Episode 224. “I took on debt to help my family. Now she won’t marry me.”

Rachel (31) and Pierre (42) have been together for four years, building a loving and stable life in Brooklyn. But one issue is holding everything back: Pierre’s $60,000 in debt from a failed business he started to support his family. His plan is to wait it out, hoping the problem disappears. But Rachel is unwilling to move forward towards marriage until there’s a plan in place.

To her, his passive approach feels like a warning sign for their future together. Can Ramit help them face the reality of this debt, make a plan, and build a shared vision?

In this episode we uncover:

• Why Rachel vowed never to date someone with debt—and why she chose to date Pierre anyway
• Pierre’s family vape shop business collapse and the $60,000 in debt he took on to try to save it
• The stark difference in how each partner views the debt
• Why Pierre believes ignoring the judgment is a valid strategy
• Rachel’s habit of minimizing her own fears
• How Pierre’s family history shaped his own sense of obligation
• Rachel’s painful history with her mother being scammed out of $60,000
• The tension between investing for the future versus paying off past mistakes
• How cultural expectations and family loyalty complicate Pierre’s decision-making around money
• The breaking point: Rachel admits she cannot say yes to a proposal without a clear plan for the debt
• Ramit’s game plan to get the debt paid off—the right way

Chapters:

(00:00:00) “If you don’t handle this debt, I won’t marry you”

(00:19:50) Ramit breaks down their numbers

(00:27:25) “Happy wife, happy life” — but what about the debt?

(00:41:53) He took on debt for his family — but at what cost to his future?

(00:55:01) “I don’t ask my dad for money… and I don’t ask Pierre either”

(01:07:31) How small sacrifices can open the door to big changes

(01:23:21) Logistics are a big turn on

(01:30:50) Where are they now? Rachel and Pierre’s follow-ups

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Links mentioned in this episode 

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Transcript 

Download the full transcript PDF 

[00:00:00] Rachel: I told myself that I wasn’t going to date anyone who has debt.

[00:00:06] Pierre: I had to shut the business down, and I had to accumulate all this debt because I felt obligated to take care of my family.

[00:00:15] Rachel: He told me what happened and how it was just sitting there. I said, “Are you going to do anything about it?” And he just brushed it off.

[00:00:25] Pierre: I spoke to a financial advisor about it. He said just wait it out, because after seven years it’s removed from your credit report.

[00:00:34] Rachel: At some point, honestly, it was starting to piss me off a little bit. Why would I want to be with someone who doesn’t know their [Bleep]?

[00:00:42] Pierre: I have enough to pay for it, but if I don’t have to pay for it, why would I?

[00:00:50] Rachel: It’s just every time I try to bring up this debt, that’s where things just go downhill. So I think it’s like a sore spot for the both of us.

[Narration]

[00:01:04] Ramit: If your partner said they would not get married to you unless you paid off your debt, what would you do? Today I’m speaking with Rachel and Pierre. They’re 31 and 42 years old. They’ve been together for four years, and they live together in Brooklyn. Their goal is to get married and start a family, but one thing is stopping them, Pierre’s $60,000 business debt from before they met. He’s basically written off paying it, and Rachel says she will not say yes to a proposal unless there’s a plan for that debt.

[00:01:37] I’m going to look at their conscious spending plan right now, or their CSP so we can see their actual numbers. You can download your own template of the conscious spending plan for free at iwt.com/csp. They have $0 in assets, $134,000 in investments, $35,000 saved, $60,000 in debt for a total net worth of $109,000. They make a combined $183,000 per year. Fixed costs are 48%. It’s quite low. 15%, investments. 11%, savings. 26%, guilt-free spending.

[00:02:19] Now, if we don’t count the debt, their numbers look pretty solid. But if you’ve listened to this podcast before, you know that the numbers alone never tell the whole story. Let’s meet Rachel and Pierre.

[Interview]

[00:02:33] Ramit: Rachel, in your application, you said something that really caught my eye. You said, you’re both working towards marriage, but you will not accept a proposal unless this debt is handled. Is that still true?

[00:02:51] Rachel: Not necessarily that it has to be paid off in full, but at least there’s some solution that this is being worked on, or that there’s– let’s say the solution is paying it off. Then that’s considered handled to me.

[00:03:12] Ramit: I got it.

[00:03:13] Rachel: There’s a solution to it.

[00:03:14] Ramit: Okay. So we’re here because of Pierre’s debt?

[00:03:17] Rachel: I’ve known about this debt probably early on, before we were boyfriend and girlfriend. I’ve known about it, and I told myself that I wasn’t going to date anyone who has debt because I don’t to have to deal with that. At the time I was in my late 20s, and I don’t want that burden on me. I didn’t want to have to deal with that.

[00:03:48] When he told me what happened with his debt and how it was just sitting there, I asked him about it, and I said, “Are you going to do anything about it?” And he just brushed it off. And over, I want to say maybe two years ago I brought it up again, and asked him, I said, “How much debt do you have?” And he’s like, “Oh, I think I have some stuff here, some stuff there.” And at some point, honestly, it was starting to piss me off a little bit because I thought, why would I want to be with someone who doesn’t know their [Bleep]?

[00:04:35] Ramit: What happened?

[00:04:36] Pierre: It’s a business credit card debt. It wasn’t anything personal. It had nothing with personal debt. Before that, I never had debt. Of 30 something years of my life, I was debt-free. My credit score was between 760 and 780. And then I opened a vape shop. It was a shared space with family, and they couldn’t cover their share of the rent, so I ended up covering their rent and not paying off the credit cards.

