WEBVTT - Essential Habits For Financial Success #614 0:00:00.120 --> 0:00:02.480 Welcome to How the Money. I'm Joel and I in 0:00:02.680 --> 0:00:27.080 Matt and today we're discussing essential habits for financial success. Alright, Joel, 0:00:27.160 --> 0:00:29.560 you know this is gonna be a great episode, in particular, 0:00:29.920 --> 0:00:32.400 a great episode to follow up our conversation that we 0:00:32.479 --> 0:00:36.280 had on on Monday with economist Katie Milkman. During that convo, 0:00:36.400 --> 0:00:39.239 she dived into the science behind why it is that 0:00:39.240 --> 0:00:41.680 there are certain decisions, certain changes that we're able to 0:00:41.720 --> 0:00:44.600 make that we stick with, and why there are other 0:00:44.680 --> 0:00:46.880 changes that we make and when the first bump in 0:00:46.920 --> 0:00:49.280 the road comes along, we just immediately fall off that wagon, 0:00:49.320 --> 0:00:52.199 throwing the towel exactly. But the fact is, when it 0:00:52.280 --> 0:00:54.560 comes to some of the larger financial goals that we 0:00:54.600 --> 0:00:56.040 have in our lives, there aren't a lot of folks 0:00:56.040 --> 0:00:59.160 that have like this grand tenure plan. They're like, I 0:00:59.200 --> 0:01:00.520 don't know, like I don't even know what I want 0:01:00.560 --> 0:01:02.200 to do by the end of this year, let alone 0:01:02.200 --> 0:01:04.320 at the end of ten years. But they do know 0:01:04.360 --> 0:01:06.520 that they need to make some healthy changes in their lives. 0:01:06.560 --> 0:01:08.240 When it comes to how it is that they handle 0:01:08.319 --> 0:01:11.080 their money. They don't know exactly where they want to go, 0:01:11.120 --> 0:01:13.800 but they know they need to start taking some positive steps, 0:01:13.880 --> 0:01:16.360 you know. And this is exactly where this episode comes in. 0:01:16.680 --> 0:01:19.120 This is this episode is especially for the folks who 0:01:19.160 --> 0:01:20.959 are saying, like, just tell me what to do, Like 0:01:21.000 --> 0:01:24.000 I don't exactly know what it is I'm pursuing, like 0:01:24.040 --> 0:01:26.800 the big things are gonna bring about happiness in my life, 0:01:26.800 --> 0:01:29.120 but I do know I need to be smarter with 0:01:29.160 --> 0:01:30.920 my money. Tell me what I need to do. I 0:01:30.920 --> 0:01:33.279 think this episode is definitely going to connect with those folks, 0:01:33.280 --> 0:01:35.280 but just for for everyone out there who is looking 0:01:35.319 --> 0:01:37.679 to get better with their money as well. They might 0:01:37.680 --> 0:01:41.399 not have like a big, hairy, audacious goal of achieving 0:01:41.400 --> 0:01:43.679 fire by the time their thirty three or something like that, 0:01:43.959 --> 0:01:45.480 but it doesn't mean that they don't want to make 0:01:45.480 --> 0:01:48.200 progress and leave themselves more options. And so yeah, we 0:01:48.240 --> 0:01:50.760 think these these habits, implementing some some of the habits 0:01:50.760 --> 0:01:52.600 that we're gonna talk about today are going to help 0:01:52.600 --> 0:01:53.960 put you on the right path, even if you don't 0:01:53.960 --> 0:01:56.000 know where that path is going to lead exactly. But 0:01:56.040 --> 0:01:57.840 before before you get to that, man, I wanted to 0:01:57.840 --> 0:02:00.720 mention something in one of our listeners told us about 0:02:00.760 --> 0:02:03.360 the other day via email. Thanks thanks to listener Nate, 0:02:03.360 --> 0:02:06.160 by the way a listener who has some inside knowledge 0:02:06.160 --> 0:02:09.840 when it comes to how the insurance industry works. Yeah, 0:02:09.960 --> 0:02:13.880 and so he is an independent insurance agent himself. And 0:02:13.880 --> 0:02:16.600 and you and I always talked about how great independent 0:02:16.760 --> 0:02:21.720 insurance agents can be for individual consumers because they're not 0:02:21.760 --> 0:02:24.560 beholding to a specific company. And so instead of saying, like, yeah, 0:02:24.680 --> 0:02:27.600 let me quote you prices from Progressive only