Final Reflections and Follow Ups

You said it, I listened. A lot of you have been asking for me to do more around single people and money It's time to do it. I am casting a new reality series about love and money. So if you are single and you live in LA, I want to talk to you Wt. com slash dating show. And if you've got friends who are single in LA, send them the link Wt. com slash dating showow. When are you going to be rich I'm not talking metaphorically, I want a date. What month and what year are you going to have? A million dollars, two million, five hundred thousand, be debt free, or just be able to take a vacation without worrying about the price of Kalamari Well, I'm hosting a free live event on july thirteenth. I'm going to help you answer that exact question. You can save your seat at Wt d. com slash live event I'm in my forties and we've felt broke for a long time. We're constantly trying to make things work. I feel like our Personal finances are in a better place than they ever have been. Guys, these are two different universes. Talk about being on a different page. what's the deal? Maybe sometimes we're overreaching and it just never feels comfortable. If you cannot build up a reserve, you are already in a very dangerous zone. I would love one hundred thirty thousand dollars a year retire I think it could probably be like eighty to ninety. Guys, that's like wildly off. To get to one hundred thirty thousand dollars, you need two point three five million dollars at retirement. That means you need to increase your investments to forty five thousand five hundred dollars per year Nothing changes in the next five years what happens to you We still are not able to retire Is it too late for you to be successful with money Maybe didn't get started in your twenties Maybe you woke up one day worried about money asking yourself, am I screwed in retirement Well today we're getting a look into that very question that tens of millions of people ask themselves because I'm speaking with Sebastian, who's forty two and hope They've been married for sixteen years, They have a nine year old son, and they recently both became business owners. Listen to this line from Sebastian's application. We both made a choice to become business owners, but now we are locked into these choices for the foreseeable future Raising a kid, running businesses, and paying down debt leaves us with barely any money to invest and has us questioning every purchase We mostly ignore it pretend that it is a problem we'll solve later. Unfortunately, this is a story I hear all the time A couple will come up against some financial challenge, Maybe it's debt, maybe it's high cost of living And they will simply say, I'll deal with that later. Human beings do not like pain especially when it's not acute It's much easier to tell ourselves, I'll just deal with that later. Dole. robbing thing on your wrist, ads fine I'm actually curious to hear from you Have you ever kicked a can down the road? until you just couldn't ignore it anymore What was that moment where it finally broke, like the straw that broke the camel's back Head over to YouTube or Spotify and let me know in the comments. I read every one of your comments. Now, I'm looking at their conscious spending plan, which breaks down how much they make and where they spend their money. If you want my help with your own conscious spending plan, join my money coaching program at Wt d. com slash money coaching their assets, six hundred seventy four thousand dollars. Investments, one hundred twenty nine thousand dollars, savings eleven thousand dollars four hundred and thirty seven thousand dollars for a total net worth of three hundred seventy six thousand dollars I have a lot of questions So let's get started with Sebastian and Hope You said something in your application. You said, Sebastian We've been together for twenty years, married for sixteen and have only recently started talking about investing for retirement I'm curious why did it take you so long to talk about investing? It never occurred to us before. I wasn't taught that as a kid. You guys don't talk about investing strategy on date number one or two. No. We talked about a lot of other stuff on date one or two, but Yeah We were too busy thinking about adventures and what we wanted to do with our lives right then. When was the first time you did have a substantive conversation about mudoney? Well, the first big time was we were living in another city and before moving, we kind of I wanted to put together a plan and what we were going to do next. I wanted to change careers And we needed to plan what the next, you know, ten months to a year look like in that transition. And it was the first time we kind of L we sat down for a whole day and u mapped out what we wanted to do, what it would take, what we were Aable to do? How to feel Good. It's actually a tradition that we've u maintained for the last fifteen years every January takeake a retreat together and spend a day or two talking about money and Really? what we want to do. Wait, what? That's quite advanced Hold on right. It's become more sophisticated over the years, for sure. This is amazing. What did you talk about in these annual money meetings? They're not just money meetings. They're really a look at, it's called our executive household planning retreat And so we talk about things that we want to do more of during the year, friendriends we want to have more of in our lives, things that we should really focus on in the coming year and then Also looking back at what Have we accomplished in the past here What role does money play in these conversations Sadly, it only started to play a role probably five years ago. Got it. Okay You have kids One child is nine Now, how often do you talk about money probablyrobably Uh, you know, on a weekly basis, there's a sort of small check in a more serious check in once every six weeks And then every six months because we do a Now we do a bi annual head of household like check in. and that's a half day thing. And so We check in then as well just to see how we're doing on our projections and I mean, I love what I'm hearing. I freaking love it. It's all dialed in. You got the six weeks, six months, one year. I love it It's very structured Yeah Is it working I would say it's working pretty well Yes. We're fairly on the same page, honestly about money and doing these planning retreats really helps us align we want to do because we, you know, we say, okay, this year we're really going to focus on our debt or this year We really want to make some moves in terms of investments, but I still think that we're just at this point a p right now where our lives have been changing for the better And our finances have been changing for the better. and We're still just having a hard time conceiving that our fininances are better and that we are about to make some steps ahead, I think What do you mean I don't understand So I purchased a business five years ago So now I'm the soul Oer Um I am still paying off the former owner for the next two years. There is some leeway now for an increase in wages, but once I finish the purchase. there will be more leeway for an increase in wages. Sebastian just purchased his business last October, a year ago today actually Congrats. And so I think that we're so used to being broke that we're still kind of We're still living in that in that kind of way. I guess I'm surprised because From reading your application, Sebastian What you wrote is quite different than what Hope is telling me. Yeah We have a we have a different approach or different outlook on how things are going purchases business and I'm super thrilled I made it through a year. like that feels like a really big accomplishment to stay on top of my bills and you know, be paying down the loan. And I also feel like it's precarious because there's All sorts of stuff that I can't control U You know tariffs are affecting my businesses I import So I pay my bills in another currency you know, the currency markets have changed. like the dollar is a lot weaker than it was a year ago. So this is this is quite Surprising. Hope you just spent a couple of minutes telling me like we're about to have more money. We're about to be in a better position than we ever have. We can't seem to get our heads around the fact that we're doing really well Sebastian in your application You wrote Won't We just can't seem to get ahead We are both small business owners who wanted to direct our future and have control of our time but are constantly stressed about whether our businesses are sustainable And what could happen if one of us or both doesnn't make it. Guys, these are Two different universes. talkalk about being on a different page. What's the deal? Yeah, I mean, I like my business does feel really chakaking up this year with everything that's going on with trade How do you feel about hope saying we're in a Great place and we're about to have more success than we've ever had I mean, that was a hope when we you know, when she became a business owner, the idea was that she would have not just more control over her career, but also that you know, eventually she would be able to like financially see some return on it. She took over her business In January of twenty twenty and you, six weeks later had to send everybody to work from home. working through the pandemic was Uh a huge trial Sebastian, I guess my question is about the fact that the two of you Just a minute ago said you're on the same