[00:05:09] And then when New York passed all this legislation regarding flavored e-juice and what can be sold or can’t and not being able to move my license, it hit me hard, and I gave up. I was like, “You know what?” I knew that it would be on my credit score for seven years, and after that it would be off the credit score. And from there I figured I could start rebuilding my credit.

[00:05:39] Ramit: What do you think made this different, where you went 30-plus years of no debt, of being quite responsible with debt, to suddenly accumulating a larger amount of debt and then not paying it?

[00:05:52] Pierre: Number one, I didn’t find a job afterwards. I did a little later on, but, for a couple of months I was just upset that I had to give up the space. I had to shut the business down. Because at the time when I shut it down, it was the number one rated vape shop in New York City, or one of the top ones.

[00:06:11] And I was doing well. So losing that really hurt. I felt like I had an obligation to help families. So a big part of that also contributed to it. I’m the eldest child, and I have two little sisters. My dad passed away when I was 20, so for the longest time, I tried to grow and find my own path, but at the same time, I had to take into consideration I was man of the house, or I had to help my mom with the business, with the taxes and any administrative work with her business for years.

[00:06:54] And when I finally found something and I was good at it, it was a successful business, and then I had to shut it down, I had to accumulate all this debt because I felt obligated to take care of my family.

[00:07:09] Ramit: What did you feel?

[00:07:11] Pierre: I felt angry. I felt upset. I felt heartbroken.

[00:07:16] Ramit: Angry at whom?

[00:07:18] Pierre: At myself, at having or feeling the responsibility of being there for my family.

[00:07:27] Ramit: Mm-hmm. Did you feel angry at your family?

[00:07:31] Pierre: No. During that time, before I shut down the business, I felt good because my mom sacrificed so much and gave me so much, and this was the least I can do for her.

[00:07:48] Ramit: Okay. Rachel, how many times have you brought up this debt?

[00:07:52] Rachel: Definitely at least five, maybe six or seven times.

[00:07:56] Ramit: Okay. And how many times has Pierre brought up the debt?

[00:08:02] Rachel: I think zero, maybe one.

[00:08:05] Ramit: Okay. When these conversations come up, when you bring up the debt, Rachel, how do the conversations go?

[00:08:12] Rachel: The first time was not fun.

[00:08:15] Ramit: What happened?

[00:08:17] Rachel: It’s started in tears. It ended in tears.

[00:08:25] Ramit: This conversation happened like over a year ago. Right?

[00:08:31] Rachel: Yeah, happened over a year ago.

[00:08:32] Ramit: We can take a break. We can pause. It’s no problem at all. But I’m just noticing the second you start thinking about it, you begin to cry. Almost like it just happened. And I’m wondering, why is it so vivid for you?

[00:08:49] Rachel: I think it’s because we don’t really ever argue.

[00:08:53] Ramit: Mm-hmm. I think Pierre is coming to hand her a nice box of tissues. Thank you, Pierre. Very nice of you.

[00:09:04] Rachel: Yeah, we don’t really fight. We don’t argue about anything. It’s just every time I try to bring up this debt, that’s where things just go downhill. So I think it’s like a sore spot for the both of us.

[00:09:22] Ramit: Yeah. It can feel tender, talking about whatever topic. Every couple’s got something. Money’s often the one that ends up making its way to me, and it’s like a really tender spot. The rest of your body might feel perfectly fine, but you just brush this little area on your arm, and it feels incredibly painful.

[00:09:45] And it’s interesting, if that happened on our own body, we would know. We should probably get that checked out. We should probably do something about that. But it’s interesting that with money, a lot of times we just shuffle it off to the side because we can paper it over and we can avoid those conversations.

[00:10:04] And when they come up and they feel incredibly tender, we fight, we cry, we go to sleep on opposite sides of the bed, and then we wake up in the morning, and we try to forget about it. So what you’re feeling is very normal. Okay, let’s try it again. The first time you had this conversation, what happened?

[00:10:24] Rachel: I remember we were sitting in the bedroom, and I asked him. I was like, “Oh, how much is your debt? And then I asked him, I said, “Log into–” I think it was Experian or TransUnion, Equifax, whatever it is, because it lists everything. And then from there, that’s just where we started going through the list.

[00:10:47] Ramit: What was the gist of it? You were asking him questions. He was responding to your questions. And then? What was the general gist of that conversation?

[00:10:54] Rachel: Just figuring out how much debt he has.

[00:10:57] Ramit: And what was your reaction?

[00:11:00] Rachel: Just thinking, damn, that’s a lot. But it’s manageable. You deal with people that have hundreds of thousands of dollars in debt. For something like his, I think it’s like 60, 60-some thousand in debt. So it’s not horrible, and it’s not accumulating interest. My biggest concern was, is this debt accumulating interest?

[00:11:24] Ramit: Do you find yourself minimizing your own problems a lot?

[00:11:28] Rachel: Possibly.

[00:11:29] Ramit: Mm-hmm. Pierre’s nodding his head yes.

[00:11:32] Rachel: Oh.

[00:11:33] Ramit: Striking that you’re discovering your live-in boyfriend of many years has $60,000 of debt, which you had to “bug” him to share, and your first response is, “Oh, it’s actually not that bad because other people have hundreds of thousands of dollars of debt.” What do you make of that, Rachel?

[00:11:57] Rachel: I guess I could be blowing it out of proportion a little bit.

[00:12:01] Ramit: Which part are you blowing out of proportion?

[00:12:06] Rachel: The amount of debt that he has.

[00:12:08] Ramit: You think you’re blowing his amount of debt out of proportion?

[00:12:13] Rachel: Possibly.

[00:12:17] Ramit: Mm-hmm. When were you taught to put the feelings of others before your own?

[00:12:23] Rachel: It’s how I was raised.

[00:12:27] Ramit: Oh, really.