or All 0:02:27.639 --> 0:02:29.920 States only or whatever it might be, they say, no, 0:02:30.000 --> 0:02:33.000 I'm gonna I have the ability to shop with eight 0:02:33.080 --> 0:02:34.840 or nine companies on your behalf, and I'll tell you 0:02:34.880 --> 0:02:38.079 what the best prices are, which I think is super valuable, 0:02:38.120 --> 0:02:40.519 including a bunch of companies you've never heard of. Because 0:02:40.560 --> 0:02:43.400 they don't put any money towards marketing, right, they're also 0:02:43.440 --> 0:02:45.880 able to offer sometimes the best rates. Yeah, they don't 0:02:45.919 --> 0:02:48.240 have a cute green get go or something like that, like, 0:02:49.040 --> 0:02:51.079 which means they can offer you better rate sometimes because 0:02:51.080 --> 0:02:53.600 they're not spending so much on marketing exactly. And the 0:02:53.680 --> 0:02:56.160 website that Nate mentioned, I've not heard of this website before. 0:02:56.200 --> 0:02:59.280 We've talked about finding an independent local insurance agent, but 0:02:59.520 --> 0:03:02.280 he mentioned the site trusted choice dot com, which is 0:03:02.280 --> 0:03:04.720 a great site for finding a local agent. Where you are. 0:03:04.760 --> 0:03:06.760 So if you're like, hey, one of my goals this 0:03:06.880 --> 0:03:09.120 year is to save money on insurance. I know, like 0:03:09.160 --> 0:03:11.440 my insurance cost just went up big time. How am 0:03:11.480 --> 0:03:13.240 I going to be able to lower that cost in 0:03:13.280 --> 0:03:16.080 a meaningful way? Well, one of the easiest ways to 0:03:16.080 --> 0:03:19.320 do that is to find a local independent agents and so, yeah, 0:03:19.360 --> 0:03:21.160 we will link to that site in the show notes 0:03:21.200 --> 0:03:23.520 for this episode. But finding a local agent having them 0:03:23.520 --> 0:03:25.960 shop on your behalf is one of the easy things 0:03:25.960 --> 0:03:28.680 that you can do to potentially save hundreds or maybe 0:03:28.680 --> 0:03:30.919 even a thousand dollars or more in the coming year 0:03:31.000 --> 0:03:34.040 on on insurance costs, definitely without giving up a ton 0:03:34.080 --> 0:03:36.640 in coverage in order to do so. About exactly that, 0:03:36.440 --> 0:03:39.960 that's where we don't want you to cut corners in 0:03:40.080 --> 0:03:42.240 order to save There are other ways and one of 0:03:42.240 --> 0:03:44.920 the reasons he pointed out to local agents oftentimes they 0:03:44.960 --> 0:03:48.040 know the specific nuances and the laws associated with the 0:03:48.080 --> 0:03:51.360 state where you live, and so they oftentimes can provide 0:03:51.400 --> 0:03:53.800 better coverage because they know exactly what it is that 0:03:53.880 --> 0:03:55.840 you are going to be required to have, but then 0:03:55.880 --> 0:03:58.760 also what you don't necessarily need to have, and uh, 0:03:58.800 --> 0:04:02.280 they'll probably ask more about your specific situation sometimes, and 0:04:02.320 --> 0:04:04.560 I think that's helpful totally. All right, let's introduce the 0:04:04.600 --> 0:04:06.480 beer that you and I are going to enjoy during 0:04:06.480 --> 0:04:10.680 this episode. Uh, this is a liquid Hop Magma. This 0:04:10.760 --> 0:04:15.040 is our last beer donated to the show by Mutation Brewing. 0:04:15.080 --> 0:04:17.520 A big thanks to Jack and all of our friends 0:04:17.560 --> 0:04:19.240 over there at the brewery. But I'm looking forward to 0:04:19.520 --> 0:04:21.360 enjoying this one and we will share what we think 0:04:21.360 --> 0:04:23.320 about it at the end of the episode. For sure, 0:04:23.400 --> 0:04:25.640 we're like happy beers. We'll keep our thoughts on this 0:04:25.640 --> 0:04:28.120 one in just a bit. But Matt, but let's get 0:04:28.120 --> 0:04:29.839 onto the subject at hand. Let's talk about the essential 0:04:29.839 --> 0:04:33.520 habits for financial success. And it just makes me think 0:04:33.560 --> 0:04:35.960 of high school for some reason that like, remember we 0:04:35.960 --> 0:04:39.120 were always told back to school