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Speaker 1: Welcome to How the Money. I'm Joel and I am Matt,

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Speaker 1: and today we're talking making money changes that stick with

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Speaker 1: Katie Milkman. That's right, man, We are going to talk

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Speaker 1: about how we can make positive money changes in three

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Speaker 1: and who better to have this conversation with than Katie Milkman,

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Speaker 1: who is the author of How to Change the Science

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Speaker 1: of Getting from where You Are to where You Want

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Speaker 1: to be. Katie is a professor at the Wharton School

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Speaker 1: of the University of Pennsylvania, where she explores ways that

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Speaker 1: insights from economics and psychology how they can be harnessed

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Speaker 1: to change consequential behaviors for good like exercise and vaccinations,

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Speaker 1: but also behaviors saving more money, which is what we

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Speaker 1: are we are all about here on the show. She's

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Speaker 1: advised organizations ranging from the White House to twenty four

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Speaker 1: Hour Fitness. She writes everywhere as well. Her op eds

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Speaker 1: appear in The Times, uh and The Economist, and we're

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Speaker 1: just lucky to have her here with us today to

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Speaker 1: talk about how you can make some of these money

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Speaker 1: changes that stick. Katie, thank you so much for joining

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Speaker 1: us today. Joel and Matt, thank you so much for

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Speaker 1: having me. We are pumped to talk to you today, Katie.

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Speaker 1: So much to discuss, specially since the dawn of a

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Speaker 1: new year. There's a lot of changes that we want

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Speaker 1: to make, and our listeners of course are tuning in

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Speaker 1: because they want to make money changes. But and we're

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Speaker 1: here kind of with the money advice, but you're here

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Speaker 1: with hopefully the here's how you can continue to do

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Speaker 1: it over a longer period of time advice. But um,

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Speaker 1: the first question we ask anybody who comes on the

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Speaker 1: show is what they like to sport John and give

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Speaker 1: us a little window into their world. And Matt and

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Speaker 1: I we sported on craft beer while we're saving and

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Speaker 1: investing for the future. But what's that for you? What

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Speaker 1: do you like to spot? John? And some people might

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Speaker 1: think here a little crazy for spending a lot of

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Speaker 1: money in that one area. I don't know if anyone

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Speaker 1: will think I'm crazy, But I like to splurge on vacations,

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Speaker 1: for sure. That's my that's my big one. That's not

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Speaker 1: crazy at all. But I like the I like it though. Yeah,

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Speaker 1: there's actually a lot of research showing that when we

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Speaker 1: spend on experiences rather than just buying stuff, we get

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Speaker 1: more out of it. So I try to follow the data,

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Speaker 1: and I take really nice vacations, very nice. So are

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Speaker 1: you like a are you a quantity of vacations type

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Speaker 1: of girl or like a quality? So do you go

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Speaker 1: on like one really okay? So so you go on

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Speaker 1: fewer really nice vacations as opposed to more of them

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Speaker 1: throughout the year. Yeah, I will. I would say I

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Speaker 1: try to have a healthy number. But I think the

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Speaker 1: splurge part is the quality. Our best vacation you've had recently? Well,

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Speaker 1: I have a six and a half year old, so

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Speaker 1: that limits the exotic travel I do these days. I

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Speaker 1: used to go all over the world, but we had

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Speaker 1: a really wonderful vacation to Hawaii, um this summer that

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Speaker 1: was truly spectacular. Looking forward to maybe finally making that

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Speaker 1: trip happen maybe this year. We've got young kids too,

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Speaker 1: so it's limited up and we're like where our kids

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Speaker 1: are getting a little bit older, it feels like we

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Speaker 1: can finally expand some of our destinations and to requate

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Speaker 1: myself with the world. Yeah. Right, So before we talk

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Speaker 1: about how to go about making change, like, can we

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Speaker 1: just talk about how sometimes folks feel unable to change? Um, Like,

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Speaker 1: what is it that's that's holding most folks back from

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Speaker 1: believing that they just have the ability to to make

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Speaker 1: progress in their lives at all. Yeah, that's a great question. Well,

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Speaker 1: first of all, I should say there are lots of

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Speaker 1: very real external barriers to change. Right. You might feel

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Speaker 1: like your budget is just too tight to make the

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Speaker 1: changes you want, or you don't have a family support

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Speaker 1: that you need to make the changes, or um job stability.

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Speaker 1: So there are very real external barriers that can block people.

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Speaker 1: I don't study those. I actually study the internal barriers

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Speaker 1: to change, and I think they're particularly fascinating because even

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Speaker 1: when everything is lined up, which it rarely is, but

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Speaker 1: even whenever reathings lined up in your favor outside, sometimes

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Speaker 1: we're our own worst enemies. And the fascinating thing about

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Speaker 1: the internal barriers to change is there's no one barrier.

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Speaker 1: There's there's a laundry list, and some of us have

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Speaker 1: multiple things we're fighting against. Some of us are just

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Speaker 1: struggling with one. Diagnosing is really important to using the

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Speaker 1: right solution. So barriers that are common include procrastination, lack

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Speaker 1: of confidence forgetting, which I think we overlook often. But

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Speaker 1: if it doesn't get to the top of your priority list,

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Speaker 1: if it's not top of mind. We often don't take

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Speaker 1: the actions that are important. Habits can get in the way.

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Speaker 1: We tend to be creatures of habit. We tend to

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Speaker 1: take the path of least resistance, um, which is, you know,

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Speaker 1: following those those habits, and that can be a real

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Speaker 1: barrier to change. So there are many many challenges, uh,

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Speaker 1: And depending on which one a given person is facing

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Speaker 1: when they're trying to make a change, the solution that

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Speaker 1: will be most well suited to help them it is different. Yeah,

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Speaker 1: what I will say forgetting used to be like at

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Speaker 1: the top of the list for reasons I didn't get

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Speaker 1: things done. And I swear Google Calendar has been a

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Speaker 1: game changer for me in that regard, Like I get

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Speaker 1: a lot more stuff done just because I'm better at

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Speaker 1: putting stuff on the calendar to get it done. But man,

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Speaker 1: nothing worked for me before that, and so I was

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Speaker 1: just like a forgetful mess and the compus nearly as

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Speaker 1: much as I wanted to. So that it's definitely one

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Speaker 1: thing You're right that we don't put a give enough

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Speaker 1: credit just so we're forgetting things because we're not putting

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Speaker 1: them in front of ourselves. But one of the difference differences, Katie,

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Speaker 1: between resolutions that we make and then the potential for

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Speaker 1: lasting change, because I don't know, something like this is

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Speaker 1: the staff that gets quoted all the time, but there's

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Speaker 1: something like eight percent of people who don't actually follow

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Speaker 1: through on the resolutions they make after a month or two.

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Speaker 1: So we're in this period right now, with this fresh

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Speaker 1: start period that you talk about, where a lot of

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Speaker 1: people are ready willing and they're trying to move in

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Speaker 1: the right direction when it comes to making change. But yeah,

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Speaker 1: how do we make sure that it sticks around and

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Speaker 1: isn't just a failed attempt a few weeks from now. Yeah,

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Speaker 1: it's a great question. And as you know, this is

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Speaker 1: sort of a magic moment. I've done research on what's

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Speaker 1: called the fresh start effect phenomenon, where at the start

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Speaker 1: of um new chapters in our lives, moments that feel

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Speaker 1: like new beginnings, So the start of a new year

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Speaker 1: being the best known, but there are many others actually

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Speaker 1: as well. We pursue goals with extra vigor. But the

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Speaker 1: funny thing about fresh starts is they're short lived, right,

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Speaker 1: So they give you that little boost of motivation to

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Speaker 1: begin something new, but a couple of weeks pass and

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Speaker 1: that's gone, and now you need something to carry you forward.

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Speaker 1: And that's where a lot of folks fall flat. And

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Speaker 1: I actually think one of the biggest issues is that

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Speaker 1: people aren't strategic about how am I going to achieve

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Speaker 1: this school. They just say, oh, you know, I'm going

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Speaker 1: to go to the gym this year, and I'll go

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Speaker 1: now because I feel motivated, And then three weeks later

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Speaker 1: they don't feel motivated anymore and everything falls apart. But

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Speaker 1: an alternative way you could pursue a goal, and what

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Speaker 1: research is better is actually by um following a bunch

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Speaker 1: of best practices. So ideally, when you want to pursue

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Speaker 1: a goal, first of all, you define a plan. And

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Speaker 1: the plan isn't just I'm going to go to the

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Speaker 1: gym once, right. The plan is I'd like to do

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Speaker 1: this regularly for some hopefully very long term period of time.

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Speaker 1: If it's about getting in shape, if it's about um

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Speaker 1: cutting back you're spending, whatever that is. Maybe you want

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Speaker 1: to learn a new language this year. UM, you don't

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Speaker 1: want to just say I'm gonna learn Spanish. You actually

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Speaker 1: want to sit down and say, okay, how am I

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Speaker 1: going to do it? Well, maybe those details look like

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Speaker 1: saying it's going to be four hours a week that

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Speaker 1: I spend on dual Lingo, and it's going to be Tuesday, Wednesday, Thursday,

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Speaker 1: Friday at five pm right after work when I spend

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Speaker 1: an hour on the app practicing uh, and I'm going

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Speaker 1: to do that every week consistently. Now you're actually starting

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Speaker 1: to um see the groundwork for the kind of plan

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Speaker 1: that might carry for it. Now that might sound boring,

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Speaker 1: but actually breaking down a big vague into bite sized pieces,

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Speaker 1: whether it has to do with savings, volunteering exercise is

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Speaker 1: one of the most important things you can do. And

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Speaker 1: then figuring out when will I do it, where will

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Speaker 1: I do it, how will I get it done? There's

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Speaker 1: more to the magic as well. You have to make

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Speaker 1: sure you won't forget so you can put it on

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Speaker 1: your Google calendar. Um. Ideally you're thinking about accountability, So

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Speaker 1: can you create consequences so that if you fail to

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Speaker 1: follow through, it isn't just a shoulder shrug, but you're

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Speaker 1: really gonna feel crummy about that. Um. The more the consequence,

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Speaker 1: the more likely it is that you won't procrastinate or

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Speaker 1: give up on yourself, so you can actually put money

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Speaker 1: on the line for instance, that you agree will forfeit

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Speaker 1: if you don't achieve a given goal. You can choose

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Speaker 1: referees or some websites like stick dot com and be

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Speaker 1: minder dot com which I am i should say, unaffiliated

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Speaker 1: with just an admire of their product, that allow you

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Speaker 1: to do things like that. And research shows that when

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Speaker 1: you use these so called commitment devices basically penalize seeing

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Speaker 1: yourself for future failures to fall throw on your goals,

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Speaker 1: you dramatically increase the likelihood of success. Because nobody's nobody

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Speaker 1: likes a fine. So those are a bunch of strategies

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Speaker 1: you can take, and there's more we could get into,

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Speaker 1: depending on what other obstacles you foresee, like making sure

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Speaker 1: you enjoy the way you're pursuing the goal and so on.

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Speaker 1: But that's a pretty good groundwork. Yeah, absolutely, like you

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Speaker 1: kind of just you give it's just like a little

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Speaker 1: sampler platter of a lot of different strategies that you

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Speaker 1: talk about your book. Um. But essentially, I mean, all

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Speaker 1: of these things can lead an individual to create processes

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Speaker 1: that work for them and which makes me think of

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Speaker 1: like my favorite new quote, which is process saves us

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Speaker 1: from the poverty of our intentions, which I heard recently.

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Speaker 1: I was just like, man, that is so stink and good.

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Speaker 1: But that's what all of this does. It's about creating

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Speaker 1: this plan because we've all got these idealized intentions at

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Speaker 1: this point in the year where it's like, of course

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Speaker 1: I'm gonna do this, like everyone has goals. I just

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Speaker 1: turned over a new leaf. But if you don't have

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Speaker 1: the processes to back that up, then inevitably it's gonna

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Speaker 1: fall flat for most folks, right, That's exactly right, And unfortunately,

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Speaker 1: too often we aren't focused on those processes. We're just

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Speaker 1: focused on that short burst of motivation and we imagine

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Speaker 1: it will carry us for it and we'll have no problems.