[00:12:28] Rachel: Sorry. Yeah, yeah.

[00:12:31] Ramit: Okay. We’ll get to that. Can we role play the conversation or conversations that you have about this debt? Because I think I have a general sense of how the conversation goes, but I’d like to try to almost observe it like a fly on the wall.

[00:12:47] So what I’d like to do is I would like to sit here, and I would like for the two of you to recreate one of those conversations as closely as possible using the exact words, using the person who starts the conversation, they respond the way they did, and the other person responds the way they did. Put yourself in the mental space of that conversation, and let’s pick it up at one of the times you talked about debt. Go ahead.

[00:13:15] Rachel: Hey, babe. Can you find a way to figure out how much debt you actually have?

[00:13:26] Pierre: Yeah, I actually looked it up, and it’s about $60,000.

[00:13:34] Rachel: Do you know if there’s any interest on it, or do you know where exactly it is?

[00:13:40] Pierre: No. It hasn’t shown any interest. It hasn’t risen in years. I spoke to a financial advisor about it, and he said that if it was the first or second year of the debt and you didn’t plan to pay for it, you could have filed for bankruptcy. But this far into it, he said just wait it out because after seven years it, it’s removed from your credit report. I have enough to pay for it, but if I don’t have to pay for it, why would I? 

[00:14:19] Rachel: So what about the Amex? That’s about 33,000.

[00:14:26] Pierre: They want a judgment on it. And after 10 years, I was told that they would probably try to sue me again to get another 10 years to collect. And when that happens, I’ll reach out to my lawyer, depending on where I’m working, and see if we could do a settlement.

[00:14:54] Rachel: Wouldn’t it just be better to try and figure it out now? I feel like there’s a bigger risk of waiting to see if they try to sue you. Because if it’s Amex, it’s not a small amount. It’s about $33,000. And I feel like if it’s going to be, let’s say, what is it, another four years from now, wouldn’t it mean more or be easier to pay off now than it would be in the future if we decide to, let’s say, have kids?

[00:15:39] Pierre: I had a really late start to, putting money into my retirement, so now, any extra money that I have is going towards that. And if I had to settle it in five years, I’ll be making more money. So let’s say that $38,000, the settlement is 25. 25,000 now is worth a lot more than what 25,000 will be five years from now.

[00:16:13] Rachel: Okay. This is where the conversation ended at that point because I didn’t know how to respond to that afterwards.

[00:16:23] Ramit: First of all, well done. Thank you. That actually took me right into that conversation.

[Narration]

[00:16:28] Ramit: Let me jump in here because the first few minutes of this conversation are incredibly revealing. My antenna are going up because Rachel says she and Pierre hardly ever argue. That’s a huge clue. As if arguing is bad. I don’t actually consider it a virtue when somebody says, we hardly ever argue. In fact, a lot of people who say this actually avoid conflict.

[00:16:51] And then we see what happens when the debt comes up. Rachel cries. Listen to how she talks about it. One moment she says the debt is terrible. The next, “Well, some people have hundreds of thousands of debts, so this is manageable.” She’s immediately minimizing.

[00:17:07] I suspect she probably doesn’t talk about this with anyone else. And when she finally brings it up with Pierre, did you notice his reaction? He basically shrugs. He changes his subject. If I were Rachel, seeing that, I would feel incredibly lonely. Because this isn’t just about money. It’s really about what the debt represents.

[00:17:27] In life, we are all going to face challenges. And if your partner can’t deal with debt, if they won’t even talk about it, that is an ominous sign of how they’ll handle other difficulties. Deep down, I bet Rachel knows this. But we need to go deeper into the why. To Rachel, debt is bad. Doesn’t matter why you have it. If it’s there, it’s bad. You deal with it.

[00:17:50] To Pierre, the debt feels quite different. He took it on to help his family. He lost a business over it. It represents sacrifice. It represents doing the right thing. So they’re not even talking about $60,000. They are talking about two different concepts of something they each just happened to call debt. Rachel wants a plan right now. Pierre’s just hoping the problem goes away.

[00:18:18] Now, I want to help them see each other’s perspective, but I also know that Rachel has made it clear there is no future for them as a couple if they cannot agree on this debt. After this break, we’re going to get into their numbers.

[Interview]

[00:18:31] Ramit: I have questions, but first, I want to look at your numbers. All right. Let’s see. Rachel, why don’t you read the word in bold and then the number in full next to it for this entire net worth box please?

[00:18:49] Rachel: Okay. Assets, $0. Investments, 134,000. Savings, 35,000. Debt, 60,000. With a total net worth of 109,000.

[00:19:03] Ramit: All right. What do you think about that number?

[00:19:07] Rachel: Pretty good.

[00:19:08] Ramit: Cool.

[00:19:09] Rachel: All things considered. Yeah.

[00:19:11] Ramit: Pierre, what do you think?

[00:19:13] Pierre: I like it, but I know it could be up 60,000 more.

[00:19:20] Ramit: Got it. All right. Let’s take a look at the income. This time, Pierre, I’d like you to give me the number of your combined monthly gross income, please.

[00:19:30] Pierre: Our combined gross income is 15,292.

[00:19:35] Ramit: All right. So that means that combined, the two of you make $183,500. Who knew that, by a show of hands? Rachel’s putting her hand up. Pierre?

[00:19:47] Pierre: Yeah.

[00:19:48] Ramit: Okay, great. All right. Both of you knew. Damn. I’m going to give you a round of applause. That’s very rare on this show or in America. Interestingly, your incomes are quite similar. One of you, Pierre, makes 7,000 a month gross. Rachel makes 8,200 a month gross. So a little bit more, but in general in the same ballpark.

