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Speaker 1: Welcome to How to Money. I'm Joel, and too, I

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Speaker 1: am Matt, and today we're discussing why you need a

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Speaker 1: bare bones budget.

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Speaker 2: You know, a bare bones budget. It's got that BBB

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Speaker 2: action going on, some nice alliteration for our listeners today,

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Speaker 2: like a better business bureaud. Okay, So here is what

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Speaker 2: this episode makes me think of. You know, when you

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Speaker 2: start acquiring items for your closet, like your wardrobe, and

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Speaker 2: you kind of just add another hanger in there, and

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Speaker 2: you're like, oh, you know, I ran out of hangers.

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Speaker 2: Let's buy another pack of hangers, and you start filling

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Speaker 2: your closet, it starts bulging. It's about the bus at

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Speaker 2: that seems. I feel like our budgets can act that way, right, Like,

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Speaker 2: over time, as we add line items to our budget,

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Speaker 2: it can start to swell. Maybe now that we're you know,

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Speaker 2: we've got a legit job. Maybe you go on like

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Speaker 2: acation every year with your friends or something like that,

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Speaker 2: or maybe you like clothing, like that's something that you

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Speaker 2: really value, or maybe you really like electronics. It's okay

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Speaker 2: to spend money on the things that you enjoy, the

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Speaker 2: things that bring you value, but the effect that that

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Speaker 2: has on our budget is it. It starts getting kind

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Speaker 2: of thick, it gets a little bit plump. And so

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Speaker 2: with this episode, we want to introduce this idea of

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Speaker 2: essentially like a thought experiment for folks, Right, we want

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Speaker 2: folks to think through what would happen if you were

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Speaker 2: to pare down your budget to the bear essentials.

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Speaker 1: Yeah, we're not going to force you to create and

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Speaker 1: then adhere to this bear bones budget, but we do

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Speaker 1: think there's a whole lot that could be gained by

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Speaker 1: by just trying it out and seeing what happens by

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Speaker 1: at least creating one. And so we're going to talk

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Speaker 1: about how you do that and what you're going to

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Speaker 1: gain by doing that in today's.

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Speaker 2: Yeah, there's a lot of benefits from partaking in this exercise.

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Speaker 1: No doubt. Before we get to that, mat, I want

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Speaker 1: to quickly mention listener Holly send us an email and

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Speaker 1: she had mentioned this app that I hadn't heard about,

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Speaker 1: and I feel like we had to look into it

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Speaker 1: called Giveling, and it's this like student loan app or

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Speaker 1: people come together they play trivia games and sometimes say

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Speaker 1: pay money to play more trivia games and see if

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Speaker 1: they can move up the standings in order to win

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Speaker 1: a big prize to help pay off their student loans.

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Speaker 1: And yeah, I mean I know you took a look

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Speaker 1: at this too. Yeah, what would you think about it?

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Speaker 2: Dude? Yeah, it seemed a little too good to be

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Speaker 2: true because one of the things they say is that

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Speaker 2: once you get to the number one spot, you're eligible

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Speaker 2: for the grand prize, which is a fifty thousand dollars

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Speaker 2: student loan payoff.

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Speaker 1: Which you know, to anybody who has a bunch of

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Speaker 1: student loans is like, that's that's music to my ears exactly.

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Speaker 2: And here's the thing, dude, I was almost even hesitant

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Speaker 2: for us to even talk about it because I don't

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Speaker 2: want people to get the idea that this is something

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Speaker 2: that they need to do, because there are some serious

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Speaker 2: red flags, right because you're able to move up that

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Speaker 2: queue by acquiring I think what they call Q points,

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Speaker 2: and you do that by you can answer trivia, you

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Speaker 2: can watch ads within the app. You can also make

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Speaker 2: purchases like from their just different companies that they've partnered with,

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Speaker 2: and also by referring people from reading up on it.

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Speaker 2: Those are all ways that you can get closer to

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Speaker 2: that kind of prize, but specifically that last way of

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Speaker 2: getting points, referrals, pulling your friends in, dude. That's the

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Speaker 2: part of this that makes me feel like that this

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Speaker 2: is more of a pyramid scheme than anything else, right,

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Speaker 2: because essentially they are counting on the additional people that

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Speaker 2: are coming in in order to pay off the prizes

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Speaker 2: for the folks at the top, right, And anytime you

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Speaker 2: have any sort of model like that that's dependent on

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Speaker 2: the acquisition of more customers in order to be successful,

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Speaker 2: because there isn't truly an actual product. It makes me

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Speaker 2: feel that at some point if there are not enough

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Speaker 2: folks kind of at that base of the pyramid, you

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Speaker 2: know what happens that the pyramid essentially gets inverted, and

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Speaker 2: so you've got a fewer number of people at the

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Speaker 2: bottom paying into it. You've got a lot of people

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Speaker 2: invested who are waiting for that big payout at the

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Speaker 2: top exactly, and it's going to fail. And so something

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Speaker 2: like this, you can have so many people who are invested,

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Speaker 2: like literally invested. The We can link to an article

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Speaker 2: that we came across, but there's folks who have paid

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Speaker 2: in thousands of dollars and there's nothing really keeping a

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Speaker 2: company like this from going bankrupt. Now, next year or

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Speaker 2: like tomorrow.

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Speaker 1: Right, Yeah, I think it is. It's one of those

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Speaker 1: things where people get excited to think that they could

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Speaker 1: win a big sum of money that would help them

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Speaker 1: in a massive way, maybe pay off all their student

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Speaker 1: loans or at least pay off a huge chunk of it.

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Speaker 1: But it's kind of like the lottery in my opinion.

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Speaker 1: It might be a perment scheme. I'm not sure, but

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Speaker 1: it definitely has some lottery feel to it. And they

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Speaker 1: get you in there and you start to pay money

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Speaker 1: so you can continue to move up this leader board,

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Speaker 1: making you think you have a greater chance of winning

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Speaker 1: a big chunk of money that's going to help you

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Speaker 1: in a big way. And I think, yeah, there are

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Speaker 1: certain free ways that you can participate in this app

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Speaker 1: where you don't have to spend a time, and I

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Speaker 1: would say, like, even be careful doing that, because I

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Speaker 1: think it might get you in the mental state where

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Speaker 1: you're more willing to part with some of your money

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Speaker 1: to try to move up and to try to win

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Speaker 1: some cash. And I think the likelihood that's going to

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Speaker 1: happen for you is skim, just like winning the lottery.

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Speaker 1: So I would say, yeah, avoid givling I think it's

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Speaker 1: an app that doesn't make sense for almost anybody.

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Speaker 2: Yeah, the free aspects of it we don't have any

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Speaker 2: problems with. But like you said, it's like the prime

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Speaker 2: the pump a little bit and then gets you ready

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Speaker 2: to pay a little bit more money into it. And

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Speaker 2: specifically because it's the leader board, Like, I think that's the.

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Speaker 1: Part of it that the gamification of this.

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Speaker 2: Yeah, and I get it, Like I understand how it's

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Speaker 2: kind of fun, but essentially there's the expectation that at

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Speaker 2: some point you're going to reach the top. Right with

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Speaker 2: a lottery, When folks you know, play the lottery, they

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Speaker 2: know that there's a slim chance of them getting any money. Right,

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Speaker 2: there's not a leader board where it's like, Okay, eventually,

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Speaker 2: if I work hard enough, I will I will achieve it. Yeah,

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Speaker 2: it's chance. And so there's in my mind, there's a

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Speaker 2: huge difference between working towards something where you're expected to

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Speaker 2: pay out versus you know, one and I don't know,

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Speaker 2: ten million chance of winning the lottery or something like that,

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Speaker 2: where there's a huge payout.

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Speaker 1: Yeah, and gamification, we think can be a really healthy

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Speaker 1: and good part of personal finance. Right that we've talked

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Speaker 1: about that before on the episode. There are ways that

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Speaker 1: you can gamify your own personal finances that are gonna

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Speaker 1: help you in your pursuit of saving more and building wealth.

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Speaker 1: This is a way that's like praying on that behavioral tendency,

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Speaker 1: that a llure of gamification that's actually gonna part you

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Speaker 1: from your money. So, yeah, don't participate.

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Speaker 2: Games with friends that could cost you thousands of times right.

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Speaker 1: Well, so, all right, Matt, let's mention the beer that

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Speaker 1: we're having on the show today. This one's called Ethereal

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Speaker 1: Vibrations by Monday Night Brewing, one of our favorite local breweries,

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Speaker 1: and they collabed with Burial out of Ashville to make

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Speaker 1: this really good looking IPA. Looking forward to having this

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Speaker 1: one on the show today with you.

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Speaker 2: Yeah, it's hard to go wrong when you've got one

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Speaker 2: of your favorite local breweries teaming up with one of

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Speaker 2: your favorite national breweries to make a delicious beer. Looking

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Speaker 2: forward to enjoying this one on the show.

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Speaker 1: Dude, me too. All right, But for now, onto the

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Speaker 1: subject of the hand. Why you need a bear bones budget.

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Speaker 1: That's what we're talking about today, And Matt, I don't

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Speaker 1: know if you've seen this show there's a History Channel

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Speaker 1: show called Alone. Have you seen it?

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Speaker 2: I have not? Okay, so basically sounds like your worst nightmare,

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Speaker 2: though it does.

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Speaker 1: I like people, I would be sad.

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Speaker 2: I would probably deal okay with it.

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Speaker 1: You probably would. But basically what happens is that folks

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Speaker 1: are allowed to bring ten items with them as they're

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Speaker 1: dropped off in this remote section of the wilderness to

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Speaker 1: survive amongst like okay, bears, bobcats, other various treachery. But yeah,

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Speaker 1: so like ten people, they're competing against each other to

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Speaker 1: see who can stay out there the longest, whether it's

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Speaker 1: like thirty days, forty days, Like how long can you

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Speaker 1: be out there? And you don't know how everyone else

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Speaker 1: is doing. You're just trying to survive, And like the

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Speaker 1: idea of doing that with only ten items, with like

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Speaker 1: bare bones resources makes a show so much more interesting

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Speaker 1: than if those folks were able to bring any or

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Speaker 1: all of their possessions with them, right, Like, like I'm

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Speaker 1: thinking of dropping them in the woods with a tiny

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Speaker 1: house and a wood burning stove, and like it's like

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Speaker 1: not as interesting as a show.

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Speaker 2: I'd pay to go there, Yes, Like that's what's on

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Speaker 2: the first page of Airbnb right now, it's just like,

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Speaker 2: you know, these secluded cabins in the woods with a

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Speaker 2: wood burning stove, right.

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Speaker 1: And maybe an Xbox or something.

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Speaker 2: Yeah. Yeah, so with panels, it's all set ready to go.

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Speaker 1: Yeah, and I'm just thinking, like, not a very fun

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Speaker 1: TV show to watch a dude play Xbox in the woods, right,

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Speaker 1: But like seeing what people can do with limited resources

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Speaker 1: is actually kind of fascinating and for some of the

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Speaker 1: individuals who've gone on the show, even if they don't win,

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Speaker 1: it seems like it can be like this meaningful and

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Speaker 1: empowering experience. Well, we think that having a bare bones budget,

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Speaker 1: it's not going to make you the next Bear Grills.

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Speaker 1: You know, you're not gonna be able to survive in

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Speaker 1: the wilderness for months on end, like sleeping inside dead animals.

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Speaker 1: I think I saw him do that once. Dude, he

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Speaker 1: does a weird stuff that's a Star Wars reference. Yeah,

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Speaker 1: I guess that's true too. But he's an impressive man.