essentials, right, remember, well 0:04:39.360 --> 0:04:41.520 kids are going back to school for the second semester 0:04:41.560 --> 0:04:44.200 in just a couple of days. But like, uh, in 0:04:44.279 --> 0:04:45.960 high school, we were always told that we needed to 0:04:46.000 --> 0:04:48.760 get good grades. But it always thought a little arbitrary 0:04:48.760 --> 0:04:51.000 to me, like nobody was connecting the dots and so 0:04:51.080 --> 0:04:53.279 I was. I personally was more than happy to trade 0:04:53.320 --> 0:04:55.440 like hours of studying for a solid be instead of 0:04:55.440 --> 0:04:57.279 like busting my butt to getting it always felt like 0:04:57.279 --> 0:05:01.599 the gap in effort needed between getting a B in 0:05:01.680 --> 0:05:04.400 an A was significant, so I was just always content 0:05:04.480 --> 0:05:06.680 to get a slightly lower grade, but it was still 0:05:06.720 --> 0:05:09.400 solid right, And I think I choked it up to 0:05:09.440 --> 0:05:11.520 the fact that I had no desire to attend a 0:05:11.600 --> 0:05:13.760 prestigious school like the IVY leagues were out of the 0:05:13.880 --> 0:05:16.479 question for me. No, no Yale for Joel Little Little 0:05:16.560 --> 0:05:18.800 High School JOLS. No. I wasn't thinking about Yale or 0:05:18.839 --> 0:05:22.280 Harvard or Standford or any of that stuff. But it 0:05:22.320 --> 0:05:24.080 turns out, though, I think there were good reasons that 0:05:24.120 --> 0:05:26.680 my parents were pushing me to try harder, even though 0:05:26.680 --> 0:05:29.280 I wasn't planning on going to Colgate or one of 0:05:29.279 --> 0:05:32.920 those nice schools. Right, and better grades meant a wider 0:05:33.000 --> 0:05:36.080 range of options and the potential for more financial aid 0:05:36.080 --> 0:05:38.039 to no matter what school I went to. It makes 0:05:38.040 --> 0:05:40.760 me think recently, I was talking to my wife Emily 0:05:40.800 --> 0:05:42.920 one of her cousins, and he talked told me about 0:05:42.960 --> 0:05:44.680 getting a thirty two on his A. C T took 0:05:44.680 --> 0:05:48.880 it three times and he just couldn't get past that 0:05:48.880 --> 0:05:51.080 that mark. But if he'd gotten a thirty three, he 0:05:51.080 --> 0:05:53.880 would have gotten all his housing paid for at the 0:05:53.920 --> 0:05:56.880 school he went to. So it's just like one point 0:05:57.120 --> 0:05:59.840 man costs him a lot of money. But he said, man, 0:05:59.880 --> 0:06:02.400 I just I couldn't stomach taking that test again at 0:06:02.400 --> 0:06:04.560 that point in time. And I don't think he realized 0:06:04.720 --> 0:06:06.919 at the time, when he was eighteen how much it 0:06:06.920 --> 0:06:09.160 was gonna cost him. And so both his parents and 0:06:09.200 --> 0:06:12.920 my parents, I think, could see past our lethargy, my 0:06:13.279 --> 0:06:16.440 you know, lack of focus and dedication and his lack 0:06:16.480 --> 0:06:18.880 of wanting to take that test again, and they knew 0:06:18.920 --> 0:06:20.680 that that trying just a bit harder would have long 0:06:20.760 --> 0:06:23.960 term positive financial consequences for both of us, not to 0:06:24.000 --> 0:06:26.960 mention a stronger work ethic right that would provide dividends 0:06:26.960 --> 0:06:29.239 for years to come. So your parents wanted to see 0:06:29.320 --> 0:06:31.520 your full potential, Joe. They knew that you were capable 0:06:31.640 --> 0:06:34.080 of so much more. But but but what you're saying, though, 0:06:34.160 --> 0:06:35.760 is like, I mean, you're not just going to focus 0:06:35.839 --> 0:06:37.440 on getting good grades because you know that you have 0:06:37.520 --> 0:06:39.760 to achieve a certain g p A to get into 0:06:39.960 --> 0:06:42.279 a specific school, Like that is not the only reason 0:06:42.360 --> 0:06:44.240 that you're doing it. And you know, when it comes 0:06:44.279 --> 0:06:46.520 to like the big financial goals that we have in life, 0:06:46.640 --> 0:06:48.880 it can be overwhelming, you know, like when you hear 0:06:49.080 --> 0:06:50.880 Life Grows out