[00:20:09] So that’s helpful as we go down the list. All right. Can we take a look at the rest of the numbers here on the CSP? Let’s see here. Rachel, what is that fixed cost percentage that you have?

[00:20:20] Rachel: 48%.

[00:20:21] Ramit: Good. Very good. One of the lower numbers I’ve seen. Don’t you both live in New York?

[00:20:27] Pierre: Yes.

[00:20:27] Rachel: Yes, we do.

[00:20:28] Ramit: Wow. Very impressive. So you mentioned you have a rent-controlled apartment.

[00:20:32] Rachel: Rent-stabilized.

[00:20:33] Ramit: Rent-stabilized. All right. So your rent is 26%, which is good. But in New York, it’s excellent. Because New York is the most, very high cost of living city in America in general. So well done on that. Let’s move on to the next one. Investments are at 15%. That’s good. And are you doing some 401(k) as well?

[00:21:02] Rachel: Yes.

[00:21:04] Pierre: I’m not. She is.

[00:21:05] Ramit: You are, Rachel. Okay. Savings are at 11%. You have a vacation fund. You have a gifts fund. You have an emergency fund and a wedding fund. Okay. And your savings are currently $35,000, which is about six months. All right. Good. And then finally down to guilt-free spending, which is at 26%. Would you say this number is accurate, $2,627 a month on guilt-free spending?

[00:21:31] Rachel: For me, I would say yes.

[00:21:32] Pierre: Yeah. Sounds about–

[00:21:34] Ramit: You have fixed costs at 48%. First thing I think when I see that is fantastic. What are they doing with the extra money? That’s the first thing that goes to my mind. Then I move down to investments. I see 15%. I go, “Oh, that explains it.” They’re actually investing fairly aggressively, exactly the numbers that I would expect for somebody making a high income, no kids. All right. You have something on here that says, mom, $300 a month. What’s that?

[00:22:04] Pierre: I give my mom $300 a month.

[00:22:06] Ramit: Okay. What does she do with it?

[00:22:08] Pierre: I’m guessing what she always does with money, is save it.

[00:22:15] Ramit: And also, I love that you never even asked her.

[00:22:19] Pierre: Yeah. I don’t need to. I know her.

[00:22:21] Ramit: Yeah. Okay, fine. How do you send it? You write a check, or you give her cash, or what?

[00:22:28] Pierre: I Zelle it. I used to give her cash, but now I just send it to her phone.

[00:22:33] Ramit: And then does she reply when you send it, or no?

[00:22:37] Pierre: She’ll send me a text.

[00:22:38] Ramit: What does it say?

[00:22:41] Pierre: Thank you. Good boy.

[00:22:50] Ramit: Oh my God. Adorable. God, I love moms. All right.

[00:22:57] Pierre: Yeah. She doesn’t live too far from my work, and she’ll make food and bring it to me so I could bring it home to Rachel.

[00:23:07] Ramit: I love that.

[00:23:08] Pierre: Yeah, yeah, yeah.

[00:23:09] Ramit: So then your savings is at 11%, and you have a fairly healthy amount. You’ve got 500 bucks a month for vacations. You’ve got a gift fund, almost 300 bucks a month, etc. And a wedding fund of $100 a month. Okay. And then the remainder is going to guilt-free spending at 26%.

[00:23:24] So all of this to me, looking at it, I go, yeah, it looks pretty straightforward. In general, just looking at it, the biggest thing I notice is your fixed costs are low, and some of the money that would ordinarily go towards housing and cars, you’ve diverted it towards investments and savings. Okay. All right. Can you break down the 60k of debt for me?

[00:23:48] Pierre: So 38 of it is to Amex, and that, they got a judgment on. So that’s the only one that– there’s another four grand or 4,800 with Amex. They’ve sent letters saying, if you pay 1,400, they’ll cover the debt, but you can’t get an Amex card anymore.

[00:24:07] There is another, I think eight grand that was– that one’s in collections. And there was a 10 grand from Squarespace where it was like a business loan. I never got any other documentation from them since the business closed and I had stopped paying.

[00:24:29] Ramit: All right. What do you think about those breakdown of the four sources of debt totaling 60k?

[00:24:39] Pierre: Damn, that’s a lot, and I don’t want to pay that.

[Narration]

[00:24:44] Ramit: Let’s pause here because I think this is really important. Pierre’s got $4,800 with Amex that he can settle for $1,400. He’s got $8,000 in collections, $10,000 from a business loan he stopped paying after that business closed, and $38,000 from two Amex cards with a court judgment already in place.

[00:25:04] Pierre thinks if he ignores this debt, it will just disappear. It won’t. Now, yes, in the US some unpaid debts fall off your credit report after seven years. But that doesn’t mean they vanish. Creditors can still try to collect, and in New York a judgment like Pierre’s is enforceable for 20 years.

[00:25:24] With a judgment, the court has already decided he owes the money, so the creditor can garnish wages, freeze bank accounts, even put liens on property, and the balance racks up interest. If Pierre waits five years, that 38k grows to 58k. Wait another five years, it’s close to 90k. Basically doing nothing is not really an option.

[00:25:45] But I can’t just sit here and give Pierre all these numbers and rattle them off. He’s avoided debt for years, so me coming and sharing a bunch of large, scary, confusing numbers will only make him retreat further. It would make anyone do that. So instead I’m going to focus on meeting him where he is.

[00:26:03] This is an important lesson if you ever find yourself trying to help someone change something, whether it be their relationship with money or food or anything else. Your temptation will be to jump in and give them all the technical facts. Hey, it’s so scary. Look at this interest rate. It’s actually compounding. Time is working– no wonder you see their eyes glaze over. I used to do it right when I was in college and right out of college. “Hey, you really need to do a Roth IRA. Don’t you know about the five-year rule?” It never works.

