Speaker 1: Welcome to Had the Money. I'm Joel and I'm Matt,
Speaker 1: and today we're talking about how to overcome your idiot brain.
Speaker 2: Hey, we've all done some dumb things. Joel, Actually, so,
Speaker 2: what's the Is there something that you do on a
Speaker 2: recurring basis that is kind of an idiot thing or
Speaker 2: a dumb thing? Or ask my wife? You have two options.
Speaker 2: What's that one of the dumbest things you've ever done?
Speaker 2: Or what's something that you do more regularly that you're like,
Speaker 2: why do I do that?
Speaker 1: That's not gonna minute.
Speaker 2: It's probably a Matt. Well, we'll make sure to hit
Speaker 2: those topics when we have our Wives episodes later this summer.
Speaker 2: If I so, I thought about this because I was
Speaker 2: gonna ask you this question. But I think one of
Speaker 2: the dumbest things I ever did was I had a
Speaker 2: jeep when I was in high school and I thought
Speaker 2: that meant oh that means I can drive through mud
Speaker 2: of any depth and worked like that. Well, I I
Speaker 2: was such an idiot, Like I drove, we went, not
Speaker 2: we It was just me that there's one mistake I wasn't.
Speaker 2: I didn't have a buddy there to you know, who
Speaker 2: had my back. But I went to this field that
Speaker 2: I'd never been to before, and it brained a whole lot,
Speaker 2: and there's a bunch of big puddles, or so I thought,
Speaker 2: And so I'm like, why driving around mud splashing everywhere.
Speaker 2: I'm just like living the life until the nose of
Speaker 2: the jeep just like dives down and it was this
Speaker 2: massive hole and I couldn't get out, and we had
Speaker 2: a call like a tow truck to winch me out
Speaker 2: of there. There is Yeah, it was a mess. That
Speaker 2: was most likely the dumbest thing I've ever done in
Speaker 2: my life.
Speaker 1: I mean, that's not the worst thing. A lot of
Speaker 1: people have done, a lot of dumber things.
Speaker 2: It ruined the transmission, okay, Like like mud and liquid
Speaker 2: water got into the transmission and the transmission had to
Speaker 2: be That was a costly misfand that's no fun.
Speaker 1: Well, we're gonna talk about all sorts of things today
Speaker 1: on this episode. Ways, especially specifically that our brain works
Speaker 1: largely because of the thousands and millions of years of evolution, right,
Speaker 1: and and how it doesn't really work to our advantage
Speaker 1: in the modern modern day society. That's true, Ways that
Speaker 1: we're inspiring against ourselves. And then how to overcome them.
Speaker 2: Yeah, there's certain things and more in our more recent
Speaker 2: history and in our own personal lives that has an
Speaker 2: impact on how it is that we handle our money,
Speaker 2: and you didn't reciprocate. I was hoping you would have
Speaker 2: a good dumb story, but you keep thinking about it.
Speaker 2: Folks can hang on for at the end of the episode,
Speaker 2: maybe you'll not tell you.
Speaker 1: So my girls they love to hear this one. You
Speaker 1: tell us one story. When I was in college in
Speaker 1: South Carolina, it didn't really snow very often, but one
Speaker 1: time it snowed, and what idiot college dudes think to
Speaker 1: do when that happens. Well, we wanted to go skiing,
Speaker 1: but there's no place to ski in Greenville, South Carolina, naturally,
Speaker 1: So what we did was we put on the skis,
Speaker 1: we threw an electrical cable, slammed it in the trunck
Speaker 1: on mytoita camera, and we went skiing on the icy roads.
Speaker 1: And nobody got terribly injured. But there's some minor injury
Speaker 1: at least. That's just like one dumb thing that I
Speaker 1: remember doing.
Speaker 2: See that just sounds like fun, because you know, like
Speaker 2: you said, nothing bad happened, So that was just a
Speaker 2: good time.
Speaker 1: It's not been like a dislocated shoulder or something like that.
Speaker 2: But I think that's about it. Stuff like that all
Speaker 2: the time, Like, Okay, maybe we'll say this one for yeah,
Speaker 2: I don't want to go down this path of dumb
Speaker 2: stuff that we did that was actually fun, not considered
Speaker 2: dumb because it didn't come with it come at a
Speaker 2: high cost. But actually, speaking of college, a quick little
Speaker 2: story to share with folks, Amazon is actually no longer
Speaker 2: in the college textbook rental business.
Speaker 1: And my wife found this out the hard way. So
Speaker 1: we've talked about this before, how that's a massive way
Speaker 1: to save when it comes to the tech instead of
Speaker 1: buying brand new or even buying used and then returning
Speaker 1: into the school bookstore renting it instead.
Speaker 2: And if you're talking about I mean hundreds and even
Speaker 2: thousands of dollars when it comes to the amount that
Speaker 2: these college textbooks cost for sure.
Speaker 1: And so my wife, she's in grad school and she's
Speaker 1: been using Amazon Textbooks, checking it against the prices other
Speaker 1: places too, But Amazon Textbooks, I guess they found out
Speaker 1: we're pressing these things too low and we're not making
Speaker 1: any money, so they shut her down. And so now
Speaker 1: if you want to rent a textbook to save money,
Speaker 1: which I think is still a good way to go,
Speaker 1: still good route to choose, get a tactic. Yeah, book Scouter,
Speaker 1: e Campus, and cheg are the three websites you should
Speaker 1: be checking out. We'll link to those in the show notes,
Speaker 1: but those.
Speaker 2: Are I think book scouter in particular, it's like a marketplace,
Speaker 2: like it aggregates a bunch of different additional websites and
Speaker 2: you can compare prices easily on there, which is huge.
Speaker 1: Huge, and I hate to see one less competitor, especially
Speaker 1: one as big as Amazon in the space. But yeah,
Speaker 1: if you were like my wife and you were bummed
Speaker 1: and you're like, I don't know where to go now,
Speaker 1: we'll check out one of these sites, because yep, yeah,
Speaker 1: you still it's better to rent than to buy.
Speaker 2: And so I bet there's probably still a lot of
Speaker 2: folks out there who have Amazon books that they had rented,
Speaker 2: and you actually have I think it's until sometime this fall,
Speaker 2: like August or September, in order to return those those books.
Speaker 2: We just returned hers for the last semester. You don't
Speaker 2: get to keep them.
Speaker 1: We were shopping for the next semester and we were like, oh, bummer,
Speaker 1: but we found we went to cheg for some of
Speaker 1: hers and save some money. But he hat just word. Otherwise,
Speaker 1: if you're in school or you know someone who's in
Speaker 1: school and they're like, these books are expensive, this is
Speaker 1: definitely one way to save money.
Speaker 2: Absolutely. All right, man, are you ready for this beer?
Speaker 1: I'm ready, We're born ready.
Speaker 2: It's time to tap some of the beers that I
Speaker 2: grabbed recently from Asheville, North Carolina. But this is end
Speaker 2: of Plagues and this is a beer buy Burial Brewing Company.
Speaker 2: We will enjoy this one during this episode and share
Speaker 2: our thoughts at the end of the episode.
Speaker 1: Burial always so chill in their naming conventions. Not all right,
Speaker 1: let's move on, Matt. Let's say, let's get to the
Speaker 1: topic we want to discuss on this episode, which is
Speaker 1: overcoming your idiot brain, and specifically, how are brains process
Speaker 1: information that make us bad with money? And we've all
Speaker 1: seen the meme of the guy on the bike who
Speaker 1: puts a stick in his own wheel and he falls off.
Speaker 1: That's kind of becoming ubiquitous at this point. There are
Speaker 1: literally hundreds of different memes based on this goofy poorly
Speaker 1: drawn comic and for instance, Matt I saw one. The
Speaker 1: first line says, fifteen holes a good go, and then
Speaker 1: it says, my brain realizing him playing well as he
Speaker 1: puts the stick in the front wheel, and then what happens.
Speaker 1: He's lying on the ground writhing in pain. It's amazing.
Speaker 1: That just reveals a deeper truth whenever you attach something
Speaker 1: to this meme.
Speaker 2: Yeah, one of my favorite. It makes me think of,
Speaker 2: Like the first one's like, I'm tired at work, falling
Speaker 2: asleep at my desk, drinks a big old cup of
Speaker 2: afternoon coffee as he sticks the stick in the spokes
Speaker 2: and can't sleep that night. Is the end result, which
Speaker 2: I feel like is something we've all done.
Speaker 1: Yeah, for sure. And the truth is it's not really
Speaker 1: all that hard for any of us to become our
Speaker 1: own worst enemy on the money front, right, and that, yeah,
Speaker 1: good intentions just aren't going to get the job done.