there saying that like, you've got to 0:06:50.920 --> 0:06:53.039 start with the end in mind. And I'm pretty sure 0:06:53.120 --> 0:06:55.360 that that's something we've even said before, even though we 0:06:55.400 --> 0:06:58.760 don't at all consider ourselves gurus. And the reason though 0:06:58.800 --> 0:07:00.839 that that can be overwhelming, I think is because sometimes 0:07:00.839 --> 0:07:03.760 you just have no idea what end it is that 0:07:03.839 --> 0:07:06.680 you're actually pursuing. And plus, you know, we think this 0:07:06.720 --> 0:07:09.080 is also a great way to tackle the new year, 0:07:09.160 --> 0:07:11.200 because you know, you may not even know what you 0:07:11.240 --> 0:07:14.480 want to accomplish by the end of three let alone 0:07:14.480 --> 0:07:16.520 by the end of the decade. You might not have 0:07:16.760 --> 0:07:20.520 a specific crystallized goal yet. And that's okay, But it's 0:07:20.560 --> 0:07:23.240 about moving in the right direction. It's about getting that 0:07:23.280 --> 0:07:26.880 momentum started, getting that ball rolling, even if the end 0:07:26.920 --> 0:07:29.680 goal is subject to change. And so just like with you, Joel, 0:07:29.760 --> 0:07:31.240 so you didn't know exactly where it was that you 0:07:31.240 --> 0:07:33.560 wanted to go to college, but by having a good 0:07:33.600 --> 0:07:35.720 g p A, by giving it your best shot on 0:07:35.760 --> 0:07:37.880 the on the s a T. That was going to 0:07:37.960 --> 0:07:40.360 open up the potential for you to go to some 0:07:40.360 --> 0:07:42.600 different schools that you might have changed your mind to 0:07:42.680 --> 0:07:46.120 down the road and developing the right financial habits. We 0:07:46.160 --> 0:07:48.960 think that that will similarly help folks to start moving 0:07:48.960 --> 0:07:51.640 in the right direction, even if you don't know what 0:07:51.800 --> 0:07:54.280 your ultimate destination is going to be. Yeah, And the 0:07:54.280 --> 0:07:55.920 truth is that most of us have goals that are 0:07:55.960 --> 0:07:58.000 subject to change right now. None of our goals are 0:07:58.040 --> 0:08:00.000 are very few of our goals are set in stone. 0:08:00.280 --> 0:08:02.600 This is and we know them on like a multi 0:08:02.640 --> 0:08:06.240 decade long timeline, and life throws us curveballs and we 0:08:06.320 --> 0:08:09.360 have to adapt. That doesn't necessarily mean that you've failed, right. 0:08:09.400 --> 0:08:11.120 It's often that as you grow up and evolve as 0:08:11.120 --> 0:08:14.200 a person that what you want out of life changes, 0:08:14.600 --> 0:08:17.360 which is totally fine and totally understandable, and it's actually 0:08:17.360 --> 0:08:18.960 a good thing. What it feels like we live a 0:08:18.960 --> 0:08:21.040 new life, something like every seven years, we're turning over 0:08:21.040 --> 0:08:22.960 a new leaf. Matt. There are certain things that people 0:08:23.040 --> 0:08:26.120 might have told me three years ago, but pre pandemic, 0:08:26.160 --> 0:08:28.440 and they would have said, Hey, you're gonna end up 0:08:28.440 --> 0:08:30.240 doing this, this and this, making these choices. You're even 0:08:30.240 --> 0:08:32.120 gonna move from the neighborhood that you can love so 0:08:32.200 --> 0:08:33.720 much right now, and you're gonna end up in a 0:08:33.720 --> 0:08:35.200 new place and I would have been like, you're crazy, 0:08:35.280 --> 0:08:37.800 like there's no way out of your mind. But life 0:08:37.920 --> 0:08:39.800 here we are throws us her balls. We have to 0:08:40.000 --> 0:08:43.120 react accordingly. And you and I we moved our families 0:08:43.240 --> 0:08:45.600 right last year, but we want you to have the 0:08:45.600 --> 0:08:48.040 financial ability to be able to make those changes without 0:08:48.080 --> 0:08:51.200 freaking out. And the earlier you adopt the financial habits 0:08:51.240 --> 0:08:53.439 that we're gonna cover in today's episode, the quicker, you're 0:08:53.440 --> 0:08:55.960 gonna be on your way to increase levels of margin 0:08:56.040 --> 