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Speaker 1: But once you start recognizing no, there are barriers to

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Speaker 1: success and to maintenance um and starting to set yourself

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Speaker 1: up so that you can overcome them, you start seeing

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Speaker 1: better results. And of course everyone resolutions get made at

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Speaker 1: the beginning of the year, and so I feel like

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Speaker 1: that's one that's a little more natural for for a

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Speaker 1: lot of folks. But in your book you also talk

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Speaker 1: about how there are different life events that can occur

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Speaker 1: that folks can maybe take advantage of. Can you talk

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Speaker 1: through maybe some different examples of maybe even disruptive life

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Speaker 1: events that that folks are able to use to their

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Speaker 1: advantage to basically put them on this path towards a

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Speaker 1: new fresh start for them. Yeah. Absolutely, Well. One of

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Speaker 1: the really interesting things about the way we think about

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Speaker 1: time and the way we think about our lives is

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Speaker 1: that we don't perceive it linearly. We actually think about

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Speaker 1: ourselves like we're characters in a book. And um, our

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Speaker 1: life is divided into chapters, and there are big chapters,

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Speaker 1: and there are short chapters. There's even you know, subsections

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Speaker 1: of chapters. Every time, um, something happens that feels like

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Speaker 1: a book ends a chapter or a section of our life, UM,

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Speaker 1: we feel this sense of discontinuity. So think about, you know,

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Speaker 1: moving to a new city, and you could think about,

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Speaker 1: you know, the years you maybe were in college or

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Speaker 1: working at a certain employer. Those are sort of chapters

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Speaker 1: in your life. Or a year is also a major

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Speaker 1: chapter marker for many people in their lives, which is

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Speaker 1: part of why New Year's feels like a fresh start.

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Speaker 1: And whenever we cross one of those boundaries, close one

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Speaker 1: chapter and open another, we have a sense that we

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Speaker 1: are um further apart from our past. Self. Whatever you know,

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Speaker 1: I didn't get done last year or last year I

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Speaker 1: meant to get in shape, or I meant to get

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Speaker 1: my portfolio under control and diversify better. Whatever it was, Uh,

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Speaker 1: I didn't do it yet. But that was the old me,

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Speaker 1: and this is the new me, and the new me's

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Speaker 1: going to be different. So that discontinuity can be really

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Speaker 1: productive for anything where you you haven't already achieved the

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Speaker 1: goal and maybe you were feeling a little sad about it,

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Speaker 1: and now you can say, well, you know that was

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Speaker 1: the past and and this is going to be different.

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Speaker 1: It also tends to lead us a step back and

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Speaker 1: think big picture about our lives. So we have shown

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Speaker 1: that this happens um not just with things that you

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Speaker 1: might expect to be momentous like a real physical change.

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Speaker 1: You have a new job or a new house, or

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Speaker 1: um a new community or a new role of some kind. Right,

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Speaker 1: there's actually really wonderful past research by Wendy Wood at

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Speaker 1: the University of Southern California looking at these life disruptions

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Speaker 1: and how they can break up our habits. But we've

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Speaker 1: shown that even um trivial events on the calendar that

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Speaker 1: truly do not matter and they they create the same

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Speaker 1: psychological and choice effects where we pursue goals with greater vigor.

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Speaker 1: So the start of a new week is a minor

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Speaker 1: fresh start. We already talked about New Years, that's the

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Speaker 1: big one we're all familiar with. At the start of

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Speaker 1: a new month. Sometimes the celebration of spring, especially its

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Speaker 1: drawn to your attention. The start of spring feels like

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Speaker 1: a new beginning, the celebration of a birthday, and there

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Speaker 1: are many minor holidays that feel like fresh starts to people,

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Speaker 1: So think more Labor Day and less Valentine's Day. And

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Speaker 1: different religions have different holidays that signal a fresh start

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Speaker 1: for people who practice in that religion. So all these

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Speaker 1: fresh start dates um when we sort of look at data,

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Speaker 1: have this incredible ability to increase, just naturally how much

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Speaker 1: people are doing things like searching for the term diet

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Speaker 1: on Google, or visiting the gym, or setting goals on

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Speaker 1: popular goal setting websites about everything from their health to

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Speaker 1: their finances to their education. Uh. And we have also

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Speaker 1: done experiments where we show that by highlighting fresh start

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Speaker 1: dates that people might not otherwise be attending to, we

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Speaker 1: can get people to pursue their goals more aggressively. So

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Speaker 1: my favorite experiment involved trying to get more people to

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Speaker 1: sign up for a retirement saving account with their employer.

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Speaker 1: UM That was you know, text beneficial. It was a

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Speaker 1: four or three ban out of four oh one k,

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Speaker 1: which is probably the most familiar. But this was when

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Speaker 1: I do so I thought I could throw out some

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Speaker 1: of that that fun stuff. Um So, so we UM

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Speaker 1: partnered with four universities that had four or three B

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Speaker 1: plans and we sent out mailings to employees who were

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Speaker 1: not yet saving at the sort of match thresholds. They

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Speaker 1: weren't taking advantage of all of their employeer benefits, or

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Speaker 1: weren't saving at all. In fact, most weren't saving at all,

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Speaker 1: and we invited them to start saving, either right away

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Speaker 1: or in the future, because we know a lot of

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Speaker 1: people would want to put off that that decision to

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Speaker 1: start saving from past research. And what we varied is

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Speaker 1: whether or not the date in the future when we

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Speaker 1: invited people to begin saving, we said, we'll take care

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Speaker 1: of it, just mail back this postcard. If that date

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Speaker 1: in the future aligned with a fresh Start and was

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Speaker 1: described in that way, or if it aligned with the

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Speaker 1: Fresh Start but wasn't described So to be really specific,

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Speaker 1: imagine your birthdays coming up in two months and you're

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Speaker 1: in the six arm, and we would flip a coin

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Speaker 1: and the coin toss would determine whether you got a

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Speaker 1: version of the mailing that invited you to start saving

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Speaker 1: after your upcoming birthday or in two months. Now, they're

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Speaker 1: literally identical, but in one case we are highlighting an

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Speaker 1: upcoming fresh start as the opportunity. So we tried this

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Speaker 1: with birthdays, we tried it with a start of spring

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Speaker 1: um and what we see is that inviting people to

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Speaker 1: begin saving after a fresh start date and like literally

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Speaker 1: calling it out as such, leads to more savings in

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Speaker 1: the following eight months, uh than a literally identical invitation

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Speaker 1: to save that doesn't name the fresh start date. Significant increase. Y. Yeah,

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Speaker 1: it's pretty exciting. Humans are odd beings, right that we

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Speaker 1: respond differently that, but it's cool to see that that's

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Speaker 1: the case, and then you can tailor your marketing accordingly

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Speaker 1: to help people make better decisions. And I'm curious to

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Speaker 1: you write about Katie. You performed a lot of research

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Speaker 1: that shows that we underestimate the discipline needed to make

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Speaker 1: change in our lives, but that there are ways that

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Speaker 1: we can make it more fun. So, yeah, I can

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Speaker 1: talk about that because sometimes there are if we can

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Speaker 1: make it more fun, we're more likely to stick to it. Yeah.

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Speaker 1: This is a huge insight and and I think the

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Speaker 1: best research on this comes from islet fish Buck at

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Speaker 1: the University of Chicago and Caitlin Williott Cornell, who showed

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Speaker 1: most of us, when we are left to our own devices,

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Speaker 1: think the best way to pursue our goals is just

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Speaker 1: to look for the most direct path to success and

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Speaker 1: follow it. So let's take the example of getting in shape.

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Speaker 1: What's the maximally efficient workout machine that will create the

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Speaker 1: most pain and sort of benefits per minute. You're like,

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Speaker 1: I'm going to get on that if I want to

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Speaker 1: get in shape. Yeah, it means I'm gonna start running

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Speaker 1: right this minute. Yeah, exactly, flailing your arms, carrying weights

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Speaker 1: to all the things that are hard. A small minority

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Speaker 1: of people, though, pursue their goals a different way, which

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Speaker 1: is that they actually look for a fun way to

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Speaker 1: achieve that goal of say getting in shape, so that

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Speaker 1: that person might go to zoomba classes with a friend

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Speaker 1: instead of getting on the punishing StairMaster. And what's really

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Speaker 1: interesting is that the folks who into it they should

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Speaker 1: find a fun way to pursue their goals. They're actually

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Speaker 1: the ones that have it right. In randomize control trials

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Speaker 1: where people are either encouraged to pursue their goals in

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Speaker 1: ways that are fun or in ways that are maximally efficient,

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Speaker 1: the people encourage to pursue goals and ways that are

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Speaker 1: fun are the ones who actually end up sticking to

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Speaker 1: them longer. And in most cases, it's not about how

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Speaker 1: much progress you make percession. It's about sticking to it

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Speaker 1: that leads to the real success. So that persistence difference

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Speaker 1: between pursuing goals in a way that's fun and ways

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Speaker 1: that are you know, slightly more efficient, we miss you know,

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Speaker 1: we don't appreciate it, and we we make a mistake there.

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Speaker 1: So I've done some research on different ways you can

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Speaker 1: make it fun to pursue your goals, because there are

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Speaker 1: strategies that systematically make it more enjoyable. Um one is

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Speaker 1: whenever there's something that would feel like a chore. Otherwise

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Speaker 1: you can actually try to link it with a temptation.

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Speaker 1: So only let yourself say binge, watch your favorite TV

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Speaker 1: show when you are working out at the gym, or

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Speaker 1: only let yourself pick up your favorite beverage from a

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Speaker 1: coffee shop, um, when you're heading to the library to

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Speaker 1: hit the books. If you're a student, I talk to

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Speaker 1: my students that weren't about that one a lot. Or

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Speaker 1: you know, only let yourself listen your favorite podcast while

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Speaker 1: you're doing household chores. And by combining those two things,

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Speaker 1: something that's a temptation and source of pleasure with something

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Speaker 1: that might otherwise not be super fun, that you might

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Speaker 1: put off and dread, you can transform the experience so

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Speaker 1: that you'll get your chores done and um, keep at it.

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Speaker 1: And and there are other strategies to write. Selecting different

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Speaker 1: types of activities as a way to pursue the same

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Speaker 1: goal and also making it social can be really effective

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Speaker 1: when you pursue goals with someone who you enjoy. That's

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Speaker 1: another way to change the experience. But the key insight

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Speaker 1: is when you're thinking about a goal, when you're making

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Speaker 1: a plan, just something we already talked about a little

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Speaker 1: bit earlier, how important it is to be strategic, think

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Speaker 1: about pursuing that goal and anning to pursue that goal

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Speaker 1: in a way you will enjoy, because ultimately that is

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Speaker 1: a huge predictor of success. You've got to stick to it.

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Speaker 1: And if you don't enjoy it, if it's no fun

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Speaker 1: while you're pursuing the goal, you're going to quit. That's right. Yeah,

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Speaker 1: that's where you can use that instant gratification which normally

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Speaker 1: works against us. But then you're harnessing it. You're using

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Speaker 1: that as like wind at your back. But so you're

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Speaker 1: talking about temptation bundling, yes, yeah, yeah, I would love

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Speaker 1: to hear, how like, how are maybe some specific ways

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Speaker 1: that folks can apply temptation bundling to their financial habits

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Speaker 1: to you know, whether it is for them to save more,

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Speaker 1: whether it's them spending less at the grocery store. I'd

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Speaker 1: be curious to hear if you have any suggestions for

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Speaker 1: ways that folks can temptation bundle to get ahead with

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Speaker 1: their money. Yeah. I think that's a great question. Um,

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Speaker 1: And I do think there are ways that you can

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Speaker 1: use temptation bundling when it comes to financial habits. Um.

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Speaker 1: You know, one is just thinking about budgeting, which is

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Speaker 1: not a task that everybody relishes and looks for too, um,

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Speaker 1: and thinking about are there are there things you can

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Speaker 1: bundle with budgeting that make it more pleasant, like maybe

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Speaker 1: a favorite bottle of wine you only open once a

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Speaker 1: month when you go through your budget, or a person

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Speaker 1: you really enjoy spending time with and you both um

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Speaker 1: get together when it's sort of time to make budgets

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Speaker 1: and you get to chit chat and laugh a little

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Speaker 1: bit while you're going through it. I will admit that UM.

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Speaker 1: I was influenced very much on that one by my

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Speaker 1: dad growing up, who used to uh do as taxes

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Speaker 1: with an accountant who become became a very dear friend,

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Speaker 1: and they made it a source of fun every year.

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Speaker 1: It was basically a big party. They stayed up late,

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Speaker 1: they drank a lot of great wine, UM, they had

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Speaker 1: a really good meal when it was tax time. And

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Speaker 1: so there's lots of ways I think you can make

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Speaker 1: UM some of the things that feel like chores but

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Speaker 1: are really important to healthy financial decision making UM more pleasant.