Speaker 1: So today we want to talk about some of the
Speaker 1: common ways we're inspiring against ourselves, and we want to
Speaker 1: offer an antidote or multiple antidotes to help us make
Speaker 1: the progress we're looking to achieve more possible, more of
Speaker 1: a reality.
Speaker 2: Yeah, Like that's what makes these memes so hilarious and
Speaker 2: poignant at the exact same time. Right is that because
Speaker 2: like we know the truth, like we know what it
Speaker 2: is that we should be doing, but then we go
Speaker 2: we basically do the exact opposite. Right, We have all
Speaker 2: been there and it's impacted all areas of our lives
Speaker 2: as well. I think like anyone ever sabotage relationship? Have
Speaker 2: you ever sabotage a job interview? Almost like subconsciously though, right? Yeah,
Speaker 2: Like even without realizing. I think sometimes we only become
Speaker 2: aware of it, like what we have done after the
Speaker 2: fact in hindsight.
Speaker 1: Like, oh wait, that's how I That's how I ruined
Speaker 1: that thing.
Speaker 2: Yeah, Like, I mean honestly, like that's what it's what
Speaker 2: it means to be human. Like we get to just
Speaker 2: revel in the complexity and the incomprehensibility of being human beings.
Speaker 2: But as Carl Jung said, until you make the unconscious conscious,
Speaker 2: it will direct your life and you will call it fate.
Speaker 2: And yeah, yeah, when we leave these underground, subterranean thoughts
Speaker 2: and beliefs unexamined, untapped, we're going to be prone to
Speaker 2: make the same mistakes just on repeat throughout our lives.
Speaker 2: It's honestly, it's truly amazing that humanity has even come
Speaker 2: this far, given our tendencies to self sabotage. Luckily, we
Speaker 2: have great philosophers and thinkers like Carl Jung who have paused,
Speaker 2: and they cause us to think a little bit and
Speaker 2: so maybe spend some time digging below the service a
Speaker 2: little bit. And honestly, even today, I think just the
Speaker 2: emotional or like mental health has risen in prominence, and
Speaker 2: I think that's a good thing because I think that
Speaker 2: has allowed a lot of folks to maybe think a
Speaker 2: little bit more about why it is that they're doing
Speaker 2: the things that they're doing.
Speaker 1: So they can hopefully avoid sticking the stick in the
Speaker 1: wheel again exactly basically styming their own progress and hurting
Speaker 1: their inability to do the things that they really do
Speaker 1: want to achieve, in favor of often kind of some
Speaker 1: sort of short term reward. And I do think that
Speaker 1: thinking and feeling affect the way we handle our money
Speaker 1: so much more than we give it credit for, and
Speaker 1: even more so than the immutable characteristics that we possess.
Speaker 1: Our personal history and our personality tendencies are likely to
Speaker 1: play a bigger role in how we react to spending
Speaker 1: and investing than even our age or our education level. Yeah,
Speaker 1: about your skills and how good you are, right, Yeah,
Speaker 1: it's it's really about your history and kind of different
Speaker 1: things probably that formed early in life. I mean, we're
Speaker 1: going to sound like a psychotherapist here, like you're laying
Speaker 1: down on a couch and we're you know, picking your
Speaker 1: brain or something like that. But that's it really is
Speaker 1: true that a lot of kind of how we have
Speaker 1: come to view and think about money has been tainted,
Speaker 1: has been informed by those early years. And so it
Speaker 1: doesn't matter how good you are at math, that's not
Speaker 1: a prerequisite for handling money well.
Speaker 2: Either.
Speaker 1: It's really difficult to remove ourselves from our day to
Speaker 1: day way of living in order to understand and come
Speaker 1: to grips with the groundwork that we've laid already that's
Speaker 1: been laid over, you know, especially those first formative years,
Speaker 1: which informs how we're making decisions in the present that
Speaker 1: impact our lives on an ongoing basis.
Speaker 2: I mean, it doesn't help that everyone out there is
Speaker 2: basically trying to sell you something, you know, like attention.
Speaker 2: It's the most important commodity that we have in this
Speaker 2: day and age and every company out there is they're
Speaker 2: doing their absolutely best to hijack our attention for their profit.
Speaker 2: We think about we recently talked about the TV and like,
Speaker 2: you're having your attention, you're having your literally your eyeball
Speaker 2: is hijacked in order to get something for free, free TV.
Speaker 1: And you say, and then you know it comes at
Speaker 1: a high cost.
Speaker 2: That well, initially it seems like it's a low cost
Speaker 2: in that case, right, like the free TV, but they
Speaker 2: ultimately except for no money. Yeah, ultimately what this means
Speaker 2: are more dollars flowing out of your life because of it.
Speaker 2: And social media is a great example as well, but
Speaker 2: a plethora of streaming options like that's an entirely additional front.
Speaker 2: I feel like that we have to fight right, Like
Speaker 2: there are still like more good TV shows out there
Speaker 2: than any sane human being could possibly watch. There's a
Speaker 2: lot of bad ones out there too, but a lot
Speaker 2: even just goofy little games like candy Crush on our phones,
Speaker 2: Like these are all distractions that are pulling at us.
Speaker 2: And the more that we give into these distractions, the
Speaker 2: less productive and the more unhappy that we're going to become.
Speaker 2: And we say it like no judgment here right by
Speaker 2: the way, we fall prey to these same distractions, these
Speaker 2: same things that are constantly viol for our attention, and
Speaker 2: so maybe a part of why we're covering this topic,
Speaker 2: like we're doing this for ourselves sure, as well as
Speaker 2: for you. Yeah.
Speaker 1: No, I mean, I think the goal of this is
Speaker 1: where you and I are always trying to be lifelong
Speaker 1: learners too. We don't want to just point fingers at
Speaker 1: anybody who uses candy crush and call them crazy or
Speaker 1: anything like that. I try to avoid games, video games,
Speaker 1: any sort of games on my phone, but I realized
Speaker 1: that they bring some people a lot of joy, and
Speaker 1: in fact, they help your mooter skills and coordination to
Speaker 1: some degree too. So I'm not saying there's no visit
Speaker 1: at all. Yeah, yeah, but we're talking just.
Speaker 2: A double edged sword though, you know, like like that's
Speaker 2: the thing with tech in particular, like like what we
Speaker 2: were talking about counseling earlier. It also makes me think
Speaker 2: of like the rise in like headspace, Like there are
Speaker 2: some different apps out there that cause people to slow
Speaker 2: down and to pause and reflect. But it's a double
Speaker 2: edged sword because like five hundred years ago, like back
Speaker 2: in the day, I'm guessing there was probably less issues
Speaker 2: when it came to mental health. I don't know if
Speaker 2: that's proven. That's just this is that's just my assumption.
Speaker 2: They probably didn't need some of these apps because today
Speaker 2: environment like the way things are today, our again, our
Speaker 2: attention is just hijacked constantly, instead of having downtime where
Speaker 2: we might naturally reflect on things where we might naturally
Speaker 2: have a conversation with the loved one and do some
Speaker 2: of the things that matter more. Instead, yeah, we're just
Speaker 2: scrolling social media. And so we have to be more purchases,
Speaker 2: more proactive.
Speaker 1: Basically because of the nature of the society society we
Speaker 1: live in, and because of the things that are the
Speaker 1: flaming arrows that are aimed our way, we need some
Speaker 1: sort of like shield to fin them off so that
Speaker 1: we can protect ourselves and seth godin he writes about
Speaker 1: defeating the lizard brain, and that's kind of like what
Speaker 1: we're talking about here in this episode. You know, the
Speaker 1: basic part of our psyche that only cares about the
Speaker 1: most fundamental aspects of life, like surviving, eating, and procreating,
Speaker 1: which are all good, yea necessary things. I like all
Speaker 1: the above, you know, but that lizard brain can also
Speaker 1: cause us to function with the survivalist short term mentality.
Speaker 1: And Matt, I remember hearing Tim Urban say this. He said,
Speaker 1: the world we were programmed to be in and didn't
Speaker 1: have long term projects that often. So so basically the
Speaker 1: reality that our ancestors grew up in long term wasn't
Speaker 1: really a thing, Like nobody was investing for retirement. Like
Speaker 1: our brains haven't kept up with the new reality of
Speaker 1: much longer life spans and four one k's and all
Speaker 1: the stuff that come along with those things, right, and
Speaker 1: so it's just no surprise that our brains have had
Speaker 1: trouble keeping up with this new reality, albeit a very fortunate.
Speaker 2: Reality, right.