0:09:00.320 and financial flexibility, which directly equates to the likelihood that 0:09:00.440 --> 0:09:02.200 money isn't going to be the thing holding you back 0:09:02.440 --> 0:09:04.199 from the lifestyle you want to lead and the changes 0:09:04.240 --> 0:09:05.640 you want to make. Man, it would have been so 0:09:05.679 --> 0:09:08.360 much more stressful if we felt like we wanted to 0:09:08.400 --> 0:09:10.360 move our families somewhere else, but we didn't have the 0:09:10.360 --> 0:09:13.199 financial backstop to make that decision exactly. And so that's 0:09:13.200 --> 0:09:16.319 what we want for people. Like, as goals start to crystallize, 0:09:16.360 --> 0:09:19.080 you're like, Hey, the habits I've been implementing are you know, 0:09:19.120 --> 0:09:20.840 have gotten me to the place where I can now 0:09:20.880 --> 0:09:24.120 achieve that without having to to fret, without having to 0:09:24.240 --> 0:09:27.400 like freak out that you don't have the financial wherewithal 0:09:27.440 --> 0:09:29.719 to to make those decisions you want to make. That's right, man, Yeah, 0:09:29.720 --> 0:09:32.520 I can agree. More so let's get into it. Where 0:09:32.800 --> 0:09:36.360 do you start? And we would argue that gathering the 0:09:36.360 --> 0:09:39.400 facts that that is step number one. Uh, and that 0:09:39.440 --> 0:09:42.360 means tracking your spending. We think that this is the 0:09:42.440 --> 0:09:44.920 number one habit that folks who handle their money do 0:09:45.240 --> 0:09:48.680 without fail. Last month, actually we talked about how people 0:09:49.000 --> 0:09:52.640 underestimate what it is that they spend on their monthly subscriptions, 0:09:52.679 --> 0:09:55.040 and not just by like a little bit of money, 0:09:55.280 --> 0:09:57.680 like almost always it was by at least a hundred bucks. 0:09:58.000 --> 0:10:00.120 And so the reason I bring that up is we is, 0:10:00.120 --> 0:10:02.080 if you don't know where your money is going, it 0:10:02.240 --> 0:10:05.400 becomes really easy to let those precious dollars slip through 0:10:05.400 --> 0:10:07.840 the cracks, and that makes it harder to actually reach 0:10:07.880 --> 0:10:11.439 whatever goals it is that you are either currently pursuing 0:10:11.520 --> 0:10:13.520 or that you might end up pursuing at some point. 0:10:13.960 --> 0:10:16.520 Every dollar counts when we're looking to make changes, uh. 0:10:16.520 --> 0:10:18.240 And if you don't track where those dollars are going, 0:10:18.600 --> 0:10:20.840 it's like you're on a ship with a perpetual leak. 0:10:21.200 --> 0:10:23.160 You gotta fix that leak in order to get where 0:10:23.160 --> 0:10:25.079 you're trend to go. It makes me think of that. 0:10:25.200 --> 0:10:27.679 So the conversation we had with Katie on Monday, one 0:10:27.720 --> 0:10:29.160 of the things she wrote about in the book, she 0:10:29.480 --> 0:10:32.880 one of the similarities between Benjamin Franklin and Jerry Seinfeld 0:10:33.280 --> 0:10:37.239 was that they were incredibly disciplined in tracking their progress. 0:10:37.600 --> 0:10:40.640 There were changes that they both I would say probably 0:10:40.720 --> 0:10:43.360 very different changes that they both wanted to implement in 0:10:43.400 --> 0:10:46.480 their lives. Uh, and they were both able to basically 0:10:46.600 --> 0:10:48.839 chart their progress and that allowed them to achieve the 0:10:48.920 --> 0:10:52.240 results much faster. And specific to Jerry Seinfeld, one of 0:10:52.240 --> 0:10:54.720 the things she said that he would often do um 0:10:54.800 --> 0:10:56.440 is that he would maintain these streaks, and so I 0:10:56.440 --> 0:10:58.719 think maybe it was something like every night he was 0:10:58.760 --> 0:11:00.880 trying to do and like an open mic nights somewhere 0:11:00.920 --> 0:11:03.400 in order to just hone his craft. And once he 0:11:03.440 --> 0:11:05.800 got that going, he didn't want to stop, specifically because 0:11:05.800 --> 0:11:07.920 he didn't want to break break the streak that he 0:11:07.960 --> 0:11:09.360 had going to like in a sense, he was almost 0:11:09.400 --> 0:11:11.160 kind of gamifying it. And when I read that, I 0:11:11.200 --> 0:11:14.640 realized that's one of the reasons why I track my 0:11:14.720 --> 0:11:17.240 spending every single penny, every single month, and I've done 0:11:17.240 --> 0:11:20.120 that since two thousand and seven. Like literally, for I'm on, 0:11:20.240 --> 0:11:22.679 I'm on like a fifteen year streak where every single 0:11:22.679 --> 0:11:24.720 month that that is something I've been able to maintain. 