page, but To my mind, you are not Yeah, I mean, I think we're on the same page in terms of like how we how we allocate our money, how we, you know, how we choose to manage in with priorities we choose to make about it I think we're on a different page in terms of how we feel about our businesses are going. How do you feel about it in a sentence? Like our personal finances are headed on the right track If I can make it through the next six months of my business, that would mean things are going in the right direction, but I'm really nervous that they might not be able to continue. Okay And hope, how about you? I feel like our Personal finances are in a better place than they ever have been. We're on more solid ground in terms of our finances. Currently, I do absolutely worry about Sebastian's business mostly just because it is so new and things are so carious and the tariffs and People not drinking as much have really affected wine consumption and importing My business is Pret steady right now. Now, you both own businesses Separately, correct? Yes, Yes. Okay. And how did you wind up owning them? A you both founders No Both of us purchased from a founder Oh Separately, you each purchase a business. wow. Okaykay. and How did you decide to purchase businesses is somewhat unusual? Oh, you're gonna hate this for me Sorry. I always been a little bit nervous about owning a business. I'm an architect and was just nervous about the prospect of Be in charge of all those people Yeah but then I heard that my former employer was going to sell to someone else. and so I put my hand up because I was in my favorite job that I've ever B. Why do I hate that? U because it was very spontaneous. I mean, he went out for happappy Hour with these other people and I wrote him an email right then. evenven though I'd been saying for years, like I do not, I'm not going to get licensed Because you have to be licensed to become a firm owner I'm not going to get licensed. I'm not going to purchase this firm, even though I knew he he felt as though I would do a good job, but it was a very spontaneous spur of the moment. decision All right. So you're an architect, Is that the business architect? I'm an archect. yeah. cool. All right. Sebastian, what about you? How didd you come to buy this business? I was working for a guy that I really enjoyed working for and it's a really interesting business. I like hope I love my job. You know, the former owner actually lives out of the country and he realized he wanted to kind of Make a transition. And we had long conversations about it. and you know, after a long process, I came to realize like Things are going to change whether I like it or not and either I can be in control of Uh, where that goes and continue to do something that I really love. Or go find something else. This is a wine business And so wine importer So now that you both run your own businesses Why do you say in the application that it feels like you're not getting ahead I knew this from the get go that The first year or two was going to be hard. There was a lot of startup cost. I'm still paying down some of that business debt U for the startup cost. I think part of it's the feeling of, you know, I'm in my forties and As Hope said, it's like we've felt broke for a long time. We're constantly trying to make things work, make things a little bit better and maybe sometimes we're overreaching. it just never feels comomfortable. Are you broke U I mean, we pay our bills. There's money in a savings account. so no I'm kind of confused about what I'm even doing here Like Hope tells me they're doing better than ever, but Sebastian's application is full of fear They say they're on the same page But if you listen to them, they're clearly not. They have executive planning retreats where they meet every six weeks with all this structure And yet one of them says they're thriving, the other says they feel broke. Very confusing Mixed messages It's like they've built this force field around themselves. And no matter how bad it gets, they can always say Well, we're better off than we used to be they would be here if there wasn't a real problem. But I can't help them if we can't even agree on what that problem is So I'm going to get direct Before we can fix anything, I need to cut through some of this and see what's actually going on We'll get to that right after this. 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You know, we're always scrambling to pieces together L quit All right, we had to replace three appliances this year already Two refrigerators and a dishwasher And wasn't something we planned on I'm kind of surprised becauseuse you have these planning sessions multiple times a year Why not plan ahead for the expected and the unexpected We'll add that for this coming January. I'm sure you will. But why have you not we've been trying to pay off debt We've been trying to like Deb Some of the fundamentals taken care of. Do you find yourself feeling like you're not getting ahead? I would like to be more prepared for the future. I actually feel good about about where we are actually. Okay I am happy that when these things have come up we have had the resources to to buy them even when it feels more He we have been able to buy them. Have you seen what Sebastian wrote in his application I don't think so. Do you mind if I read it, Sebastian? Now go ahead. Okay, the reason I'm because I'm K kind of struck by the differences in The application Sebastian, what you're telling me and then hope what you're saying. Like these are three different things I want to try to get us on the same page before we proceed. As I mentioned, Sebastian wrote, We just can't seem to get ahead cononstantly stressed about whether our businesses are sustainable. We have been supportive of each other's choices, but We are now locked in to these choices for the foreseeable future. Running our businesses and paying down debt leave us barely any money to invest and has us questioning every Purchase Do anybody hear a difference in the way this conversation is going in this application? I'm an internal optimist. Your name is Hope Is there something to that? Probably. Like the way you're talking, it's like, Ohh, we're doing great. we're doing better than ever. We just don't know how to spend our money, like we're crushing it. Sometimes when I hear Sebastian talk about these things, I think that it's a little over. Bown Tell me about that I mean, I would agree I can definitely be a little bit of a and do in gloom. , you know, response to these things. You're the pessimist. Yeah. And then You're the optimist. hope the optimist Yes. Is there any realism in the I think that's why we meet and have these discussions because we're trying to keep it real. We've been able to do planning in our in our past for for moves or for planning to purchase the house. Wh brings up the topic of money in the conversation Usually Sebastian because he's more in it. But we both discuss it Sebastion, when you bring up money, what is the tone of these conversations about money s Probably not very cheerful. It's probably coming from a place of worry. I think there's a block in my thinking about, as Hopa said, we're doing better in our personal finances than we ever have It feels to me like that could all go away Everything that we've built over the last few years, like yes, we have investments, yes, we have an emergency fund And it all feels so small and so much like a placeholder like oh ye okay, we've started an emergency fund, but It's not that much. L if this if I have to close the doors of my business, like there's very little runway for us or if something happens to Hope's business, there's very little runway there. I agree with that That's the first time I've heard you describe it like that. and hope you agree with that. Yeah, that's why I want to plan more for the future. I think Sebastian will be successful in his business. He is really good at what he does I think that the tariff things are going to even out, but It is a very weird situation that we're in right now and I would rather be in a place of preparedness then then not so that we can feele more free Okay, let's take a look at the numbers. Sebastian, can you read the words in bold and then the numbers in full Next to it for this entire box, please. Assets six hundred, seventy four thousand three hundred Investments, one hundred twenty nine thousand Savings eleven thousand one hundred and twenty five debt. four hundred thirty seven thousand seven thirty two And then total net worth, three hundred and seventy six thousand six hundred and ninety three All right, cool, what do you think about those numbers? Not bad, not great Like I said, some of those numbers feel kind of like a placeholder rather than real what? hold on. What does that mean? They feel like a placeholder Those are real numbers Yeah, I mean, if we look at like where our investments would Be when we're ready to retire, it doesn't feel like enough. Our savings doesn't feel like enough of emergency funds. Why are we talking about feelings? I'm just curious We're looking at cold hard numbers. Why whyy does it not feel like enough? It's either enough or it's not I mean, it's not enough. Our investments and savings aren't where we would want them to be. Okay, they're not where N noodies are where they want them to be. almost nobody I talk to. Even the ones who have more than they thought, they even say They're not where we want them to be. Nobody knows what they want Fied. Candidly, being