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Speaker 1: A lot of them are social choosing an advisor who

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Speaker 1: you enjoy spending time with, maybe going out for a

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Speaker 1: special meal at a restaurant you you reserve for only

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Speaker 1: spending time with them. So those are a few ideas,

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Speaker 1: but creative listeners may come up with others. And I'm

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Speaker 1: always on the market for other temptation bundles. Yeah, no,

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Speaker 1: I like it. I literally had a coworker who she

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Speaker 1: would go to the gym, get on the StairMaster, and

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Speaker 1: she would watch her favorite shows. And it was I remember, like,

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Speaker 1: I think she would have given up her gym commitment

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Speaker 1: if it hadn't have been for the fact that that

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Speaker 1: she so deeply associated watching her favorite shows with working out,

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Speaker 1: that it became this thing like, well, I'm gonna go

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Speaker 1: watch my show, and but inevitably she was getting exercise

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Speaker 1: at the same time. So I think that's brilliant and

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Speaker 1: it's one of those things that not many people think about. Well,

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Speaker 1: we've got a few more questions we want to get

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Speaker 1: to with. You want to talk about overcoming procrastination and laziness.

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Speaker 1: We'll get to some questions for Katie on those fronts

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Speaker 1: right after this. All right, we are back from the

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Speaker 1: break talking with Katie Milkman about these different money changes

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Speaker 1: that you can make. Uh, and not only that you

432
00:22:00,000 --> 00:22:02,719
Speaker 1: can make, that that you can stick with. And Katie,

433
00:22:03,160 --> 00:22:05,760
Speaker 1: in your book, you talk about how, I mean, basically

434
00:22:05,840 --> 00:22:09,680
Speaker 1: everybody procrastinates, right, everybody from folks like us all the

435
00:22:09,720 --> 00:22:12,880
Speaker 1: way down to your students who you teach. But there

436
00:22:12,920 --> 00:22:17,200
Speaker 1: are constraints or commitment devices you mentioned this just before

437
00:22:17,240 --> 00:22:19,760
Speaker 1: the break that we can use, So can you explain

438
00:22:19,920 --> 00:22:23,240
Speaker 1: how those work and maybe give some examples. Yeah. Absolutely,

439
00:22:23,400 --> 00:22:27,399
Speaker 1: Commitment devices are fascinating because we're actually quite used to

440
00:22:28,040 --> 00:22:30,840
Speaker 1: their sort of sister tool, which is being managed by

441
00:22:30,920 --> 00:22:34,399
Speaker 1: other people. Right, if you have a UM, a boss,

442
00:22:34,840 --> 00:22:37,080
Speaker 1: or you know, live in a country that has a

443
00:22:37,119 --> 00:22:39,879
Speaker 1: functioning government, then you are familiar with the fact that

444
00:22:40,000 --> 00:22:42,960
Speaker 1: sometimes you are incentivized to behave in ways that are

445
00:22:43,080 --> 00:22:47,080
Speaker 1: good for your organization or your UM community. Right, So,

446
00:22:47,240 --> 00:22:50,800
Speaker 1: think about speeding tickets. You are tempted to speed UM,

447
00:22:50,920 --> 00:22:53,760
Speaker 1: but you get slapped with a fine if you give

448
00:22:53,800 --> 00:22:58,320
Speaker 1: into that temptation or UM. Think about finishing a project

449
00:22:58,400 --> 00:23:01,120
Speaker 1: at work. You probably are given a deadline by your boss.

450
00:23:01,160 --> 00:23:02,920
Speaker 1: I know there will be some real consequence if you

451
00:23:02,920 --> 00:23:06,320
Speaker 1: don't actually hit that deadline. Well, that's when someone else

452
00:23:06,440 --> 00:23:10,600
Speaker 1: external to you imposes some cost for say procrastination or

453
00:23:10,640 --> 00:23:13,600
Speaker 1: giving into temptation UM. But it turns out you can

454
00:23:13,600 --> 00:23:16,879
Speaker 1: actually impose penalties on yourself in the same way. And

455
00:23:17,040 --> 00:23:20,280
Speaker 1: that's when it's called a commitment device. And it sounds

456
00:23:20,359 --> 00:23:23,800
Speaker 1: weird because The idea of imposing penalties on yourself for

457
00:23:23,960 --> 00:23:26,760
Speaker 1: not achieving your goals is kind of counterintuitive, like why

458
00:23:26,800 --> 00:23:29,800
Speaker 1: would I find myself or punish myself or set deadlines

459
00:23:29,840 --> 00:23:34,760
Speaker 1: with consequences for myself? But there it really does. But

460
00:23:34,920 --> 00:23:38,600
Speaker 1: the evidence shows that when you create those kinds of

461
00:23:39,600 --> 00:23:44,080
Speaker 1: deadlines and penalties for yourself, it can be incredibly effective. Um.

462
00:23:44,920 --> 00:23:48,640
Speaker 1: This is a podcast about finance, so or financial decision making,

463
00:23:48,680 --> 00:23:51,200
Speaker 1: so it's a good place to talk about one of

464
00:23:51,280 --> 00:23:53,960
Speaker 1: my favorite studies on the power of a commitment device,

465
00:23:54,040 --> 00:23:57,960
Speaker 1: which actually was a saving study, and it involved giving

466
00:23:58,040 --> 00:24:01,320
Speaker 1: people access to a very unusual kind of savings account.

467
00:24:01,840 --> 00:24:04,359
Speaker 1: The study was done in the Philippines, and it was

468
00:24:04,440 --> 00:24:07,879
Speaker 1: done um to give people access to an account where, uh,

469
00:24:08,000 --> 00:24:10,560
Speaker 1: they actually wouldn't be able to take their money out

470
00:24:11,160 --> 00:24:15,840
Speaker 1: unless they reached a predetermined date or predetermined savings goal,

471
00:24:16,400 --> 00:24:20,119
Speaker 1: and it had no interest rate benefits over a standard

472
00:24:20,160 --> 00:24:24,119
Speaker 1: account that was fully liquid. It's sort of crazy to

473
00:24:24,280 --> 00:24:26,800
Speaker 1: think people would actually put money into this. View have

474
00:24:26,920 --> 00:24:31,200
Speaker 1: sort of a strict um economic perspective. Somebody who doesn't

475
00:24:31,240 --> 00:24:33,960
Speaker 1: like freedom or liberty, Yeah, like, why would you ever

476
00:24:34,119 --> 00:24:36,680
Speaker 1: do that unless there's like a higher interest rate? Why

477
00:24:36,720 --> 00:24:39,000
Speaker 1: would you ever want to put your money into this account?

478
00:24:39,080 --> 00:24:42,000
Speaker 1: That's it's just strictly worse. You can't access your cash.

479
00:24:42,520 --> 00:24:47,119
Speaker 1: But interestingly, in a randomized controlled trial, about thirty of

480
00:24:47,160 --> 00:24:50,920
Speaker 1: those offered this kind of account chose to put money

481
00:24:51,000 --> 00:24:53,440
Speaker 1: in it, uh, some of their money at least into

482
00:24:53,520 --> 00:24:56,119
Speaker 1: that account. So that's sort of shocking. And then the

483
00:24:56,280 --> 00:25:00,760
Speaker 1: most astounding fact is that two groups ran only selected

484
00:25:01,320 --> 00:25:03,760
Speaker 1: we're compared to one another, one of which had access

485
00:25:03,800 --> 00:25:05,400
Speaker 1: to this account that were told, hey, you can put

486
00:25:05,440 --> 00:25:07,520
Speaker 1: some money in it if you want, and remember thirty

487
00:25:07,600 --> 00:25:11,919
Speaker 1: percent did. So. We compare that entire group, everybody who

488
00:25:11,960 --> 00:25:14,000
Speaker 1: had access to it, whether they put money in or didn't,

489
00:25:14,400 --> 00:25:16,720
Speaker 1: to a second group, which is the control group that

490
00:25:16,960 --> 00:25:19,639
Speaker 1: wasn't given access to this account. And the question is

491
00:25:19,680 --> 00:25:21,920
Speaker 1: which group saves more of the group that can put

492
00:25:22,000 --> 00:25:25,440
Speaker 1: money in an illiquid account or the group that can't.

493
00:25:25,760 --> 00:25:29,280
Speaker 1: And what's fascinating is that having access to these accounts

494
00:25:29,880 --> 00:25:32,919
Speaker 1: where you don't get any interest rate benefit, but your

495
00:25:32,960 --> 00:25:35,560
Speaker 1: money is locked up until you've reached a predetermined saving

496
00:25:35,600 --> 00:25:39,919
Speaker 1: school or hit a date that you selected, having access

497
00:25:39,960 --> 00:25:42,920
Speaker 1: to it leads to eighty percent more savings year over year.

498
00:25:43,440 --> 00:25:45,720
Speaker 1: And again only thirty percent of people are even putting

499
00:25:45,720 --> 00:25:48,120
Speaker 1: money in these accounts. So just think, you know, imagine

500
00:25:48,200 --> 00:25:50,640
Speaker 1: if a hundred percent or how how high the savings

501
00:25:50,760 --> 00:25:53,840
Speaker 1: benefits would be for the whole additional dollar that was

502
00:25:53,920 --> 00:25:57,440
Speaker 1: the average for the entire group. That's right, exactly, So

503
00:25:58,280 --> 00:26:01,200
Speaker 1: eighty percent increase in savings for the entire population just

504
00:26:01,400 --> 00:26:04,639
Speaker 1: offered the account, even though only thirty percent took it up.

505
00:26:05,160 --> 00:26:09,280
Speaker 1: An incredible result. UM. So it highlights that when we

506
00:26:09,920 --> 00:26:13,720
Speaker 1: take steps to constrain ourselves to prevent ourselves from giving

507
00:26:13,720 --> 00:26:17,080
Speaker 1: into temptation, it's really beneficial. Another great studies showed that

508
00:26:17,280 --> 00:26:22,040
Speaker 1: UM letting smokers put money into a an account where

509
00:26:22,080 --> 00:26:24,119
Speaker 1: they would have to forfeit all that cash. So this

510
00:26:24,280 --> 00:26:26,600
Speaker 1: is a different way of imposing a commitment. Here we're

511
00:26:26,680 --> 00:26:31,040
Speaker 1: finding people instead of constraining access, but smokers who have

512
00:26:31,320 --> 00:26:33,280
Speaker 1: a way to put money on the line theft of forfeit.

513
00:26:33,320 --> 00:26:36,000
Speaker 1: If they don't quit smoking six months later, they quit

514
00:26:36,119 --> 00:26:39,760
Speaker 1: at a thirty percent higher rate than otherwise identical smokers

515
00:26:39,800 --> 00:26:43,600
Speaker 1: who UM just get standard smoking cessation tools. So if

516
00:26:43,640 --> 00:26:47,320
Speaker 1: we can find ourselves or constrain ourselves, that's the way

517
00:26:47,359 --> 00:26:49,719
Speaker 1: we can sort of bully ourselves into achieving goals at

518
00:26:49,760 --> 00:26:52,080
Speaker 1: a higher rate. And again we're used to others doing

519
00:26:52,119 --> 00:26:54,000
Speaker 1: this for us, our manager who sets a deadline and

520
00:26:54,040 --> 00:26:55,840
Speaker 1: says there's a penalty if you don't turn this in

521
00:26:55,920 --> 00:26:59,080
Speaker 1: on time, or or our government that says I, you know,

522
00:26:59,160 --> 00:27:01,280
Speaker 1: I'll find you for the behaviors that I don't want

523
00:27:01,320 --> 00:27:04,040
Speaker 1: to see. But if you do it for yourself, you

524
00:27:04,200 --> 00:27:07,680
Speaker 1: can reap all the benefits. And I just, uh, I

525
00:27:07,720 --> 00:27:09,960
Speaker 1: think this has everything to do with why I've been

526
00:27:10,000 --> 00:27:12,919
Speaker 1: so successful at going to the gym three times a week, Katie,

527
00:27:13,080 --> 00:27:15,159
Speaker 1: is because I pay a lot of money at the

528
00:27:15,200 --> 00:27:18,520
Speaker 1: beginning of the month automatically gets deducted. Well. It was

529
00:27:18,520 --> 00:27:20,159
Speaker 1: also a fresh start thing, Matt, because you and I

530
00:27:20,280 --> 00:27:24,320
Speaker 1: started working out when we moved moved over the summer, Katie,

531
00:27:24,359 --> 00:27:26,680
Speaker 1: and like we thought of it kind of and we

532
00:27:26,760 --> 00:27:29,080
Speaker 1: didn't connect the terminology because we hadn't read your book

533
00:27:29,080 --> 00:27:30,920
Speaker 1: at that point, but we were connecting it to this

534
00:27:31,040 --> 00:27:33,600
Speaker 1: like ability start effect to start some fresh things. And

535
00:27:33,680 --> 00:27:36,560
Speaker 1: so the move so basically combined with that, I'm never

536
00:27:36,600 --> 00:27:39,199
Speaker 1: going to stop working, right because I got I got

537
00:27:39,240 --> 00:27:42,080
Speaker 1: the double way. Yeah, that's great. And it is funny