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Speaker 1: But we do believe that having you know, one of

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Speaker 1: these bare bones budgets in your back pocket is necessary,

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Speaker 1: is helpful, and it can be powerful in the case

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Speaker 1: of an emergency popping up.

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Speaker 2: Yeah, essentially, we think that having a bare bones budget

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Speaker 2: is about prioritizing your needs, not your once right, so

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Speaker 2: it reflects only those most essential monthly expenses, and having

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Speaker 2: one comes in handy in a lot of ways. So,

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Speaker 2: for instance, you may feel trapped working in a high

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Speaker 2: paying job that you hate, but because the pay or

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Speaker 2: the benefits are so good and you need that income,

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Speaker 2: you're stuck, or at least you feel like you're stuck.

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Speaker 2: Maybe you don't get treated as well as you should,

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Speaker 2: or the hours or the demands of that job are overwhelming.

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Speaker 2: You're not going to be left with many options if

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Speaker 2: you don't think you can seriously downsize your b and

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Speaker 2: so creating that barbones budget can help you to see

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Speaker 2: the path to exit that job, even if you don't

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Speaker 2: have a new one lined up yet. Or maybe it

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Speaker 2: can even help you to realize that you can take

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Speaker 2: a job or a position that pays less because your

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Speaker 2: finances are still going to be okay. It's essentially about

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Speaker 2: giving you options, flexibility, and the freedom to act in

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Speaker 2: ways that you want to act.

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Speaker 1: That's right, Yeah, And so I guess, like, who is

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Speaker 1: a bare bones budget for? We would say that it's

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Speaker 1: for everyone, that everyone should really attempt this experiment. Right,

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Speaker 1: even if you love your job, there's no guarantee that

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Speaker 1: your employer keeps you around as long as you'd like

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Speaker 1: to stick around. So some people might be like, but

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Speaker 1: I really like what I'm doing. I probably don't need

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Speaker 1: a bearbones budget because I plan on working, you know,

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Speaker 1: here for a long time. But you know what if

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Speaker 1: your employer goes to a rough patch, or the economy

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Speaker 1: in the general goes to a rough patch, and you

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Speaker 1: don't have that job anymore, Right, So we think it's

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Speaker 1: important for everyone. You know, I personally have seen the

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Speaker 1: difficulties that unexpected employment can create firsthand, and it's not pretty.

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Speaker 1: I would say two, Having that bear bones budget on

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Speaker 1: hand before an awful event like that happens to you

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Speaker 1: can help you whether the storm much better than you'd

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Speaker 1: otherwise be able to. It's so much harder to try

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Speaker 1: and slash expenses when you're in the midst of the

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Speaker 1: emotional and financial turmoil that you're going through in the

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Speaker 1: aftermath of something like a furlough, a job loss, or

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Speaker 1: a reduction in hours. Trying to get your budget in

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Speaker 1: order and pair it down in the middle of the

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Speaker 1: emergency is overwhelming. So that's why we would suggest getting

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Speaker 1: this bear bones budget done now, and it can be

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Speaker 1: a helpful resource for you in the future if you

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Speaker 1: need it.

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Speaker 2: Yeah, dude, rarely do we think that the worst things

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Speaker 2: are going to happen to us. But it's good to

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Speaker 2: start thinking about these things ahead of time. It actually

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Speaker 2: makes me think of have you ever changed a tire

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Speaker 2: like on your car?

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Speaker 1: I have, It's been a while.

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Speaker 2: Most people haven't done it, but if they were to

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Speaker 2: get a flat tire, they've never done it, and so

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Speaker 2: it's like they're stuck in the position of being like, Okay, wait,

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Speaker 2: do I have a spare tire like on this vehicle?

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Speaker 2: Where is it? How do I go about it? You know?

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Speaker 2: Should I put the parking brake on? Yes, it's going

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Speaker 2: to be really important that you do that.

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Speaker 1: I even have a jack in my car.

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Speaker 2: Yeah, And so there's all these things, and I mean, honestly,

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Speaker 2: it sounds a little bit like prepping, but it's just

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Speaker 2: thinking through the worst case scenario a little bit and

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Speaker 2: making sure that you're familiar with what you're gonna need

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Speaker 2: to do if that situation ever arises. I feel like

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Speaker 2: that's a part of the reason why we're recommending for

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Speaker 2: folks to start thinking about this ahead of time. The

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Speaker 2: bare bones budget. It's almost like a fire escape plan

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Speaker 2: that you had to come up with in elementary school,

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Speaker 2: you know. I remember my folks, like you remember back

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Speaker 2: in the nineties, there's those ladders, like if you had

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Speaker 2: a bedroom in the second floor, you're supposed to get

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Speaker 2: one of those ladders that you can like you know,

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Speaker 2: roll out the window. Yes, so you could escape.

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Speaker 1: I tried to, you know, tell my parents that we

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Speaker 1: needed one of these things, because like I think every

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Speaker 1: elementary school kid did, and I feel like they didn't

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Speaker 1: love because we never got that.

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Speaker 2: Okay, so my bedroom was there was actually this column

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Speaker 2: outside my bedroom window, and we never got one of

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Speaker 2: those things. But I remember thinking, okay, well you can

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Speaker 2: slide down that. Yes, I remember thinking, well, at least

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Speaker 2: I bet I could jump out my window, grab onto

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Speaker 2: that and just kind of slide down like fireman polls FID.

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Speaker 2: But I mean, in the same thing, just even as adults,

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Speaker 2: if you work in an office building or an office park,

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Speaker 2: you know, like once a year you have a fire

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Speaker 2: drill and everybody goes out to the parking deck or

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Speaker 2: the parking lot. Hopefully they have the ice cream truck

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Speaker 2: there where everyone gets the free ice cream, that kind

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Speaker 2: of thing, And it always kind of seems silly for

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Speaker 2: adults to be doing that, but it was an important

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Speaker 2: thing to do to make sure that we knew where

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Speaker 2: to go, knew how to get out of the building

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Speaker 2: in case there was a fire. It's not likely to happen,

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Speaker 2: but planning for the worst is still a good idea.

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Speaker 2: And in regards to your budget, knowing that you will

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Speaker 2: you know that you have this bare bones budget made,

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Speaker 2: and then just being able to just easily flip the

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Speaker 2: switch in an instant to spending a good bit less

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Speaker 2: than you currently are. This just offers some peace of mind,

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Speaker 2: you know, And it's truly helpful if you find yourself

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Speaker 2: in a precarious financial spot just down the road. Yeah.

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Speaker 1: So I'm man, I'm an optimist. You know this about me.

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Speaker 1: That's true, maybe to a fault, some might say, and

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Speaker 1: I might even say that I don't know.

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Speaker 2: And I'm a realist. I'm more the prepper type. Yeah,

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Speaker 2: I know exactly where the jack is on my van,

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Speaker 2: you know where yours is? Yes?

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Speaker 1: See, yeah, okay, I do so. Yeah, it's I gotta say,

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Speaker 1: like I think it's good to be an optimist. I

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Speaker 1: think hoping for the best is a really good thing.

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Speaker 1: But we would say, and I would say, yeah, even

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Speaker 1: as an optimist, budgeting like a pessimist and planning for

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Speaker 1: the worst is just a smart thing to do, right.

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Speaker 1: And that doesn't mean that you can't have a normal,

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Speaker 1: healthy budget where you use up all of your money

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Speaker 1: every month, with hopefully a healthy amount headed towards savings

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Speaker 1: and investing goals. But it does mean that you should

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Speaker 1: at least have this bare bones budget in case you

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Speaker 1: need it. Right. It's the budget equivalent, I would say,

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Speaker 1: of an emergency fund. You're hoping to never have to

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Speaker 1: use it, but having it is clutch, right if the

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Speaker 1: worst were to happen, if job loss does occur. I

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Speaker 1: think both of those things actually work really well in tandem,

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Speaker 1: right if something hard does come along.

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Speaker 2: Yeah, Plus, having that bear bones budget can also be

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Speaker 2: a confidence builder, right, if you've got a solid emergency

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Speaker 2: fund and a bear bones budget that's far less than

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Speaker 2: your normal monthly budget, it can really boost the assurance,

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Speaker 2: right that your finances are going to be okay no

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Speaker 2: matter what. But it can be an eye opening experience

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Speaker 2: to realize that you actually can live on far less

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Speaker 2: than you might have previously thought, because you know, like

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Speaker 2: fear of the unknown that is such a real thing,

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Speaker 2: especially when it comes to your money. But the bear

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Speaker 2: Bones Budget can just bring some concrete reality to quell

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Speaker 2: some of those fears. You don't have to stay awake

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Speaker 2: at night wondering like, well, what happens if I lose

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Speaker 2: my job? Like what if I'm ridding my bike and

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Speaker 2: I fall off and I break my arm and I

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Speaker 2: can't go to work, or you know, I guess I

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Speaker 2: could still talk you and I can continue to podcast.

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Speaker 2: Like then you start thinking, oh, do I need accident

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Speaker 2: you know, income replacement insurance? You know, do I need affleck?

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Speaker 2: Like no, Like, we wouldn't point you in that direction,

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Speaker 2: but we do think that this is a really valuable

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Speaker 2: step to making sure that you've got that peace of mind.

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Speaker 2: We want you to know that you would have options.

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Speaker 1: Yeah, that you're going to be okay in the event

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Speaker 1: of an emergency, and the E Fund and the bar

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Speaker 1: Bones Budget simultaneously is really going to provide I think

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Speaker 1: a lot of that peace of mind.

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Speaker 2: It's like a nice one to two punch.

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Speaker 1: Yeah, for sure, I think too Matt. This exercise of

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Speaker 1: creating a bar bones budget. We're going to talk about

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Speaker 1: how to get there in just a second. It might

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Speaker 1: present some helpful questions about the expenses that are in

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Speaker 1: your current budget too. I think this is a healthy

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Speaker 1: exercise to realize that the expenses in your life they're

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Speaker 1: not fixed. I mean, some of them are, we're gonna

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Speaker 1: talk about that, but many of them are actually just

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Speaker 1: spending choices that we've made, and we all make them.

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Speaker 2: Yeah, this lifestyle.

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Speaker 1: Yeah, and there are some things obviously, like we think

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Speaker 1: it's okay, and it's actually good to prioritize certain expenses

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Speaker 1: in your life that others might think are crazy, purely

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Speaker 1: because you love them and you enjoy them. Use your

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Speaker 1: fancy socks, like my fancy socks. Yeah, I don't know,

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Speaker 1: I like my socks.

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Speaker 2: I mean that's a lifestyle thing, you think. You know,

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Speaker 2: I'm an adult now, I'm not gonna wear socks that

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Speaker 2: have holes in them, Whereas I am cheap in that way,

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Speaker 2: like I don't care man like, so in my mind,

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Speaker 2: I don't call it cheap. It's frugal. Like I am

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Speaker 2: willing to have socks with holes in them because I

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Speaker 2: don't care. But then of course I spend money on

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Speaker 2: other things that you would you know, you might think

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Speaker 2: is our foolish, Like I got this new bike bag

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Speaker 2: that I can wear around town or you know, while

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Speaker 2: I'm riding my bike. It's fancy like my old one.

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Speaker 2: It totally still carries it contained things. It's just that

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Speaker 2: I kind of wanted one that was updated, that looked

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Speaker 2: a little more sleek.

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Speaker 1: Yeah, but I think that's what my priorities like. I

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Speaker 1: know we have different priorities, and that's okay, But I

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Speaker 1: think as we go through this exercise, it's good to

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Speaker 1: point some of those things out, and it's good to

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Speaker 1: realize that some of the things that are currently in

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Speaker 1: your budget they are there because of choice and not

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Speaker 1: because of necessity. And creating a bare bones budget figuring

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Speaker 1: out the minimum amount that you could live on, can

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Speaker 1: be a helpful mindset shift in how you think about

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Speaker 1: the money that's going out of your account every single month.