Speaker 1: I mean, I personally like electricity or plumbing. I'm not
Speaker 1: mad about any of the progress that we've made, but
Speaker 1: it comes with, like I said, double edged short, it
Speaker 1: comes to the downside and somethings with something we need
Speaker 1: to pay attention to if we want to live a
Speaker 1: fulfilling life and one that also comes along with financial
Speaker 1: security at the same time.
Speaker 2: Yeah, yeah, there's no part of me that wants to
Speaker 2: go back five hundred years ago. There are a lot
Speaker 2: of things that we don't have to worry about there
Speaker 2: are a lot of diseases that would not so much progress. Yeah, exactly,
Speaker 2: Like I'm very, very happy to be living in the
Speaker 2: air that word.
Speaker 1: I mean, even even if you're in the bottom twentieth
Speaker 1: percentile of Americans, you're living better than French kings did
Speaker 1: three hundred years ago, which is I mean just pretty
Speaker 1: amazing to think about, Like had some perks they would
Speaker 1: trade places for.
Speaker 2: Yeah, okay. So one of the problems I think we
Speaker 2: face that stems from what Seth Goudin calls the lizard brain,
Speaker 2: is that we all have a tendency to overvalue the present.
Speaker 2: This is called present bias. There's a study from twenty
Speaker 2: nineteen and they found that present biased consumers are more
Speaker 2: likely to spend in the present and less likely to
Speaker 2: save for the future. And obviously this makes sense given
Speaker 2: where we've come from ancestrally, like our brains they just
Speaker 2: haven't adapted to this long term thinking that's required as
Speaker 2: lifespans have increased and just our need to build up
Speaker 2: assets for you know, like potentially multiple decades. That's the
Speaker 2: reality now that we live in Like this is.
Speaker 1: The exact opposite of what used to happen when our
Speaker 1: ancestors would come across food like they didn't. Now we
Speaker 1: have as much food as we want and our fingertips
Speaker 1: to a certain career. Right, you can walk into a
Speaker 1: gross shore get whatever you want. Before it was like
Speaker 1: you come upon food, you almost have to hoard it. Yeah,
Speaker 1: you almost have to.
Speaker 2: You can arrise that honey, like that's some good stuff.
Speaker 2: But now everything is sweet, and we still crave sugar,
Speaker 2: that's right.
Speaker 1: But unlike our ancestors, we can get them whenever we
Speaker 1: want it, and so we don't have to.
Speaker 2: And they're quite refined, but we still like to eat.
Speaker 1: Them the way ancestors did. And so when we have
Speaker 1: it like we want to consume it.
Speaker 2: Yeah. Yeah, because this present bias is something that we're
Speaker 2: continually rubbing up against. We just have a hard time
Speaker 2: mustering this self control, even though we know that we
Speaker 2: don't need, for instance, those additional calories via that sugar.
Speaker 2: We lack this self control that's needed when it comes
Speaker 2: to your finances, curb spending and to set more aside
Speaker 2: for your future. But the good news is that there
Speaker 2: are some tools at our disposal in order to help us,
Speaker 2: you know, within this quest on our as we're on
Speaker 2: our path to financial independence. So we'll discuss some other
Speaker 2: psychological hurdles that we face and how to overcome them
Speaker 2: right after this.
Speaker 1: All right, Matt, let's keep going. We're getting psychological with
Speaker 1: this one. It's true our brains conspire against us and
Speaker 1: they cause us to do things that aren't in our
Speaker 1: best interest.
Speaker 2: And overcoming the ancestral lizard brain.
Speaker 1: Yeah, I mean, I think back to middle school and
Speaker 1: uh it just or even even high school. I was
Speaker 1: babb with the ladies and I remember trying, like I
Speaker 1: wanted to ask somebody out on a date or something
Speaker 1: like that. I was so nervous that that person was
Speaker 1: going to say no. And it took me a while
Speaker 1: to come to grips with the fact that what if
Speaker 1: they do say, Now, what's the worst thing that happens,
Speaker 1: Like you feel bad for a second. What if they
Speaker 1: say yes, you have this awesome chance to hang out
Speaker 1: with this person that you would really like to spend
Speaker 1: some time with.
Speaker 2: So I com back to Joel's base desire exactly.
Speaker 1: Well, these are the kind of things that, like we
Speaker 1: we have a hard time rationalize. It took me a
Speaker 1: long time to come to that conclusion, to realize that
Speaker 1: the stakes were actually a lot lower than.
Speaker 2: I thought that you weren't in literal life harm because like,
Speaker 2: that's what it feels like. That's exactly when it's when
Speaker 2: faced with either confrontation, at least when you're sixteen, Yeah,
Speaker 2: something like that. It feels that like, literally, I'm going
Speaker 2: to die, like, which is why that's a phrase that
Speaker 2: you hear teenagers say, because I think a lot of
Speaker 2: time like the haven't oftentimes like identified that, No, you're
Speaker 2: not literally gonna die, even though I totally get that
Speaker 2: that's what it feels like. Yeah, that's what we're oftentimes
Speaker 2: trying to overcome. Right, But like we were just talking
Speaker 2: about present bias, you know, just before the break, and
Speaker 2: how we fail to think ahead, how we fail to
Speaker 2: prepare for the future by investing our money. And I
Speaker 2: think that one of the reasons that so many folks
Speaker 2: don't have enough in retirement is simply because it's so
Speaker 2: difficult for us to understand the concept of compounding, right,
Speaker 2: Like it is tough to wrap your mind around. I
Speaker 2: would say that most things in our lives actually occur linearly.
Speaker 2: It's nice and orderly. One thing happens after the other,
Speaker 2: as opposed to things happening exponentially, which at least personally,
Speaker 2: it feels a bit more chaotic. It's certainly more complex,
Speaker 2: but it's also more difficult to comprehend.
Speaker 1: It's too complex for us to really wrap our minds are.
Speaker 1: It's kind of like those big, big numbers, like, oh,
Speaker 1: we a trillion dollars worth of.
Speaker 2: This or that spending. It's like, what exactly does that mean?
Speaker 1: And we see a bill like that and we just
Speaker 1: chalk it up to how future generations just ahead paying
Speaker 1: off these desks. But a trillion dollars is substantial, and
Speaker 1: we just I'll admit I have a hard time explaining
Speaker 1: how much a trillion dollars is. It's pretty it blows
Speaker 1: my mind.
Speaker 2: Yes, okay, So, for instance, so we're talking about numbers.
Speaker 2: Take a simple math problem of addition five plus five
Speaker 2: plus five plus five plus five and so you know
Speaker 2: the answer. Pick me if you're keeping up. You heard
Speaker 2: me say five five times, So we're talking about a sum.
Speaker 1: Of twenty five.
Speaker 2: There you go, so smart. I'm hoping there's a lot
Speaker 2: of folks that answered out loud. But now take those
Speaker 2: same fives and then multiply them, right, So five times
Speaker 2: five times five times five times five. We might have
Speaker 2: some rare math geniuses out there, but the answer here
Speaker 2: is three twenty five. And this is I wouldn't have
Speaker 2: gotten there. I wouldn't have either. Basically, what I'm getting
Speaker 2: at it's this is a much more complex problem, and
Speaker 2: it's just simply more difficult to comprehend and then to
Speaker 2: actually apply it to our money, specifically to our investments.
Speaker 1: But this is so important to understand because this is
Speaker 1: the basis for turns that we're going to get in
Speaker 1: the stock market. It's a different set of skills, and
Speaker 1: most folks are not able to simply figure this out
Speaker 1: on the fly. So let's give another example on the
Speaker 1: compounding front, Matt, Like, imagine taking a big sheet of
Speaker 1: paper and folding it in half. But then you fold
Speaker 1: it in half again and again until you've done this
Speaker 1: fifty times, which fifty sounds reasonable, right, right, because you're like, oh,
Speaker 1: you can do something and fifty times, but no, you've
Speaker 1: actually yeah, that's actually physically impossible. Right, But if you
Speaker 1: were to do this, if it were possible, how tall
Speaker 1: would that stack of paper be? It turns out to
Speaker 1: be sixty four million miles tall, around two thirds of
Speaker 1: the distance of the Sun, which is crazy doesn't seem
Speaker 1: right when you put it in terms like that, But
Speaker 1: that's what would happen if you had the ability to
Speaker 1: make it happen. And so it's no wonder that Einstein
Speaker 1: called compounding interest the eighth wonder of the world. It's
Speaker 1: it's a wonder in the fact that we, like our
Speaker 1: brains can't wrap around it. But it's also a wonder
Speaker 1: in the fact that it can be a wealth generator.
Speaker 1: Even though our rudimentary brains have a hard time understanding
Speaker 1: exactly how it works. The reality is that it does.