[00:26:33] I’m going to start with how he feels about his debt, and I want to invite you to share this with somebody. If you know somebody who’s in a relationship with one partner is avoiding their debt, maybe they think it’ll just go away, send them this episode. It could actually be the wake-up call they need to finally face that debt head on.

[Interview]

[00:26:50] Ramit: What would it be like? I feel resentment? I feel defensive?

[00:26:55] Pierre: I do feel a little resentment. But when I feel that, I think about all the good and positive things that came from it, and that balances it out or cancels it out.

[00:27:12] Ramit: Mm-hmm. When you feel negative emotions, is your first instinct to find a way to wipe those negative emotions away?

[00:27:26] Pierre: Part of it. I like to be a positive person, so I like to be a problem solver.

[00:27:32] Ramit: Ah. Let’s talk about the problem solving then. What is the plan for that debt?

[00:27:39] Pierre: So outside of the judgment, I’m just planning the way to those other debts outside of the big Amex to come off and then see what Amex would do regarding the 38.

[00:27:57] Ramit: Hmm. Can we take a look at Rachel’s expression right now? What do you see, Pierre?

[00:28:05] Pierre: Frustration and annoyance. Yeah, I think that was why she submitted the application.

[00:28:17] Ramit: Okay. And?

[00:28:20] Pierre: I feel more comfortable or I wanted to do it my way versus paying– like I said earlier, 20 grand now is worth more than 20 grand five years from now.

[00:28:39] Ramit: 20 grand is about three months of your gross income or four months of your net income.

[00:28:45] Pierre: Mm-hmm.

[00:28:47] Ramit: How’s that sound to you?

[00:28:50] Pierre: That’s barring if you don’t pay for our living expenses and investments. But that 20 grand, I would rather invest it because if my interest is not going up, I would rather invest that 20 grand into a portfolio or whatnot and see what happens in five years and take that risk.

[00:29:16] Ramit: Mm-hmm.

[00:29:17] Pierre: Or take that chance.

[00:29:19] Ramit: So you both see this debt differently. I think we can all agree on that. What do you think is the path forward? Because Rachel asked you, what’s going on with the debt? What’s the amount. What’s the plan? And Pierre, you had a series of responses. You had a plan in your own head. This is what I’m going to do.

[00:29:38] I’d rather make more by investing it. 20k is worth more to me now than later. You had a series of responses. I can see why you say those responses. It didn’t seem to comfort Rachel to hear that. Would you agree?

[00:29:55] Pierre: Yeah.

[00:29:56] Ramit: All right. So you both have an idea of this debt, but neither one of you is really reaching the other. What do you think is a way to move forward?

[00:30:06] Pierre: Happy wife, happy life.

[00:30:09] Rachel: Oh my God.

[00:30:10] Ramit: Do we believe that?

[00:30:12] Pierre: I do.

[00:30:14] Ramit: First of all, I [Bleep] hate that phrase. I hate that phrase. I [Bleep] hate– I detest that phrase, but I’m going to go with it for just a second. Okay, if that’s true, happy wife, happy life, then technically wouldn’t you just do what she said and pay off the debt?

[00:30:32] Pierre: That’s one way to go about it. When that happens is like, so I should just– I think my way would cost the least. She’s worried about renting, finding a new apartment, if our family gets bigger and we need to find another apartment. And one of the solutions for that is to– because right now our, my name isn’t on the lease, so there’s no record of me paying rent aside from me sending her money.

[00:31:01] But if we can put my name on the lease and we pay everything on time for a year, at least a year, when we go and apartment hunt, it wouldn’t be an issue because there’s proof showing that are responsible rent payers.

[00:31:19] Ramit: So option one is happy wife, happy life. Pay it all off. Option two is put Pierre’s name on the lease, hopefully build up his credit enough that if and when you go to find another apartment, you can both do it together. Okay. Are there any other options of how you might come together?

[00:31:41] Pierre: Aside from me just not paying and just waiting it out, which she–

[00:31:45] Ramit: Yeah, that’s the third option.

[00:31:47] Pierre: Yeah.

[00:31:48] Ramit: That’s what’s going on right now. Right?

[00:31:50] Pierre: Yeah.

[00:31:51] Ramit: That’s a default option.

[00:31:53] Pierre: Right.

[00:31:54] Ramit: There’s only one problem with these options, which is, from what, Rachel, you told me in your application, your relationship is at a standstill. You will not accept a marriage proposal unless there is some kind of plan from Pierre to address the debt. Is that correct?

[00:32:16] Rachel: Correct.

[00:32:18] Ramit: Which of those plans would allow you to move forward in your relationship? Pierre?

[00:32:26] Pierre: When you say plan, is my waiting it out plan considered a plan?

[00:32:36] Ramit: Ask her.

[00:32:37] Pierre: Is that a plan?

[00:32:42] Rachel: If it’s the best option– I’ve come to realize that just because it’s not what I like to hear doesn’t mean that it’s not the best option for us. I think because, for the longest time I kept thinking, oh, okay, you have to pay off this debt. Because if you don’t pay off this debt, then your credit is not going to get any better.

[00:33:05] That’s my biggest concern. I have to put your name on the lease. That’s fine. I have no problem with that. I’m trying to think of other ways that we could help boost your credit. And again, if this debt is still hindering that or hindering any way to build your credit, that’s just my concern.

[00:33:29] Ramit: I’m lost, and I do this for a living.

[00:33:32] Rachel: Okay.

[00:33:32] Ramit: I guarantee Pierre is lost too.

[00:33:34] Rachel: Okay.