538
00:27:42,119 --> 00:27:44,400
Speaker 1: that by reducing the marginal cost of a gym visit

539
00:27:44,480 --> 00:27:48,000
Speaker 1: to zero, you're essentially pre committing. Um, there's also a

540
00:27:48,080 --> 00:27:51,440
Speaker 1: bit of fun psychology. You know, it is a sunk cost,

541
00:27:51,600 --> 00:27:54,000
Speaker 1: right once you've spent it, you can't recover it. So

542
00:27:54,200 --> 00:27:56,119
Speaker 1: in a sense, you sort sort of be making a

543
00:27:56,200 --> 00:27:58,240
Speaker 1: decision that ignores that about whether you're going to go

544
00:27:58,240 --> 00:28:00,600
Speaker 1: to the gym this afternoon or not. But that's not

545
00:28:00,720 --> 00:28:03,440
Speaker 1: the way our mind works. We tend to feel guilty

546
00:28:03,560 --> 00:28:07,520
Speaker 1: about expenses even if there's sunk costs, if we're not

547
00:28:07,840 --> 00:28:11,000
Speaker 1: sort of taking full advantage of them. So there's, um,

548
00:28:11,880 --> 00:28:15,080
Speaker 1: there's a behavioral bias you're leveraging to get yourself to

549
00:28:15,160 --> 00:28:18,119
Speaker 1: the gym there too. Yeah. Yeah, well, so for so

550
00:28:18,200 --> 00:28:20,520
Speaker 1: many elements of our financial lives, we're not just trying

551
00:28:20,560 --> 00:28:25,199
Speaker 1: to incentivize something positive. We're trying to discourage something that's negative, right,

552
00:28:25,280 --> 00:28:29,400
Speaker 1: Like reckless spending is one of those things. And so, yes,

553
00:28:29,520 --> 00:28:32,480
Speaker 1: some studies have shown that using cash is more painful

554
00:28:32,600 --> 00:28:35,600
Speaker 1: for people, which helps us helps people spend less overall.

555
00:28:36,000 --> 00:28:39,000
Speaker 1: And although I've heard anecdotal evidence from younger folks that

556
00:28:39,080 --> 00:28:41,440
Speaker 1: that's not the case, that they actually think of cash

557
00:28:41,520 --> 00:28:43,600
Speaker 1: as of its burning a hole in their pocket literally

558
00:28:43,960 --> 00:28:46,320
Speaker 1: and they don't feel the pain associated with it. And

559
00:28:46,400 --> 00:28:48,240
Speaker 1: so maybe some of these older studies need to be updated.

560
00:28:48,280 --> 00:28:50,960
Speaker 1: I'd be curious to see if that like still holds.

561
00:28:51,040 --> 00:28:54,000
Speaker 1: But but how else can we create pain points to

562
00:28:54,040 --> 00:28:56,080
Speaker 1: help us curb some of those negative habits, some of

563
00:28:56,120 --> 00:28:58,920
Speaker 1: those ways maybe in the realm of money that we're

564
00:28:59,040 --> 00:29:02,480
Speaker 1: using it kind of like in ways that we don't

565
00:29:02,520 --> 00:29:04,760
Speaker 1: want to be using it anymore, ways that are really

566
00:29:04,840 --> 00:29:08,160
Speaker 1: working where we're working against ourselves. Yeah, Well, accountability to

567
00:29:08,280 --> 00:29:10,640
Speaker 1: other people can be an important way of sort of

568
00:29:10,640 --> 00:29:13,080
Speaker 1: punishing yourself if you want to avoid a bad behavior.

569
00:29:13,160 --> 00:29:15,320
Speaker 1: So we talked a little bit about UM accounts that

570
00:29:15,400 --> 00:29:17,800
Speaker 1: are a liquid so you can you know, you're literally

571
00:29:17,840 --> 00:29:20,160
Speaker 1: not able to touch it. That's one way of penaltizing yourself.

572
00:29:20,200 --> 00:29:22,760
Speaker 1: You can literally find yourself. But that's sort of counterproductive.

573
00:29:22,800 --> 00:29:24,600
Speaker 1: You're trying to save more money and then you find

574
00:29:24,640 --> 00:29:26,680
Speaker 1: yourself for not saving enough, right, you can see how

575
00:29:26,760 --> 00:29:29,880
Speaker 1: that becomes a vicious cycle. UM. But another tool is

576
00:29:29,960 --> 00:29:33,160
Speaker 1: just UM giving visibility to someone so that you'll be

577
00:29:33,240 --> 00:29:35,720
Speaker 1: ashamed if they find out that you don't achieve a goal.

578
00:29:35,800 --> 00:29:39,320
Speaker 1: That's another kind of penalty UM. And and so uh,

579
00:29:39,760 --> 00:29:43,360
Speaker 1: having having accountability to someone else, giving them visibility into

580
00:29:43,640 --> 00:29:45,680
Speaker 1: a financial goal in whether or not you're achieving it.

581
00:29:46,160 --> 00:29:49,280
Speaker 1: Um that could be a you know, still somewhat painful,

582
00:29:49,600 --> 00:29:53,880
Speaker 1: but less painful way that you could achieve success, kind

583
00:29:53,880 --> 00:29:55,760
Speaker 1: of like announcing on social media, Hey, I'm gonna run

584
00:29:55,880 --> 00:29:58,600
Speaker 1: run a marathon at the in November or something. I like,

585
00:29:58,880 --> 00:30:01,160
Speaker 1: if you don't actually make it happened, you kind of

586
00:30:01,320 --> 00:30:03,680
Speaker 1: like set yourself up. All your peer group is expecting

587
00:30:03,680 --> 00:30:05,840
Speaker 1: you to accomplish this, and there is some sort of

588
00:30:06,280 --> 00:30:08,200
Speaker 1: a level of public failure if you don't hit it

589
00:30:08,240 --> 00:30:10,240
Speaker 1: and hit that goal. So yeah, I can see that

590
00:30:10,320 --> 00:30:13,360
Speaker 1: being working in your favor to even as like a

591
00:30:13,480 --> 00:30:16,280
Speaker 1: negative kind of motivation. Yeah, absolutely, Although I would say

592
00:30:16,360 --> 00:30:19,200
Speaker 1: one important thing about any sort of public accountability is

593
00:30:19,280 --> 00:30:24,080
Speaker 1: generally it's more effective to define small sub goals that

594
00:30:24,240 --> 00:30:26,760
Speaker 1: you want to achieve and give some visibility into that

595
00:30:26,920 --> 00:30:28,760
Speaker 1: rather than a big end goal. So you talked about, oh,

596
00:30:28,760 --> 00:30:31,880
Speaker 1: I'm going to run a marathon, uh next year, you

597
00:30:31,960 --> 00:30:35,040
Speaker 1: know in the fall. That's a really big end goal.

598
00:30:35,240 --> 00:30:37,280
Speaker 1: The ideal would be to say, you know, I'm going

599
00:30:37,320 --> 00:30:40,640
Speaker 1: to run a marathon next fall, and I'm starting with

600
00:30:41,080 --> 00:30:44,480
Speaker 1: a five k next month. Uh, and then you know,

601
00:30:44,560 --> 00:30:46,280
Speaker 1: the month after that, I'll do a half marathon and

602
00:30:46,320 --> 00:30:47,760
Speaker 1: so and so. You sort of work your way up

603
00:30:48,080 --> 00:30:51,400
Speaker 1: and there's visibility at each point along the way. Um.

604
00:30:51,440 --> 00:30:54,960
Speaker 1: When it's a big goal that's distal, then even with

605
00:30:55,120 --> 00:30:57,960
Speaker 1: that penalty and shame, you may not take the steps

606
00:30:58,000 --> 00:30:59,560
Speaker 1: in between. You may sort of put it off and

607
00:30:59,600 --> 00:31:01,240
Speaker 1: put it off, and then it it's too late to

608
00:31:01,280 --> 00:31:03,479
Speaker 1: actually train for the marathon by the time you realize

609
00:31:03,480 --> 00:31:07,600
Speaker 1: how embarrassed you'll be. So. Um, smaller, bite sized goals

610
00:31:07,920 --> 00:31:13,640
Speaker 1: with visibility to others and accountability are a better approach. Yeah.

611
00:31:13,840 --> 00:31:15,880
Speaker 1: I mean you talk about putting that plan together and

612
00:31:16,200 --> 00:31:18,440
Speaker 1: how that's probably one of the most most important things

613
00:31:18,480 --> 00:31:20,280
Speaker 1: you can do because literally, like what you start planning

614
00:31:20,360 --> 00:31:23,360
Speaker 1: things out, you start tackling the problem. It's not like

615
00:31:23,480 --> 00:31:25,400
Speaker 1: it's just this device that sits on the shelf until

616
00:31:25,440 --> 00:31:28,640
Speaker 1: it's needed. Like literally the process of planning starts. You

617
00:31:28,680 --> 00:31:31,040
Speaker 1: start to implement the very next steps that you need

618
00:31:31,080 --> 00:31:32,760
Speaker 1: to take. It kind of like gets you started on

619
00:31:32,800 --> 00:31:35,560
Speaker 1: that setting things in motion at that point. Exactly, Yeah, exactly,

620
00:31:35,880 --> 00:31:40,080
Speaker 1: got it. Okay, Automation. When it comes to defining laziness,

621
00:31:40,160 --> 00:31:42,400
Speaker 1: I think that that's a device that can be used.

622
00:31:42,520 --> 00:31:45,320
Speaker 1: How important do you think automation is when it comes

623
00:31:45,440 --> 00:31:50,280
Speaker 1: to creating lasting change and specifically fighting against laziness. Automation

624
00:31:50,680 --> 00:31:55,560
Speaker 1: is such an amazing tool for changing for good, particularly

625
00:31:55,600 --> 00:31:58,680
Speaker 1: in the domain of financial decision making. If we could

626
00:31:58,720 --> 00:32:02,360
Speaker 1: have automation and every part of our lives, I think

627
00:32:02,840 --> 00:32:06,040
Speaker 1: we would have far fewer problems. Uh if you if

628
00:32:06,120 --> 00:32:09,200
Speaker 1: only I could just automate rejecting dessert for the next month,

629
00:32:09,560 --> 00:32:12,200
Speaker 1: can you can you imagine? Or I could automate today.

630
00:32:12,200 --> 00:32:14,040
Speaker 1: I'm just gonna put it on autopilot that I will

631
00:32:14,120 --> 00:32:17,320
Speaker 1: show up at the gym every day at five pm. Um.

632
00:32:17,520 --> 00:32:20,560
Speaker 1: The amazing thing about automation and your finances is that

633
00:32:20,880 --> 00:32:23,640
Speaker 1: you really can, sort of, in the words of Nobel

634
00:32:23,760 --> 00:32:25,520
Speaker 1: right at Richard Taylor, set it and forget it. You

635
00:32:25,560 --> 00:32:28,120
Speaker 1: can say, I'm gonna take this amount of money. I'm

636
00:32:28,120 --> 00:32:30,920
Speaker 1: gonna auto deduct it from my paid check every month

637
00:32:31,000 --> 00:32:33,160
Speaker 1: when it arives and send it straight to a retirement

638
00:32:33,240 --> 00:32:36,040
Speaker 1: savings account or straight to an emergency savings account, or

639
00:32:36,040 --> 00:32:38,680
Speaker 1: whatever it is I need to save for. You do it.

640
00:32:38,840 --> 00:32:41,640
Speaker 1: Once it happens automatically, you literally don't have to think

641
00:32:41,640 --> 00:32:43,880
Speaker 1: about it. Again and then that money isn't sitting there

642
00:32:43,960 --> 00:32:46,960
Speaker 1: for you to spend. It's a really incredible tool and

643
00:32:47,040 --> 00:32:50,400
Speaker 1: there have been a lot of studies showing just how

644
00:32:50,560 --> 00:32:56,959
Speaker 1: useful these kinds of auto deduct settings are for increasing savings. Frankly,

645
00:32:57,040 --> 00:32:58,840
Speaker 1: I do a lot of work. I do work on savings.