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Speaker 1: So we're gonna talk more about what's included in a

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Speaker 1: bare bones budget and how to create one, and we'll

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Speaker 1: get to that right after this.

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Speaker 2: All Right, dude, we are back, and we just covered

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Speaker 2: all the different reasons why it is that we should

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Speaker 2: all have a bare bones budgets in our lives. And

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Speaker 2: so now let's talk about what is actually in a

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Speaker 2: bare bones budget. And at the top of the list

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Speaker 2: we're gonna put beer because beer is the essential to life. No,

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Speaker 2: actually it's not right. I mean, water is virtually free,

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Speaker 2: and if it came to it, I would be willing

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Speaker 2: to pair back how much I'm spinning on beer if

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Speaker 2: I was in a tight spot, wouldn't you?

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Speaker 1: Yeah, I totally would. And I also think that would

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Speaker 1: be one of the last things I cut, Like definitely

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Speaker 1: when I made my bear bones budget, beer was not

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Speaker 1: a part of that because it should not be a

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Speaker 1: part of your bearer bones. But that's not what it's for.

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Speaker 1: That this exercise is literally for, like how little amount

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Speaker 1: of money can you live on?

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Speaker 2: That is true. Yeah, we're looking at the essentials. And again,

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Speaker 2: this isn't the budget that you're hoping to ever have

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Speaker 2: to use. And so we want you to slash to

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Speaker 2: the point to where it starts to hurt, you know.

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Speaker 2: And so let's talk about some of the different categories

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Speaker 2: that will make the cut. Let's talk about which ones

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Speaker 2: won't make the cut. And as we do this, I

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Speaker 2: think it can be helpful to think about Maslow's hierarchy

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Speaker 2: of needs here as we discuss the basic needs that

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Speaker 2: it actually takes for us to survive.

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Speaker 1: And so, Jill, you want to kick it off food obviously, yeah,

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Speaker 1: a basic need that we all have, right, But what

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Speaker 1: we don't all have as a basic need to survive

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Speaker 1: Chipotle or like Chick fil a or whatever fast food

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Speaker 1: or whatever food in general that you enjoy, like in

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Speaker 1: all likelihood, you're going to need to and you should

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Speaker 1: in this bare bones budget exercise, pare down your food budget.

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Speaker 1: Your current budget might include eating out and fancy cheeses

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Speaker 1: at the grocery store. Yeah, maybe some fine craft beers,

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Speaker 1: but the bare bones budget shouldn't include any of those things.

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Speaker 1: You know, we're not expecting you to survive on bread

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Speaker 1: and water alone. That's not healthy. But I guess if

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Speaker 1: you're in that show alone on the History Channel, maybe

434
00:18:32,520 --> 00:18:34,640
Speaker 1: that's what you're doing. If you can't kill a critter

435
00:18:34,680 --> 00:18:37,640
Speaker 1: that night to roast over and open flame. Maybe, but yeah,

436
00:18:37,720 --> 00:18:40,760
Speaker 1: rice and beans are tons of protein and fiber. Basically,

437
00:18:41,000 --> 00:18:43,320
Speaker 1: strip down your food budget to what you can actually

438
00:18:43,359 --> 00:18:46,040
Speaker 1: get by on without all the extras, without all the

439
00:18:46,080 --> 00:18:49,359
Speaker 1: fluff without all the niceties. It's helpful knowledge to have

440
00:18:49,440 --> 00:18:51,440
Speaker 1: on hand to know how low you can actually get

441
00:18:51,440 --> 00:18:53,080
Speaker 1: your grocery budget if you needed to.

442
00:18:53,320 --> 00:18:55,600
Speaker 2: Yeah, dude, seriously, Like, like you mentioned rice and beans

443
00:18:56,000 --> 00:18:57,560
Speaker 2: in like I don't know. It can kind of be

444
00:18:57,600 --> 00:18:59,320
Speaker 2: a rallying cry of certain folks who are like trying

445
00:18:59,320 --> 00:19:01,560
Speaker 2: to get out of debt. But there's a good reason why,

446
00:19:01,640 --> 00:19:03,359
Speaker 2: and that's because, I mean, you can get a lot

447
00:19:03,359 --> 00:19:05,800
Speaker 2: of protein from rice and beans. I guess it's specifically

448
00:19:05,800 --> 00:19:08,080
Speaker 2: the beans, but like the combination of those two foods together,

449
00:19:08,359 --> 00:19:11,399
Speaker 2: Like you don't have to buy some fancy protein, you know,

450
00:19:11,440 --> 00:19:14,720
Speaker 2: you don't have to get the fresh Alaskan salmon that's

451
00:19:14,720 --> 00:19:16,680
Speaker 2: never been frozen. There are other ways to make sure

452
00:19:16,680 --> 00:19:19,040
Speaker 2: that you're getting the nutrients you need. And so we're

453
00:19:19,040 --> 00:19:21,320
Speaker 2: going to go from food to shelter because this is

454
00:19:21,359 --> 00:19:24,280
Speaker 2: one that everyone needs. This is one that's usually not

455
00:19:24,320 --> 00:19:26,119
Speaker 2: going to change, honestly from your regular budget.

456
00:19:26,160 --> 00:19:28,400
Speaker 1: So are you going to suggest that people should pitch

457
00:19:28,400 --> 00:19:30,879
Speaker 1: a tent in the woods near where they live. Is

458
00:19:30,880 --> 00:19:32,360
Speaker 1: that all that can make the cut in the bar bot?

459
00:19:32,440 --> 00:19:35,200
Speaker 2: I mean they could, but most people aren't gonna do that, right,

460
00:19:35,240 --> 00:19:36,840
Speaker 2: Like that's not the position that most of us are in.

461
00:19:37,520 --> 00:19:39,000
Speaker 2: But you know, if you are nearing the end of

462
00:19:39,040 --> 00:19:41,760
Speaker 2: your lease, maybe moving to a smaller place, smaller home

463
00:19:41,880 --> 00:19:44,679
Speaker 2: or a smaller apartment, that might make sense if your

464
00:19:44,720 --> 00:19:48,400
Speaker 2: financial situation has changed, But you can't, you know, really

465
00:19:48,480 --> 00:19:50,840
Speaker 2: change the reality of your current monthly you know, housing

466
00:19:51,000 --> 00:19:53,920
Speaker 2: expenses in most cases, and so as you're putting together

467
00:19:53,920 --> 00:19:55,720
Speaker 2: your bear bones budget, you're probably going to transfer this

468
00:19:55,760 --> 00:19:59,200
Speaker 2: lime atom pretty much directly from your regular budget. Although

469
00:19:59,200 --> 00:20:01,439
Speaker 2: it is importan and to point out though, that we

470
00:20:01,480 --> 00:20:04,400
Speaker 2: do have control to a certain extent of how much

471
00:20:04,440 --> 00:20:06,800
Speaker 2: are housing costs, right, because your mortgage payment isn't going

472
00:20:06,840 --> 00:20:08,639
Speaker 2: to change, but the amount that you're paying towards that

473
00:20:08,640 --> 00:20:11,560
Speaker 2: mortgage payment can change. Maybe you've got an extra bedroom,

474
00:20:11,640 --> 00:20:13,360
Speaker 2: and you've got that room set aside for friends who

475
00:20:13,400 --> 00:20:15,520
Speaker 2: might come to visit a place for them to crash.

476
00:20:15,560 --> 00:20:16,879
Speaker 1: Now it's set aside for strangers.

477
00:20:17,160 --> 00:20:19,240
Speaker 2: Well now as yeah, it's a set aside for a roommate.

478
00:20:19,359 --> 00:20:21,040
Speaker 2: And so if you're able to all of a sudden

479
00:20:21,160 --> 00:20:22,760
Speaker 2: realize that, like wait a minute, like I've got this

480
00:20:22,800 --> 00:20:24,679
Speaker 2: extra room, maybe I've got two extra rooms. I can

481
00:20:24,720 --> 00:20:28,560
Speaker 2: get two additional roommates who would gladly pay four hundred

482
00:20:28,560 --> 00:20:30,920
Speaker 2: dollars a month, you know, just for their own small room.

483
00:20:31,600 --> 00:20:33,480
Speaker 2: You get two of those room set up, you're bringing

484
00:20:33,480 --> 00:20:35,720
Speaker 2: in eight hundred bucks a month. That could offset a

485
00:20:35,720 --> 00:20:38,800
Speaker 2: fifteen hundred dollars mortgage in a significant way. And so

486
00:20:38,840 --> 00:20:40,320
Speaker 2: it's worth pointing out that you're probably not going to

487
00:20:40,320 --> 00:20:42,520
Speaker 2: sell your house just because you're having maybe a tough

488
00:20:42,520 --> 00:20:45,240
Speaker 2: time with your finances. But there are other smaller moves

489
00:20:45,240 --> 00:20:47,879
Speaker 2: that you can make without putting your house on the market. Right,

490
00:20:47,960 --> 00:20:49,960
Speaker 2: I get some roommates. That's definitely a way that you

491
00:20:50,000 --> 00:20:51,399
Speaker 2: can bring down your housing costs.

492
00:20:51,400 --> 00:20:52,800
Speaker 1: And you don't have to go live in a van

493
00:20:52,960 --> 00:20:54,000
Speaker 1: down by the river either.

494
00:20:54,080 --> 00:20:54,840
Speaker 2: Like that. That is true.

495
00:20:54,840 --> 00:20:56,720
Speaker 1: It's an option, I guess, but I'm not sure the

496
00:20:56,800 --> 00:21:00,080
Speaker 1: legalities of that. Probably depends on your local municipality. I

497
00:21:00,080 --> 00:21:02,880
Speaker 1: shouldn't do that. Rest in peace, Chris Farley, Oh love

498
00:21:02,920 --> 00:21:06,160
Speaker 1: that guy, Kay, see a good one. I think another

499
00:21:06,200 --> 00:21:09,280
Speaker 1: thing that obviously needs to enter into your bare bones

500
00:21:09,320 --> 00:21:14,239
Speaker 1: budget is utilities associated with your shelter. Utilities aren't a

501
00:21:14,280 --> 00:21:17,560
Speaker 1: fixed cost, but they are largely fixed right. But at

502
00:21:17,600 --> 00:21:19,960
Speaker 1: the same time, we do think that you can trim

503
00:21:20,000 --> 00:21:23,159
Speaker 1: this back slightly from your normal budget, maybe five to

504
00:21:23,200 --> 00:21:23,679
Speaker 1: ten percent.

505
00:21:24,040 --> 00:21:25,680
Speaker 2: Just depends on how much you're willing to sweat in

506
00:21:25,720 --> 00:21:27,520
Speaker 2: the summer. You know, if you just keep crinking that

507
00:21:27,560 --> 00:21:30,400
Speaker 2: thermostat up, man, utilize those fans, drink eyes water.

508
00:21:31,240 --> 00:21:32,879
Speaker 1: That's what I used to do. I gotta say, seventy

509
00:21:32,880 --> 00:21:36,679
Speaker 1: eight degrees in summer is what I feel like should be. Okay,

510
00:21:36,720 --> 00:21:39,760
Speaker 1: and my wife might disagree, but then I think you

511
00:21:39,760 --> 00:21:41,720
Speaker 1: can pull it down a seventy six at times that

512
00:21:41,800 --> 00:21:43,719
Speaker 1: you need it if you're going below seventy six. Though

513
00:21:43,760 --> 00:21:45,439
Speaker 1: I don't even know who you are, man, you just

514
00:21:45,480 --> 00:21:48,080
Speaker 1: lived in luxury. How fancy are you?