[00:33:35] Ramit: Does anybody even remember what the question was?

[00:33:39] Pierre: Would we still be able to forward in our relationship if I decide to go with my plan and at least wait two years so that a portion of it will be off of the credit report, and then maybe reach out to Amex after that, or–

[00:34:00] Rachel: I think by now it’s probably going to be less than two years for the ones that are currently in collections to fall off.

[00:34:07] Ramit: Guys, way too many words. And neither of you can see the dynamic. You’re talking yourself into spinning and doing nothing right now. Do you all realize that?

Does anybody even remember what the question was?

[00:34:19] Pierre: Would we still be able to forward in our relationship if I decide to go with my plan and at least wait two years?

[00:34:30] Rachel: I think by now it’s probably going to be less than two years for the ones that are currently in collections to fall off.

[00:34:36] Ramit: Guys, way too many words, and neither of you can see the dynamic. You’re talking yourself into spinning and doing nothing right now. Do you all realize that? Pierre, you’re asking a question that has 30 sub questions in it. Pierre, do you want to get married to Rachel?

[00:34:54] Pierre: Yes.

[00:34:54] Ramit: Okay, great. Let’s start there. The only question that matters is Pierre asking, if I did this strategy, would you be open to getting married? And it’s a yes or no question.

[00:35:06] Rachel: Okay.

[00:35:07] Ramit: Let’s try it with each case in turn. Pierre, go ahead. Take the first example. If I asked you to marry me and we did blank, would you say yes? Go ahead. Step by step.

[00:35:21] Pierre: If I asked you to marry me and I chose to wait it out, would you still marry?

[00:35:30] Rachel: No.

[00:35:35] Pierre: Why?

[00:35:37] Rachel: I’m trying to be as black and white with this as I can because I feel like it’s still going to affect your– I don’t know. I feel like it’s still going to affect your credit score.

[00:35:49] Pierre: So it affects my credit score, but if it doesn’t affect us renting an apartment, buying a house, the only other thing is if it’s a car loan, which we live in New York City. We won’t need one. But if we go somewhere else, I don’t need a new car. I feel like we would be able to buy something a little more affordable where we don’t need a big loan.

[00:36:20] Rachel: Is maybe an answer?

[00:36:25] Ramit: When you both gave me the gift of role-playing how your conversations go, I immediately saw the roles that each of you play when it comes to talking about money. Rachel, you are thrust into the role of being the person who brings it up, and you are furthermore thrust into the role of being the person who has to increasingly ask with increasing specificity and intensity, what about this? What about that? What about this?

[00:36:58] You use the word bug. I have to bug him. And I hate hearing somebody describe their own totally legit questions as bugging. Other people often call it nagging. I hate that word. It’s very gendered. But that is the role that you have both been thrust into and accepted being thrust into. You accepted it.

[00:37:21] Pierre, you have a very nice countenance. You answer the questions. You’re not trying to evade on purpose, at least as far as I can tell. But you’re essentially doing this. Watch my body language. 6, 4, 2 years from now. You are answering questions as if there’s a gun to your head and your only job is to answer questions.

[00:37:45] But Rachel is not actually asking you like, what month and year is the debt going to be paid off? And have you considered– you know what she’s really asking you? She’s asking you to handle this. Take care of this [Bleep] debt because it’s driving a wedge between us. But she doesn’t or won’t say exactly that.

[00:38:09] Her approach is to simply ask a series of increasingly tiny questions. And Pierre, you’re just accepting it because it’s easy. Oh, I can answer this question. I have this reason, and I have this reason. But she doesn’t care about that. She actually just wants the debt to be taken care of. Let me pause and see if I’m getting this correct. I want to check in with you, Rachel.

[00:38:28] Rachel: Yeah. Honestly, I don’t care how it’s handled. Yeah, you explained it perfectly.

[00:38:38] Ramit: But you’ve never said that, have you?

[00:38:40] Rachel: No.

[00:38:41] Ramit: You put yourself in the role of asking question after question, and Pierre, you accepted the role of, oh, she’s asking questions. I’ll answer her questions. And the more I answer, the more she’ll leave me alone. But she doesn’t want that. She doesn’t actually even care about the answer to some esoteric question. What she’s saying, which she has not said until now, is I want you to take care of this debt. Pierre, how does that strike you?

[00:39:09] Pierre: I knew that’s what she meant when she would it up, but I’ll handle it is different.

[00:39:20] Ramit: I agree. I agree. And in order to make a decision that works to help you both move forward together, we need to understand why you see money the way you do. So will you stick with me as I go a little bit back in time with each of you?

[00:39:41] Pierre: Yeah.

[00:39:41] Ramit: Okay. Pierre, you mentioned that you took on debt to help your family out with this business, right? I want to understand more about how you experienced money growing up. Let’s go back to your childhood. What do you remember your family saying about money when you were young?

[00:40:01] Pierre: I remember hearing my mom saying that money can’t buy you love. Growing up in my mind, we didn’t have a lot of money. I remember coming home on Allen and– I used to live on Remington Street, and we would come home, open the doors, and we would see literally hundreds of cockroaches crawling underneath the refrigerator, the couch, the kitchen.

[00:40:34] So I remember that. But at the same time, I remember traveling a lot as a kid. It made me feel like I had a lot, but at the same time I didn’t. I remember when our family didn’t have a lot of money, we were very close. And then once the siblings, my aunts and uncles started making money, all these other problems arose.

[00:41:01] Some people moved out of New York. The ones that are in New York don’t talk. And then at the same time with my dad’s side of the family– my parents came from Vietnam. So when my dad came over, he came over by himself. My mom was able to come over with her family.