Speaker 2: Work, and it works to hard advantage. It just doesn't
Speaker 2: work the way we think it should work, like it
Speaker 2: just doesn't make sense, even though you can like sit
Speaker 2: down and crunch the numbers, do the math like the
Speaker 2: I think the rest of the Einstein quote is that, like,
Speaker 2: those who understand compound interest will actually earn it, and
Speaker 2: those who don't are going to end up paying it.
Speaker 2: But again, just because our dumb brains don't actually, like
Speaker 2: naturally conclude that this is possible, this doesn't mean that
Speaker 2: we can't actually do the math and figure it out
Speaker 2: because we just did it right, Like people have calculated
Speaker 2: what the distance of that sheet of paper would be
Speaker 2: were you to fold it fifty times and then so
Speaker 2: the trick is to then take these principles and apply
Speaker 2: them to investing. Basically, the earlier that you're able to
Speaker 2: start investing and the more that you're able to keep
Speaker 2: at it, the more that you're going to have at
Speaker 2: the end of the day. What seems small is going
Speaker 2: to be able to grow large because of this reality
Speaker 2: that can just be so difficult to grasp. The longer
Speaker 2: you allow your investments to double and then double again,
Speaker 2: the more money is going to grow, giving you lots
Speaker 2: more options. So one last example, let's say you start
Speaker 2: out with nothing safe for retirement, like literally you've got
Speaker 2: zero in your roth ira or your four one k.
Speaker 1: Hopefully that's not where most of our lists find themselves.
Speaker 2: Hopefully you've got like a little bit of seed money, right,
Speaker 2: but let's say that's that is where you're starting from.
Speaker 2: You you've literally got nothing set aside for retirement. Were
Speaker 2: you to max out your roth Ira every year at
Speaker 2: sixty five hundred dollars, it's going to take you a
Speaker 2: little less than thirty six years to reach millionaire status.
Speaker 2: To hit those you know those seven digits. That is
Speaker 2: a long time, I will say, and again, but that's
Speaker 2: assuming you know you're you're starting with nothing, a little
Speaker 2: less than thirty six years. But then how long before
Speaker 2: you have two million dollars? Well, you'll actually hit that
Speaker 2: milestone in less than ten additional years. But then guess
Speaker 2: what five more years in addition to that. Well, then
Speaker 2: you're up to three million dollars. So the first million
Speaker 2: took you a little less than thirty six years, but
Speaker 2: then the subsequent millions after that then take less than
Speaker 2: ten and then around five years.
Speaker 1: And I always say your first crazy, the first million
Speaker 1: is the hardest.
Speaker 2: Well, yeah, no joke. And when you understand compound exactly like,
Speaker 2: you can truly understand Like again, it's hard to wrap
Speaker 2: your mind around, but you don't have to totally understand
Speaker 2: it where it makes sense in your mind in order
Speaker 2: for you to put.
Speaker 1: It to use, in order for you to trust the
Speaker 1: principle exactly see the reality of what it can provide. Yeah,
Speaker 1: you're right, and I do think that that is a
Speaker 1: really interesting point, that the first million is harder, largely
Speaker 1: because your money is not working for you on your behalf.
Speaker 1: Yet you're working to funnel money into this account that's
Speaker 1: going to eventually do the work for you. But it
Speaker 1: takes a while for that work to start to start happening.
Speaker 1: But then once it starts happening, it starts to happen quickly.
Speaker 1: It's like a snowball rolling down hill, right, And so
Speaker 1: that's why, Yeah, our brains again have a hard time
Speaker 1: understanding this concept. But if we can kind of at
Speaker 1: least understand it a little bit and then to trust
Speaker 1: the principle, trust the other reality that this is how
Speaker 1: money works and how investing your money is going to
Speaker 1: help grow your money over time, we can take advantage
Speaker 1: of it. Whereas our lizard brain wants to say, I
Speaker 1: don't know about this. I can't quite understand it, and
Speaker 1: so maybe I should avoid like going in this direction.
Speaker 1: I think it's probably where a lot of people, a
Speaker 1: lot of people stand the way a lot of people
Speaker 1: think about investing or saving money for the future.
Speaker 2: Okay, so this is a random thought, but I was
Speaker 2: thinking a back to like five hundred years ago or
Speaker 2: I don't know, like five thousand years ago or something.
Speaker 2: But like, in my mind, the only way that I
Speaker 2: feel like folks way back in time had the ability
Speaker 2: to experience exponential growth or compounding like that is if
Speaker 2: so the beer we're drinking it is called end of plagues.
Speaker 2: Is if they were if there's a plague upon them,
Speaker 2: like literally, like a plague of locusts or rats or
Speaker 2: something like that. I feel like back then they would
Speaker 2: say even then, they didn't totally understand it, even though
Speaker 2: they experienced it. And what they would say is like, oh, man,
Speaker 2: the gods must be mad at me. We must sacrifice
Speaker 2: whatever we need to do in order to appease the
Speaker 2: appease the gods. But like that's an example of exponential growth, right,
Speaker 2: Like when you've got a locust that multiplies and then
Speaker 2: those locust multiplely, you know, Like that is an instance
Speaker 2: I think in natural I don't know in the natural
Speaker 2: environment where you might have experienced exponential growth or compounding.
Speaker 2: Maybe again five hundred years.
Speaker 1: Agea, so if theyve known a little bit more, they
Speaker 1: would have realized what was going on beneath you.
Speaker 2: Would have said, Aha, here's what's going on.
Speaker 1: This is just science, not some sort of apocalyptic plague
Speaker 1: being sent after me and by some higher power. Yeah sure, yeah, right,
Speaker 1: let's talk about how our lizard brains work against us
Speaker 1: in regards to how we use money in the present too.
Speaker 1: I think one way that our idiot brains keep us
Speaker 1: from making progress is it stops us from investing as
Speaker 1: much as we could or as much as we should,
Speaker 1: because we don't fully comprehend the process or we're not
Speaker 1: willing to funnel our money in that direction. But on
Speaker 1: the other side of the coin is the fact that
Speaker 1: we don't save and invest enough because we're spending every
Speaker 1: dollar we make. And that is the American way, right.
Speaker 1: I think when you look at the savings rate right
Speaker 1: now in the United States of America, it's like, what
Speaker 1: two point three cents on the dollar is what we
Speaker 1: save on average, which is pretty pathetic. And specifically, let's
Speaker 1: throw out some examples, Matt and discuss kind of what's
Speaker 1: going on under the surface. Some situations it might trigger
Speaker 1: our idiot brains, but tricking us really into doing something
Speaker 1: that's not in our best interest. I feel like this
Speaker 1: often hits us on the shopping front, and I think,
Speaker 1: especially in our ever interconnected world, we're just bombarded by ways,
Speaker 1: avenues and means to shop more than ever before too.
Speaker 2: Yeah, like the seventy percent off sign falling prices at
Speaker 2: Walmart or Resist like. Sales like this just trigger us
Speaker 2: so much, like I feel like it activates something within
Speaker 2: that lizard brain. It's sort of like this this limited
Speaker 2: time only phenomena, which again a long time ago, we
Speaker 2: had to take advantage of stuff like that when we
Speaker 2: were hunter gatherers. But now that impulse is working against us,
Speaker 2: and even more so given the preponderance actually a fake
Speaker 2: deals out there that can be found online thanks to
Speaker 2: the way that pricing works on the internet. What's the
Speaker 2: actual real price? Who knows? Right? Like, what is the
Speaker 2: actual list price? What is the manufacturer? Is that where
Speaker 2: the thing actually costs? Well, of course not because there's
Speaker 2: profit built in, but it's tough to know what, you know,
Speaker 2: how good of a deal that you're actually that you're
Speaker 2: actually looking at. But yeah, when you're shopping all line
Speaker 2: and you see that it's a negative thirty percent and
Speaker 2: it's written in all read, yeah, we're conditioned to know, oh,
Speaker 2: it's time to pounce. We have been conditioned to know
Speaker 2: that this is a deal. It's a signal to buy.