515
00:21:48,640 --> 00:21:51,000
Speaker 2: Dude? Okay, here's the thing. I would much rather keep

516
00:21:51,040 --> 00:21:53,520
Speaker 2: it at seventy six seventy seven in the summer and

517
00:21:53,600 --> 00:21:55,840
Speaker 2: keep it cool and then keep it really cold in

518
00:21:55,880 --> 00:21:57,560
Speaker 2: the winter. I would be much more willing to take

519
00:21:57,560 --> 00:21:58,919
Speaker 2: it to the extreme in the winter and drop it

520
00:21:58,920 --> 00:22:01,480
Speaker 2: down to like fifty nine or six, which I've done before.

521
00:22:02,280 --> 00:22:04,640
Speaker 2: My in laws actually accused me one time. They were like, no,

522
00:22:05,040 --> 00:22:06,760
Speaker 2: I swear, you know, like after Kate and I got

523
00:22:06,760 --> 00:22:09,119
Speaker 2: married and back when we were super cheap. They're like,

524
00:22:09,160 --> 00:22:11,040
Speaker 2: one time, like when we were visiting, you had your

525
00:22:11,040 --> 00:22:13,240
Speaker 2: heat set of fifty seven. I was like, I don't

526
00:22:13,240 --> 00:22:15,000
Speaker 2: think so. That seems kind of crazy, and.

527
00:22:15,240 --> 00:22:17,320
Speaker 1: They swear by it, so it sounds pretty close.

528
00:22:17,160 --> 00:22:20,440
Speaker 2: To what you do. Though. Well, luckily things have changed

529
00:22:20,440 --> 00:22:22,840
Speaker 2: a little bit. I'm not nearly as cheap and imposing

530
00:22:22,880 --> 00:22:25,160
Speaker 2: as I used to be. Dude, Let's talk about transportation,

531
00:22:25,200 --> 00:22:28,040
Speaker 2: because this is another area that can be hard to change,

532
00:22:28,200 --> 00:22:31,240
Speaker 2: especially if you hop over to that barbones budget because

533
00:22:31,280 --> 00:22:33,879
Speaker 2: an emergency hits. It's hard to think about selling a

534
00:22:33,880 --> 00:22:37,000
Speaker 2: car in the middle of a difficult situation. It's hard

535
00:22:37,040 --> 00:22:38,920
Speaker 2: to hop out of a car payment or a lease

536
00:22:38,960 --> 00:22:41,600
Speaker 2: if you're in one, although there are ways of doing so.

537
00:22:41,760 --> 00:22:43,760
Speaker 1: Yeah, swap a lease, lease trainer. Those are websites.

538
00:22:43,880 --> 00:22:46,120
Speaker 2: Look and so this is a line item that probably

539
00:22:46,160 --> 00:22:48,320
Speaker 2: needs to be a part of your barbones budget, but

540
00:22:48,359 --> 00:22:50,720
Speaker 2: see if there are ways for you to pare it down.

541
00:22:51,160 --> 00:22:53,800
Speaker 2: And another piece of advice here is just to not

542
00:22:53,800 --> 00:22:56,360
Speaker 2: necessarily buy a car at the top end of your budget,

543
00:22:56,480 --> 00:22:59,239
Speaker 2: right because you're buying that car and hopefully you're not

544
00:22:59,320 --> 00:23:01,719
Speaker 2: financing it. But if you are, you've got payments, and

545
00:23:01,760 --> 00:23:04,600
Speaker 2: you've got payments that go along with your budgets. When

546
00:23:04,880 --> 00:23:07,120
Speaker 2: everything is going exactly as it should, you know, sort

547
00:23:07,119 --> 00:23:09,359
Speaker 2: of the best case scenario. And so I feel that

548
00:23:09,400 --> 00:23:11,880
Speaker 2: this is a good reason to have the vehicle that

549
00:23:11,960 --> 00:23:14,480
Speaker 2: will obviously work for you when things are going well,

550
00:23:14,520 --> 00:23:17,240
Speaker 2: but one that you can afford or one that you

551
00:23:17,280 --> 00:23:20,120
Speaker 2: can support when things are not going so well as well.

552
00:23:20,200 --> 00:23:23,359
Speaker 1: Yeah, that's right. So buying that car in cash is

553
00:23:23,600 --> 00:23:26,800
Speaker 1: definitely something we would recommend absolutely everyone. And that comes

554
00:23:26,800 --> 00:23:28,760
Speaker 1: in handy to when you're creating your bear bones budget.

555
00:23:28,760 --> 00:23:30,520
Speaker 1: You're like, I get to keep my car and I

556
00:23:30,520 --> 00:23:31,040
Speaker 1: don't have a.

557
00:23:31,080 --> 00:23:33,760
Speaker 2: No matter what. That exactly like, at least the car

558
00:23:33,800 --> 00:23:35,240
Speaker 2: is mine. You can go sleep in that, like you said,

559
00:23:35,359 --> 00:23:35,960
Speaker 2: I by the river.

560
00:23:36,040 --> 00:23:38,600
Speaker 1: That's right. One other thing that definitely needs to make

561
00:23:38,600 --> 00:23:42,320
Speaker 1: your bear bones budget is your recurring monthly debt obligations. Right,

562
00:23:42,840 --> 00:23:45,600
Speaker 1: you can't stop paying your creditors if you lose your job,

563
00:23:45,840 --> 00:23:48,400
Speaker 1: So this definitely needs to be factored into. Let's say

564
00:23:48,400 --> 00:23:50,080
Speaker 1: you do have credit card debt that you're working on

565
00:23:50,119 --> 00:23:53,800
Speaker 1: getting down student loan debt. Obviously, federal student loans have

566
00:23:53,840 --> 00:23:56,160
Speaker 1: been put on pause for the time being. Eventually those

567
00:23:56,160 --> 00:23:58,440
Speaker 1: are going to resume. You can't factor those out of

568
00:23:58,480 --> 00:24:00,640
Speaker 1: your bare bones budget that has to be there because

569
00:24:00,680 --> 00:24:03,280
Speaker 1: you're gonna need to continue to pay those payments every

570
00:24:03,400 --> 00:24:07,200
Speaker 1: single month, even if you've been put in difficult financial circumstances.

571
00:24:07,280 --> 00:24:09,239
Speaker 2: Yeah, but I mean you bring up a good point though, too, right,

572
00:24:09,280 --> 00:24:12,080
Speaker 2: which is it's worth noting that we do have some

573
00:24:12,119 --> 00:24:15,080
Speaker 2: control over those payments to a certain extent, just like

574
00:24:15,080 --> 00:24:17,159
Speaker 2: with housing, you know, there might be ways that you

575
00:24:17,160 --> 00:24:19,719
Speaker 2: can modify the terms a little bit so that you're

576
00:24:19,760 --> 00:24:22,520
Speaker 2: paying less, right. I mean, there's a national forbearance, you know,

577
00:24:22,560 --> 00:24:24,840
Speaker 2: on federal student loans, but you can go to a

578
00:24:24,840 --> 00:24:26,520
Speaker 2: specific lender and see if you can get a four barance,

579
00:24:26,560 --> 00:24:28,440
Speaker 2: so you can see if you can get the loan

580
00:24:28,480 --> 00:24:31,120
Speaker 2: extended or even a lower interest rate. If you're looking

581
00:24:31,160 --> 00:24:33,640
Speaker 2: at a credit card, right, there are ways to potentially

582
00:24:33,680 --> 00:24:36,760
Speaker 2: modify the terms of that debt. And so while you

583
00:24:36,800 --> 00:24:39,480
Speaker 2: don't want to necessarily count on that, know that if

584
00:24:39,520 --> 00:24:41,920
Speaker 2: you ever do find yourself in an in dire straits,

585
00:24:42,000 --> 00:24:44,199
Speaker 2: you're looking to all the different types of ways that

586
00:24:44,200 --> 00:24:46,280
Speaker 2: you can reduce your expenses. And so, Joel, maybe we

587
00:24:46,359 --> 00:24:47,679
Speaker 2: left some stuff out, but we feel that those are

588
00:24:47,720 --> 00:24:50,280
Speaker 2: the basic requirements that we need in order to survive

589
00:24:50,400 --> 00:24:53,080
Speaker 2: in a modern world. Right, And so let's talk about

590
00:24:53,119 --> 00:24:56,359
Speaker 2: what doesn't make the cut. Right. There are probably quite

591
00:24:56,400 --> 00:24:58,520
Speaker 2: a few things that might be in your normal budget

592
00:24:58,560 --> 00:25:01,000
Speaker 2: that you don't want to give up up in an

593
00:25:01,040 --> 00:25:04,720
Speaker 2: ideal world, and that makes sense. But the bare bones budget, dude,

594
00:25:04,840 --> 00:25:07,399
Speaker 2: is not for ideal worlds. It's for the world that

595
00:25:07,440 --> 00:25:10,199
Speaker 2: you hope never comes into being. So let's cover a

596
00:25:10,320 --> 00:25:12,720
Speaker 2: number of different expenses that I think maybe some folks

597
00:25:12,800 --> 00:25:15,280
Speaker 2: might feel are necessary to life. But we're going to

598
00:25:15,320 --> 00:25:17,080
Speaker 2: cover several of these to point out that, in fact,

599
00:25:17,200 --> 00:25:18,359
Speaker 2: they are not necessary.

600
00:25:18,440 --> 00:25:20,320
Speaker 1: Yeah, man, I feel like, you know, one of the

601
00:25:20,359 --> 00:25:23,679
Speaker 1: things that needs to go quickly, and it's pretty easy actually,

602
00:25:23,680 --> 00:25:26,280
Speaker 1: to cut up from your life is no cable or

603
00:25:26,280 --> 00:25:28,760
Speaker 1: streaming services in your barebones budget.

604
00:25:28,680 --> 00:25:30,080
Speaker 2: Even though over the past year and a half it

605
00:25:30,080 --> 00:25:32,760
Speaker 2: feels like that has been kind of like a non negotiable.

606
00:25:32,840 --> 00:25:34,720
Speaker 2: You know, people are like, no, gotta have gotta have

607
00:25:34,720 --> 00:25:35,159
Speaker 2: a Netflix.

608
00:25:35,240 --> 00:25:37,560
Speaker 1: Yeah, maybe you're only saving grace having a couple of

609
00:25:37,600 --> 00:25:40,400
Speaker 1: good shows to watch, right, But we would say that,

610
00:25:40,800 --> 00:25:43,080
Speaker 1: you know, when worse comes to worse, living on that

611
00:25:43,160 --> 00:25:46,560
Speaker 1: barebones budget, you can't be spending a dime towards those things. Instead,

612
00:25:46,560 --> 00:25:49,160
Speaker 1: you should be watching free stuff on the Roku channel

613
00:25:49,359 --> 00:25:51,879
Speaker 1: or a YouTube even, you know, when when you're in

614
00:25:51,960 --> 00:25:54,480
Speaker 1: barebones budget territory. You know most of us have like

615
00:25:54,520 --> 00:25:57,320
Speaker 1: a digital antenna. There's a bunch of stuff you can watch.

616
00:25:57,119 --> 00:25:59,480
Speaker 2: Free over the air, that free HD content.

617
00:25:59,600 --> 00:26:01,760
Speaker 1: AG. Yeah, exactly. It looks it looks good.