[00:41:24] So he had his family in Vietnam, and I remember him sponsoring his family over and us still living in our cockroach-infested apartment. My dad gave them money to buy a house or put a down payment on a house and start a business. And then they went and told the community, my dad didn’t do anything for them.

[00:41:48] So then from there my dad started getting sick and eventually passed away when I was 20. So as far as money goes, part of me doesn’t care for it, because of the bad experience. But at the same time, I was able to travel and see the world and experience different views on life and people. So it was like good and bad.

[00:42:13] Ramit: Mm. Wow. It sounds like a lot of mixed messages about money. I’m trying to interpret everything you told me. You said tons of cockroaches in your apartment and yet you traveled.

[00:42:28] Your dad came here alone, didn’t have family support, and you were living in a, sounds like a pretty rundown place, and yet when he was able to bring his family over, he gave them a lot of money to get a house, which they then did not appreciate him for. When you think of the word money, when you think of the concept of money, what do you feel?

[00:42:54] Pierre: That I wish I had more of it. That it caused a lot of problems in the family.

[00:43:07] Ramit: Do you love it, or do you hate it, or both, or none at all?

[00:43:14] Pierre: Both. More love than hate.

[00:43:17] Ramit: Mm-hmm.

[00:43:18] Pierre: Just because it provides, it gives me more opportunity to do things I do enjoy.

[00:43:23] Ramit: Mm-hmm. When you think of the times that you love money, what comes to mind for you?

[00:43:30] Pierre: Being able to spend it on family and friends, going off for drinks, covering the tab, able to take my family out to dinner. Growing up we didn’t go out to dinner often. For birthdays, we went to Dallas BBQs. That was the big thing.

[00:43:53] Ramit: Mm-hmm.

[00:43:53] Pierre: And now, I could take back– then we didn’t order appetizers. We just order a meal. Now I love it when I could take my mom to a nice place and like, “Order whatever you want, mom. Hope you like it.”

[00:44:03] Ramit: Mm-hmm. And what about the times where you hate it, when you hate money?

[00:44:13] Pierre: When it broke apart the family.

[00:44:17] Ramit: Mm-hmm.

[00:44:18] Pierre: When it becomes master instead of a tool where it controls people versus allowing people to do things.

[00:44:30] Ramit: Does your debt control you?

[00:44:34] Pierre: I don’t think so.

[00:44:35] Ramit: How much of your relationship with your debt is out of sight out of mind?

[00:44:39] Pierre: All of it.

[00:44:41] Ramit: Mm-hmm. If you were to bring it insight, if you were to actually look at the envelopes and calculate certain things and take a more assertive approach with it, how do you think you would feel about that debt?

[00:44:56] Pierre: I would feel annoyed that I have to pay it.

[00:45:00] Ramit: So therefore, you what instead?

[00:45:05] Pierre: Just ignore it and don’t pay.

[00:45:08] Ramit: Mm-hmm. Okay. Do you see any relationship with how your dad gave lots of money to his family even while perhaps not living in a nicer place yourself and your relationship with money today?

[00:45:33] Pierre: I can see that correlation with putting that money towards the debt versus spending that money on people I care about.

[00:45:41] Ramit: Did you ever think of it before, that connection? 

[00:45:45] Pierre: No.
[00:45:46] Ramit: Now that we’re talking about it, how does it strike you?

[00:45:52] Pierre: It makes a lot of sense because that was really when my dad’s health started to deteriorate. Because while he was here for 15, 16 years while his family was over, he sent money back too. They never appreciated it. We found out that his cousin or his aunt, actually, instead of giving out the money, she kept it for herself.

[00:46:22] Ramit: Damn.

[00:46:24] Pierre: Yeah. Yeah, my dad ended up having colon cancer, but I remember it wasn’t– my mom almost divorced my dad over it.

[00:46:34] Ramit: Hmm.

[00:46:34] Pierre: She almost left them because she’s like, “You got to take care of your own family. We don’t make that much.” So I remember seeing his being from a healthy person that worked seven days a week, no problem, to literally skin and bones.

[00:46:51] So that really affected me for years. It wasn’t really until like maybe my mid-30s where I really got over it or accepted or was able to on. So no, I do remember trying to be like him, at the same time being an Asian American and trying to find my way in society and in the culture.

[00:47:26] Ramit: It sounds really hard.

[00:47:28] Pierre: Yeah.

[00:47:28] Ramit: It sounds like you went through some really tough stuff. Most people don’t grow up on Rivington with cockroaches. Most people don’t grow up with mixed messages about money. Most people don’t grow up seeing their dad pass away in their 20s. I didn’t. I can’t imagine how difficult that would be.

[00:47:46] And that shapes life and relationships and money. I can’t help but point out the striking similarities in the story about your parents and what is happening right in front of us. You said that your mom almost left your dad. What is Rachel saying? What is the origin of us all talking today? Is Rachel saying, I will not accept your marriage proposal if you don’t address this financial issue. You see the similarity? They’re almost identical.

[00:48:23] Pierre: Yeah. My dad, when he was here, his cousin also ended up coming over here, and they actually took a loan now or got some money or inventory and used his name. So that actually gave him bad credit for seven– I’m just remembering it now.

[00:48:51] So he had bad credit for 10 years or so. And same thing. They took the money and ran. I know that they’re living in Jersey last– I remember hearing that they had a liquor store somewhere and never repaid my dad for anything. So I see a lot of money go out and not a lot of appreciation coming back.

[00:49:22] Ramit: Yes.

[00:49:23] Pierre: Like with this debt, if I pay it off, what appreciation am I seeing?

[00:49:28] Ramit: Wow. That’s actually a profound realization, that for generations in your family, the debt may have been taken out for a very good reason. There may have been a reason. But think of all the problems that it generated. And even when it was paid back or somebody was generous to another person, no appreciation. In fact, betrayal.