Speaker 2: And the original price it's great out It's got like
Speaker 2: a little little line cut through it, and I saw
Speaker 2: two Amazon. They're just stacking all the tactics against us,
Speaker 2: and now it says like deal and it is also
Speaker 2: written in like all caps red letters in order to
Speaker 2: again to kind of evoke that emotion that tells us
Speaker 2: that we should be making a purchase right now. They
Speaker 2: want you to feel like a fool for passing up
Speaker 2: on a deal as good as this one, which I'm
Speaker 2: gonna be honest, like, this is one that has been
Speaker 2: difficult for me for a long time because that I
Speaker 2: feel like I've gotten a lot better. I've grown in this,
Speaker 2: but only as I've started to realize the fact that
Speaker 2: this is what's happening behind the scenes, right only as
Speaker 2: I've started to be like, wait a second, that's my
Speaker 2: lizard brain trying to get me to do something that's
Speaker 2: not my best interest. But I was like all about
Speaker 2: the deals, and I was like, I realized I was
Speaker 2: just spending too much time thinking about buying stuff and
Speaker 2: trying to get a good deal on things, and the
Speaker 2: best thing to do was to want less stuff and
Speaker 2: to care less about the prices of things and just
Speaker 2: not be into shopping nearly as much as I was.
Speaker 2: So it's I think I inherited that gene from my
Speaker 2: mom to a certain dream. Not trying to throw shade mom,
Speaker 2: but this is one of those things where I think
Speaker 2: a lot of people, especially in today's era, when Amazon
Speaker 2: and Instagram and email newsletters kind of pull at us,
Speaker 2: trying to get us to spend money, hard us from
Speaker 2: our money, and they're using all sorts of sneaky tactics.
Speaker 1: It is. It is something like most of us are
Speaker 1: susceptible to.
Speaker 2: Yeah, well, I mean, like you said, email newsletter or whatever,
Speaker 2: like the abandoned cart email where retailer checks in with you.
Speaker 2: I mean, dude, like there is an entire offering you.
Speaker 1: An additional discount because you walked away.
Speaker 2: Here's a coupon code. Did life get busy? Like all
Speaker 2: of these things that triggered the like, oh yeah, this
Speaker 2: is something that was important to me that it should
Speaker 2: be doing, and I should be so thankful that they're
Speaker 2: following up with at CRM, Like customer relationship management, that
Speaker 2: is an entire industry, and it's not that it's evil,
Speaker 2: but I mean their sole goal is to get you
Speaker 2: to buy more stuff, whether that's them keeping up with
Speaker 2: the different purchases that you've made, but not. Oftentimes it's
Speaker 2: not even the things that you buy, it's the stuff
Speaker 2: that you're looking at. It's the things like on Instagram,
Speaker 2: it's the ads that you linger on or the ads
Speaker 2: that you swipe on where there's a carousel because you're like, oh,
Speaker 2: I really like that first item. Let me see if
Speaker 2: they got some of the other stuff on sale up.
Speaker 2: And then you're feeding the system, going back to the
Speaker 2: whole free TV thing, like they now know more about you.
Speaker 2: That's gonna end up costing you more money down the road.
Speaker 1: Yeah, window shopping used to be a completely innocent activity,
Speaker 1: and now window shopping is watching you a window into
Speaker 1: your soul for advertisers, for people that want to sell
Speaker 1: you stuff, which is only really putting us at more
Speaker 1: of a disadvantage when it comes to like our brain
Speaker 1: and how we react.
Speaker 2: Yeah, and this isn't to like demonize the folks that
Speaker 2: are in that, Like I used to be an advertising myself,
Speaker 2: but it's important as consumers to highlight the fact that
Speaker 2: this is what's going on, so that we're essentially we're
Speaker 2: equipping other consumers out.
Speaker 1: So you can put that shield up because it's a
Speaker 1: fair fight and yeah, and be like stop yeah. Well,
Speaker 1: and we'll give some practical ways to in a bit
Speaker 1: to kind of help make that a reality, to help
Speaker 1: stop your brain from progressing this way. But part of
Speaker 1: the beginning at least is to highlight some of the
Speaker 1: ways that happens. Another thing is like the impulse by right,
Speaker 1: that's a struggle for lots of other people out there.
Speaker 1: It's not just a sale. It's a good deal, but
Speaker 1: it's and maybe sometimes you do find the perfect thing
Speaker 1: at a thrift store or an artist market. I've done that,
Speaker 1: and you make the purchase because it really is kind
Speaker 1: of something that's not going to come along again. But
Speaker 1: there's often something else that causes us to make an
Speaker 1: impulse buy. It's when we feel like we deserve it, right,
Speaker 1: it's time to treat ourselves.
Speaker 2: Ye.
Speaker 1: And so maybe you've had a hard week at work,
Speaker 1: which in.
Speaker 2: Reality is just a moment of weakness.
Speaker 1: Exactly, That's exactly what it is. It's not that you've
Speaker 1: actually found the right thing that's never going to come
Speaker 1: along again. It's that you're trying to soothe yourself through
Speaker 1: some consumption, and so yet buying something can provide a
Speaker 1: temporary relief, It can make you feel better for a second,
Speaker 1: like you click buy and you're like, ah, I feel
Speaker 1: I'm you know, this is just a method of sweet
Speaker 1: self soothing, right, But look back maybe to a recent
Speaker 1: impulse buy, what emotions triggered it, and how did you
Speaker 1: feel afterwards? I think those are good questions to ask yourself.
Speaker 1: And I realized maybe I'm sounding a little bit like
Speaker 1: a therapist right now, taking a page out of my
Speaker 1: wife's book. But asking those questions are going to help
Speaker 1: you get to the heart of the why behind the
Speaker 1: impulse spending that you've done, and it can allow you
Speaker 1: to recognize them moving forward, because it's typically matt it's
Speaker 1: going to be those same impulses, those same triggers that
Speaker 1: cause you to do it in the future, and if
Speaker 1: you can identify them, you might be able to catch
Speaker 1: yourself in the act next time you are tempted to
Speaker 1: buy on the fly.
Speaker 2: That's right. Yeah, So retailers they also use just different
Speaker 2: subtle tricks out there as well, like free shipping. Again,
Speaker 2: like when it comes to online shopping, that's one of
Speaker 2: the words that's written in all caps emboldened off to
Speaker 2: the side. Do you see free and you think, oh, yeah,
Speaker 2: somehow this is free even though there is a prices station.
Speaker 2: You know, they're not losing money on shipping. Come on, exactly,
Speaker 2: it's not truly free shipping. And we also know that
Speaker 2: even if we pay for something in for easy installments,
Speaker 2: that will end up paying the same amount in the end.
Speaker 2: They're just making it easier for you by not pay later.
Speaker 1: Adds to the frictionlessness of it all. Yeah, they're reducing
Speaker 1: the friction just enough, but we know it logically we're
Speaker 1: paying the same amount anyway.
Speaker 2: Yeah, but by doing that, they're able to actually garner
Speaker 2: a sale for most that otherwise they wouldn't get and
Speaker 2: we find ourselves parted with our money when we might
Speaker 2: have otherwise saved it. So again, awareness of how these
Speaker 2: different strategies and tactics and tricks impact us is crucial
Speaker 2: so that we can put up a good fight. I
Speaker 2: will say, like I think for me, I don't know
Speaker 2: for me to say, the whole sale mentality, it's not
Speaker 2: something that gets me. You know, my adrenaline mies don't
Speaker 2: dilate or whatever. My people don't use.
Speaker 1: It's an impervious robot to a certain extent.
Speaker 2: But we know what I'm not impervious to what is uh, messaging,
Speaker 2: like when they try to sell you an image or
Speaker 2: when they're trying to sell you basically like a message,
Speaker 2: even if it's subconscious, right, Like, like I'm specifically thinking
Speaker 2: about it. Like I bought a really nice coffee grinder recently.
Speaker 2: We talked about it maybe a couple months ago. I
Speaker 2: was thinking about getting Actually we talked with Brandon on Monday.
Speaker 2: That's one of the things him and I nerded out
Speaker 2: about because he actually recently bought a blade. Well, mine
Speaker 2: is a flat blade grinder. I think his was kindic cool. Oh,
Speaker 2: I don't know the difference. Yeah, he was also considering mine.
Speaker 2: But the way that that thing is styled and the
Speaker 2: way it's designed, it's it's like Matt Black. The design
Speaker 2: is I mean, it's beautiful. It sits there on your counter,
Speaker 2: and so the reason it's well reviewed and stuff is
Speaker 2: because it actually does grind your coffee really really well.
Speaker 2: So practically speaking, it does an excellent job. But you're
Speaker 2: also buying the image, right, like the way we're always
Speaker 2: being sold in the image, right. Yeah, It's just branded
Speaker 2: in such a cool way and it's like minimalist. And
Speaker 2: I think there's a part of me that bought into
Speaker 2: that where it's just like, by getting this thing, you're
Speaker 2: gonna be cool, like the like all the other guys,
Speaker 2: like like this is gonna make your house look like
Speaker 2: the counters that this coffee grinder is featured on within
Speaker 2: the picture on our website. Yeah, it's okay to.