0:11:24.880 --> 0:11:26.760 There's no way I'm gonna break that streak. I'm not 0:11:26.800 --> 0:11:29.880 gonna let a busy month allow me to not do 0:11:29.920 --> 0:11:31.920 this thing that I've done for so long that has 0:11:32.040 --> 0:11:35.360 allowed me to achieve the financial progress and the financial 0:11:35.360 --> 0:11:37.240 success that I have. And you're living up now to 0:11:37.240 --> 0:11:39.280 the moniker that everyone has for you, which is the 0:11:39.360 --> 0:11:43.960 Jerry Seinfelder personal finance if only No, I think you're right. 0:11:44.000 --> 0:11:45.959 I mean, I think those things, those things matter, right, 0:11:46.000 --> 0:11:49.840 And the longer we do something, the more habitual it becomes. 0:11:50.080 --> 0:11:55.360 But something as simple as tracking your money is crucial, 0:11:55.360 --> 0:11:57.600 Like it's it's like the first building block really personal 0:11:57.640 --> 0:12:00.080 finding so many ways, and if you're not doing that 0:12:00.200 --> 0:12:02.800 basic thing, the likelihood of you being able to achieve 0:12:03.280 --> 0:12:05.560 bigger goals that you've set out for yourself becomes a 0:12:05.600 --> 0:12:07.319 lot more unlikely if you're not willing to do the 0:12:07.320 --> 0:12:09.800 small stuff. Exactly. Yeah, I think I mean that's worth 0:12:09.800 --> 0:12:13.360 sharing too, because I think they're gonna are saying, oh great, 0:12:13.440 --> 0:12:15.959 how the money, guys, They're they're talking about tracking or spending, 0:12:16.000 --> 0:12:19.600 but like, this is something that folks who have accomplished 0:12:19.600 --> 0:12:21.280 a lot in their lifetimes. This is what they do. 0:12:21.320 --> 0:12:23.400 This is where you start. Yeah, and it sounds basic, 0:12:23.440 --> 0:12:24.960 but the realities most people don't do it, and so 0:12:25.000 --> 0:12:26.920 they don't know where the leaks are. They don't know 0:12:26.920 --> 0:12:28.839 how to go about plugging them. And the truth is 0:12:28.840 --> 0:12:30.360 there are lots of ways to track. Right. You can 0:12:30.360 --> 0:12:32.680 go old school spreadsheet like you do, Matt, and we 0:12:32.720 --> 0:12:35.560 can link to your budget spreadsheet that people can copy 0:12:35.600 --> 0:12:37.440 and use however they like. In the show notes for 0:12:37.480 --> 0:12:40.520 this episode, if you're like, hey, I do like I 0:12:40.600 --> 0:12:43.760 do like the Matt's grandpa approach to budgeting and tracking. 0:12:44.120 --> 0:12:45.719 That's cool. Feel free you go use it. Or you 0:12:45.720 --> 0:12:48.240 can use a software like Mint or wineap. If you're like, 0:12:48.320 --> 0:12:50.760 I'm hip, I'm with it, then go for that, like 0:12:50.800 --> 0:12:52.760 sign up for one of those sites Mints free, wineap 0:12:52.760 --> 0:12:56.120 costs money, But whatever system works best for you is 0:12:56.160 --> 0:12:58.440 all good with us. But if you opt to avoid 0:12:58.480 --> 0:13:01.319 tracking your spending, your progress, it's just it's gonna be stunted. 