forty two and forty eight If you extrapolate the numbers and project at retirement, blah, blah Would it be fair to say those numbers are not where they need to be Yes. Would it be fair to say they are not enough Yes.. Have you ever said that exact phrase The amount we have is not enough Yes. Really We said it the other night What'd you say? because the way you just said it was, it doesn't feel like it's enough They're better than they've ever been, but We'd to be eter, eter,eter What did you say the other night Well, we actually looked at it like an investment calculator to see, okay, What are the possibilities like if you can get a raise, if I can give myself a raise, if, you know As soon as we're done paying off our credit card debt, like if we can put more money away in our investments, what? how does that affect you know, where our retirement would be in twenty, twenty five years. What about just how much do we have and how much is it going to be? What about just that you guys see what I'm getting at? I feel like there's a lot of avoid the actual numbers in front of us. Can I just put them back up on screen? Yeah. You have one hundred twenty nine thousand dollars invested We need more. Yeah, I agree with how like we need more. Why has it been so difficult confront the reality of where you are financially. I think for me, it feels like I should have been doing this ten, fifteen years ago. It feels Like I haven't been doing the work that I should have been doing Same. I I have had a long time that I've been working and was just making making it through for so long should have also been investing more Do you know how much you will currently on your current trajectory you will have at retirement Probably about seven hundred fifty thousand. Yeah, ballparks. We calculate eight hundred eighty five thousand, but withithin the margin. We do a four percent calculation you will be able to safely withdraw thirty five thousand dollars per year in income Yeah, that's low Here are some of the things that I've noticed you describing feel like We could be doing better I feel like we are doing better than we have done in the past I feel like it's not enough There are other people who are doing worse. So we're actually doing okay, and this doesn't include our business value What do you notice about all those things I'm saying They're all hedging bats. Yeah, J just excuses for not. dealing with the numbers directly. Yeah, there is no confrontation of what are the numbers point blank and what do they mean? Guys, just run a calculation And it without adding in a mythical raays and selling the business, is that enough for us? Obviously no What should we do? I'm not trying to berate anybody. I'm just trying to in terms of pure numbers There is a time and a place for feelings and there is a time and a place to talk about the numbers and run a calculation. Do you find that this is a recurring pattern when the two of you talk about money minimizing, hedging, talalking about the future, but not confronting the numbers directly Yeah. I mean, there's always There's always a contingency or, you know, what ifs that We talk about. I think we're driven a lot by Um you know, thinking big and dreaming about our goals and being creative about how to make those things happen and it beds into that sense of like not just talking about, you know, this is the number, but how can we how can we get what we want? Is that why we're here today because I don't think we're here to talk terrorists. I don't think we're here to talk about how you're in a better position than you've ever been and you don't know how to spend money. Guys, you have one month of emergency savings Yeah This is directly at odds with what you told me. We have more money than We know what to do with. I don't see that Let's take a look at the rest of the numbers on the CSP. This time I will ask hope to read off your combined Gross monthly income, please Combined gross monthly income is sixteen thousand two hundred and sixty dollars. Great. So your household income is one hundred ninety five thousand dollars a year By show of Hs who here knew that Mostly Why is everybody's hand going kind of up? What the hell is happening right now That's not the number that I expected to see actually. What'd you think? one hundred fifty eight thousand Oh, only forty thousand dollars off Okay, now that you have forty thousand dollars more than you thought What does that tell you I mean, it tells me that we need to think about good our you know, our money where we say We We need it and hope Did you know it was one hundred ninety five K I also thought that we were up near one hundred and sixty because that's how did both of you raise your hand, but both of you were forty thousand dollars off Remember, you filled this out This is literally your CSP. I'll show you right now. I'm gonna show you I took the two gross incomes. they add up together to sixteen thousand two hundred and sixty a month and then I multiplly it by twelve So what did we do wrong, Sebastian? I'm not sure I think we're including the rental income in my income column Yeah Okay, did you see what just happened? They both raised their hands and told me they know their household income. And then They were forty thousand dollars off Now most couples would say, see, we're not on the same page. But Hope and Sebastian insist that they are on the same page. And I think that's actually more concerning I talk about being on the same page in my new book, Money for cououples. Like when I ask couples, what's the problem with money in your relationship? Almost everyone says we're just not on the same page But that's vague That's generic. It's what people say when they don't really want to look at what's truly going on. When couples insist they are aligned evenven though Obviously, their words are telling completely different stories. To me, that's almost worse They don't even realize they're reading totally different books Hope says we're doing better than ever Sebastian says, we can't get ahead. You can't be on the same page when you don't even know what page you're on So if you and your partner need help getting on the same page, actually on the same page, not just feeling one way about it, then that's exactly what my money coaching program does. You're going to get personalized help from me and from our community members to see the patterns that you might just be missing on your own You can sign up at Wt. com slash money coaching. Now listen, as I challenge them on these answers And I'll see if I can actually help them get on the same page Why does every website for important stuff in our financial life have to be so confusing? Like H anyone here ever looked at their Medicare website? Like, what is this? What do these words mean? 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That's ZOC DO dot com slash remath Zakdoc dot com slash rememet. And I want to thank Zakdoc for sponsoring this message Here's what's interesting to me, and I think this is a big pattern I'm seeing over and over already I don't mind that you don't know what your household income is. fifty percent of people I talk to don't know their household income. No problem. I mean, it's a problem, but Everybody does it The real problem is that I asked you, did you know this number? Both of you put your hands up. saying yes And it turns out you were forty thousand dollars off So not only did you not know it, but you told me, yes, I actually knew it. And I think this is a recurring pattern You Both are struggling to give me straight answers guys, I'm not here to like trrick you I'm not here to judge you. That's not my role. I'm actually here to help you. You called me I really want to help you I don't think you have a Candid assessment of what is going on with your finances On one hand, you're saying we're in a better place than ever. On another hand, we are now realizing we are not in a position to be able to retire And what are we working for? We're taking on all this stress and risk and like we have one month of emergency fund That would be my assessment. If you disagree, tell me, I'm wide open to it But I want to hear your take because I am struggling to get straight answers from both of you. I think what you're saying is rings true to me is why am I Why am I taking on all of this stress If it's not resulting in Yeah. life that we want and you know, being able to reach the goals that we want, What am I not seeing about what we're doing that I have blind spots to or I have blocks to that can't I can't get there. I have done the projection many times and I know that we're not where we need to be We need to get in a better place. So that is why we're here Okay, let's keep continuing along. Fixed costs are at sixty seven percent What do you think about that number H 's high. We typically like to see that fifty per to sixty percent. And if you are getting older and you do not have enough saved for retirement, that number needs to be even lower So that's challenging. We'll come back to that. Investments are at two percent. Okay, what does that tell you? Hello low. and even though you are contributing an additional four hundred dollars a month to your four hundred one K, which brings the total up to approximately four percent or five percent, that actually explains why. You don't have enough in investments. Savings are at Five percent Okay, interesting here We have Vacationations at four hundred dollars a month, gifts at two hundred a month and then zero for a long term emergency