646
00:32:58,880 --> 00:33:02,680
Speaker 1: I also do work on health, uh and education, and

647
00:33:02,760 --> 00:33:06,760
Speaker 1: it is frustrating that we cannot automate um, you know,

648
00:33:06,920 --> 00:33:11,120
Speaker 1: study habits, healthy eating and so on everyday behavior that

649
00:33:11,240 --> 00:33:13,680
Speaker 1: we're still take some sort of willpower. That's right, And

650
00:33:13,760 --> 00:33:17,040
Speaker 1: of course you can't automate resisting the temptation every day

651
00:33:17,120 --> 00:33:21,680
Speaker 1: to splurge spend, But but it sure is helpful that

652
00:33:21,880 --> 00:33:24,400
Speaker 1: some of that money has disappeared in your account balance

653
00:33:24,520 --> 00:33:27,400
Speaker 1: is limited in terms of the splurge spending because you

654
00:33:27,480 --> 00:33:31,600
Speaker 1: automated those deductions and sending money to savings. Yeah. I mean,

655
00:33:31,840 --> 00:33:35,000
Speaker 1: when you look at the results of automatic opt ins

656
00:33:35,240 --> 00:33:38,280
Speaker 1: when it comes to like four one K contributions, the

657
00:33:38,480 --> 00:33:40,320
Speaker 1: amount of people that contribute to their four one K

658
00:33:40,920 --> 00:33:45,120
Speaker 1: when the default position is that they are like, it's

659
00:33:45,160 --> 00:33:48,920
Speaker 1: so much higher when it's left up to the individual choice. Right. Yeah,

660
00:33:49,000 --> 00:33:51,000
Speaker 1: So this is this is a classic study that was

661
00:33:51,080 --> 00:33:53,600
Speaker 1: done and I guess two thousand and three by um

662
00:33:53,800 --> 00:33:58,480
Speaker 1: Bridget Madrian, and what she and her collaborator showed is

663
00:33:58,600 --> 00:34:04,120
Speaker 1: that when this single employer switched from having new employees

664
00:34:04,240 --> 00:34:06,680
Speaker 1: fill out paperwork UM where they had to check a

665
00:34:06,760 --> 00:34:08,640
Speaker 1: box to opt in to be a part of the

666
00:34:09,120 --> 00:34:12,879
Speaker 1: employers for a one K to having new employees check

667
00:34:12,920 --> 00:34:15,440
Speaker 1: a box to opt out, they saw about a thirty

668
00:34:15,520 --> 00:34:19,360
Speaker 1: percentage point increase overnight in how many people were saving

669
00:34:19,680 --> 00:34:22,239
Speaker 1: UM for retirements. Just extraordinary. And this has now been

670
00:34:22,280 --> 00:34:25,800
Speaker 1: replicated many times. The effects aren't always necessarily thirty percentage

671
00:34:25,840 --> 00:34:29,879
Speaker 1: point increases, but they're large increases. Uh. And it's really

672
00:34:29,960 --> 00:34:34,880
Speaker 1: powerful and and lots of companies now have smart defaults.

673
00:34:35,000 --> 00:34:37,279
Speaker 1: And in fact, I think the two thousand six US

674
00:34:37,360 --> 00:34:40,960
Speaker 1: Pension Protection Act legislated that its tax advantaged for your

675
00:34:41,000 --> 00:34:44,879
Speaker 1: employer to automatically enroll you in their in their savings plan.

676
00:34:45,320 --> 00:34:48,440
Speaker 1: That's when good process design or I don't know what

677
00:34:48,520 --> 00:34:50,800
Speaker 1: they call it, all the software engineers who designed the

678
00:34:51,040 --> 00:34:54,320
Speaker 1: different software that when you're on boarding employees, but just

679
00:34:54,520 --> 00:34:56,719
Speaker 1: some of the right tweaks to the system can make

680
00:34:56,840 --> 00:34:59,319
Speaker 1: a significant impact on the ability for folks to say

681
00:34:59,480 --> 00:35:02,719
Speaker 1: for future years UM. But Katie, we've got a few

682
00:35:02,760 --> 00:35:04,680
Speaker 1: more questions for you that we're gonna get to here

683
00:35:04,680 --> 00:35:06,360
Speaker 1: after the break, including we want to talk about the

684
00:35:06,440 --> 00:35:10,359
Speaker 1: impact of the people we hang out with. We're gonna

685
00:35:10,360 --> 00:35:22,000
Speaker 1: talk about peer pressure and more. Right after this all,

686
00:35:22,120 --> 00:35:24,600
Speaker 1: we're back from break, still talking with Katie Miltman. We

687
00:35:24,640 --> 00:35:28,000
Speaker 1: want to make money changes in most of us, at

688
00:35:28,120 --> 00:35:30,480
Speaker 1: least unless you're just already crushing it, but most of

689
00:35:30,560 --> 00:35:32,200
Speaker 1: us want to make money changes this year. We want

690
00:35:32,239 --> 00:35:34,640
Speaker 1: to get better with our finances. But we don't want

691
00:35:34,680 --> 00:35:37,320
Speaker 1: to just make empty gestures in this new year and

692
00:35:37,719 --> 00:35:39,600
Speaker 1: then find out that we fall flat on our face

693
00:35:39,800 --> 00:35:42,799
Speaker 1: weeks from now. And so Katie, I'm glad. We're glad

694
00:35:42,800 --> 00:35:44,439
Speaker 1: to have you here talking about how to make money

695
00:35:44,520 --> 00:35:46,279
Speaker 1: changes that are going to stick around stand the test

696
00:35:46,320 --> 00:35:50,400
Speaker 1: of time, creating, initiating and incorporating some of these tactics

697
00:35:50,480 --> 00:35:53,080
Speaker 1: to do that. You give an example in your book

698
00:35:53,120 --> 00:35:55,239
Speaker 1: about a way that high school students were able to

699
00:35:55,320 --> 00:35:58,279
Speaker 1: boost their performance. Uh, can you share that story? I

700
00:35:58,320 --> 00:36:01,719
Speaker 1: think I found that one fascinating. Yeah. Absolutely so. One

701
00:36:01,760 --> 00:36:04,240
Speaker 1: of the most interesting studies I've gotten to be involved

702
00:36:04,280 --> 00:36:06,680
Speaker 1: in UM was a study led by Lauren S. Chris

703
00:36:06,719 --> 00:36:09,960
Speaker 1: Winkler at the Kellogg School at Northwestern University, showing that

704
00:36:10,040 --> 00:36:14,279
Speaker 1: when students are invited to advise their peers on how

705
00:36:14,320 --> 00:36:19,120
Speaker 1: to study more effectively, the invitation to give that advice

706
00:36:19,200 --> 00:36:23,120
Speaker 1: to others and the act of doing so improves advisor's

707
00:36:23,239 --> 00:36:25,799
Speaker 1: own grades. So let me just say that again, it's

708
00:36:25,840 --> 00:36:28,680
Speaker 1: not the students getting advice who are getting better grades.

709
00:36:28,760 --> 00:36:32,040
Speaker 1: It's the students giving advice who are getting better grades,

710
00:36:32,360 --> 00:36:36,719
Speaker 1: which I think is just absolutely fascinating. And the psychology

711
00:36:36,800 --> 00:36:40,719
Speaker 1: there is that um when you're invited to coach someone

712
00:36:40,760 --> 00:36:43,680
Speaker 1: else on how to achieve a goal that you also

713
00:36:43,760 --> 00:36:47,560
Speaker 1: are trying to pursue, like boosting your grades in school. One,

714
00:36:47,840 --> 00:36:51,720
Speaker 1: it improves your confidence. If somebody's asking me for advice,

715
00:36:51,760 --> 00:36:53,480
Speaker 1: I must not be such a dufous. There must be

716
00:36:53,600 --> 00:36:55,840
Speaker 1: something I could say that's you're right, Like, Okay, I

717
00:36:55,880 --> 00:36:57,799
Speaker 1: guess I'm not. I'm not going to be a straight

718
00:36:57,840 --> 00:37:01,520
Speaker 1: sea student forever. I've got something to offer somehow you've

719
00:37:01,800 --> 00:37:06,200
Speaker 1: figured out how to money. You guys are making such

720
00:37:06,520 --> 00:37:12,000
Speaker 1: such great decisions now that you're giving advice. No, so

721
00:37:12,280 --> 00:37:15,320
Speaker 1: that there's magic there. And then the second ingredient is

722
00:37:15,719 --> 00:37:18,080
Speaker 1: you have to introspect now deeply about what might work

723
00:37:18,280 --> 00:37:20,439
Speaker 1: for someone else. You're gonna think about things that would

724
00:37:20,480 --> 00:37:22,800
Speaker 1: work for you too, of course, because that's what you

725
00:37:22,920 --> 00:37:25,120
Speaker 1: have access to. So you're gonna think deeply because now

726
00:37:25,120 --> 00:37:27,400
Speaker 1: I have to tell somebody something, so I've got to

727
00:37:27,440 --> 00:37:30,359
Speaker 1: come up with some answers and then um, then you're

728
00:37:30,400 --> 00:37:32,640
Speaker 1: gonna say it out loud to another human. And when

729
00:37:32,680 --> 00:37:35,600
Speaker 1: you do that, there's something called the saying is believing effect,

730
00:37:36,040 --> 00:37:38,040
Speaker 1: where you know, I wouldn't be giving this advice if

731
00:37:38,080 --> 00:37:40,399
Speaker 1: I didn't think it was good advice, and it would

732
00:37:40,400 --> 00:37:42,120
Speaker 1: be totally a po critical if I didn't take it.

733
00:37:42,280 --> 00:37:45,959
Speaker 1: So all those things combined are a really powerful force

734
00:37:46,080 --> 00:37:49,760
Speaker 1: to help people achieve better results when they give advice

735
00:37:49,840 --> 00:37:53,440
Speaker 1: to someone about a goal they too hope to um

736
00:37:53,560 --> 00:37:56,560
Speaker 1: succeed on. Absolutely, I mean and truly this is something

737
00:37:56,640 --> 00:37:59,399
Speaker 1: that has had a positive impact on both your mind

738
00:37:59,560 --> 00:38:02,719
Speaker 1: and those finances the ability too. There's a there's a

739
00:38:02,760 --> 00:38:04,880
Speaker 1: degree of responsibility. Not only are we just posting it

740
00:38:04,920 --> 00:38:06,719
Speaker 1: on social media that we've got these goals, it's like

741
00:38:06,800 --> 00:38:09,080
Speaker 1: we've got a podcast that's you know, that is also

742
00:38:09,160 --> 00:38:12,200
Speaker 1: documenting all these different strategies and tips, and we're talking

743
00:38:12,200 --> 00:38:15,759
Speaker 1: about don't revised funds in November, and I was like, Man,

744
00:38:16,000 --> 00:38:18,680
Speaker 1: I know about these things and I believe that they're good,

745
00:38:18,760 --> 00:38:22,160
Speaker 1: But now I'm gonna open my own. Yeah, exactly. And

746
00:38:22,440 --> 00:38:24,800
Speaker 1: when it comes to our listeners as well, I think, like,

747
00:38:24,920 --> 00:38:27,840
Speaker 1: what's so great about this is we often are encouraging

748
00:38:27,840 --> 00:38:30,360
Speaker 1: our listeners just to start talking about money. That's the

749
00:38:30,400 --> 00:38:32,319
Speaker 1: biggest reason why we started the show five years ago.

750
00:38:32,400 --> 00:38:34,680
Speaker 1: We just wanted it to be something that did not

751
00:38:34,920 --> 00:38:40,160
Speaker 1: feel like was unspeakable. And even with our listeners, as

752
00:38:40,239 --> 00:38:42,200
Speaker 1: do you start hearing about what you should be doing

753
00:38:42,280 --> 00:38:44,239
Speaker 1: with your money, but just taking this first steps and

754
00:38:44,480 --> 00:38:47,560
Speaker 1: talking about it with somebody else gets the conversation started

755
00:38:47,960 --> 00:38:50,319
Speaker 1: pretty soon. Yes, they They might ask you a question

756
00:38:50,400 --> 00:38:52,279
Speaker 1: and all of a sudden, it sort of feels like

757
00:38:52,320 --> 00:38:54,479
Speaker 1: you're a teacher and you always you hear the saying

758
00:38:54,560 --> 00:38:57,040
Speaker 1: that there's no faster way to learn something than to

759
00:38:57,120 --> 00:38:59,520
Speaker 1: actually teach it, And just like you said, the saying

760
00:38:59,640 --> 00:39:01,400
Speaker 1: is believe in effect, I think the same thing applies.

761
00:39:02,320 --> 00:39:04,920
Speaker 1: And that's I mean, we love seeing that that happened

762
00:39:05,040 --> 00:39:07,239
Speaker 1: with our listeners as well. Yeah, and I want to

763
00:39:07,320 --> 00:39:10,000
Speaker 1: know to Katie because like some of us are are

764
00:39:10,320 --> 00:39:13,239
Speaker 1: inevitably going to fail at some of the goals we set, right,

765
00:39:13,280 --> 00:39:16,000
Speaker 1: none of us is ever perfect. We just accomplish everything

766
00:39:16,000 --> 00:39:18,000
Speaker 1: we set out to do in record time. So so

767
00:39:18,160 --> 00:39:21,439
Speaker 1: how do we recover from from failure. Let's say someone

768
00:39:21,560 --> 00:39:24,040
Speaker 1: set their goal to max out their roth IRA last year,

769
00:39:24,040 --> 00:39:26,080
Speaker 1: but they fell short, Like, how should they approach that

770
00:39:26,160 --> 00:39:29,400
Speaker 1: goal moving forward now? In Yeah, it's a great question.