Speaker 1: Have certain aesthetic preferences and to say this is my style,
Speaker 1: this is this is my jam, I'm into this. That's
Speaker 1: totally fine. But I think there's also a lot of
Speaker 1: advertising that is subtenly weaving that into absolute brains, and
Speaker 1: it's saying it's not even telling us about the product,
Speaker 1: it's just by association saying if you do or drink
Speaker 1: or buy or hang out with this product, you are
Speaker 1: by proxy gonna be cooler. Then you're gonna be you
Speaker 1: currently a cool hip dude, right right.
Speaker 2: Yeah, And even if it practically accomplishes what it is
Speaker 2: that you want to accomplish because you are checking off
Speaker 2: the boxes and whatnot, I think we are still susceptible
Speaker 2: to that that kind of branding. And the fact is
Speaker 2: nobody cares. It's not like anybody thinks that I'm cooler
Speaker 2: because I got Like nobody sees the stupid thing like
Speaker 2: I don't invite people over for coffee. Maybe I should,
Speaker 2: I guess is when I'm now learning just to show off,
Speaker 2: just to show off my fancy grinder. Anyway, I just
Speaker 2: wanted to mention that too, because I think there are
Speaker 2: some of these more subtle, subconscious brandy kind of not
Speaker 2: like you know, not the liquor, but like where there's
Speaker 2: a brand and you're kind of buying into the brand,
Speaker 2: and that's actually how they're able to make this sale. Right,
Speaker 2: It's not that they dropped a sale on me. Is
Speaker 2: it's not that I did it impulsively where no, I've
Speaker 2: been researching this for months, but there's another part of
Speaker 2: it where I paid a premium for it.
Speaker 1: I think that's what they say about billboards and commercials.
Speaker 1: It's not that they're trying to make the sale instantly.
Speaker 1: They're trying to slowly mold your mind into thinking something
Speaker 1: about that product or brand so that eventually you come
Speaker 1: around when you're like, oh wait, now I need a car.
Speaker 1: Ah Remember that toilet to rab four commercial. Maybe that's
Speaker 1: the one for me.
Speaker 2: I don't know. It's that kind of stuff that really
Speaker 2: family looked like my family. I can reade us driving
Speaker 2: that kind of car.
Speaker 1: Yeah, exactly, that's kind of tricks are being played on us,
Speaker 1: slowly but surely. But there are a lot of things
Speaker 1: that we can do. There are a lot of things
Speaker 1: in our power to react and to combat these subtle
Speaker 1: and not so subtle hints. Sure ways that we're parted
Speaker 1: with our money, whether it's on the spending or just
Speaker 1: on the not investing side. We'll get to a bunch
Speaker 1: of our thoughts on how to make progress, how to
Speaker 1: overcome the lizard brain financially speaking, we'll get to that
Speaker 1: right after this.
Speaker 2: All right, folks, we are back and we are talking
Speaker 2: about overcoming your idiot brain. And this is just a
Speaker 2: fun conversation because we're just really diving into the psychology, right.
Speaker 1: I just say, this is not about IQ either.
Speaker 2: This is oh yeah.
Speaker 1: I think there's a lot of people who are like,
Speaker 1: I'm in mensa, Okay, I don't have an idiot brain.
Speaker 1: My IQ is one forty eight. And I think these
Speaker 1: are the things that again, we all have this lizard
Speaker 1: brain part in the back, and we're all tempted to
Speaker 1: or subconsciously reacting in these ways. We're talking about the
Speaker 1: subconscious no matter how freakan smart you are, no matter
Speaker 1: whether you're an engineer or you stock the shelter your
Speaker 1: local grocery store. It doesn't it doesn't matter. We're also
Speaker 1: sept the police.
Speaker 2: Well, that's what makes this so interesting, right, Like, we
Speaker 2: are fascinated by just this behavioral psychology element and how
Speaker 2: it is that it's going to impact how we handle
Speaker 2: our money, both collectively as a society but also as individuals.
Speaker 2: And so another factor that plays into how we personally
Speaker 2: interact with our finances has to do with our history
Speaker 2: with money. Our beliefs about money often stem from how
Speaker 2: it impacted us in our childhood. This makes me think
Speaker 2: back to our Freudian Yeah, so we had a conversation.
Speaker 2: We had Christy Sheen on the podcast as an interview
Speaker 2: back in episode one to eighteen. We'll link to that
Speaker 2: one in the show in the show notes. But she
Speaker 2: grew up on forty four cents a day in China,
Speaker 2: and when you do that, that is going to make
Speaker 2: you appreciate the wealth and the opportunity is available to
Speaker 2: you when you finally arrive in North America or for her,
Speaker 2: Canada specifically, and Canada's in North America. But if you
Speaker 2: grew up in like an affluent suburb, like you might
Speaker 2: have seen the downsides of money, right, Like you may
Speaker 2: have been confronted with the signaling and the unhappiness that
Speaker 2: it can produce. Some people like Christie and much of
Speaker 2: the Fire community, like they are able to see money
Speaker 2: as a tool in order to earn their freedom, And
Speaker 2: we tend to agree that freedom is one of the
Speaker 2: best things that money can buy. But it's important to
Speaker 2: identify your history and what it is is that informs
Speaker 2: how it is that you view money, some of the
Speaker 2: different attributes that you associate with your money.
Speaker 1: Yeah, I think if you grew up in China and
Speaker 1: you come to North America, Canada, Canada, Canada, you see
Speaker 1: I think as mostly a good thing, right, Yeah. But
Speaker 1: if you let's say you hung out with Jordan Belford,
Speaker 1: Wolf of Wall Street sort of thing which I never
Speaker 1: saw the movie, I just know very little, But if
Speaker 1: you hung out it's good in those environments, you would
Speaker 1: you might think money is all bad and only terrible
Speaker 1: people have money, right, And so you might just there's
Speaker 1: associations that we make that really when you think about it,
Speaker 1: and when you do a little bit of introspection, you
Speaker 1: might be able to find some ties that you can
Speaker 1: untangle a little bit in terms of how you view money,
Speaker 1: and maybe the way you think about it stems from
Speaker 1: some experiences from elementary, middle or high school, and some
Speaker 1: of those things might have informed you well, in others
Speaker 1: maybe not so well. And Sarah Newcomb, who writes about
Speaker 1: money psychology for Morning Star, I like that she shared
Speaker 1: this article you wrote some She had some great prompts,
Speaker 1: some questions really to help reveal what's going on under
Speaker 1: the surface in terms of our money beliefs. We'll link
Speaker 1: to that article in the show notes because I think
Speaker 1: it's helpful to look at. But let's go over them
Speaker 1: real quick, because I think they're just really insightful or
Speaker 1: they can help you find some insight. But first she
Speaker 1: tells people to fill in the blank money is what,
Speaker 1: and then you tell your answer and you talk about why.
Speaker 1: It'll tell you a lot about your current underlying beliefs.
Speaker 1: Money is blank, like fill in the blank what is
Speaker 1: money for you? I think that is going to give
Speaker 1: you a lot of insight as to how you think
Speaker 1: about money, how you feel about money, and what's going
Speaker 1: on below the surface. Second, she says, if money was
Speaker 1: a character in your life would be a friend or foe,
Speaker 1: a villain or hero. I think that's a helpful question
Speaker 1: as well, because some people have an inherently antagonistic view
Speaker 1: and approach towards money. They kind of view it as
Speaker 1: inherently bad. We've talked about how it's not. It's really
Speaker 1: just this kind of neutral thing, but we make attachments
Speaker 1: to it, and I think seeing how you view it
Speaker 1: from that perspective can be helpful. Third, she says, growing up,
Speaker 1: what was your financial situation? How did the people raising
Speaker 1: you handle their money? Do you see any ways that
Speaker 1: this affects the way you think about or handle money today?
Speaker 1: For me, yes, You've talked about it with Brandon on
Speaker 1: Monday's episode. I mean, this is one of those things
Speaker 1: where I was particularly especially influenced by the way money
Speaker 1: was handled in my house growing up. I'm sure other
Speaker 1: listeners have a similar sort of story, right background. So,
Speaker 1: but thinking through those things and not just letting them
Speaker 1: subconsciously inform how you handle money, but bringing them to
Speaker 1: the forefront, to the surface, consciously thinking about them will
Speaker 1: allow you then maybe to combat some of those ark
Speaker 1: realities that you grew up with.