fund What's that putting our money where we should be putting it. Okay I agree. Why out of curiosity, like, okay, you love to travel. I get that Gifts Where the gifts going birthday presents, Christ you know, saving for Christmas or I think it's more it's gifts and dinners. It's not dinners out. It's we host a solstice party every year Okay. See you put money aside for that It's in the gifts. I mean, it's all it's kind of we're not crazy about buying a lot of things, but But we do like food and experiences Okay. what's what's this guilt free spending at twenty six percent or three thousand two hundred and thirty seven dollars a month all of the discretionary stuff that we choose to do, music lessons for our son. U You know, eating out, you know, those sorts of things. What else? Three thousand dollars is so much money. It seems like M than we're actually spending. I think some of that includes like if our son has a school break, We'll book a camp for him. How much? Summer camps will be three hundred, four hundred dollars for a week. So sometimes we're, you know, we're paying those over a few months. What happens is these one time expenses We'll spend it in December or we'll spread it out for camp for eight months, not twelve, et cetera Our mind does not properly amortize those costs. The only way to know is to actually put it in here and track it And it's no shame. like, you want to send your kid to camp. great. We just need to know it because Otherwise you're like three thousand bucks is crazy. It's actually not that crazy when we just go through it in five seconds. and over the course of two more minutes, you could probably get eighty five percent of the way Okay So Now that we look at the entire picture You have sixty seven percent going to fix costs. You have two percent going to investments, five percent going to savings and twenty six percent going to guilt free spending. What do you notice about these numbers? would assess these numbers We have too much going to gu free spending aggreed and our fixed costs are too high agreed aggreed on both Accordingly Too little going to savings and investing Perfect. The puzzle pieces all fit Perfect sense. So the good news is' no mystery here totally explains why things are the way they are Now what I want to do is I want to dive in a little bit more to the fixed cost to understand what's going on there All right, your mortgage is twenty thousand one hundred bucks. That's pretty low That's great Stay there, donon't move. Your insurance nine hundred ninety are fine. Car payment is one hundred What is that just gas? Gas. Amazing. What That payments two thousand seven hundred and seventy dollars. Okay, I guess it's time to dig into that Tell me about your debt of four hundred thirty seven thousand dollars. What do you have? So that's the mortgage. How much threeree hundred and thirty eight, I thinkve. Okay student loans How much? I have about five thousand five hundred. I'm at thirty two thousand. thirty two thousand Okay, What else on the deck? We have a He loock that is fifty Seven thousand. and then There is a balance of thousand eight hundred dollars on one of the credit cards What's with the credit card balance? Couple making one hundred ninety five thousand dollars has credit card debt? Why That is leftover from a bathroom remodel. What's the H helel loock? Why'd you take that For some home improvements. so I mean about half of that is for the bathroom remodel that we did, you know, we use some of that to convert our garage into an A toU, which is a rental property. How much you make from that about twenty four to twenty seven thousand a year Great Okay, amazing It feels to me like they're choices, we made it one point and we said, o this is This is good or we want this And those croices have carried over you know, then It's hard, I think for us to every month like make a conscious choice about what were're what we're spending our money on. Stay with that first idea We've made choices long ago. Th choices have carried over. Keep going on that And they're just on autopilot now. We say this is part of our lives. so we're just going to keep on doing this. Like what? Like the gym, like I try to I try to go you know, as often as I can and there are sometimes where it doesn't make sense for us to have you know, that gym membership. think This idea that Sebastian has brought up is really interesting. this idea of like we made choices years ago and we are now quote locked in. Either we are locked in committed to them like a business or we are locked in in the sense that they've just become second nature to us. This is really common. A gym membership is the obvious one. I'm looking at them right now. camp That is essentially locked in, doesn't have to be the case. Solstice dinner doesn't have to be the case. I know these are uncomfortable here. I'm just raising the question. What do you think about that? Yeah, that is fair. I mean, I do think that these are things that we value in our lives. Totally I value a lot of things as well. I think the reason we're here is We're working hard. We have these businesses, but we don't have enough money for retirement Yes But it's very interesting, especially talking to two business owners because you know what business owners are really good at ading to marketplace realities If your business takes a fifty percent cut, you're laying people off Bus owners are very good at this. They move extremely quickly You know who sucks at doing this individuals. Literally one of them will lose their job. They will not change a single thing. They'll buy the same at the grocery store. It's crazy So in many ways, I actually encourage people L like a business Hits the fan, you already have a plan in place and you adapt immediately. That is why the CSP makes it so easy. Somet bad happens, you literally go down to the last box here, I'll show you You go down to the last box, you go time to pull out a freaking machete. and chop it up All this stuff, goodbye. I don't even have to think about it. That's how it works. That's the philosophy What do you say we adapt it to your situation Sounds good. Yeah. How much is enough How much money do you need onn a monthly basis what would we need for ust our lives. How much do you need to retire Oh, to retire I would love Even one hundred thousand dollars or one hundred and thirty thousand dollars a year income. in income becausecause we won't be paying a mortgage at that time too. Okay. And what do you say Sebastian I think it could Prob be a little bit less like eighty to ninety thousand a year. Oh, of income. Guys, that's like wildly off. Do you ever talk about this before? No What Well, I'm glad we're talking about it now. Wait a minute, I'm very surprised I need to understand. You both have a more sophisticated rhythm of meeting and talking about your relationship and about money than almost any other couple I've spoken to. That part is awesome And yet, You have not said How much money do we need in a relatively short amount of time How is that possible We were in a habit of thinking about what's happening this year. You know, those annual conversations were, hey, what's going to happen in the next twelve months? What you know what are our goals for that? I think it's only been in the last couple of years that we started to have to consider what's going to happen in the next five years and certainly taking on a business for me, it opened my eyes to say, well, what's going to happen in the next years and shifting my mentality from that short term thinking to long term thinking has been really hard. It's never something I I ever considered. And so to think about retirement is twenty five years off, you know, like I can't think about that. I just need to get through the next week. I need to get through the next month. I want to get through the next year U, you know, with my business and And then if I'm doing things right, it will like things will fall into place. but I I have struggled to even consider like a five year plan feels daunting to me to. You said so many interesting things. You said, if I just do the right things, the rest of it will fall into place You've been at this for twentywenty years Has it worked? In the bigger sense, no, like I'm not like I'm not, you know, I have twenty one thousand dollars in my Roth account. Like that doesn't feel like. It's worked. I feel a little bit Like there's a false sense of security and like, oh, I've got a good credit score and I'm, you know, I'm able to pay my bills, but But yeah, I mean, if I project all of that out. like It's just it's It's too little. I believe most people down They have an intuitive understanding of at least where they are in the universe of money They may not know their income They may not know what a twenty six point nine nine percent interest rate means But deep down, they know Am I doing poorly OK or great. That at least. And I think part of my job is to take a chisel and chisel around the stories and the narratives that we have created for ourselves and just help people get in touch with reality And then when we actually confront that, like you're both doing right now, which I really appreciate. then we can start to reflect on certain things. Wow, it's been the last two years that you've really focused on money Great. In the last two years, you've made a lot of progress Great So what if we did more of that For the next ten to fifteen years, where could we be But in order to do that, we have to get rid of these old stories, these ones