771
00:39:29,760 --> 00:39:32,000
Speaker 1: There's a couple of things that research has to say

772
00:39:32,040 --> 00:39:34,240
Speaker 1: about that. One thing that I think is really important

773
00:39:34,800 --> 00:39:38,480
Speaker 1: is an insight about the way we code failure and

774
00:39:38,600 --> 00:39:41,520
Speaker 1: it comes from work by Carol Dweck at Stanford University.

775
00:39:41,880 --> 00:39:46,360
Speaker 1: She's studied something um called growth mindset and she compares

776
00:39:46,400 --> 00:39:49,320
Speaker 1: it to a fixed mindset, and they're basically two extreme

777
00:39:49,400 --> 00:39:55,200
Speaker 1: ways of thinking about failure and success. In a growth mindset,

778
00:39:55,640 --> 00:39:57,440
Speaker 1: the way you perceive the world, or the way you

779
00:39:57,520 --> 00:40:01,160
Speaker 1: perceive your skill at anything, whether it's investing or your intelligence,

780
00:40:01,480 --> 00:40:05,680
Speaker 1: is that it's not a fixed set of abilities you're

781
00:40:05,680 --> 00:40:08,120
Speaker 1: born with that you can learn and grow and develop

782
00:40:08,160 --> 00:40:11,800
Speaker 1: over time. But if you have a fixed mindset, you

783
00:40:11,920 --> 00:40:13,920
Speaker 1: think about things just the opposite that you're sort of

784
00:40:13,960 --> 00:40:17,799
Speaker 1: born with some innate abilities and whatever they are, they are.

785
00:40:17,920 --> 00:40:21,960
Speaker 1: And so these two perspectives that people can take on

786
00:40:22,040 --> 00:40:24,480
Speaker 1: the world lead to really different ways of interpreting failure.

787
00:40:24,560 --> 00:40:26,640
Speaker 1: If you have a if you have a fixed mindset

788
00:40:26,680 --> 00:40:29,080
Speaker 1: and something goes badly for you, you fall down on

789
00:40:29,200 --> 00:40:32,200
Speaker 1: a goal, you're going to interpret that as diagnostic of

790
00:40:32,280 --> 00:40:35,239
Speaker 1: your capabilities, and it's gonna be really discouraging. But if

791
00:40:35,280 --> 00:40:37,799
Speaker 1: you have a growth mindset and you recognize the truth,

792
00:40:37,880 --> 00:40:40,560
Speaker 1: which is that in almost everything in life, maybe the

793
00:40:40,640 --> 00:40:43,760
Speaker 1: exception of your height, you have the ability to improve

794
00:40:44,719 --> 00:40:48,560
Speaker 1: over time with learning, then you're going to interpret that

795
00:40:48,640 --> 00:40:51,439
Speaker 1: failure as input and an opportunity to learn and grow

796
00:40:51,480 --> 00:40:53,799
Speaker 1: and do better next time. And it turns out these

797
00:40:54,160 --> 00:40:57,319
Speaker 1: which mindset you use, it's it's malleable. There's research showing

798
00:40:57,360 --> 00:41:00,400
Speaker 1: that we can teach people to have a growth mindset

799
00:41:00,440 --> 00:41:03,239
Speaker 1: by pointing out that basically everything in the world you

800
00:41:03,320 --> 00:41:07,000
Speaker 1: can get better with practice and and effort and and learning,

801
00:41:07,520 --> 00:41:10,279
Speaker 1: and to the extent that you can be deliberate about

802
00:41:10,320 --> 00:41:13,360
Speaker 1: adopting a growth mindset. Then when you fall short of

803
00:41:13,400 --> 00:41:16,680
Speaker 1: your goals, which inevitably that's what goal. If you're setting

804
00:41:16,719 --> 00:41:18,759
Speaker 1: goals correctly, by the way, you should be falling short

805
00:41:18,760 --> 00:41:20,720
Speaker 1: of some of your goals. You want to always stretch

806
00:41:20,760 --> 00:41:22,839
Speaker 1: yourself with your goals. That is what the research shows.

807
00:41:22,840 --> 00:41:25,200
Speaker 1: If you're setting wimpy goals and you always succeed, you

808
00:41:25,280 --> 00:41:27,640
Speaker 1: are not pushing yourself enough and you're not you're not

809
00:41:27,760 --> 00:41:31,359
Speaker 1: getting enough out of yourself. Um. So when you stumble though,

810
00:41:31,800 --> 00:41:33,840
Speaker 1: think about it with a growth mindset and say, what

811
00:41:33,960 --> 00:41:36,160
Speaker 1: did I learn from this? Not like, oh no, this

812
00:41:36,320 --> 00:41:37,960
Speaker 1: means I could never do it, but rather you know,

813
00:41:38,080 --> 00:41:40,200
Speaker 1: what can I do differently next time? What was the

814
00:41:40,239 --> 00:41:42,759
Speaker 1: obstacle that tripped me up? How could I adopt a

815
00:41:42,880 --> 00:41:45,279
Speaker 1: new strategy so that in the future when that same

816
00:41:45,360 --> 00:41:48,520
Speaker 1: obstacle gets in my way, I'll have a better outcome.

817
00:41:48,680 --> 00:41:51,719
Speaker 1: So I'd take growth mindset approach to all goals is

818
00:41:51,760 --> 00:41:55,040
Speaker 1: really important. And then the other thing is based on

819
00:41:55,160 --> 00:41:59,040
Speaker 1: research by my colleague Merca Sharif at the Wharton School,

820
00:41:59,080 --> 00:42:02,640
Speaker 1: who's shown that when we set stretch goals for ourselves,

821
00:42:02,680 --> 00:42:04,440
Speaker 1: which is the ideal, right, you know, I want to

822
00:42:04,440 --> 00:42:06,200
Speaker 1: go to the gym seven days a week is better

823
00:42:06,280 --> 00:42:07,600
Speaker 1: than I want to go to the gym two days

824
00:42:07,640 --> 00:42:10,200
Speaker 1: a week. Um, it's we're motivating, You're more likely to

825
00:42:10,640 --> 00:42:14,200
Speaker 1: push yourself. But when we do that um anticipating that

826
00:42:14,239 --> 00:42:17,200
Speaker 1: we're gonna need to have the ability to give ourselves

827
00:42:17,239 --> 00:42:19,239
Speaker 1: some get out of jail free cards. She calls them.

828
00:42:19,280 --> 00:42:22,759
Speaker 1: Emergency reserves can be really useful. So when you set

829
00:42:22,840 --> 00:42:25,520
Speaker 1: tough goals, that is ideal, but it's also ideal to

830
00:42:25,719 --> 00:42:28,040
Speaker 1: make sure that you let yourself off the hook not

831
00:42:28,200 --> 00:42:29,840
Speaker 1: a lot. Because if you say, like, oh, you know,

832
00:42:29,920 --> 00:42:31,399
Speaker 1: I'm gonna go to the gym seven days a week

833
00:42:31,440 --> 00:42:34,839
Speaker 1: and I have six emergencies that I can take then,

834
00:42:34,960 --> 00:42:36,840
Speaker 1: but that's not going to get you very far. But

835
00:42:37,160 --> 00:42:38,839
Speaker 1: it's better to say I'm going to aim for seven

836
00:42:38,920 --> 00:42:41,080
Speaker 1: days a week of this this behavior and I give

837
00:42:41,120 --> 00:42:43,920
Speaker 1: myself a little wiggle room to to get out of

838
00:42:44,000 --> 00:42:45,440
Speaker 1: jail free than to say I'm going to try to

839
00:42:45,480 --> 00:42:47,560
Speaker 1: go five days a week. And the reason is you're

840
00:42:47,560 --> 00:42:49,879
Speaker 1: not gonna want to take those get out of jail

841
00:42:49,920 --> 00:42:51,719
Speaker 1: free cards if you can avoid it, So you're likely

842
00:42:51,760 --> 00:42:54,239
Speaker 1: to put yourself really hard. But if you do have

843
00:42:54,360 --> 00:42:56,959
Speaker 1: a miss um, you won't give up and you'll still

844
00:42:57,320 --> 00:43:01,520
Speaker 1: keep pushing to do quite well. Nonetheless, don't scrap it

845
00:43:01,520 --> 00:43:03,840
Speaker 1: all together. It keeps you from throwing everything out the window,

846
00:43:03,960 --> 00:43:07,000
Speaker 1: to having those those doovers or those Mulligan's like you're

847
00:43:07,000 --> 00:43:08,600
Speaker 1: sick for a few days, and like it gives you

848
00:43:08,640 --> 00:43:11,160
Speaker 1: the grace to say, Okay, that's cool, Like that's a

849
00:43:11,239 --> 00:43:13,200
Speaker 1: reason to miss a Jim, it's a decent reason to

850
00:43:13,320 --> 00:43:14,680
Speaker 1: not be able to make it. And I mean, I

851
00:43:14,719 --> 00:43:16,320
Speaker 1: don't think we're gonna have time to touch on it.

852
00:43:16,360 --> 00:43:19,200
Speaker 1: But you talk about elastic habits and how not being

853
00:43:19,400 --> 00:43:22,560
Speaker 1: overly rigid, how important that is to keep us on track.

854
00:43:22,880 --> 00:43:24,880
Speaker 1: I think the same thing applies with sort of these

855
00:43:24,920 --> 00:43:27,799
Speaker 1: doovers as well. But Katie, what yeah, what about using

856
00:43:27,840 --> 00:43:31,799
Speaker 1: peer pressure? Peer pressure social relationships? I think that there

857
00:43:31,800 --> 00:43:33,399
Speaker 1: are different ways that we can use those to our

858
00:43:33,520 --> 00:43:36,120
Speaker 1: advantage as well, because it's it's not just middle schoolers

859
00:43:36,320 --> 00:43:38,680
Speaker 1: that feel that kind of pressure, you know, like we're

860
00:43:38,719 --> 00:43:40,720
Speaker 1: we're all social animals, and so how can we harness

861
00:43:40,840 --> 00:43:44,520
Speaker 1: that reality to propel us forward with our financial goals? Yeah?

862
00:43:44,840 --> 00:43:49,040
Speaker 1: I love this topic. It's so important. UM. So we

863
00:43:49,160 --> 00:43:52,920
Speaker 1: are incredibly influenced by the people who surround us. They

864
00:43:53,000 --> 00:43:57,839
Speaker 1: show us what's possible. UM. They shape our beliefs about, um,

865
00:43:58,000 --> 00:44:01,040
Speaker 1: how we should be behaving. When my favorite studies showing

866
00:44:01,080 --> 00:44:04,920
Speaker 1: this is just looking at the college roommate you're randomly

867
00:44:04,960 --> 00:44:07,359
Speaker 1: assigned as a freshman, and shows that if you end

868
00:44:07,440 --> 00:44:11,440
Speaker 1: up with a roommate who is basically a better student historically,

869
00:44:12,000 --> 00:44:14,759
Speaker 1: you get better grades than if you end up with

870
00:44:15,239 --> 00:44:19,920
Speaker 1: roommate who had sort of less less studious nous historically. So,

871
00:44:20,239 --> 00:44:22,600
Speaker 1: you know, think about the logic of it. Your your

872
00:44:22,680 --> 00:44:26,120
Speaker 1: roommate goes out and parties every Thursday and Friday. You think, well,

873
00:44:26,520 --> 00:44:28,040
Speaker 1: that's the thing to do in college. I should be

874
00:44:28,080 --> 00:44:30,960
Speaker 1: partying all the time, versus your roommate every Thursday and

875
00:44:31,000 --> 00:44:34,040
Speaker 1: Friday stays in with a book, makes um, you know,

876
00:44:34,160 --> 00:44:37,560
Speaker 1: flash cards. You're thinking, gosh, I guess the succeeding college,

877
00:44:37,560 --> 00:44:39,439
Speaker 1: I should be staying in Thursdays and Fridays and making

878
00:44:39,480 --> 00:44:42,399
Speaker 1: flash cards. So we're in. My roommate is a nerd,

879
00:44:42,480 --> 00:44:45,839
Speaker 1: and I gotta get a new one. In the extreme,

880
00:44:46,040 --> 00:44:51,399
Speaker 1: that also happens. But on average, Um, you're right, it's yes,

881
00:44:51,560 --> 00:44:54,080
Speaker 1: there can there can be. There could be situations where

882
00:44:54,080 --> 00:44:56,640
Speaker 1: you're like, God, you're so crazy that you don't aren't

883
00:44:56,640 --> 00:44:59,960
Speaker 1: influenced by people. But on average, if there is two

884
00:45:00,080 --> 00:45:04,160
Speaker 1: much of a disparity, it turns folks off that way, Yeah,

885
00:45:04,280 --> 00:45:06,080
Speaker 1: I mean, in that way, it can kind of backfire.