618
00:26:01,800 --> 00:26:04,720
Speaker 2: It looks better HD over the you know, over air,

619
00:26:04,840 --> 00:26:07,040
Speaker 2: looks better than the stuff they stream, right because it

620
00:26:07,040 --> 00:26:07,800
Speaker 2: gets downgraded.

621
00:26:08,119 --> 00:26:08,199
Speaker 1: Right.

622
00:26:08,280 --> 00:26:10,560
Speaker 2: I don't know how the technology works, but I've been

623
00:26:10,600 --> 00:26:10,959
Speaker 2: told that.

624
00:26:11,080 --> 00:26:12,879
Speaker 1: And maybe on the bear bones budget too, you go

625
00:26:12,960 --> 00:26:16,320
Speaker 1: from you know, watching stuff more frequently to reading more. Yeah,

626
00:26:16,320 --> 00:26:19,840
Speaker 1: because yeah, reading is essentially free too, and you can

627
00:26:19,960 --> 00:26:22,000
Speaker 1: read free stuff on the libby app. I use that

628
00:26:22,080 --> 00:26:25,479
Speaker 1: all the time. They're little free libraries and tons of

629
00:26:25,680 --> 00:26:29,080
Speaker 1: neighborhoods near where you live. In all likelihood, man, we've

630
00:26:29,119 --> 00:26:30,919
Speaker 1: got so many just in our neighborhood alone.

631
00:26:30,960 --> 00:26:33,600
Speaker 2: Like people love the little free libraries in our part

632
00:26:33,640 --> 00:26:34,960
Speaker 2: of town at least. It's like, I feel like the

633
00:26:35,200 --> 00:26:38,040
Speaker 2: number of little free libraries doubled during the pandemic because

634
00:26:38,040 --> 00:26:39,399
Speaker 2: it was just like a little I don't know, I

635
00:26:39,440 --> 00:26:41,320
Speaker 2: felt like it was a fun project that maybe some

636
00:26:41,359 --> 00:26:43,000
Speaker 2: households were like, oh, let's make one of those and

637
00:26:43,040 --> 00:26:45,280
Speaker 2: stick it, you know, at the sidewalk in front of

638
00:26:45,280 --> 00:26:47,440
Speaker 2: our house. There's one actually a couple of blocks away.

639
00:26:47,480 --> 00:26:49,360
Speaker 2: Have you seen the little free puzzle library?

640
00:26:49,440 --> 00:26:50,239
Speaker 1: Oh I have seen that one.

641
00:26:50,280 --> 00:26:54,000
Speaker 2: Yeah. Yeah, Like they used a like the old school newspaper. Uh.

642
00:26:54,160 --> 00:26:55,760
Speaker 2: Like you stick a quarter and push the button and

643
00:26:55,800 --> 00:26:57,440
Speaker 2: it allows you to open the door and you grab

644
00:26:57,600 --> 00:26:59,880
Speaker 2: you know, you're supposed to grab one newspaper. Whatever kept

645
00:26:59,880 --> 00:27:03,200
Speaker 2: you from grabbing like all the newspapers back Just general civility,

646
00:27:03,320 --> 00:27:04,920
Speaker 2: just honesty.

647
00:27:05,600 --> 00:27:07,600
Speaker 1: I mean, what would you do with more newspapers? I know,

648
00:27:07,640 --> 00:27:10,240
Speaker 1: exactly right, I guess to trying to start selling them again.

649
00:27:10,720 --> 00:27:12,560
Speaker 2: But one of our neighbors somehow got their hands on

650
00:27:12,560 --> 00:27:14,600
Speaker 2: one of those, and now this thing is packed full

651
00:27:14,640 --> 00:27:17,520
Speaker 2: of different puzzles and so it's just a fun, free

652
00:27:17,520 --> 00:27:20,920
Speaker 2: way to entertain yourself without paying for cable, without paying

653
00:27:20,960 --> 00:27:23,840
Speaker 2: for streaming services. Uh and so. And obviously, dude, you

654
00:27:23,840 --> 00:27:26,120
Speaker 2: know we're talking about like entertaining ourselves. How about vacations

655
00:27:26,119 --> 00:27:29,280
Speaker 2: and travel? If things get tough financially, it is crucial

656
00:27:29,320 --> 00:27:32,119
Speaker 2: to put spending on fun stuff like that summer trip

657
00:27:32,359 --> 00:27:34,800
Speaker 2: on hold, even though you've been itching to go on

658
00:27:34,840 --> 00:27:36,600
Speaker 2: a trip. Right, So we would recommend for you to

659
00:27:36,640 --> 00:27:39,880
Speaker 2: remove leisure travel from your bare bones budget and make

660
00:27:39,880 --> 00:27:42,440
Speaker 2: sure too that you don't fall into the sunk cost

661
00:27:42,520 --> 00:27:44,760
Speaker 2: fallacy because you might think, well, shoot, I've already got

662
00:27:44,800 --> 00:27:47,040
Speaker 2: a deposit down on this place. If I don't go,

663
00:27:47,160 --> 00:27:49,880
Speaker 2: I'm going to lose that deposit. And here's the thing,

664
00:27:50,119 --> 00:27:51,919
Speaker 2: it doesn't really matter, because if you don't have the

665
00:27:51,960 --> 00:27:54,960
Speaker 2: money to actually go on that vacation, then it might

666
00:27:55,000 --> 00:27:57,480
Speaker 2: be worth losing that deposit. Right. Hopefully you're able to

667
00:27:57,480 --> 00:27:59,520
Speaker 2: get all of your money back, but even losing out

668
00:27:59,520 --> 00:28:01,600
Speaker 2: on like fifty percent of the cost of a trip

669
00:28:01,920 --> 00:28:04,199
Speaker 2: might be worth doing if that keeps you from spending

670
00:28:04,240 --> 00:28:07,280
Speaker 2: additional money that you wouldn't spend where you just stay home.

671
00:28:07,440 --> 00:28:09,359
Speaker 2: And so the sunk cost fallacy comes into play because

672
00:28:09,359 --> 00:28:12,119
Speaker 2: you think, well, I've got money invested into that trip.

673
00:28:12,560 --> 00:28:14,439
Speaker 2: I need to see it through. But that's not the

674
00:28:14,480 --> 00:28:15,760
Speaker 2: case if you can't afford it.

675
00:28:15,880 --> 00:28:17,960
Speaker 1: Yeah, those are hard words, but I think they're true words. Yeah,

676
00:28:18,119 --> 00:28:19,879
Speaker 1: I think it's important to put stuff like that on

677
00:28:19,960 --> 00:28:23,320
Speaker 1: hold if you're in a tough spot. And Matt another thing,

678
00:28:23,320 --> 00:28:26,280
Speaker 1: I think that definitely does not make the bar bones

679
00:28:26,320 --> 00:28:29,360
Speaker 1: budget is clothing. I'd say that, you know, maybe thrift

680
00:28:29,400 --> 00:28:32,119
Speaker 1: store purchases only, and you know, because you can get

681
00:28:32,119 --> 00:28:35,080
Speaker 1: stuff they're pretty cheap. But on a bare bones budget,

682
00:28:35,359 --> 00:28:37,120
Speaker 1: you should be able to have this line on him

683
00:28:37,119 --> 00:28:39,680
Speaker 1: at zero. Yeah, and just wear stuff you already own.

684
00:28:39,600 --> 00:28:42,719
Speaker 2: Unless your socks are getting so holy that. I mean,

685
00:28:43,640 --> 00:28:45,480
Speaker 2: like evidently yours were, like they're so bad that you

686
00:28:45,520 --> 00:28:46,400
Speaker 2: couldn't wear them anymore.

687
00:28:46,480 --> 00:28:48,040
Speaker 1: No, they weren't, But I also wasn't on a bar

688
00:28:48,080 --> 00:28:49,880
Speaker 1: bones budget, and I could afford some new socks, right,

689
00:28:50,200 --> 00:28:53,320
Speaker 1: But in the bar bones budget, I'm not buying the

690
00:28:53,440 --> 00:28:55,360
Speaker 1: semi nice stocks that I like, we're not buying your

691
00:28:55,360 --> 00:28:58,600
Speaker 1: mamas exactly. They're off the table, right. The one exception

692
00:28:58,720 --> 00:29:01,240
Speaker 1: might be getting clothes for your but you know, still

693
00:29:01,280 --> 00:29:02,920
Speaker 1: you should be able to go without that for a time,

694
00:29:03,120 --> 00:29:06,400
Speaker 1: you know, keep clothes out of the bare bones budget altogether.

695
00:29:06,600 --> 00:29:08,720
Speaker 1: If you got to pull the trigger and start using it,

696
00:29:08,880 --> 00:29:10,880
Speaker 1: there's just no reason to be spending on clothes in

697
00:29:10,880 --> 00:29:11,480
Speaker 1: that situation.

698
00:29:11,720 --> 00:29:13,479
Speaker 2: And I think that's an instance where you can look

699
00:29:13,520 --> 00:29:16,160
Speaker 2: to your community, right, dude. Recently, we had two families

700
00:29:16,200 --> 00:29:21,000
Speaker 2: donate us some clothes, multiple large trash bags full of clothes,

701
00:29:21,320 --> 00:29:24,360
Speaker 2: because their daughters are older than our oldest and what

702
00:29:24,400 --> 00:29:26,480
Speaker 2: that meant for us was a ton of free clothes. Man.

703
00:29:26,520 --> 00:29:29,040
Speaker 2: The girls loved it because they're just kind of sitting there, like,

704
00:29:29,080 --> 00:29:30,800
Speaker 2: you know, flipping through all these clothes and like, I'm

705
00:29:30,840 --> 00:29:32,880
Speaker 2: gonna keep this. I wanna keep this. Kate loved it

706
00:29:32,920 --> 00:29:34,280
Speaker 2: because she didn't have to go to the store, she

707
00:29:34,320 --> 00:29:36,360
Speaker 2: didn't have to like order stuff you know online, have

708
00:29:36,440 --> 00:29:38,080
Speaker 2: a ship. If it doesn't fit, she has to ship

709
00:29:38,080 --> 00:29:39,840
Speaker 2: it back. And then of course it was good for

710
00:29:39,880 --> 00:29:41,200
Speaker 2: the budget because that joke was free.

711
00:29:41,280 --> 00:29:43,440
Speaker 1: Yeah, hand me down clothes are the best, dude.

712
00:29:43,440 --> 00:29:46,440
Speaker 2: Absolutely. And you know, we already kind of touched on entertainment,

713
00:29:46,480 --> 00:29:48,480
Speaker 2: but you know, I'm thinking of like concerts and movies

714
00:29:48,520 --> 00:29:50,800
Speaker 2: like that kind of thing as well. We've all seen

715
00:29:51,160 --> 00:29:53,480
Speaker 2: how we can get by without those over the you know,

716
00:29:53,480 --> 00:29:55,880
Speaker 2: the past year and a half. Again, it's not ideal.

717
00:29:56,080 --> 00:29:58,760
Speaker 2: Maybe it's to have no entertainment funds in your normal budget,

718
00:29:59,000 --> 00:30:01,840
Speaker 2: but this is again we're looking to how we can

719
00:30:01,880 --> 00:30:05,120
Speaker 2: pare down our budget in the most extreme way. And

720
00:30:05,200 --> 00:30:07,760
Speaker 2: let's also talk about like self care. You know, I

721
00:30:07,760 --> 00:30:10,760
Speaker 2: think a gym membership is something that a lot of

722
00:30:10,760 --> 00:30:12,840
Speaker 2: folks have also learned that they can do without over the.

723
00:30:12,840 --> 00:30:14,840
Speaker 1: Past year, push ups at home. Baby Dude's that.