that are minimizing and making excuses and like just distracting us We've seen the numbers, one hundred ninety five thousand dollars income One month of emergency savings, sixty seven percent fixed cost and almost nothing invested But the numbers only tell you what's happening. They don't tell you why is very important if you want to truly understand somebody to understand why these things are happening Because people don't avoid their money for no reason. They don't stay stuck in dysfunctional patterns that don't serve them because they're lazy or stupid There's a reason. And we have to figure out what that reason is. There's often a story they're telling themselves, a belief they picked up a long time ago. Until we find that story and tackle it, then all the spreadsheets and retreats in the world don't mean a thing Sebastian, I want to understand how you grew up with money What do you remember your family saying about money when you were young Not much. My mom is French and it's not talked about culturally, you know, there was a a big kind of turning point in My childhood around money, you know, from age zero to ten We were like solidly middle class. my Dad was a business owner, single income in the house. U doing really well. And then when I was about ten He went through bankruptcy We had to sell our house. They actually lost money on it You know, there was a big life change We actually moved. My dad started a new career and the seven years after that were really tight And, you know, I saw my parents struggle, but they didn't really talk about it. They kept it to themselves, you know, L tried to handle it and give the best life they could to me and my brother and sister. Where did you grow up Southern California And then we moved to Oregon when when I was ten What age were you when your dad went bankrupt And why did he go bankrupt? Print shop was a family business. You know, things were changing in the nineties. so desktop publishing, you know, he was a small shop and so he was just kind of couldn't compete with larger. They used to do all the yellow pages Okay. Wow, that's pretty interesting. So here your dad is running a small business. times change around him sort of structurally causes the business to fail. There's nothing he can really do. Maybe tries to keep up, Do doesn't work. shuts the business down affectses family finances What messages do you take away now as a business owner yourself? terrified of that same thing happening to me. And I thought about it a lot. getting ready to buy the business And it's come up a lot. And like I said, I'm still terrified of it. but I also I know I made a choice to engage with this for a lot of reasons, not just not just financially If you had to shut the business down How would you feel I'm letting a lot of people down you're Employees, your colleagues. The guy I bought the business from. Um my family. myself Does your dad's experience make it more or less likely for you to take a rational approach to the business I think of myself as a pretty rational operator. So I don't, yeah, I don't know. Hope what do you think I think that Sebastian is terrified of losing the the business. I mean, you're down from last year, which is understandable And I think that you're doing greatreat job and headed in the right direction But do I think that It makes him more or less rational. I think probably a little bit less rational because he's So terrified of that. by being terrified, U tariffs, etcer. makes you do what, Sebastian It's made it harder to make decisions. It's made it harder for me to feel like I'm making the right decisions. And it's paralyzing in some cases. That's what I was gonna say is I feel like it makes you freeze. This is very helpful. Thankk you Hope how to You grew up with money. What do you remember your family saying? My mom was a single mom from the time that I was Very small She owned a big house and she rented out. units so she always said, be a landlord whichich we are because she she was a school teacher And so she wanted us to have more Passive income coming in so We don't have a lot of money Gring up In my town where we lived, we had a lot more money. a lot of people. and my dad had had money. He had been an attorney You was sick my whole childhood So he didn't have any money. And so he was selling selling jackets and things like that from bar to bar too bar owners. Okay because he could do that and be kind of flexible with being in and out of the hospital Soorry It's okay Take your time. I know this is difficult sometimes going back So didn' he didn't have any money. U He was also a gambler U It's not funny, but But I think that's also why you didn't have any money Can I ask Difficult for you to talk about your dad. Why is that I think just because you He died when I was fourteen That's a tough age. And I just wish I could have had these conversations with him more. What would you have said to him Well, we, I mean, we actually did have a lot of these conversations. I was pretty precocious I'll m it that So he had a lot of regrets about a lot of things including money Even though he didn't have money, he wanted to be able to spend what he had on on me Hm And That always made me feel guilty that your dad was spending money on you. Be he work. I mean I remember this stupid it was a stupid junkie Junky little wall hanging that It was so dumb. It was just a little piece of wood that had picture of a dog probably from a magazine or something that was glued on it. And I really wanted it and it was Probably twenty dollars or something ridiculous And of course he bought it for me And then it just made me feel So sad when I would look at it. Sad Sad because I fel guilty for taking It's mudy It's interesting because I haven't heard you use the word gill. before today, not once Yeah, I've kind of gotten over that How'd you do that U it took some work. It took some work. Yeah, it's taken therapy and I used to haveave a real problem spending any money on myself H and they I no longer do, like I want more money. Wow. to spend on myself very refreshing Honestly, I don't hear that from a lot of people rarely from women Oh no, I definitely do I love that Can I ask you hope lessons do you think you took away from your upbringing with money that you bring into today's relationship. I'm very independent Okay I am Super capable Mhm I'm very resilient. tell you gone through a lot. very few of us lose a parent at thatge. Really tough age Very few of us raaised by single mom in the manner that you were And I kind of love the way you describe yourself I think it's really cool. He said, I want More money indndependent. I'm resilient I overcame Guilt, a word I never heard you use today, which is extremely rare Love it. It's refreshing. so thank you. Sebastian, how about you? What lessons did you bring from your bringing to today's relationship with money You know, I'm ret much the same age my dad was when he went through the bankruptcy and to see him decide to change careers, go back and get a master's of education at the same time while he was going through graduate school. My mom, who and she didn't even complete her high school education, much less college, like She worked to support us while my dad was in school, like that work ethic Yeah, you know, was instilled in me and I. I've had a job since I was outine in one way or another I know that I am also capable and hard working and don't shy away from engaging with the process. As much as I'm terrified of a bankruptcy, like I comfort in knowing like My dad had There were three kids It was super uncertain and yet he was able to make a big change in his life. and Are you too able to make a big change in yours Yeah. I think if we If we We want something and we, you know, if we have a goal in mind, I know that we can make a big change. Do you need to Yeah. I mean the numbers say yes. interestnteresting response Hope Ver resolute saying yes, just crisp, yes, not even an extra syllable Sebastian saying a bit of a softer the numbers tell us so. Not that I agree, not that I think we should, not yes, just the numbers suggest so. What do you think's the difference in that response? Now I'm the one hedging. Yeah quite a roll reversal. Why is that I feel overwhelmed. Like it's a lot to run a business. It's a lot to raise a kid. It's hard to see the right answer in front of me Okay Now it's starting to make sense Sebastian watched his dad's business fail He watched his family lose their house move states and struggle for years. And now He's a business owner himself paralyzed by the fear that history will repeat itself. grew up feeling guilty every time her sick father spent money on her. So what did she do? She learned not to want things She had to do years of therapy just to be able to say I want more money. These stories are real also keeping them stuck. Notice that they have these planning retreats where they talk about their dreams and what they want and where they want to go. I'm not particularly impressed by that Like in a way it's the equivalent of people who spend hours budgeting, but don't actually make changes in their spending Unless you actually change your behavior, this is all just play acting Let's say your four year old gets one of those little kitchens, you know and he puts a fake cupcake in there. Is he really cooking? Of course not. Oh, sure we'll lie to him and say, goodood job. You're such a good little chef. But that little kid can't cook shit Now how is this any different? Going on these retreats, but you