886
00:45:06,160 --> 00:45:09,120
Speaker 1: And so it's it's so important to surround yourself with, like,

887
00:45:09,440 --> 00:45:11,840
Speaker 1: you know, individuals who have something in common with you,

888
00:45:11,920 --> 00:45:13,880
Speaker 1: but who who aren't, like at the very top of

889
00:45:13,960 --> 00:45:15,799
Speaker 1: their game, because when there is that gulf, it can,

890
00:45:16,160 --> 00:45:18,279
Speaker 1: like if I'm working out with, it can prevent you.

891
00:45:18,480 --> 00:45:21,120
Speaker 1: It's going to be it's gonna be dispparenting, right, it's

892
00:45:21,120 --> 00:45:24,040
Speaker 1: gonna make me. So you want someone who stretches you

893
00:45:24,120 --> 00:45:25,759
Speaker 1: a little bit because they are a little bit ahead

894
00:45:25,800 --> 00:45:28,560
Speaker 1: of you, but it's not hopeless. It's not a hopeless golf.

895
00:45:28,640 --> 00:45:31,360
Speaker 1: And that's also what this research on college roommates showed

896
00:45:31,520 --> 00:45:34,400
Speaker 1: was you want somebody who is, um was a stronger

897
00:45:34,480 --> 00:45:36,640
Speaker 1: student than you, ideally as your roommate. But you don't want,

898
00:45:36,719 --> 00:45:39,960
Speaker 1: you know, the valedictorian if you were a straight A student,

899
00:45:40,000 --> 00:45:42,239
Speaker 1: because now there's there's such a gulf that you can't

900
00:45:42,280 --> 00:45:44,279
Speaker 1: even relate. And like you said, you say, hey, this

901
00:45:44,360 --> 00:45:46,120
Speaker 1: person is a nerd. I'm going out every night. I

902
00:45:46,160 --> 00:45:49,320
Speaker 1: gotta get away from them. Um. So that but it

903
00:45:49,440 --> 00:45:52,000
Speaker 1: is important to cultivate, if you if you have big

904
00:45:52,080 --> 00:45:56,160
Speaker 1: goals in any part of your life, trying to cultivate

905
00:45:56,560 --> 00:46:00,200
Speaker 1: social relationships with people who share those goals and who

906
00:46:00,239 --> 00:46:02,759
Speaker 1: are frankly a little bit ahead of you and from

907
00:46:02,760 --> 00:46:05,880
Speaker 1: whom you can learn is incredibly valuable. UM. They can

908
00:46:05,920 --> 00:46:08,280
Speaker 1: be a support group. You can also offer them advice,

909
00:46:08,760 --> 00:46:10,840
Speaker 1: which we already talked about the power of advice giving. Right,

910
00:46:10,840 --> 00:46:12,480
Speaker 1: you can talk about those shared goals and you'll find

911
00:46:12,520 --> 00:46:14,840
Speaker 1: you actually do have something to offer. UM. But you

912
00:46:14,920 --> 00:46:19,040
Speaker 1: can do what my collaborator Angela Duckworth and also Katie

913
00:46:19,080 --> 00:46:22,000
Speaker 1: Mayor and I'll call copy and paste, which is actually

914
00:46:22,040 --> 00:46:24,600
Speaker 1: we show that when you deliberately coach people to go

915
00:46:24,640 --> 00:46:27,800
Speaker 1: out and look for friends who are using clever tactics

916
00:46:27,880 --> 00:46:29,840
Speaker 1: to achieve a goal they too want to achieve, and

917
00:46:29,880 --> 00:46:32,880
Speaker 1: say go find what they're doing and try to emulate it,

918
00:46:33,520 --> 00:46:37,680
Speaker 1: there's benefits to that people somehow, even though they naturally

919
00:46:37,800 --> 00:46:40,680
Speaker 1: soak up some of what's around them, there's still something

920
00:46:40,800 --> 00:46:43,160
Speaker 1: left on the table because just that nudge to copy

921
00:46:43,239 --> 00:46:48,319
Speaker 1: and paste leads people to go looking for um mimicable behaviors.

922
00:46:48,640 --> 00:46:51,560
Speaker 1: And that is really important and valuable because other people

923
00:46:51,760 --> 00:46:54,640
Speaker 1: have approached and tried to pursue most of the goals

924
00:46:54,719 --> 00:46:56,759
Speaker 1: that you want to achieve, and some of them have

925
00:46:56,840 --> 00:46:59,400
Speaker 1: found a degree of success. And particularly people in your

926
00:46:59,440 --> 00:47:01,600
Speaker 1: social net work. They have more in common with you,

927
00:47:01,680 --> 00:47:05,239
Speaker 1: their lifestyle might resemble yours in many ways. Um so

928
00:47:05,360 --> 00:47:08,880
Speaker 1: they probably the things that they're trying maybe quite effective

929
00:47:08,960 --> 00:47:11,520
Speaker 1: for someone like you too, So ask and try to

930
00:47:11,600 --> 00:47:14,120
Speaker 1: figure out. What can you learn from others who have succeeded.

931
00:47:14,800 --> 00:47:17,200
Speaker 1: No need to reinvent the wheels. Start from scratch, not

932
00:47:17,400 --> 00:47:20,520
Speaker 1: rocket science. But we often forget it right, like we forget, hey,

933
00:47:20,719 --> 00:47:23,200
Speaker 1: somebody else already did this, and I should go collect

934
00:47:23,280 --> 00:47:25,480
Speaker 1: that data like we're used to, you know, trying to

935
00:47:25,560 --> 00:47:28,320
Speaker 1: learn from experts and so much of life I you know,

936
00:47:28,400 --> 00:47:30,560
Speaker 1: I teach it to business school people go look at

937
00:47:30,560 --> 00:47:33,000
Speaker 1: an accounting textbook when they have to figure out accounting.

938
00:47:33,239 --> 00:47:35,440
Speaker 1: But sometimes with goal setting, we forget that there are

939
00:47:35,440 --> 00:47:37,840
Speaker 1: other people who've come before us, and that there's expertise

940
00:47:37,920 --> 00:47:40,040
Speaker 1: there too, for sure, and you don't have to just

941
00:47:40,200 --> 00:47:42,480
Speaker 1: figure it out all on your own, and other people

942
00:47:42,520 --> 00:47:44,480
Speaker 1: are a great resource. Katie, thank you so much for

943
00:47:44,600 --> 00:47:47,040
Speaker 1: joining us today. Not only do you have your book

944
00:47:47,120 --> 00:47:49,239
Speaker 1: How to Change, which you've also got a podcast, You've

945
00:47:49,239 --> 00:47:51,600
Speaker 1: got a newsletter in addition to all your work being

946
00:47:51,640 --> 00:47:54,160
Speaker 1: a professor. So where can folks learn more about you

947
00:47:54,280 --> 00:47:56,440
Speaker 1: and what you're up to. Yeah, thanks for asking and

948
00:47:56,560 --> 00:47:59,000
Speaker 1: thanks for having me. Um, best place to find more

949
00:47:59,080 --> 00:48:02,360
Speaker 1: about me is that Katie Milkman dot com. It's Katie

950
00:48:02,360 --> 00:48:05,560
Speaker 1: with a while like Katie Perry, and you can subscribe

951
00:48:05,600 --> 00:48:09,680
Speaker 1: for Milkman Delivers if you so choose to get monthly

952
00:48:10,120 --> 00:48:12,560
Speaker 1: tidbits or yeah, listen to my podcast, check out my

953
00:48:12,600 --> 00:48:16,120
Speaker 1: book or read the nerdy research papers. If that's your thing,

954
00:48:16,840 --> 00:48:19,600
Speaker 1: that's definitely my thing. You love it all, Katie, thank

955
00:48:19,640 --> 00:48:21,800
Speaker 1: you so much for joining us today. We really appreciate it.

956
00:48:21,920 --> 00:48:25,359
Speaker 1: Thanks for having me. It was a blast. Well all right, man,

957
00:48:25,560 --> 00:48:28,080
Speaker 1: I only wish we just had more time to actually

958
00:48:28,239 --> 00:48:30,440
Speaker 1: talk with Katie. Yeah. Well, maybe our new goal in

959
00:48:31,160 --> 00:48:33,680
Speaker 1: three is that our interviews are more Joe Rogan from

960
00:48:34,719 --> 00:48:36,920
Speaker 1: even going one hour, I think sometimes as long, but yeah,

961
00:48:36,920 --> 00:48:40,759
Speaker 1: maybe we should take it to like two four hours long. Now,

962
00:48:40,800 --> 00:48:43,480
Speaker 1: this this really was an awesome conversation though, that we

963
00:48:43,560 --> 00:48:45,680
Speaker 1: had with Katie. What was your your big takeaway from

964
00:48:45,760 --> 00:48:47,719
Speaker 1: this conversation? And she's smart, She's got a depth of

965
00:48:47,760 --> 00:48:50,760
Speaker 1: knowledge that's fascinating. But she also researched all the different

966
00:48:50,800 --> 00:48:52,759
Speaker 1: examples and stories as you and I were talking about

967
00:48:52,760 --> 00:48:55,680
Speaker 1: before we started chatt with Katie, she just she not

968
00:48:55,760 --> 00:48:57,279
Speaker 1: only has the head knowledge, but she's done all this

969
00:48:57,360 --> 00:48:59,640
Speaker 1: practical work with companies that give us the ability to

970
00:48:59,680 --> 00:49:01,840
Speaker 1: connect to to everyday human actions, which I think is

971
00:49:01,840 --> 00:49:04,920
Speaker 1: super helpful. But you get from consulting like you have

972
00:49:05,040 --> 00:49:08,680
Speaker 1: to make that connection. Otherwise you're not really a consultant, right,

973
00:49:08,920 --> 00:49:11,120
Speaker 1: You're just a professor. You're just a research exactly. They're like,

974
00:49:11,120 --> 00:49:12,719
Speaker 1: I would have taken your class if that's what I wanted.

975
00:49:12,760 --> 00:49:15,160
Speaker 1: I want the practical application to this. But I think

976
00:49:15,280 --> 00:49:17,239
Speaker 1: my biggest takeaway was when she talked about making it

977
00:49:17,400 --> 00:49:21,080
Speaker 1: fun and that you know, even if progress takes longer,

978
00:49:21,400 --> 00:49:23,279
Speaker 1: you're gonna be more likely to stick to it. And

979
00:49:23,360 --> 00:49:25,439
Speaker 1: I think, yeah, when we're talking about budgetings, she said,

980
00:49:25,440 --> 00:49:26,680
Speaker 1: do it over a class and wine or something like.

981
00:49:26,680 --> 00:49:29,640
Speaker 1: That's kind of advice we've given over the years, like

982
00:49:29,840 --> 00:49:33,520
Speaker 1: incorporate something fun into that money management. Set little rewards

983
00:49:33,600 --> 00:49:35,640
Speaker 1: for yourself as you do make gains, as you do

984
00:49:35,719 --> 00:49:38,440
Speaker 1: accomplish those smaller goals that you've set out for yourself.

985
00:49:38,719 --> 00:49:41,040
Speaker 1: It doesn't need to be all drudgery, and ultimately the

986
00:49:41,120 --> 00:49:43,520
Speaker 1: goal is that you're you know, hitting on all cylinders

987
00:49:43,600 --> 00:49:45,880
Speaker 1: your your budget reflects the biggest goals that you have

988
00:49:46,040 --> 00:49:47,960
Speaker 1: for your life, and so that when you achieve those things,

989
00:49:48,360 --> 00:49:51,759
Speaker 1: it's like it's fun and it's energizing. But the more

990
00:49:51,880 --> 00:49:55,640
Speaker 1: that we can make what seems boring to be fine.

991
00:49:55,760 --> 00:49:58,480
Speaker 1: Like when I thought about working out, Matt, you decided

992
00:49:58,480 --> 00:50:00,920
Speaker 1: for CrossFit, I said, you don't what sounds fun to me?