724
00:30:14,840 --> 00:30:16,600
Speaker 2: In the kettlebell. Folks don't want to hear me talk

725
00:30:16,600 --> 00:30:18,600
Speaker 2: about that. I'll talk about that enough, but a lot

726
00:30:18,640 --> 00:30:21,040
Speaker 2: of folks are working out at home. If you are

727
00:30:21,080 --> 00:30:23,520
Speaker 2: having a tough time with your money, but if you're

728
00:30:23,520 --> 00:30:26,320
Speaker 2: not eliminating that, like thirty bucks up to two.

729
00:30:26,320 --> 00:30:28,640
Speaker 1: Hundred dollars looking at you, crosswait, dude.

730
00:30:28,840 --> 00:30:32,600
Speaker 2: CrossFit folks pay a lot of money for that accountability.

731
00:30:32,680 --> 00:30:34,920
Speaker 2: I mean essentially, that's what it is. It's accountability, and

732
00:30:35,000 --> 00:30:37,040
Speaker 2: I get it, But man, is there not a way

733
00:30:37,080 --> 00:30:39,600
Speaker 2: that you can get more affordable accountability?

734
00:30:39,640 --> 00:30:41,440
Speaker 1: Well, I will say, you know, if that's in your

735
00:30:41,480 --> 00:30:44,760
Speaker 1: normal budget and you love it, I don't care. That's fine,

736
00:30:44,800 --> 00:30:46,320
Speaker 1: Like I don't mind if you're spending. I think the

737
00:30:46,360 --> 00:30:48,600
Speaker 1: first time I heard a friend was joining CrossFit and

738
00:30:48,640 --> 00:30:50,320
Speaker 1: they told me how much it was, I almost puked,

739
00:30:50,360 --> 00:30:51,920
Speaker 1: Like I was like, that's really I guess I'm going

740
00:30:51,960 --> 00:30:54,040
Speaker 1: to open a CrossFit job, you know exactly, Like that's

741
00:30:54,040 --> 00:30:56,360
Speaker 1: definitely the business I'm getting into. But I was like,

742
00:30:56,520 --> 00:30:58,760
Speaker 1: that doesn't make any sense to me. But the more

743
00:30:58,760 --> 00:31:00,800
Speaker 1: I've heard people talk about it does make sense to me,

744
00:31:00,840 --> 00:31:03,520
Speaker 1: and it is kind of a community based thing.

745
00:31:03,880 --> 00:31:04,400
Speaker 2: I get it.

746
00:31:04,640 --> 00:31:07,280
Speaker 1: But in your bear bones budget, sorry, you're gonna have

747
00:31:07,320 --> 00:31:09,040
Speaker 1: to hang out with those people like on your front

748
00:31:09,080 --> 00:31:11,080
Speaker 1: porch right your house goes. You're not gonna work out

749
00:31:11,120 --> 00:31:12,480
Speaker 1: with them at two hundred bucks a month.

750
00:31:12,600 --> 00:31:15,080
Speaker 2: Yeah, dude, hanging out outside, going hiking with friends, like

751
00:31:15,120 --> 00:31:16,720
Speaker 2: hanging out on the front porch, like playing games that

752
00:31:16,720 --> 00:31:19,480
Speaker 2: you already have. These are all great alternatives, you know,

753
00:31:19,560 --> 00:31:22,320
Speaker 2: to entertainment that's gonna cost you money, but you know

754
00:31:22,400 --> 00:31:24,200
Speaker 2: with like gym memberships, like that's something you can do

755
00:31:24,240 --> 00:31:26,640
Speaker 2: at home, and even other self care you know. Again,

756
00:31:26,680 --> 00:31:28,040
Speaker 2: Like one of the other things I feel like folks

757
00:31:28,080 --> 00:31:29,680
Speaker 2: to learn from the pandemic is that like, Okay, I

758
00:31:29,720 --> 00:31:32,320
Speaker 2: can actually cut my hair at home. Maybe it's not pretty,

759
00:31:32,440 --> 00:31:34,240
Speaker 2: it wasn't pretty the first time, but like, I bet

760
00:31:34,280 --> 00:31:37,400
Speaker 2: you learned a lot after that first haircut. You learn

761
00:31:37,440 --> 00:31:38,840
Speaker 2: how to make it look pretty good. I've been cut

762
00:31:38,840 --> 00:31:40,760
Speaker 2: my own hair for I don't even know how long,

763
00:31:40,800 --> 00:31:43,280
Speaker 2: but it's something you get used to in the and dude,

764
00:31:43,280 --> 00:31:45,840
Speaker 2: the money that I've saved has compounded, let me tell you,

765
00:31:45,480 --> 00:31:48,440
Speaker 2: over the years of not having to pay for haircuts.

766
00:31:48,440 --> 00:31:50,520
Speaker 1: So that's where thousands in your roth Iran, there's tens

767
00:31:50,520 --> 00:31:52,640
Speaker 1: of thousands. Maybe I don't know, it's gonna be a lot.

768
00:31:52,680 --> 00:31:55,280
Speaker 1: All right, well, yeah, I think to one of the

769
00:31:55,360 --> 00:31:58,600
Speaker 1: great things. Again, we're not telling people to create this

770
00:31:58,640 --> 00:32:02,160
Speaker 1: bear bones budget and start living according to it now, right.

771
00:32:02,160 --> 00:32:05,600
Speaker 1: It really is this exercise that can be a confidence builder,

772
00:32:05,600 --> 00:32:08,640
Speaker 1: that can reveal some of the spending choices that are

773
00:32:09,120 --> 00:32:12,160
Speaker 1: easily changeable in your life, that you feel like are immovable.

774
00:32:12,600 --> 00:32:15,160
Speaker 1: But once you've created this barre bones budget, once you've

775
00:32:15,160 --> 00:32:19,080
Speaker 1: got it alongside the budget that you're using right now

776
00:32:19,360 --> 00:32:21,760
Speaker 1: every single month, you're gonna notice there are a lot

777
00:32:21,800 --> 00:32:24,280
Speaker 1: of differences. There's going to be one big difference, right,

778
00:32:24,320 --> 00:32:27,120
Speaker 1: the number that is coming out of your accounts every

779
00:32:27,120 --> 00:32:30,280
Speaker 1: month to pay for your monthly expenses. We'll talk more

780
00:32:30,320 --> 00:32:32,840
Speaker 1: about that and how a bare bones budget can be

781
00:32:32,920 --> 00:32:35,280
Speaker 1: implemented into your life, not just in the case of

782
00:32:35,320 --> 00:32:37,360
Speaker 1: an emergency. We'll hit that right after this break.

783
00:32:47,120 --> 00:32:48,880
Speaker 2: All right, Joel, we are back to the break, and

784
00:32:48,920 --> 00:32:50,800
Speaker 2: you know we've been talking about what's include in your

785
00:32:50,840 --> 00:32:53,760
Speaker 2: bare bones budget, what you definitely should not include, like

786
00:32:53,840 --> 00:32:56,840
Speaker 2: basically anything that we didn't mention in that first little section,

787
00:32:57,520 --> 00:32:59,680
Speaker 2: as far as like the you know, the bear essentials,

788
00:33:00,120 --> 00:33:02,160
Speaker 2: everything else you can kind of, you know, cut from

789
00:33:02,160 --> 00:33:02,600
Speaker 2: your budget.

790
00:33:02,600 --> 00:33:05,560
Speaker 1: What about my Gulf string, Matt, like my my private airplane?

791
00:33:05,720 --> 00:33:09,040
Speaker 2: Your helicopter membership? Yeah, that also has to God, have

792
00:33:09,080 --> 00:33:10,600
Speaker 2: you ever heard of those? There's these things where you

793
00:33:10,600 --> 00:33:11,959
Speaker 2: can pay to be a member and you can kind

794
00:33:11,960 --> 00:33:13,960
Speaker 2: of get airlifted from. I don't know if this is

795
00:33:13,960 --> 00:33:15,880
Speaker 2: something that died out like years ago, but I remember

796
00:33:15,920 --> 00:33:18,520
Speaker 2: seeing that one time and thinking, holy crap. There are

797
00:33:18,560 --> 00:33:21,760
Speaker 2: people who you know, are essentially have like a gym membership,

798
00:33:21,800 --> 00:33:23,680
Speaker 2: but it's like Uber for helicopters.

799
00:33:24,160 --> 00:33:25,240
Speaker 1: Who's got that kind of money?

800
00:33:25,760 --> 00:33:28,560
Speaker 2: Elon Musk, I'm sure, you know, call up a helicopter

801
00:33:28,640 --> 00:33:31,400
Speaker 2: whatever he wants. But you know, before we're gonna talk

802
00:33:31,440 --> 00:33:34,160
Speaker 2: through some additional benefits of creating one of these bare

803
00:33:34,200 --> 00:33:35,720
Speaker 2: bones budgets. But I wanted to mention some of the

804
00:33:35,760 --> 00:33:38,760
Speaker 2: different tools that you can use if you're not already budgeting,

805
00:33:38,840 --> 00:33:40,960
Speaker 2: if you're gonna go more analog, you can be like

806
00:33:41,000 --> 00:33:43,160
Speaker 2: me and kind of copy and paste your expenses over

807
00:33:43,200 --> 00:33:47,440
Speaker 2: into an Excel sheet. I've got over a decade's worth

808
00:33:47,440 --> 00:33:50,640
Speaker 2: of budgets that I you know, I could go back

809
00:33:50,680 --> 00:33:52,360
Speaker 2: and look at my expenses, but I don't. It's not

810
00:33:52,440 --> 00:33:55,520
Speaker 2: like I reminisce, oh, you know what I spent in

811
00:33:55,640 --> 00:33:59,640
Speaker 2: June of two thousand and seven, But I could. But

812
00:33:59,640 --> 00:34:02,640
Speaker 2: for most normal folks, you can check out Mints wine

813
00:34:02,680 --> 00:34:05,240
Speaker 2: ab or you need a budget, that's a totally great

814
00:34:05,280 --> 00:34:07,640
Speaker 2: app that you can use. And so once you've kind

815
00:34:07,640 --> 00:34:09,640
Speaker 2: of paired that thing back, once you know how little

816
00:34:09,680 --> 00:34:12,120
Speaker 2: it actually takes for you to survive, and you've got

817
00:34:12,280 --> 00:34:15,600
Speaker 2: you know, this small, hopefully smaller number than what you

818
00:34:15,640 --> 00:34:18,120
Speaker 2: normally have flowing out of your account, you might be

819
00:34:18,160 --> 00:34:20,960
Speaker 2: wondering when should I actually implement this, And we think

820
00:34:20,960 --> 00:34:22,960
Speaker 2: that there are a couple instances.

821
00:34:22,640 --> 00:34:23,799
Speaker 1: Where you might put this to use.

822
00:34:24,200 --> 00:34:26,600
Speaker 2: You could switch over to a bare bones budget, maybe

823
00:34:26,640 --> 00:34:28,960
Speaker 2: because of an unexpected job loss. We kind of touch

824
00:34:29,000 --> 00:34:31,160
Speaker 2: on this earlier, but that's absolutely a case when you're

825
00:34:31,160 --> 00:34:32,960
Speaker 2: gonna want to, like, you know, like we said, flip

826
00:34:33,000 --> 00:34:35,200
Speaker 2: the switch. It's almost like you're operating on like safe

827
00:34:35,200 --> 00:34:37,000
Speaker 2: mode when you're booting up your computer because there's a

828
00:34:37,040 --> 00:34:39,040
Speaker 2: virus or something that's attacking it. You know, you want

829
00:34:39,080 --> 00:34:40,719
Speaker 2: to make sure that you can do the bear essentials.