Speaker 2: Yeah, and I would say that well, the argument we're
Speaker 2: making is that regardless if it was good or bad,
Speaker 2: your history is going to have an impact no matter what,
Speaker 2: and it oftentimes comes down to how you then react
Speaker 2: to that history, because like in your case, you reactive,
Speaker 2: reacted like you were polarized, like you did the opposite
Speaker 2: essentially right. But like I think back to my history,
Speaker 2: me growing up with money, and like we certainly had enough,
Speaker 2: but it wasn't like the amount of money my my
Speaker 2: folks had. But honestly, it was just the great way
Speaker 2: that they talked about it. Like I specifically like I
Speaker 2: might be one of the like, okay, we were talking
Speaker 2: about compounding earlier, and I this was a lesson that
Speaker 2: that I learned, literally, I think at age eleven. I
Speaker 2: specifically remember my dad sitting at the desk in our
Speaker 2: kitchen and him explaining compounding interest and when your money
Speaker 2: starts working harder for you than you are able to like,
Speaker 2: and that puts me in incredibly like rarefied waters, Like
Speaker 2: I was incredibly lucky to have had that taught to
Speaker 2: me at a young age. I didn't fully understand it then,
Speaker 2: but I do think that that certainly planted the seeds
Speaker 2: of my you know the basis I guess of my
Speaker 2: my financial education. But again I'm highlighting this because a
Speaker 2: I was most definitely lucky. But a lot of folks,
Speaker 2: like you said there, you tend to go to one
Speaker 2: extreme or the other right, like you either vilify money
Speaker 2: or you worship it. It kind of depends on what
Speaker 2: happened in your past and then how you are reacting
Speaker 2: to it. But Sarah she Man, she had such a
Speaker 2: great article there, and one of the other things she
Speaker 2: mentioned was to ask yourself if money affects your social life,
Speaker 2: specifically in a good way or a bad way. And
Speaker 2: then finally, this is a quote, if money were not
Speaker 2: a consideration, how would you be living your life? Would
Speaker 2: it be very different from how you currently live? And
Speaker 2: how do you feel about that? And that's just I
Speaker 2: think that's such an incredible and incredibly insightful question to
Speaker 2: ask yourself because I think it can help you to
Speaker 2: be awares to the fact that are you doing this
Speaker 2: truly because of money or maybe because of some other
Speaker 2: deeper maybe calling or mission that's driving you. We actually
Speaker 2: included some other similar questions in our how to Money
Speaker 2: Money Mission Statement worksheet. We'll make sure to link to
Speaker 2: that in our show notes. But the truth is, if
Speaker 2: you want to make more progress with your money, the
Speaker 2: problem likely isn't that you don't know enough about roth
Speaker 2: iras right, Like for most of us, the problem is
Speaker 2: the man in the mirror, the woman in the mirror,
Speaker 2: Like it goes much deeper. Don't make me say that
Speaker 2: song right now? And asking ourselves some of these hard questions,
Speaker 2: you know, doing some of this deep work, we think
Speaker 2: it can transform how it is that everyone out there
Speaker 2: relates to their finances. Just some of the realization can
Speaker 2: be freeing, and it can impact how it is that
Speaker 2: we spend and save our money. It is not just
Speaker 2: the spendaholics, right that need to perform this exercise and
Speaker 2: to look inward. It's possible to be too miserly and
Speaker 2: too frugal as well.
Speaker 1: Yeah that's true. Yeah no, when you said that if
Speaker 1: money were not a consideration, how would you be living
Speaker 1: your life? Would it be very different from how you
Speaker 1: currently live? I think it's a really really important question
Speaker 1: for us to ask ourselves. For a lot of people
Speaker 1: they might find wait a second, I'm putting too much
Speaker 1: emphasis on money. I have all that I need. If
Speaker 1: only I could incorporate and think about money a little
Speaker 1: bit less and just have more free time. Like those
Speaker 1: are the kind of questions you and I are asking
Speaker 1: ourselves now at this stage in our lives where it's.
Speaker 2: We're a little more coast fire and yeah, we have
Speaker 2: the ability to kind of choose our own.
Speaker 1: Path to and like we could say, no, we want
Speaker 1: to continue to enhance our lifestyle in a massive way,
Speaker 1: and so it's going to require a lot more money
Speaker 1: to fund this juggernaut for years to come. But no,
Speaker 1: that's not what we care about. But the only asked
Speaker 1: by asking yourself these kinds of questions, can you get
Speaker 1: to that deeper understanding. But you know, regardless of which
Speaker 1: of those camps you might find yourself in at the
Speaker 1: end of the day, both of those tendencies can be
Speaker 1: taken to the extreme, which is really just a manifestation
Speaker 1: of selfishness. And this so basically, if you spend so much,
Speaker 1: it's because you're being selfish and you're spending a lot
Speaker 1: of money on yourself. But if you're being cheap and
Speaker 1: like you know, like I was saying earlier, like miserly,
Speaker 1: that's also a very selfish ash where you're just yeah,
Speaker 1: it makes you think of storing it all away for yourself,
Speaker 1: freaking bad. Where Walter White always says he's doing it
Speaker 1: for his family, but the reality is his family is
Speaker 1: falling apart while he's like making meth and making bank.
Speaker 1: And the truth is at the end he admits he's
Speaker 1: doing it all for himself the whole time, when it
Speaker 1: was clear to the viewer for all the seasons that
Speaker 1: sounds like he did some good internal work exactly exactly.
Speaker 1: It was all that therapy he was doing that really
Speaker 1: got him to that point. Yeah, glad he reached that point.
Speaker 1: As someone who's never watched the show, right, I'm sure
Speaker 1: that's exactly what it was like, right, something like that
Speaker 1: while counseling or kind of like the Sopranos, Well he
Speaker 1: actually goes to counseling. This doesn't really Yeah, yeah, although
Speaker 1: I never saw that show, but I hear it's great.
Speaker 1: But this is this is natural tendency, right, Like we're
Speaker 1: born as selfish, selfish beings. Our brains are wired toward
Speaker 1: what we can get. Now, this is the lizard brain
Speaker 1: in action, and to keep it all for ourselves or
Speaker 1: for our small tribe, our family. But just because a
Speaker 1: behavior is natural, doesn't mean that it's the best path
Speaker 1: to take, and especially in again modern society. And so
Speaker 1: one of the more ultimate ways that were able to
Speaker 1: overcome our dumb brains is to spend our money in
Speaker 1: ways that are sacrificial, to spend or give it away
Speaker 1: in a way that doesn't bring us any benefit at all.
Speaker 1: This is one hundred percent a way that we can
Speaker 1: overcome our idiot brains. And it's a reason that we
Speaker 1: like to encourage folks to be charitable, yes, to give
Speaker 1: their money away because pretty much all stages of your
Speaker 1: financial journey, if you can be giving away a small
Speaker 1: portion and hopefully a growing portion of what you have
Speaker 1: what you make, it can help reframe money, put it
Speaker 1: in the proper light. And that is so powerful. It's powerful,
Speaker 1: largely for psychological reasons, and to get to see that
Speaker 1: money do good in the world around you. That's beautiful too.
Speaker 2: Yeah, And of course there are, like you said, in
Speaker 2: ways that where we receive no benefit, but we're also
Speaker 2: even incentivized to give money away, like that's just how
Speaker 2: the tax goes to the tax go yeah, yeah, like yeah,
Speaker 2: So it's important to realize that from a principal standpoint
Speaker 2: we want you to be doing it because it's not
Speaker 2: necessarily going to give you any benefit. But there's also
Speaker 2: the tax benefits, and there's there's kind of like the
Speaker 2: emotional feel good benefits as well, but we're not going
Speaker 2: to get into all of that because something else that
Speaker 2: we can do to actually overcome our idiot brain is
Speaker 2: to automate and to impose limitations on ourselves. We're talking
Speaker 2: about rules and automation because they can help us to
Speaker 2: do the right thing consistently without even having to think
Speaker 2: about it. Because once you opt to put let's say
Speaker 2: six percent into your four h one k, well, that
Speaker 2: joker is on autopilot. You don't have to think about
Speaker 2: it ever. Again, you your paycheck is smaller, but you
Speaker 2: forget about that pretty quickly. Automation helps us to overcome
Speaker 2: our own lack of discipline. And it's not to say
Speaker 2: that it's some sort of crutch. It's an effective tool
Speaker 2: and it's out there and so we want folks to
Speaker 2: use it. But you can also impose artificial limits on
Speaker 2: yourself where you're able to create some friction where it
Speaker 2: didn't exist before, specifically on the shopping front. You know,
Speaker 2: that's something like instituting a twenty four or a forty
Speaker 2: eight hour waiting period. That way, you're not giving into
Speaker 2: those base desires of impulse buying, right or if that
Speaker 2: means that you're on Facebook too much, which can oftentimes
Speaker 2: lead to purchases that maybe you shouldn't have made. A
Speaker 2: loved one of mine recently made approachase on Facebook that
Speaker 2: I'm not sure if that would have happened had that
Speaker 2: ad not been seen. But if that's the case, use
Speaker 2: the newsfeed erratic plug in. That way, you can go
Speaker 2: straight to the how to Money Facebook group, because surely
Speaker 2: that's the only reason that you need to be taking advantage.
