You mentioned boats, right? Boats are notorious. Yes. Money pits. Money pits. Yes. Okay. Okay. So really it's about being conscious. Yeah. Being conscious and trying to be aware. And it's, I've said that to, you know, it really is. It's just trying to be aware of your life and where you're spending and caring.

  Cause I [00:33:00] think sometimes people say, no, I don't care. I don't care that I have you do there on a level you actually do. And you're kind of lying to yourself. Well, and something else, I actually didn't put this in the book, I wish I had, it just came to me, um, is, you know, play the movie that shows you how you're going to be using that luxury item and in what sort of way, and then ask yourself if that's real or a fantasy.

  Is that really how you operate your life? Is that really your, your life? Is this, is this really your day to day life? How will it actually, I keep looking at a vacation property in a ski town and I keep fantasizing that, you know, someday we'll have the money and someday, you know, and it's literally never going to happen.

  And I enjoy fantasizing about it. And like looking at the real estate ads, it's, it's very much not going to happen. Also because my husband hates the mountains and hates skiing. So like not going to happen, but not going to happen. But. As I find myself kind of getting sucked into this, like, fantasy, I'm like, okay, really, how many weeks a year do you think you'd actually be there?

  Do you really want to Airbnb it out [00:34:00] so somebody's using it? Like, no, I don't want it. Okay, so, okay, then it's a fantasy. I'll leave it in my fantasy bucket and I'll still enjoy, like, looking at houses, but, but if I want to go skiing for a week, let me go rent something and go skiing for a week and then say goodbye, right?

  I don't need Right. Yeah, I do really don't need a vacation, right? You don't need to vacate once you start to think about the reality of it. And I do this with clothes. I buy like these going out clothes, the in heels and I wear flat, like I hate wearing heels. I mean, I'll wear wedges or, you know, but, um, I, on the every day, I want to be comfortable and I want to be warm.

  I hate being cold and I buy these clothes and I have just started in the last couple years having to talk myself into, no, just buy the every day, you know, cause it's like I want to look fancy or I want to look good or, you know, and then it, then I never wear them. And then I'm stuck wearing my workout clothes with a sweatshirt because that's the only other thing that I'll spend money on.

  And so I don't want to buy like, it's just the normal [00:35:00] clothes that I look boring, quote unquote boring in. I think it's a really helpful trick, right? Play the movie and then ask yourself, is this real? Like if you. Get invited to a fancy party and you really don't have anything in your closet and you really, it's an important thing for you.

  Okay, fine. But no, I don't get invited to parties. Yeah. Yeah. I mean, I don't know. My, my son's going to get married in a year and a half. Like I'm going to want a nice outfit for that. So like, I know that's coming, but you know, I'll wait a little while, maybe something in my closet will fit again and I'll wear that instead.

  But you know, it's like, how, how do you, how do you, again, it's, it's, it's the pause button. How do you. Find the way that works for you to hit the pause button, put it in the shopping cart, don't click, make yourself wait a night, check your list. Is it on your list? No. Do you have a long term fantasy list?

  Right? If it isn't even on that, you really don't need it. Right. Right. Okay.

  
  Final Thoughts and Takeaways

  Well, these are all great tips. I have really enjoyed talking to you and learning about your book and I think these would apply to any age. I mean, [00:36:00] honestly, if you're, or if you have kids and you're wanting to teach them about money or if you're just.

  You know, feeling out of control about money, then I think this sounds like a great book. So thank you so much. Yeah. Thanks for being on. I have really enjoyed our conversation and I'm glad to know that a lot of what we're talking about might be becoming more mainstream, you know, that if you have the same outlook that I, you know, and the ideas that I have had, that it does give me hope.

  Because I don't want people to walk around with a low self esteem about this stuff. So absolutely. It's not, it's not necessary. It just, it's, we just have to acknowledge that, that there's these poles outside of us and we just have to recognize them. And that's makes it so much easier just to understand what's going on to me.

  That's, that's a huge key. Well, I, really enjoyed this conversation. Thank you so much. Yeah. Thank you so much for being on. And you guys, we're going to have, uh, the link to your best financial life in the show notes and, uh, and, uh, [00:37:00] Instagram handle and all of the contact information that you need. Uh, and let us know if you have any questions and thank you so much for listening, everybody.

  Have a great day.

Disclaimer: The information provided in this podcast is for general informational purposes only and should not be construed as professional financial advice. Always consult with a qualified financial advisor or professional before making any financial decisions. The hosts and guests of this podcast are not responsible for any actions taken based on the information presented.