830
00:34:41,239 --> 00:34:43,719
Speaker 2: But everything else kind of falls by the wayside. That's

831
00:34:43,800 --> 00:34:45,760
Speaker 2: kind of the primary reason that you'd want to switch

832
00:34:45,760 --> 00:34:47,279
Speaker 2: to a bear bones budget. But you could also go

833
00:34:47,280 --> 00:34:50,239
Speaker 2: bear bones if you're looking to accelerate your ability to

834
00:34:50,280 --> 00:34:53,000
Speaker 2: achieve a financial goal, like maybe you're paying off a

835
00:34:53,000 --> 00:34:55,560
Speaker 2: massive amount of credit card debt. If that's the case,

836
00:34:55,800 --> 00:34:58,400
Speaker 2: then you're going to stick with that bearbones budget for

837
00:34:58,480 --> 00:35:00,840
Speaker 2: however long it takes to crush that goal.

838
00:35:01,080 --> 00:35:03,120
Speaker 1: Yeah, men, I think either you do it, like you said,

839
00:35:03,160 --> 00:35:06,000
Speaker 1: out of necessity, right, you need this. You need to

840
00:35:06,239 --> 00:35:08,279
Speaker 1: live on the bare bones budget in order to be

841
00:35:08,280 --> 00:35:10,600
Speaker 1: able to make your money stretch further until you can

842
00:35:10,680 --> 00:35:14,160
Speaker 1: get through whatever, you know, difficult circumstances have presented themselves,

843
00:35:14,480 --> 00:35:16,960
Speaker 1: or also to you kind of impose it on yourself

844
00:35:17,480 --> 00:35:20,240
Speaker 1: on purpose in order to achieve something in the short term.

845
00:35:20,520 --> 00:35:22,480
Speaker 1: I think, you know, one other way maybe people might

846
00:35:22,560 --> 00:35:25,759
Speaker 1: use it. Some people in the financial independence community might

847
00:35:25,920 --> 00:35:28,040
Speaker 1: essentially be living on a barbones budget because they're trying

848
00:35:28,120 --> 00:35:31,320
Speaker 1: to retire in five or ten years or something like that, And.

849
00:35:31,560 --> 00:35:34,319
Speaker 2: Yeah, that's their higher goal that they're trying to achieve. Right,

850
00:35:34,320 --> 00:35:36,680
Speaker 2: it's not necessarily credit card debt, but it's a certain

851
00:35:36,719 --> 00:35:39,479
Speaker 2: lifestyle in their case, to maybe step away from a job.

852
00:35:39,520 --> 00:35:42,279
Speaker 1: True, I think you know, it might be demoralizing though

853
00:35:42,320 --> 00:35:44,640
Speaker 1: to try to do a barbones budget for five or

854
00:35:44,640 --> 00:35:47,279
Speaker 1: ten years, Like that's a really really long time to

855
00:35:47,360 --> 00:35:50,160
Speaker 1: try to adhere to that and to cut back your

856
00:35:50,200 --> 00:35:53,560
Speaker 1: spending to that extreme, although it is possible if that

857
00:35:53,719 --> 00:35:55,680
Speaker 1: is your greater goal and if you feel like you

858
00:35:55,680 --> 00:35:56,719
Speaker 1: can actually handle it.

859
00:35:56,880 --> 00:35:59,520
Speaker 2: Yeah, man. And you know the additional benefit of having

860
00:35:59,560 --> 00:36:02,400
Speaker 2: a bar bone budget is that you get to see

861
00:36:02,480 --> 00:36:05,240
Speaker 2: that you truly have power and control over the amount

862
00:36:05,239 --> 00:36:07,000
Speaker 2: of spending in your life. You know, like, like we

863
00:36:07,080 --> 00:36:08,960
Speaker 2: might think that it takes a certain amount of income

864
00:36:09,360 --> 00:36:12,680
Speaker 2: for us to survive, but really we're just making ourselves

865
00:36:12,800 --> 00:36:14,280
Speaker 2: subservient to that assumption.

866
00:36:14,840 --> 00:36:15,120
Speaker 1: Right.

867
00:36:15,239 --> 00:36:17,480
Speaker 2: It's important to know that we have control over our

868
00:36:17,520 --> 00:36:20,160
Speaker 2: lives and we definitely have control over the things that

869
00:36:20,239 --> 00:36:22,560
Speaker 2: we spend our hard earned money on. It makes me

870
00:36:22,600 --> 00:36:25,480
Speaker 2: think of like, like, you know, if you're subscribed to Netflix.

871
00:36:25,520 --> 00:36:27,160
Speaker 2: You know, this isn't the second time as it's come

872
00:36:27,239 --> 00:36:29,399
Speaker 2: up as an example, and you're not really watching anything

873
00:36:29,440 --> 00:36:31,960
Speaker 2: on Netflix, and maybe you say to yourself, oh, well,

874
00:36:32,160 --> 00:36:34,239
Speaker 2: like I'm still subscribed. I'm just gonna kind of let

875
00:36:34,320 --> 00:36:36,319
Speaker 2: that keep billing me like no, Like, why would you

876
00:36:36,360 --> 00:36:38,440
Speaker 2: do that? You wouldn't do that, you would make changes.

877
00:36:38,520 --> 00:36:41,879
Speaker 2: You have control over your spending. We have control over

878
00:36:41,920 --> 00:36:44,080
Speaker 2: the direction of our lives. And I think it's easier

879
00:36:44,120 --> 00:36:46,799
Speaker 2: to kind of keep doing what we've been doing rather

880
00:36:46,840 --> 00:36:49,640
Speaker 2: than making those changes and rather pivot towards something either

881
00:36:49,719 --> 00:36:52,000
Speaker 2: unknown or something different, or something that might be just

882
00:36:52,080 --> 00:36:55,200
Speaker 2: a little more difficult. It's easier for us to not

883
00:36:55,320 --> 00:36:57,040
Speaker 2: ask any questions and continue plotting on.

884
00:36:57,360 --> 00:36:59,840
Speaker 1: Yeah, I think too, Matt. When you see the difference

885
00:37:00,160 --> 00:37:03,239
Speaker 1: in your normal budget versus the bare bones budget, when

886
00:37:03,280 --> 00:37:06,240
Speaker 1: you see how big of a chunk you can cut,

887
00:37:06,560 --> 00:37:09,480
Speaker 1: just like that, you're able to visualize the changes that

888
00:37:09,520 --> 00:37:12,600
Speaker 1: you can implement in your personal finances just by doing

889
00:37:12,600 --> 00:37:15,000
Speaker 1: this exercise. And I feel like that sense of independence

890
00:37:15,040 --> 00:37:17,400
Speaker 1: that you get by doing this can weave its ways

891
00:37:17,440 --> 00:37:20,319
Speaker 1: into other parts of your life. Right now, you might

892
00:37:20,360 --> 00:37:22,719
Speaker 1: be empowered to ask for a bigger raise at work

893
00:37:22,719 --> 00:37:25,360
Speaker 1: than you might otherwise do because you need the job.

894
00:37:25,560 --> 00:37:27,360
Speaker 1: If you're like, you know what, I can cut fourteen

895
00:37:27,480 --> 00:37:29,759
Speaker 1: hundred dollars out of my month tomorrow if I need to,

896
00:37:30,120 --> 00:37:31,440
Speaker 1: I feel like I can ask my boss for a

897
00:37:31,520 --> 00:37:34,000
Speaker 1: raise and not feel bad about it. That's definitely one

898
00:37:34,000 --> 00:37:36,200
Speaker 1: of the side effects that is possible. I think when

899
00:37:36,239 --> 00:37:38,799
Speaker 1: you create a barbones budget right also too, like you

900
00:37:38,880 --> 00:37:41,360
Speaker 1: might realize that you can invest more of your income

901
00:37:41,440 --> 00:37:43,919
Speaker 1: than you previously thought. You thought maxing out a roth

902
00:37:43,920 --> 00:37:46,520
Speaker 1: ira that's just for other people. Well, you know what,

903
00:37:46,760 --> 00:37:49,480
Speaker 1: maybe it's not. Maybe it's for you. Maybe creating a

904
00:37:49,480 --> 00:37:52,600
Speaker 1: bare bones budget helps you realize how much waste there

905
00:37:52,640 --> 00:37:55,680
Speaker 1: actually was in the budget you've been using, and you

906
00:37:55,680 --> 00:37:57,640
Speaker 1: can come back a few of those things you have

907
00:37:57,680 --> 00:37:59,400
Speaker 1: to cut everything. You don't have to go all the

908
00:37:59,400 --> 00:38:01,920
Speaker 1: way down to using that bear bones budget, but it

909
00:38:01,960 --> 00:38:04,799
Speaker 1: does help you realize that there are things that you

910
00:38:04,880 --> 00:38:07,279
Speaker 1: can cut pretty easily that don't make that big of

911
00:38:07,280 --> 00:38:10,280
Speaker 1: a difference, and you can start investing more for your future.

912
00:38:10,680 --> 00:38:14,279
Speaker 1: So yeah, I think the barebones budget exercise goes way

913
00:38:14,320 --> 00:38:17,520
Speaker 1: beyond just creating this piece of paper that you're hoping

914
00:38:17,600 --> 00:38:20,120
Speaker 1: you never have to use or implement. Putting together the

915
00:38:20,120 --> 00:38:25,040
Speaker 1: barebones budget goes beyond just having this backup in case

916
00:38:25,320 --> 00:38:27,360
Speaker 1: the worst possible thing were to happen. Although though it

917
00:38:27,400 --> 00:38:30,040
Speaker 1: is good for that reason, it can be empowering in

918
00:38:30,120 --> 00:38:32,440
Speaker 1: all these other ways of your personal finances.

919
00:38:32,520 --> 00:38:35,040
Speaker 2: Yeah, yeah, and you're saving and what you invest And dude, like,

920
00:38:35,080 --> 00:38:38,480
Speaker 2: I feel like the discipline that we gain by taking

921
00:38:38,480 --> 00:38:41,000
Speaker 2: control of our spending like that can apply that like

922
00:38:41,040 --> 00:38:43,239
Speaker 2: that can bleed into other areas of our life, right Like,

923
00:38:43,280 --> 00:38:45,359
Speaker 2: it makes me think of just like getting fits and

924
00:38:45,440 --> 00:38:48,680
Speaker 2: like controlling how much you eat, how much you exercise,

925
00:38:48,719 --> 00:38:50,239
Speaker 2: Like these are all things that we have control over,

926
00:38:50,880 --> 00:38:54,680
Speaker 2: even like our relationships, Like within our social circles, we

927
00:38:54,880 --> 00:38:57,919
Speaker 2: can initiate hanging out with a friend that we haven't

928
00:38:57,920 --> 00:38:59,759
Speaker 2: seen in a while. You know, these are all areas

929
00:38:59,800 --> 00:39:04,640
Speaker 2: in life that could benefit from this crossover of discipline

930
00:39:04,640 --> 00:39:08,239
Speaker 2: that could result from cutting back on your expenses. It

931
00:39:08,239 --> 00:39:10,840
Speaker 2: seems crazy to say that, right like that, just simply

932
00:39:10,880 --> 00:39:14,359
Speaker 2: by seeing that, Oh, I truly could live on a

933
00:39:14,400 --> 00:39:17,000
Speaker 2: third of what my current monthly budget is, which, by

934
00:39:17,040 --> 00:39:19,200
Speaker 2: the way, dude, so I crunch the numbers and I

935
00:39:19,200 --> 00:39:22,680
Speaker 2: won't give specifics, but our bare bones budget is about

936
00:39:22,680 --> 00:39:25,240
Speaker 2: a third of what we currently live on. Right It's incredible,

937
00:39:25,239 --> 00:39:27,560
Speaker 2: isn't that crazy? Yeah? Which means that two thirds of

938
00:39:27,600 --> 00:39:32,560
Speaker 2: it is basically lifestyle fluff's seriously, and that's okay, But

939
00:39:32,640 --> 00:39:35,120
Speaker 2: it's just good to see that. Wow, if it came

940
00:39:35,160 --> 00:39:37,360
Speaker 2: to it, we really could cut back a lot. And

941
00:39:37,440 --> 00:39:40,200
Speaker 2: so regardless of which area in your life you're looking at,

942
00:39:40,239 --> 00:39:42,680
Speaker 2: And obviously we're focusing here primarily on finances, but it

943
00:39:42,680 --> 00:39:45,240
Speaker 2: can affect a lot of the different areas in your life.