don't know your income within forty thousand dollars It's not real A rich life is not just about dreaming, although dreaming is important It is knowing your numbers and using your money to make those dreams reality if you need to make more money Could you? Yes. How easily sounds Like you answer that pretty quickly. hope We were talking about this last week. I think I could give myself a raise in Well, when we have our next project come into the office because we'll be more financially in a good place. Okay, cool. How much of a raise could you give yourself thousand dollars a month, I think would would be Fine and pretty easy actually right now Mhm I still have two more years before I'm paid off on my loan So once that happens, I have there's more flexibility And then Sebastian, could you make more money? U in the next couple of months, some of my expenses are going to go down. I could G myself a raace What if one of your businesses went under? How would that affect your family finances dramatically. I mean, we would have to just get another job immediately. Yeah. I mean, it would be slash and burn to the monthly budget and yeah, scramble. Okay, I'm gonna just be very direct You'll need the money If the business doesn't work, you got to have a plan B. The plan B Shut it down figure out the debt. I don't know if you declare bankruptcy or not, it would certainly be poignant You know, you've been through that with your family. But in my opinion, you gotta treat the business like a rational Investor would And that's why as CEO's, we are not rational, especially like CEOs that are in the business. It's our name, blah, blah blah. That's why sometimes we need somebody from the outside to be like, dude, if I was an investor, I would never invest in this business. Or this is great. you're undervalued, you should keep going. That is what has been so challenging for me is the uncertainty of Okay, I can do this this month and it's working this month and I paid all the bills this month the cycle of how these tariffs are going to play out. The consumer confidence is going to play out that level of uncertainty of Is it going to work in three months? Is partart of what is paralyzing to me. You want me to unparalyze you I've right now I'm telling you It sucks to be in it. I know it because I've done it. I've been there Totally paralyzed by what to do. My business was declining for a while as well And it really helps to just have somebody from the outside be like, look, here's what I would do You don't have to take the feedback, but let me just tell you what I would do You have business savings or no You need it The fact that you have no business savings is what is paralyzing you. That is why you're on a thin razor's edge every single month So that's a problem I like to have three to six months of business savings. That would obviously take you a long time. It's almost inconceivable to build savings while you're talking about downsizing If you cannot build up a reserve, you are already in like a very dangerous zone. Second, you set up timeline and you say, look I'm spending all day and night working on this freaking business Here's the amount I need to be making. Here's the margin I need to be making. I'll give myself sixix months to make it work. But if at the end of that, I am not, it's time to pack it up Again, you can adjust the margin and the timeline for what you want, but I would recommend you probably do it in less than a year because It's kind of like they used to tell you in the test. If you haven't done it by the time the test ends, you're not going to get it at all. Just pick a timeline. And then Two of you, as entrepreneurs should probably be talking to each other, giving advice as appropriate We need constraints. othertherwise we just drag on in this uncertainty forever. It's that that kills us Erepreneurs know, look, if I have to shut this thing down, fine, I'll start something else, I'll buy something else, I'll find a job. but just as paralyzing uncertainty is death. So make a plan, execute it, even if it means you shut it down. better future for you ahead, or it means you turn the business around and crush it. Also great What do you think about that Yeah, I mean, that's that's not something I laid out yet It's been very like month to month for me I hate month to month I mean, if you have profit at the end of the month instead of paying yourself more, can you setet up a savings That's how you do it. Beautiful More importantly, eventually you need to shift beyond Montamont Entrepreneurs should not be thinking month to month. That's part of the reason you feel so scarce and behind. It's like This month's good, this month' bad. We can't do that. We can't drive onlyly planning ten feet ahead each time. We need to be talking about miles That hundreds miles. That's the way we need to think Okay. Can we talk about your personal finances Nothing changes in the next five years what happens to you? We still are not able to retire agreed What else We wouldn't be able to do other big goals that we have in our life I suspect because of the dynamic you have that you would probably still take some trips, probably still spend on your son who will be, you know, in his teenage years at the time I suspect you'd probably still do those annual and six month meetings dreaming I don't know, guys It just sounds kind of like dim to me Eespecially when you're making almost two hundred thousand dollars a year It's cheap to dream, but putting numbers to it Yeah the hard part. That's the whole point. Yes So someome quick numbers to give you to get to your goals of betweenetween ninety thousand dollars a year one hundred thirty thousand dollars a year of safe withdrawal during retirement, hereere's what needs to happen We're going to assume like thirty, five, thirty six thousand dollars a year in social security. It could be more Who knows? We're just going to make an assumption. To have ninety thousand dollars, you need one point three five million dollars at retirement That requires inccreasing your investments to twenty one thousand dollars per year to get to one hundred and thirty thousand dollars of income, you need two point three five million dollars at retirement. That means you need to increase your investments to forty five thousand five hundred dollars per year. Fty five thousand dollars a year? forty five point five thousandllars Wow, okay What do you take away from that? I mean, that's a big number. Yeah That's a big ch Yes Let's go back to the CSP and you're going to tell me what you want to do All right, here we are Your fixed cost sixty seven percent Where would you like to start? So the debt payment We have one more payment on our credit card. It's going to go down by eighteen hundred We've been aggressive with the credit card Okay, your fixed costs just dropped down to fifty two percent. That's more like it for a couple making Two almost two hundred thousand dollars with a low mortgage That is great All right, your debt payments are now at nine hundred and seventy dollars. Now Tell me again. This going towards It's student loans and HLock seeven percent and roughly six percent. And is this the minimum On the HLock? Yes And the student loans? Yeah, it's I mean, it's whatever we've been paying. You know the reason I'm asking It's a relatively high interest loan So like paying an extra hundred dollars a month could shave off years of payment. That's why I'm asking You're paying the minimum, fine. We could pay more. but right now You're at fifty two percent. To me, this is great because it means you have margin to play with. These groceries Well, you like food, you said it, right We do, but we could We could shop every other week at a cheaper store. Great. How much do you want to drop it Let's drop it two hundred dollars nine ten. Damn, we're at fifty percent. This is what I'm talking about And then the subscriptions. Ke or change All right, cool. invvestments No, we're gonna fix this This is where the real wealth is created. What do you want to do? So that post tax retirement, that's my Roth IRA, we can put it at five fifty or The whatever the max is five eighty five eighty three Uhu whereere's my Yours is probably up here at four hundred dollars a month for four hundred one K. Yes, okay. wantant to put more Yeah I would love to put twelve hundred Extra Extra. so sixteen hundred total. Love it Okay, holy I just want to point out The question is like Do we have enough And the answer is always down here in the guilt free spending number because whatever number you know, you reduced your groceries and all that stuff, that number flows directly down to guilt free spending. It's sort of like a It just collects all the rainwater And now you can use that money You have four thousand six hundred dollars a month Still allocate Where do you want to allocate that money? long term emergency fund Yeah, I agree with that. How much you want to put five hundred a month Well, I think more because why don't we try it and see what happens? Watch this number here This right now tells you have four thousand six hundred and fifty four dollars per month to play with. Okaykay, Watch five hundred bucks a month. What happened to that number Barely anything. Barely anything. you still have four thousand one hundred and fifty four. And now you know, you're accumulating about six thousand dollars a year in your emergency fund, what does that tell you It's not aggressive. we can do better. Yes. Yes, how much So if we put in twelve hundred then we