0:13:01.360 --> 0:13:03.480 Just like if Jerry Sinnel wasn't if he wasn't tracking 0:13:03.480 --> 0:13:05.320 those open mic nights, and he's like, I think I've 0:13:05.360 --> 0:13:08.079 done it like the last thirteen days, but I'm not 0:13:08.120 --> 0:13:11.320 a shure. There's something about, yeah, documenting it that helps 0:13:11.400 --> 0:13:14.360 keep that progress alive. And then the next step after 0:13:14.400 --> 0:13:17.440 tracking is budgeting. It was once you know you know 0:13:17.559 --> 0:13:19.880 where those funds are going, it's so much easier to 0:13:19.960 --> 0:13:22.559 then tweak your spending to better align with your values, 0:13:22.960 --> 0:13:25.439 and you start asking questions like do my current expenses 0:13:25.920 --> 0:13:28.720 makes sense for what I care about? How do I 0:13:28.720 --> 0:13:31.600 feel about the money that I'm spending? Do I feel 0:13:31.600 --> 0:13:34.040 good about it? And if not, it's time to readirect 0:13:34.080 --> 0:13:37.080 where those dollars are going? And again like they're you know, 0:13:37.120 --> 0:13:39.560 excellent software packages to help you out with this, but 0:13:39.679 --> 0:13:42.480 you don't need software to help you do this either, 0:13:43.040 --> 0:13:44.880 like pen and paper write. It can be as simple 0:13:44.880 --> 0:13:48.400 as that. But yeah, tracking and budgeting are like two 0:13:48.480 --> 0:13:51.200 unavoidable p's in a pod if you're doing those things consistently. 0:13:51.240 --> 0:13:54.360 We actually we have a new article up on our 0:13:54.360 --> 0:13:56.840 website at how money dot com. There's like different budgeting 0:13:56.840 --> 0:13:59.720 methods I think that work better for different personality types, 0:14:00.120 --> 0:14:02.120 and so will link to that so you can hopefully 0:14:02.200 --> 0:14:04.960 find a budgeting method that works for you how you 0:14:05.000 --> 0:14:07.800 think about money, and then kind of like how you 0:14:08.000 --> 0:14:10.840 personally handle it. It's not necessarily it doesn't have to 0:14:10.840 --> 0:14:13.440 be a one size fits all approach. That's right, And 0:14:13.480 --> 0:14:15.920 I will say I'll give a slight caveat because I 0:14:15.920 --> 0:14:18.480 said that this is something that everybody who's successful with 0:14:18.520 --> 0:14:20.480 their money, this is something that they do. And while 0:14:20.520 --> 0:14:22.360 I think it would be helpful for the majority of folks, 0:14:22.400 --> 0:14:24.440 I will say, there are folks out there who don't 0:14:24.480 --> 0:14:26.280 budget as much. I mean, I think you would even 0:14:26.320 --> 0:14:28.000 kind of fall into that camp. But that's actually the 0:14:28.040 --> 0:14:30.480 fourth budgeting style in that article I referencing is is 0:14:30.520 --> 0:14:33.280 people who don't budget. But like my favorite budgeting style 0:14:33.360 --> 0:14:36.440 is to not budget. But what I wanted to say though, 0:14:36.520 --> 0:14:39.720 is you, I think initially it is incredibly helpful. Yes, 0:14:40.200 --> 0:14:41.560 like maybe in the day to day, like the month 0:14:41.600 --> 0:14:43.120 a month, you're not you know, you're not doing like 0:14:43.120 --> 0:14:46.200 a zero some budget where you're tracking every single penny, 0:14:46.280 --> 0:14:48.280 which is one of the other ones in there. But 0:14:48.320 --> 0:14:51.480 I think initially, at least at the very beginning, like 0:14:51.480 --> 0:14:53.440 you gotta face the facts, you know, like you got 0:14:53.560 --> 0:14:56.760 to face the music and be shocked with the reality 0:14:56.880 --> 0:14:59.120 of your spending because you might think that you've got 0:14:59.120 --> 0:15:01.480 a certain level of spending, you know, going on in 0:15:01.480 --> 0:15:05.000 your life, but guess what. Lifestyle inflation happens in conjunction 0:15:05.040 --> 0:15:08.080 with actual inflation, which is caused a lot of are 0:15:08.120 --> 0:15:10.560 are spending to increase. And so I think it's so 0:15:10.640 --> 0:15:13.600 important to truly face the facts, and at the very 0:15:13.680 --> 0:15:15.640 least doing that once at the beginning can help you 0:15:15.680 --> 0:15:18.040 to get sort of like, uh, I don't like, almost 0:15:18.040 --> 0:15:19.440 like a tune up, Like when you go into and 0:15:19.480 --> 0:15:21.160 you take your car in, if you take it to 0:15:21.160 --> 0:15:23.000 somebody who knows what they're doing, they're hopefully able to 0:15:23.000 --> 0:15:25.520 give you a good diagnosis. Uh. And I think that 0:15:25.520 --> 0:15:27.200 that I