993
00:50:01,160 --> 00:50:04,480
Speaker 1: A water rowing that splashy, splashy. Yeah, I wanted to

994
00:50:04,960 --> 00:50:06,800
Speaker 1: sound fun while I was working out, and I was like,

995
00:50:06,880 --> 00:50:08,239
Speaker 1: this is gonna be like kind of a whole body thing,

996
00:50:08,280 --> 00:50:11,160
Speaker 1: but it's also there's something enjoy I find enjoyable about it,

997
00:50:11,320 --> 00:50:14,000
Speaker 1: or riding my bike on the path and then up

998
00:50:14,040 --> 00:50:16,160
Speaker 1: our local mountains like that kind of thing. I was curious, though,

999
00:50:16,239 --> 00:50:18,000
Speaker 1: did you Did you make it fun though, in the

1000
00:50:18,040 --> 00:50:21,719
Speaker 1: way that you were able to um temptation bundle, Like,

1001
00:50:22,040 --> 00:50:25,080
Speaker 1: I assume that's well, actually I do. I listen to

1002
00:50:25,120 --> 00:50:28,040
Speaker 1: a podcast for music typically when I'm working. But like,

1003
00:50:28,280 --> 00:50:30,880
Speaker 1: I just tried to set out instead of signing up

1004
00:50:30,920 --> 00:50:33,319
Speaker 1: for the most hardcore workout I could, I found something.

1005
00:50:33,400 --> 00:50:36,080
Speaker 1: I was like, I know this is gonna be less intense, right,

1006
00:50:36,120 --> 00:50:37,640
Speaker 1: and I'm not going to see results as quickly but

1007
00:50:37,680 --> 00:50:39,680
Speaker 1: it's going to be the thing that I find enjoyable.

1008
00:50:40,040 --> 00:50:41,680
Speaker 1: I feel like I can stick to seem more appealing

1009
00:50:41,719 --> 00:50:43,719
Speaker 1: to you. Yeah, and I think that's really important. I

1010
00:50:43,760 --> 00:50:46,400
Speaker 1: think if it allows you, it's like playing the game

1011
00:50:46,440 --> 00:50:48,640
Speaker 1: of basketball versus going for a run. I'll sign up

1012
00:50:48,640 --> 00:50:50,320
Speaker 1: for a game basketball any day of the week, but

1013
00:50:50,400 --> 00:50:51,680
Speaker 1: I'm not going to go on to find out run

1014
00:50:51,800 --> 00:50:54,279
Speaker 1: like just not gonna happen. I hate it, and so

1015
00:50:55,000 --> 00:50:56,960
Speaker 1: find the things that's gonna stick to know yourself a

1016
00:50:57,040 --> 00:50:59,319
Speaker 1: little bit. That's so true, man, This is like one

1017
00:50:59,360 --> 00:51:01,200
Speaker 1: of the ways where you are so different. I guess

1018
00:51:01,320 --> 00:51:02,960
Speaker 1: for me, like hearing a five mile run like up

1019
00:51:03,000 --> 00:51:05,800
Speaker 1: the mountain or something, I'm like, oh, yeah, that sounds awesome.

1020
00:51:06,239 --> 00:51:10,960
Speaker 1: Basketball not so much jammed way too many fingers playing basketball.

1021
00:51:11,400 --> 00:51:14,080
Speaker 1: But so my big takeaway, I'm gonna do something completely new,

1022
00:51:14,160 --> 00:51:16,400
Speaker 1: which we've never done with an interview before. But I

1023
00:51:16,480 --> 00:51:19,120
Speaker 1: want to say something like literally entirely new. This is

1024
00:51:19,160 --> 00:51:21,399
Speaker 1: something we didn't get to but in her book as well,

1025
00:51:21,960 --> 00:51:23,640
Speaker 1: I just want to be able to present more information

1026
00:51:23,680 --> 00:51:26,439
Speaker 1: because Katie has so many great ideas, but she talks

1027
00:51:26,480 --> 00:51:30,040
Speaker 1: about how these different strategies, these different tactics they're not

1028
00:51:30,200 --> 00:51:32,520
Speaker 1: something that you can awesent times just do once and

1029
00:51:32,560 --> 00:51:35,000
Speaker 1: then completely forget about it and have your problem solved.

1030
00:51:35,280 --> 00:51:38,239
Speaker 1: And oftentimes some of these strategies that they may not

1031
00:51:38,360 --> 00:51:40,560
Speaker 1: work as well as they used to maybe when you

1032
00:51:40,640 --> 00:51:43,320
Speaker 1: first started. And so she had talked about when you

1033
00:51:43,440 --> 00:51:47,000
Speaker 1: do see some growth stalling out, just considered new ways

1034
00:51:47,160 --> 00:51:49,680
Speaker 1: to reach your goals, because a chore for one person,

1035
00:51:50,040 --> 00:51:52,920
Speaker 1: like running five miles, that might be fun for somebody

1036
00:51:52,960 --> 00:51:56,200
Speaker 1: else like me. And so I know that that really

1037
00:51:56,239 --> 00:51:58,439
Speaker 1: stuck with me as well, because she was encouraging folks

1038
00:51:58,480 --> 00:52:01,319
Speaker 1: to think about these different problems we're faced with more

1039
00:52:01,560 --> 00:52:04,840
Speaker 1: as a disease rather than a rash. So, for instance,

1040
00:52:04,880 --> 00:52:07,680
Speaker 1: like doctors wouldn't give insulin to a diabetic for a

1041
00:52:07,760 --> 00:52:10,399
Speaker 1: one month and then be like, all right, you're set

1042
00:52:10,520 --> 00:52:13,360
Speaker 1: you now, that's not how it works. It's something ongoing

1043
00:52:13,440 --> 00:52:15,640
Speaker 1: that you have to revisit. Uh. And so in the

1044
00:52:15,760 --> 00:52:18,520
Speaker 1: same way that is how you would treat a rash,

1045
00:52:18,680 --> 00:52:20,840
Speaker 1: you know, something that is more temporary. But oftentimes with

1046
00:52:20,920 --> 00:52:23,480
Speaker 1: some of these larger goals, especially the financial goals that

1047
00:52:23,520 --> 00:52:25,840
Speaker 1: we have in our lives, think about it like a disease.

1048
00:52:26,000 --> 00:52:27,680
Speaker 1: It's this thing that is going to be with you

1049
00:52:27,800 --> 00:52:29,960
Speaker 1: for a really long time, and it is up to you,

1050
00:52:30,160 --> 00:52:32,680
Speaker 1: like you said, Jill, to know yourself and to adapt

1051
00:52:32,760 --> 00:52:34,320
Speaker 1: and figure out how it is that you're going to

1052
00:52:34,400 --> 00:52:38,840
Speaker 1: accomplish that goal because oftentimes there isn't somebody outside of you.

1053
00:52:38,920 --> 00:52:41,600
Speaker 1: There isn't that external pressure who is encouraging you to

1054
00:52:41,719 --> 00:52:43,680
Speaker 1: reach that goal. Oftentimes, like I mean, this is what

1055
00:52:44,280 --> 00:52:46,040
Speaker 1: you should try to thank that happen, because that's a

1056
00:52:46,040 --> 00:52:48,560
Speaker 1: helpful way. It is helpful, but oftentimes, like these are

1057
00:52:48,640 --> 00:52:50,800
Speaker 1: internal things that we have to figure out ourselves, and

1058
00:52:50,920 --> 00:52:52,880
Speaker 1: so I just found that really helpful. The disease of

1059
00:52:52,960 --> 00:52:55,719
Speaker 1: money management will be with you forever, but we want

1060
00:52:56,040 --> 00:52:57,640
Speaker 1: you to be able to implement some of the things

1061
00:52:57,719 --> 00:53:00,400
Speaker 1: that Katie talked about on this episode, so you can

1062
00:53:00,760 --> 00:53:02,920
Speaker 1: stick to the goals that you have just created. Like

1063
00:53:03,080 --> 00:53:06,200
Speaker 1: now is a brilliant time. It's the the fresh start

1064
00:53:06,239 --> 00:53:09,440
Speaker 1: effect that Katie talked about. Now is the best time.

1065
00:53:09,480 --> 00:53:11,080
Speaker 1: And one of the things that I've heard Katie say

1066
00:53:11,120 --> 00:53:13,640
Speaker 1: before too, she didn't say today, but like like so

1067
00:53:13,760 --> 00:53:17,200
Speaker 1: many New Year's resolutions fail, but there's a huge percentage

1068
00:53:17,239 --> 00:53:19,759
Speaker 1: something stick to it. We should take the positive side

1069
00:53:19,800 --> 00:53:21,839
Speaker 1: of that and say, you know, what, There's no better

1070
00:53:21,960 --> 00:53:24,319
Speaker 1: time of year that more people make lasting change than

1071
00:53:24,480 --> 00:53:26,520
Speaker 1: right now, and so hopefully you can incorporate some of

1072
00:53:26,560 --> 00:53:29,560
Speaker 1: the things Katie talked about and make some lasting change

1073
00:53:29,920 --> 00:53:32,920
Speaker 1: moving forward when it comes to your personal finances, because

1074
00:53:32,960 --> 00:53:34,880
Speaker 1: focus on the brighter side of things for sure. Well,

1075
00:53:34,960 --> 00:53:36,800
Speaker 1: let's mention the beer that we had speaking of the

1076
00:53:36,840 --> 00:53:39,160
Speaker 1: brighter side of things that we enjoyed on this episode.

1077
00:53:39,200 --> 00:53:42,680
Speaker 1: This one was called half of Vised Guy by Mutation Brewing.

1078
00:53:42,719 --> 00:53:44,560
Speaker 1: It's a helf of vising and yeah, Matt, what we

1079
00:53:44,560 --> 00:53:47,200
Speaker 1: your thoughts on this beer? It was great? Yeah, this

1080
00:53:47,360 --> 00:53:50,840
Speaker 1: was another delightful beer by the guys by Jack and

1081
00:53:50,960 --> 00:53:56,360
Speaker 1: friends over there at Mutation. But yeah, light, pillowy wheat beer.

1082
00:53:56,920 --> 00:53:58,920
Speaker 1: It had a little bit of sweetness. I feel like,

1083
00:53:59,040 --> 00:54:00,759
Speaker 1: maybe maybe for a half of Eisen, it was a

1084
00:54:00,880 --> 00:54:03,680
Speaker 1: touch sweeter than some of the ones out there, Like

1085
00:54:03,760 --> 00:54:06,600
Speaker 1: we've had some that are quite dry. But this is

1086
00:54:06,640 --> 00:54:09,400
Speaker 1: the kind of beer I would drink with a pizza

1087
00:54:09,719 --> 00:54:12,720
Speaker 1: in particular, one that's got maybe some some spicier sausage

1088
00:54:12,719 --> 00:54:14,239
Speaker 1: on it. And if you're looking for something to cool

1089
00:54:14,280 --> 00:54:17,560
Speaker 1: you down, Yeah, this is if you're normally in the

1090
00:54:17,680 --> 00:54:20,359
Speaker 1: pilsner crowd, like if you're like Budwise or bud Light,

1091
00:54:20,400 --> 00:54:23,400
Speaker 1: that's what I drank occasionally blue Moon. This is like

1092
00:54:23,560 --> 00:54:25,360
Speaker 1: the better version of Blue Moon kind of thing, right, Like,

1093
00:54:25,440 --> 00:54:27,200
Speaker 1: if you want, if if you want to helf of

1094
00:54:27,320 --> 00:54:30,040
Speaker 1: vising moving too that craft beer realm and you haven't

1095
00:54:30,040 --> 00:54:32,080
Speaker 1: really gotten there, find a good helf of Vising from

1096
00:54:32,120 --> 00:54:34,040
Speaker 1: a local brewery. That's a good thing to to start

1097
00:54:34,080 --> 00:54:36,120
Speaker 1: off with. I still remember one of my first craft

1098
00:54:36,160 --> 00:54:38,799
Speaker 1: beers was win were Brothers in Portland oregan helf of Easing.

1099
00:54:39,000 --> 00:54:40,360
Speaker 1: They make one of the better ones out there. This

1100
00:54:40,440 --> 00:54:43,560
Speaker 1: one wasn't shocked top No, it was not. This one

1101
00:54:43,680 --> 00:54:45,919
Speaker 1: rivaled it though, I think I really like this beer.

1102
00:54:46,200 --> 00:54:48,160
Speaker 1: Even though helf of Visins or not my go to style,

1103
00:54:48,280 --> 00:54:50,680
Speaker 1: this was a good version of it. So exactly, that's

1104
00:54:50,680 --> 00:54:53,560
Speaker 1: gonna do it for this episode. For show notes links

1105
00:54:53,600 --> 00:54:55,720
Speaker 1: to some of the resources that we mentioned that Katie

1106
00:54:55,760 --> 00:54:57,960
Speaker 1: mentioned on this episode, you can find those up on

1107
00:54:58,000 --> 00:55:00,440
Speaker 1: our website at how to money dot com. Right man,

1108
00:55:00,520 --> 00:55:02,399
Speaker 1: So that's going to be it until next time. Best

1109
00:55:02,440 --> 00:55:04,239
Speaker 1: Friends Out, Best Friends Out,