944
00:39:45,440 --> 00:39:47,759
Speaker 1: Yeah, for sure. And I think to a lot of

945
00:39:47,760 --> 00:39:51,280
Speaker 1: people in all likelihood might decide to use the barebones

946
00:39:51,320 --> 00:39:53,640
Speaker 1: budget to inform their current budget to come up with

947
00:39:53,680 --> 00:39:56,719
Speaker 1: something like in in between budget, right, Like maybe maybe Matt,

948
00:39:56,760 --> 00:39:59,600
Speaker 1: after that you say, wow, you cut that much, Well,

949
00:39:59,719 --> 00:40:02,280
Speaker 1: you know, but maybe I can have a monthly budget

950
00:40:02,360 --> 00:40:04,200
Speaker 1: somewhere in between if you have other goals that you're

951
00:40:04,239 --> 00:40:05,440
Speaker 1: looking to accomplish.

952
00:40:05,040 --> 00:40:06,840
Speaker 2: Day, if you're thinking you have to subscribe to like

953
00:40:06,920 --> 00:40:09,399
Speaker 2: one or the other, like, that's a false dichotomy. R. Yeah,

954
00:40:09,400 --> 00:40:12,759
Speaker 2: Like there's plenty of spots in the middle that you

955
00:40:12,800 --> 00:40:13,800
Speaker 2: could go with exactly.

956
00:40:14,000 --> 00:40:15,799
Speaker 1: I feel like, Yeah, seeing the difference in what you're

957
00:40:15,800 --> 00:40:19,319
Speaker 1: currently spending versus what you could get by on could

958
00:40:19,320 --> 00:40:22,080
Speaker 1: help you realize, like how big this gap is. Seeing

959
00:40:22,120 --> 00:40:24,560
Speaker 1: the difference in what you're currently spending versus what you

960
00:40:24,600 --> 00:40:27,040
Speaker 1: could get by on could help you realize how big

961
00:40:27,080 --> 00:40:29,840
Speaker 1: of a gap you can actually have between what's coming

962
00:40:29,840 --> 00:40:31,880
Speaker 1: in and what's going out. You know, you might be

963
00:40:31,880 --> 00:40:35,000
Speaker 1: able to even achieve financial independence earlier than you thought

964
00:40:35,040 --> 00:40:37,600
Speaker 1: by letting that bear bones budget, not not by living

965
00:40:37,600 --> 00:40:40,160
Speaker 1: on that bar bones budget for a decade, but by

966
00:40:40,239 --> 00:40:42,840
Speaker 1: letting it at least inform your normal budget to a

967
00:40:42,920 --> 00:40:44,520
Speaker 1: larger extent in the here and now.

968
00:40:44,680 --> 00:40:46,279
Speaker 2: I mean it also like when you're looking at it

969
00:40:46,280 --> 00:40:49,920
Speaker 2: from an emergency fund standpoints, when you know that you

970
00:40:49,960 --> 00:40:52,719
Speaker 2: can pare down your budget to maybe a third of

971
00:40:53,120 --> 00:40:56,080
Speaker 2: what it currently is, that's empowering. I get a lot

972
00:40:56,080 --> 00:40:58,880
Speaker 2: of confidence knowing that our emergency fund, we could actually

973
00:40:58,920 --> 00:41:01,799
Speaker 2: stretch that out for much much further. And so you know,

974
00:41:02,239 --> 00:41:04,440
Speaker 2: a fully funded emergency fund that normally would be around

975
00:41:04,440 --> 00:41:07,160
Speaker 2: three to six months worth of expenses might in fact

976
00:41:07,600 --> 00:41:11,160
Speaker 2: translate more into maybe six to twelve months worth of expenses.

977
00:41:11,200 --> 00:41:13,920
Speaker 2: And so I don't think I'm alone and gaining some

978
00:41:13,960 --> 00:41:16,480
Speaker 2: peace of mind from that, especially dude, you know, being

979
00:41:16,520 --> 00:41:21,200
Speaker 2: self employed, when our income varies significantly, it's nice to

980
00:41:21,280 --> 00:41:24,320
Speaker 2: know that we, you know, can have enough set aside

981
00:41:24,400 --> 00:41:27,960
Speaker 2: to allow us to even out those annual expenses, those

982
00:41:28,000 --> 00:41:29,560
Speaker 2: ups and downs.

983
00:41:28,960 --> 00:41:32,280
Speaker 1: No doubt. So it's a helpful exercise for everyone out there.

984
00:41:32,560 --> 00:41:34,360
Speaker 1: Even if in the end you decide I'm sticking to

985
00:41:34,400 --> 00:41:37,120
Speaker 1: my normal budget as is not changing a thing. Having

986
00:41:37,120 --> 00:41:39,400
Speaker 1: that bear bones budget is going to provide peace of

987
00:41:39,440 --> 00:41:42,839
Speaker 1: mind and some empowerment, I think in your corner. All right, Matt,

988
00:41:42,920 --> 00:41:44,239
Speaker 1: let's get back to you. The beer that we had

989
00:41:44,360 --> 00:41:47,080
Speaker 1: on this episode, we have not yet cut it out

990
00:41:47,120 --> 00:41:49,239
Speaker 1: of our budget. We're still enjoying good graph here that

991
00:41:49,400 --> 00:41:52,520
Speaker 1: is true. But yeah, this one was called Ethereal Vibrations.

992
00:41:52,719 --> 00:41:55,200
Speaker 1: It's an IPA from two of our favorite breweries, Monday

993
00:41:55,239 --> 00:41:57,759
Speaker 1: Night Brewing and Burial Brewing. What were your thoughts on

994
00:41:57,760 --> 00:41:58,520
Speaker 1: this delicious beer?

995
00:41:58,520 --> 00:42:02,560
Speaker 2: Man, Yeah, this is a double New England IPA and Dude,

996
00:42:02,640 --> 00:42:04,960
Speaker 2: this has all the different flavors I'm looking for in

997
00:42:05,040 --> 00:42:08,560
Speaker 2: a New England hazy ipa. It poured a super hazy

998
00:42:08,600 --> 00:42:11,160
Speaker 2: orange color. It's got all the kind of floral notes

999
00:42:12,120 --> 00:42:14,600
Speaker 2: as well as all the hoppy dankness that you would

1000
00:42:14,640 --> 00:42:17,440
Speaker 2: come to expect from some IPAs from.

1001
00:42:17,280 --> 00:42:18,240
Speaker 1: Both of these breweries.

1002
00:42:18,640 --> 00:42:20,680
Speaker 2: Like, I don't feel like there's anything stand out about

1003
00:42:20,719 --> 00:42:24,319
Speaker 2: it except that it was just flat out delicious and amazing. Like,

1004
00:42:24,360 --> 00:42:27,680
Speaker 2: there wasn't anything like super unique about it. But when

1005
00:42:27,719 --> 00:42:29,640
Speaker 2: I think about a double New England IPA. This is

1006
00:42:29,760 --> 00:42:33,840
Speaker 2: one hundred percent what I'm picturing or what I'm imagining

1007
00:42:33,840 --> 00:42:34,480
Speaker 2: myself tasting.

1008
00:42:35,520 --> 00:42:38,000
Speaker 1: Yeah, I feel like to make an NBA comparison, I

1009
00:42:38,000 --> 00:42:40,480
Speaker 1: feel like Monday Night and Burial, you know, combining forces

1010
00:42:40,520 --> 00:42:43,600
Speaker 1: would be like Lebron calling stuff curry up and being

1011
00:42:43,640 --> 00:42:45,560
Speaker 1: like come over and play playing the Lakers with me? Like,

1012
00:42:45,600 --> 00:42:47,239
Speaker 1: can you imagine what that team would be like? Like

1013
00:42:47,280 --> 00:42:51,319
Speaker 1: how they would demolish people. The beer was delicious. It

1014
00:42:51,360 --> 00:42:53,840
Speaker 1: was just like blend, I think perfect blend of like

1015
00:42:53,880 --> 00:42:57,040
Speaker 1: bitter and sweet. It was juicy and delicious. I don't

1016
00:42:57,040 --> 00:42:58,880
Speaker 1: know how descriptive I can get beyond that. It was

1017
00:42:59,000 --> 00:43:01,360
Speaker 1: just it was just a really really good example of

1018
00:43:01,400 --> 00:43:03,080
Speaker 1: the style. They crushed it on this one.

1019
00:43:03,160 --> 00:43:04,840
Speaker 2: Yeah, it's not one of these IPAs where there's like

1020
00:43:04,840 --> 00:43:07,760
Speaker 2: a bunch of adjuncts which means like they're adding different

1021
00:43:07,880 --> 00:43:11,120
Speaker 2: ingredients or just kind of doing a random fruits yeah,

1022
00:43:11,239 --> 00:43:13,880
Speaker 2: or like a weird process that they're participating in. This

1023
00:43:14,000 --> 00:43:16,560
Speaker 2: was just a really good all star of a New

1024
00:43:16,600 --> 00:43:18,600
Speaker 2: England IPA. Glad that you and I got to share

1025
00:43:18,640 --> 00:43:19,239
Speaker 2: this one on the show.

1026
00:43:19,239 --> 00:43:21,000
Speaker 1: Bud me too. Man, all right, well that's going to

1027
00:43:21,040 --> 00:43:23,279
Speaker 1: do it for this episode. For folks that want the

1028
00:43:23,280 --> 00:43:26,200
Speaker 1: show notes for this episode links to anything and everything

1029
00:43:26,200 --> 00:43:28,440
Speaker 1: we mentioned, we'll put those up on our website at

1030
00:43:28,440 --> 00:43:29,560
Speaker 1: howtomoney dot com.

1031
00:43:29,640 --> 00:43:31,399
Speaker 2: That's right, And if you've been listening to the show,

1032
00:43:31,440 --> 00:43:33,360
Speaker 2: and if you have not yet left us a review

1033
00:43:33,400 --> 00:43:36,279
Speaker 2: over at Apple Podcasts, we would love it if you

1034
00:43:36,320 --> 00:43:38,279
Speaker 2: did that. So that helps us to get the word out.

1035
00:43:38,600 --> 00:43:41,600
Speaker 2: It helps others to find the show who haven't yet

1036
00:43:41,800 --> 00:43:44,719
Speaker 2: found it, and so we would appreciate that over at

1037
00:43:44,760 --> 00:43:47,400
Speaker 2: Apple Podcasts or wherever it is that you listen to

1038
00:43:47,480 --> 00:43:49,000
Speaker 2: your shows. And so Joel, that's going to be it,

1039
00:43:49,000 --> 00:43:51,919
Speaker 2: buddy for this episode. Until next time, Best Friends Out,

1040
00:43:52,120 --> 00:44:04,480
Speaker 2: Best Friends Out. The Only wo