can tell you what you can do, what's 0:15:27.240 --> 0:15:29.200 coming up with your carly Hey in maybe like a 0:15:29.200 --> 0:15:31.280 few thousand miles, those front brakes might need to be 0:15:31.280 --> 0:15:33.800 looked at again. And I don't know, maybe you're gonna 0:15:33.800 --> 0:15:36.840 need that ninety mile check up where we do this, 0:15:36.840 --> 0:15:39.320 this and this, prepare for it. Yeah, exactly, start thinking ahead, 0:15:39.320 --> 0:15:41.080 which is great, And I think that's what kind of 0:15:41.080 --> 0:15:44.240 tracking and budgeting can do for Yousolutely. It's also true 0:15:44.280 --> 0:15:46.120 that somebody like Jerry Seinfeld doesn't need to do an 0:15:46.120 --> 0:15:48.360 open mic night every single night at this point because 0:15:48.680 --> 0:15:50.280 of all the work he's put in throughout the years. 0:15:50.400 --> 0:15:53.080 So exactly, if you're that far along, you don't need 0:15:53.120 --> 0:15:57.200 to necessarily feel guilted into continuing a system that helps 0:15:57.200 --> 0:15:59.160 set you up for success, and it might continue to 0:15:59.200 --> 0:16:01.560 help you be success. But he also might not need 0:16:01.600 --> 0:16:03.880 it in the same way that somebody's just starting. Yeah, 0:16:03.880 --> 0:16:06.640 I mean it's trade offs because like simultaneously, like even 0:16:06.680 --> 0:16:08.760 the best coaches out there and the best players, they're 0:16:08.760 --> 0:16:11.520 watching tape, you know, like they are reviewing and looking 0:16:11.520 --> 0:16:14.600 back over their performances and like, and so I think 0:16:14.600 --> 0:16:16.800 even Jamaican a sports reference. But yeah, I don't want 0:16:16.840 --> 0:16:18.560 to do that off. But I get I think even 0:16:18.600 --> 0:16:21.280 the folks who are crushing their financial goals would see 0:16:21.560 --> 0:16:25.400 an increased level of performance were they to track and budget. 0:16:25.600 --> 0:16:27.120 It's just it just kind of comes down to whether 0:16:27.240 --> 0:16:29.240 or not that that is enough of a priority for 0:16:29.280 --> 0:16:30.960 them to want to do that. I remember seeing a 0:16:31.160 --> 0:16:33.840 Kobe Bryant interview where he talked about just out working 0:16:33.840 --> 0:16:35.800 everybody else, and he's like, they's say, the average athlete 0:16:35.840 --> 0:16:38.320 works out, has two good workouts in a day. Well, 0:16:38.360 --> 0:16:40.120 what if I wake up earlier in the morning, and 0:16:40.120 --> 0:16:42.400 I'm getting somewhere between three and four workouts in every 0:16:42.440 --> 0:16:44.640 single day. He's like, it doesn't matter if they were 0:16:44.760 --> 0:16:47.200 their butt off over the summer, because for the last 0:16:47.240 --> 0:16:50.120 five years, I've been doing an additional workout or two 0:16:50.440 --> 0:16:53.560 more than they have for years now, which in compounds. Yeah, 0:16:53.600 --> 0:16:55.680 and it's like those the kind of things, those actions 0:16:55.840 --> 0:16:57.840 really matter, right, That's a that's a habit that he 0:16:57.920 --> 0:17:00.560 got into that paid massive dividends, making him one of 0:17:00.560 --> 0:17:02.400 the best basketball players of all time. But you gotta 0:17:02.400 --> 0:17:04.240 you gotta let your body rest, though, too, write like, 0:17:04.600 --> 0:17:06.800 aren't you faced with like the reality of science? Yeah, 0:17:06.920 --> 0:17:08.399 I think that now that I've been working out. I mean, 0:17:08.440 --> 0:17:10.440 the guys that's a guy to work for Kobe, I'm 0:17:10.440 --> 0:17:13.040 gonna trust it. But there's there's certain guys that like 0:17:13.040 --> 0:17:14.720 work out every single day. I'm just like, how are 0:17:14.760 --> 0:17:16.920 you not sore the next day? Like when I work out, 0:17:17.080 --> 0:17:19.000 I can't I feel like I can't do Jack squad 0:17:19.080 --> 0:17:21.520 the next day. But we definitely don't need to turn 0:17:21.560 --> 0:17:26.240 this into physical fitness sports metaphor of an episode. We're 0:17:26.240 --> 0:17:29.080