would have. fourteen thousand for a year or per year that we' pudding trt You wantan to put in twve instead of five hundred All right Okay, so I'll tell you what I notice here. First of all, you still have three thousand four hundred bucks a month. That's a lot of money Second, I noticed that your savings has gone up to fifteen percent, which is great U N not so sure about these gifts and vacations at six hundred because you could keep it if you want But it's gonna to affect you down the road. six hundred bucks right now would be, in my opinion, much more valuable in another place I'm not trying to pressure anybody into not doing the stuff they want to do It's up to you how you want to allocate your money. I do want to remind you that in order to get to one hundred and thirty K. of retirement income, you need forty five thousand five hundred dollars a year in invested So instead of five hundred Let's Freakaking goher. eight hundred Watch what happens. watchatch this number down here in guilt free spending, okay? eight hundred in Vanguard per month You still twenty six, fifty four per month Yeah What do you notice about this so far We've just had it misallocated and been spending with a lot of fat. Yes And the real question Why Why do you think you've been doing that? Maybe because I feel so comfortable. Yes. Keep going. Sebastian, what about you We've always had We've had a reason to spend more and say, oh, this is for our kid. O, you know, don't we deserve this? I agree with all these. In my opinion, two things here One you had Dreams that no actual plan on how to get there There was no connection between money and your vision Okay, That's number one. And number two, you had a lot of narratives surrounding you We're doing better than we used to. Well, if we're doing better than we used to, all we should do is give ourselves a pat on the back, not actually make dramatic changes. By piercing through those narratives, now it's just it feels like this is so easy. It's like a hot butter through A hot knife through butter. We're just like cruising That took cutting through those narratives and realizing, oh We should not only be compleimenting ourselves, we should actually be making rapid change to get where we want Let's keep going. We're not done yet. We're doing great. Okay. So I'm looking at the four key numbers fifty percent in your fixed cost. Amazing becausecause that gives you lots of margin to play with. Usually we like that number between fifty percent to sixty percent. You're at the lower end of that That's amazing If it's me, I might be putting an extra like hundred or two hundred bucks towards the debt just because you could shave off years from that payment. So I'm just going to go ahead and do that. It's up to you on this, but I'll just show you. We're now at fifty two percent, tootally fine. You can run the math to decide what is the sweet spot for you, But truthfully, once you set that up to be automatically paid, you will not even miss it Your life will get so much better. Next up, investments at fourteen percent Well, I agree that you probably will have enough. When I think about a couple who's like kind of seriously starting their investment journey in their forties and they are making almost two hundred thousand dollars per year Just intuitively, I go, okay, like we got we got to really double down on this. What does that mean for some for me? I might be talking about like sixixteen, eighteen percent basasically getting really aggressive. Let's remember There's a point where in the next twenty years, one or both of you might be unemployed for a while. So when the going is good, I would rather have you investing an extra two, three, four percent then burning it on whatever So if it's me, I'm just going to go ahead and increase this number, I'll just randomly put it in one of these boxes. Let's just see what happens if we do four hundred four hundred bucks a month, which you're not even gonna to miss and increase your number to seventeen percent. That's pretty cool. I'm gonna leave it. saavings down at fifteen percent. What do you guys want to do about the gifts and the vacations? That's six hundred dollars a month or like. thousand bucks a year app prox. I want to leave the vacation money. Okay Gifts, I feel like we could reduce a little bit, but we have to it's up to you one hundred and fifty. one hundred fifty, H. Sebastian, what do you think Yeah, and I would say we could probably trim the vacation budget by a little bit as well three hundred fifty Okay. Okay, cool So there we go. We're at fourteen percent for savings U seventeen percent for guilt free spending. I like to see that number twenty to thirty five percent. You are startarting aggressively investing late I mean, vacations and gifts feel like guiltree anyway. I agree. You're actually just actively saving. So let's let's reuce some of this. What do you think? Wantanna move it somewhere or no No? Ouch, but sure Yeah. let's let's try it. You tell me. Watch this, watch this. You tell me if you wantan to do it or not Let's take an extra four hundred bucks. I put four hundred in investing. That leaves you with one thousand seven hundred and fifty four per month. Keep in mind That does not include vacations or gifts. Yeah. I don't know. I feel like you could do it. What do you think? Tell me Yeah, it feels dramatic, like there's definitely Changes H, but I know we can do that The thing that you both talk about a lot is travel. That's important to you Notice that I do not pressure you cut back on the thing that is important to you In fact, if you decide after six to eight months of this, we want to actually add fifty bucks or one hundred bucks a month into that you go ahead. You have the margin. But what I'm trying to do is to actually chop this unconscious spending. Yeah Well I think if If we are taking this amount of money out and just putting it where it needs to go without us seeing it it won't hurt us much You won't even notice it. Yeah. Cets Long term emergency fund, would you recommend that we have like six months? Yeah, maybe more, but at least six months. So if we calculate that, it's like thirty eight thousand dollars You currently have eleven thousand So we need twenty seven thousand. so that's two more years of saving. Okay. Yeah, a little less than two years. Yeahah. So keep it up. If we able to hit that mark Can we take all that money that's going there and put it into vacations Excellent question. I wish more people ask me questions like this. cururrently You have sketched out Sving twelve hundred bucks a month towards your emergency fund If it first of all, you could do whatever you want. It's your money And if it were me. I would probably take like At least four hundred bucks a month of that twelve hundred and put it towards travel, which is a massive upgrade. Yeah what you have been saving. It more than doubles Y vac Yeah. I would take some of it at least and put it towards investing especially because investing is a primary goal. So in my opinion, that means you take at least half sixix hundred Put it towards investing, and then you all can decide what to do. probably take two hundred, pay that freaking debt off faster Yeah. That's how we think about it. And that is true for The next student loan that you pay off, you take that payment, you allocate it, just do it by percentages. Okay, boom So like like in our relationship, you know, we might take whatever extra money we have coming in, like seventy, seventy five percent of it goes towards investments. In your case, it may be fifty because you have a little bit of debt, so you're going to put some more towards that. That's how you do it God, I got so excited about that question. That was awesome, awesome question. And I can see the reason I'm so excited about that is I can see you now looking forward. You're like, once we hit this, then what about that, thenen what about that? And you can see it's starting to snow. It accelerates Okay, I need to stop here for a second because I made a mistake on this episode. I made a math error and it really affected the rest of what I told this couple. Here's what happened. When we updated Hope's four hundred one K contribution, I forgot to recalculate her net income And then on top of that, I transposed a number from their savings line when I was calculating their retirement contribution. Both of these things threw off the totals. I'm the guy who tells millions of people, you gota know your numbers, You got to get your numbers right. And I got these numbers Rang on camera I want to apologize and I'm flagging this and I'm leaving this episode up because I have promised to always be honest with you I got this one wrong I'm sorry Now let's talk about what it means for Sebastian and Hope. Even with my math errors, plural, they're still in a strong position. Their income is solid, their fixed costs are relatively low. And once their emergency fund is fully funded and their debt is paid off, this plan becomes much easier to execute The mistake does not change the big picture It means though, that the exact contribution numbers need a small adjustment in the short term Let's keep moving on Sebastian your business What's the plan Right now, if we look at that effect on the personal finances You're bringing in roughly half approximately, maybe a little less depending on the ADU and all that stuff, but it's a considerable amount. None of this plan works if your income is not The same What's your plan for the business So I have a contract with