Speaker 1: I got to say, I've been using that plug in
Speaker 1: for years. I have no idea what's going on on
Speaker 1: Facebook outside of the how to Money Facebook group, and
Speaker 1: I live in Bliss.
Speaker 2: I love it. Or maybe it even means on your
Speaker 2: phone just deleting Instagram if like me, you have sometimes
Speaker 2: find yourself, you know, flipping through the carousel of the
Speaker 2: different sales or a minimum backcountry put it on page
Speaker 2: two of your apps. Yes, yeah, yeah, push it back
Speaker 2: a little bit. But there are different app limiting services
Speaker 2: out there. There is this one called one sec like
Speaker 2: one second and opal, but they can impose a delay
Speaker 2: between opening an app and actually seeing the content. This
Speaker 2: is I think can be really helpful for both social
Speaker 2: and investing apps where you're trying to give yourself a
Speaker 2: minute to actually pause and to think is this something
Speaker 2: I need to do? Honestly, I like to just stepping backwards, Like,
Speaker 2: don't necessarily include more technology to solve the problems of
Speaker 2: more technology, but even consider taking a step backwards. I mean,
Speaker 2: I think this is why we're seeing the number of
Speaker 2: flip phones like dumb phones. Sales of those have been skyrocketing,
Speaker 2: whereas sales of smartphones have actually declined. Thank Q four
Speaker 2: of last year, smartphone sales declined Alexia, whereas flip phones
Speaker 2: and like old school Nokia's sales are are actually on
Speaker 2: the rise. But Yeah, that's to me that that's an
Speaker 2: encouraging note. And I think that's something like I feel
Speaker 2: like we're seeing more of that with with gen Z
Speaker 2: because there's a younger, younger generation and they're tired of
Speaker 2: being highjacked having their screen time just completely dominate all
Speaker 2: their free time.
Speaker 1: Yeah, I've been very intrigued by the light phone. I
Speaker 1: haven't made the jump I haven't even played around with one,
Speaker 1: but I've contemplated, you know, jump into something like that.
Speaker 1: I don't want to lose. I like podcasts on my phone.
Speaker 1: There's certain things that I like having at my fingertips.
Speaker 1: But then I also realized that that it's that there
Speaker 1: are other things at my fingertips that I wish were
Speaker 1: not there, that are constantly buying for my attention. And
Speaker 1: I wish I didn't even have to think about them.
Speaker 1: I wish they didn't exist. But met to wrap this up,
Speaker 1: I mean, going back to that that Carl Jung quote
Speaker 1: at the beginning of the episode that you mentioned about
Speaker 1: making the unconscious conscious our lives, I feel like they
Speaker 1: often feel guided by an invisible hand, which really is
Speaker 1: our subconscious right.
Speaker 2: As well as the market. As like Godam Smith said.
Speaker 1: I know that's really a nod to Adam Smith using
Speaker 1: that terminology, But that invisible hand that guys, I.
Speaker 2: Mean, it's more than you think, because it is the market.
Speaker 2: It is actual companies truly a profit and that are
Speaker 2: trying to sell to you. But it's yeah, it's also
Speaker 2: the subcomstry.
Speaker 1: It's also the things about today we've experienced at an
Speaker 1: early age, or the things that we've heard our friends say,
Speaker 1: or some sort of experience we had back in eighth
Speaker 1: grade that informs how we think about money and how
Speaker 1: we handle it now more true than we realize. Yeah,
Speaker 1: And so I think when we unearth some of these
Speaker 1: thoughts and beliefs, we ask some of the deeper why questions,
Speaker 1: it's going to inevitably provide us with new information about ourselves,
Speaker 1: which is going to cause us to change some of
Speaker 1: our preconceived notions and beliefs about money. And then those
Speaker 1: altered beliefs are going to invariably impact how we act,
Speaker 1: how we move forward in this world, how we spend,
Speaker 1: how we say, how we invest. And the truth is,
Speaker 1: money is not good or evil, right. It's a tool
Speaker 1: that can be used well or it can be used poorly.
Speaker 1: And we can either put too much stock in the
Speaker 1: value of a dollar or not enough. But it's hard,
Speaker 1: if not impossible, to change our habits and our approach
Speaker 1: to money when we're not sure where the source belief
Speaker 1: material is coming from, what's subconsciously guiding us where that originates.
Speaker 1: And so I think it's important to do to do
Speaker 1: some of that deep work, not just to go like
Speaker 1: he said, to some sort of technological halting mechanism to
Speaker 1: prevent us from taking the worst action possible.
Speaker 2: To the apps to help you to overcome your lizard brain.
Speaker 1: Right, Yeah, it's not that some of those apps can't
Speaker 1: be helpful, but I think it's there's deeper work required
Speaker 1: really when it comes to fighting and overcoming our idiot brains.
Speaker 2: Absolutely, man, Yeah, I couldn't have said it better myself.
Speaker 2: Let's get back to the beer that you and I enjoyed.
Speaker 2: This was an end of plagues and IPA by Burial.
Speaker 2: What I'll say, I'll describe the label art. It's a
Speaker 2: the artist that they have that makes all their labels.
Speaker 2: I forget his name. I'll actually make sure to link
Speaker 2: to his Instagram accounts after we've bashed in to Graham
Speaker 2: and how you should delete it in their phone. But
Speaker 2: all of his artwork is super metal. This is just
Speaker 2: the best way to describe it. But it's got a
Speaker 2: rat sitting there who's just like eating the earth. That
Speaker 2: a rat or a possum is powsesome. I don't know either.
Speaker 2: Plagues are like rats, you know, like the bubon of
Speaker 2: filthy animal. Yeah, it's got the tail, but it's just yeah,
Speaker 2: there's like filth all around the earth.
Speaker 1: Yeah, the name conventions gel up really well with the pictures,
Speaker 1: with the artwork, and they're both just a little over
Speaker 1: the top.
Speaker 2: Yeap. Yeah, expect many more ridiculous names of the different
Speaker 2: burial beers that will have in the coming weeks. Yeah,
Speaker 2: but yeah, what were your thoughts though on this beer? All? Right?
Speaker 1: Say, this was juicy and sharp and it was almost
Speaker 1: like IPA concentrate, Like, yeah, that's how I think of this,
Speaker 1: and but that's how I think of most of the
Speaker 1: burial beers and burial IPAs in particular, because they just
Speaker 1: make some of the thickest, juiciest, beastly, most beastly IPAs.
Speaker 2: Yeah, I would say, so this is a single like
Speaker 2: a regular and in my mind the bot it was
Speaker 2: relatively light and body considering it's burial, and so it
Speaker 2: felt like a like a foundational IPA because there's some
Speaker 2: other ones that we're gonna have that are more over.
Speaker 1: The top, like maybe this is a nine and then
Speaker 1: the other one's take.
Speaker 2: It up to twelve. This is like their equivalent of
Speaker 2: a session IPA. Just but it was really good, solid
Speaker 2: and again when you poured it it's kind of got
Speaker 2: that pale, milky golden color where you can't see through
Speaker 2: it at all. It's sort of like the new cars today,
Speaker 2: or like their paint jobs. They've got zero metallic speck
Speaker 2: or fleck or whatever that's in them, you know, because
Speaker 2: like the old school and it's super traditional paint jobs.
Speaker 2: You see them and it's kind of it's got a
Speaker 2: sparkle to it, Yeah, but like the new ones, they
Speaker 2: don't have any sparkle. It's just like a flat color.
Speaker 2: It's shiny, but there's just no additional metallic in it.
Speaker 2: That's what this is. Yeah, Like it's just solid one
Speaker 2: note color, but the flavor was anything but one note.
Speaker 2: I'm glad you and I got to enjoy this one today.
Speaker 1: Most definitely. All right, that's gonna do it for this one.
Speaker 1: You can, as always find show notes for this and
Speaker 1: links to everything we mentioned, as well as a bunch
Speaker 1: of other money resources up on our site at how
Speaker 1: toomoney dot com. Don't forget the how to Money credit
Speaker 1: card tool. You can find that in the upper right
Speaker 1: hand corner of the homepage at howtomoney dot com. It's
Speaker 1: super easy to find the best credit card for you,
Speaker 1: but Matt, that's going to do it for this episode
Speaker 1: until next time. Best Friends Out and best Friends Out