another company that has another year on its that I have to service. That feels like a A good finish line or milestone to consider like, Ay am I succeeding or do I need to pivot? Um, I think like number one start a business savings. so that I can start to build a little bit of a buffer You know, I'm planning out the next kind of ninety day cycle right now that's I'm kind of looking forward to what's happening at the start of the year and January is always kind of a slow time for me so that gives me time to kind of examine what are meeasures of success that I want to see like, hey, am I I feel like we're in the weeds just conceptually What do you need to be doing as a business owner as it relates to your Family finances I mean, high level, like do everything that I can to make it succeed. And if it does That means what If it does succeed, you know, in a year from now, I will be able to give myself a raise. What would the raise you would be targeting Probably another thousand dollars a month gross and then If it's not succeeding then have a conversation with hope, you know, about this shutting down I would say that having that conversation happens well before twelve months from now In my opinion, twelve months is already a long time off. Those conversations start happening now. And sometimes those conversations, those people can actually help you They're like, H have you tried this? Let me introdu you that, tryry this, whatever If you start having conversations twelve months from now, that's another twelve months Yoller going to be burning cash. He has been trying new things. with his business, which I'm very happy about so that he can expand his bace Remate, do you want a wine newsletter or a house Yeah happens. R. First of all, I love that the two of you are talking about this. That's great. in a way easy for me to say this It's much harder for you to receive because if the roles were reversed I would not want somebody being like, look, either make it work or shut the thing down. likeike yeah, easy for you to say, bro. Also That's the kind of advice that entrepreneurs need Because if you're making like thirty eight thousand or forty thousand Th then the question is like, you're putting in a lot of hours, a lot of work. might it be better to simply If it's not. pulling its weight Shut that thing down, get a job do something else, etcetera. Again, you have to think as an investor would And that's tough for any entrepreneur to hear Yeah, I I never imagined myself as a business owner. Like I got into the wine business because I loved wine and you know, there was a lot of things that I was attracted to. I never thought about running my own business and this was an opportunity that came up and it seemed like I played to a lot of my strengths, and Like my degree is in architecture. L not business. There's so many things that I've had to learn over the last year and it's been a great education and I've taken a lot away from it. And like there's so much that I don't know. And to get back to your question, like what's the what is my plan? Like I think one of the things that I need to do is reach out to another mentor who can give that more cold hearted advice to say This is not working. you need to do this or you know, whatever Yes, it may be Treat it like a cold hearted business It's numbers It needs to pull its weight otherwise Get rid of it. G gott to be Darwinian about this That's my opinion. Of course, I know that you are going to take half of that advice and then every entrepreneur loves their baby and wants to nurture. I get that. That's normal. If somebody told me this, I'd be like But then at night when I wasleeping, I was like, wait Maybe I should listen to part of that. Yeah But It is, it is giving us what is on the CSP right now It is bring in enough profit that he's paying himself. Yes It is R I see those things as success Aree Agree I want your business to be successful And I see that success as being you're paying you're able to pay yourself and and take care of your business loans. And so I think that that's where the answer lies is where Are we not able to pay you or where do you run into trouble with with saving money in your business. and So to be able to not give you a raise, we'll give You know, I'll get a raise and you take that money and save it so that then you can have a raise later. when you're more profitable. Pretty c I love the teamwor. Re, really love that. this idea that We're both teammates. playing different sports, fine, different companies Sometimes one of the teammates is injured So the other one takes on a little bit more of the work. Sometimes the other one is in a development phase so the other one takes on a little bit more. I love this. This is what a team is. and sometimes it doesn't work out And that's also okay too. Yeah Lots of different ways to get to your rich life What I especially notice is teamwork, which is awesome I notice that you are being both realistic That is the ultimate lesson And then I noticed that you're saving and investing a ton of money. What surprised you about today's conversation? hope I really wasn't trying to be obtuse Um, early. but maybe I have been just kind of glossing over things I guess that was surprising Sebastian, what surprised you seeing the numbers in such an aggressive way, like and what a dramatic difference that can make You know, like when we have played around with this, it always felt like small measures like Little tweak here, little tweak there And it felt like that incremental progress where we could pat ourselves on the back. you know, you're coming about like, That's fine, but like we need to be thinking about ourselves in the future looking back at at us now how we can pat ourselves on the back twenty years from now Great inside If if you had to finish this sentence in full I feel Just give me that full sentence, Sebastian I feel more optimistic. I feel taken care of azing I appreciate that Is there any question that either of you has that you did not get answered. I just w to make sure you have a chance Yes And I know that you've answered this before on the podcast, so I'm sorry to make you do it. I'm just blanking, but If we If we have take homeold But this is measured in gross Right? What the CSP is is our gross pay Yeah. The CSP is based off of your Take home, I'll show you exactly what I mean. I want you to understand it. So this' iss a great question Here we have your gross, this number here, sixteen to, sixty All the other numbers are based on This twelve three, seventy five, which is your net That makes me feel much better. Yeah. greatreat question That was an awesome question. So I would encourage you to redo your CSP and really lock it in. Make sure you calculate the actual numbers. How much are we going to have? because we were a bit we were close, but I want you to get tighter knowing your exact retirement age knowing exactly how much you're going to be contributing, pretax, post tax, get a little dialed in. I'm looking forward to hearing more from you You Thank you. Hope and Sebastian have this peculiar verbal tick where they keep measuring themselves against their past They'll say we're doing better than we've ever done We used to be broke, but now we're not an I be blnt Yes, it's important to understand where you came from But what I really care about is what you are doing now A rich life is lived today and tomorrow, not thirty years ago. So if Hope and Sebastian keep looking backwards instead of planning forwards and changing behaviorally Well, just try to imagine riding a bike ten miles backwards. You're never going to get where you want The good news is they can change this today. They have a plan, and most importantly, they understand why they have been stuck If they can shift from look how far we've come to look where we get the opportunity to go They can actually build something incredible Now, let's check out their follow ups First of all, I want to say big thank you to Ramith and his staff for having us on the podcast. It was such a great learning experience and also really challenging. We had a lot of takeaways. My biggest surprise is that One of my biggest goals in life is to live as a genuine open and honest person, and I did not realize I wasn't communicating to myself about my finances in that same way. One of the biggest takeaways was that Sebastian and I do tend to look toward the past And in fact, we had looked at our numbers on our taxes from last year for our yearly numbers and that's where a lot of the confusion came because we knew Our numbers pretty well, but apparently Big yearly number was from last year Obviously we need more savings in retirement. That was kind of drilled in. I have already worked with Sebastian to figure out some Money to go into savings and some money to go into investments we're going to make We're going to increase those numbers shortly. But also I do most of the grocery shopping and I've committed to staying to within nine hundred dollars, including food. And I went shopping for the week yesterday and spent one hundred fifty five dollars on the week's food and so I'm Well on track for that And if we go over, then it's beans and rice for the next week Hi me, thanks again for having us on the podcast My biggest surprise was to hear our story reflected back to us how much we were looking at our past selves and not thinking about our future selves. Our biggest takeaway was that as much as we lik to talk about our dreams and our rich life, that we actually need to