[00:49:59] And so this debt, which isn’t by a family– well, it’s based on a family member, family business. You took it on. If you paid off, what are you going to get out of it? Nobody’s going to say thank you. As far as they’re concerned, it’s whatever. It’s gone. But it’s actually on your back right now, and you’ve simply chosen to ignore it. I can see the generations just repeating. Do you?

[00:50:29] Pierre: Now, yeah.

[00:50:31] Ramit: Rachel, are you surprised by any of this?

[00:50:37] Rachel: I am, actually. I knew stuff about his family and most of that stuff, but some of that was actually news to me. But the pattern of generational stuff, I had not even thought of.

[00:50:53] Ramit: I think it may have been news to you as well, Pierre.

[00:50:59] Pierre: Yeah, it was.

[00:51:04] Ramit: This is truthfully why I feel so honored to be able to speak to you and to other guests that come on this show. I certainly did not know this. I don’t think any of us realized it, but sometimes it takes a little bit of gentle probing and all of us participating to find out what actually happened.

[00:51:27] And it is so common that we go through our entire lives simply just operating on instinct and never pausing to go beneath the surface and go, “Why do I feel this way about– why am I resentful about my debt? Why am I avoiding all this debt, which, how did I even run up in the first place when I was debt-free into my 30s?” There’s something here, but sometimes we need somebody to help us chip away at the ice and go deeper. So Pierre, I appreciate you going on that journey with me.

[Narration]

[00:51:57] Ramit: One of the reasons I love doing this show is what seems absurd from the surface actually starts to make a lot more sense once you look deeper. Pierre’s dad spent heavily on family, bringing over relatives from Vietnam, so much so that his mom nearly left him over it, and now decades later, Pierre is following the same story.

[00:52:21] When you grow up watching a certain dynamic, you absorb a lot of unconscious lessons. Things become normalized to you in a way that someone else who didn’t grow up with that would never think. Like helping family no matter what the cost is, feels normal. You would never even think of saying no. It wouldn’t even occur to you.

[00:52:42] The way we handle money today as adults is often shaped from these early experiences, and your parents don’t have to be from a different country for you to have a deep set of invisible scripts about money. Just ask yourself, what did I learn about money growing up? What lessons did I take away?

[00:53:00] And if you really want to get into this, get a copy of my, I Will Teach You to Be Rich journal, which will help you probe your deep beliefs about money. Basically, it’ll help you understand why you treat money the way you do. Now, let’s hear how Rachel’s upbringing shaped her view of money.

[Interview]

[00:53:18] Ramit: Rachel, I would love to go back in time to your family. And if you are going back in time and you’re thinking about when you were young, what did your family say about money?

[00:53:34] Rachel: Similar to Pierre, mixed messages. Both of my parents are also immigrants. Growing up, my parents divorced when I was six years old, and my mom wasn’t able to work after I was born, basically. So when my parents got divorced, my dad was paying alimony to her, and the amount covered rent. It covered rent and a little.

[00:54:02] And I kept thinking to myself, I was like, okay, my mom doesn’t have to work, so I guess whatever money she’s getting from my dad, it’s enough. And as I got older, I learned that my mom actually had investments in Vietnam. And she had a very close family friend that was living there and handling the investments for her.

[00:54:29] And so at one point, she could get money sent to her at any time. And today, it’s basically pissed away, but that’s a separate story. But for my dad, I think he came to America with maybe not even $1,000 in his pocket. And he worked his way up with the business. I don’t know where he learned it from because he and his family grew up poor. But yeah, even today my dad, he’s doing well. He’s not wealthy by any means, but he has investments. He’s doing okay.

[00:55:12] Ramit: Both your parents are alive, I take it.

[00:55:14] Rachel: Yes.

[00:55:15] Ramit: And do you have a relationship with both of them?

[00:55:17] Rachel: I do not have a relationship with my mom at the moment.

[00:55:20] Ramit: Okay. With your dad, do you ever talk to him about money?

[00:55:27] Rachel: From time to time, it’s not very detailed. He’ll usually ask me, “Oh, do you have enough money in your bank account?” When I was in high school, he actually started a Roth for me.

[00:55:42] Ramit: Great.

[00:55:42] Rachel: I had no clue what it was. I did not look into it as a kid, but he started one for me. And that from that point on, it’s actually steadily grown.

[00:55:54] Ramit: Okay. You said your dad is now fine with money. He’s not wealthy, but he’s not poor. Say like middle class, upper middle class, something like that.

[00:56:04] Rachel: Yeah, I would say probably middle class to upper middle class.

[00:56:07] Ramit: Okay, cool. Okay, Rachel, I’m going to ask a question. Feel free. If you don’t feel comfortable with it, we can totally pass. But out of curiosity, why don’t you have a relationship with your mom?

[00:56:20] Rachel: So she had investments in Vietnam where it could set her up. She pissed all that money away. The internet is probably going to have a field day with us. A few years ago, she got scammed by a Nigerian prince.

[00:56:41] Ramit: Whoa.

[00:56:43] Rachel: Yes. I have gotten into many, many arguments with her about it because, back in the day, I was not making a lot of money, and she started asking me to send her money. I got into so many arguments with her saying, “If you’re getting scammed, why are you talking to this person? You shouldn’t be talking to them. You shouldn’t be giving money to them.” And she started asking our other family members for money. And to this day, it’s still going on.

[00:57:14] Ramit: Oh.

[00:57:15] Rachel: It’s happened where she is opened and closed multiple bank accounts. I will never forget, there was one day where I called Chase Bank and I said, “I am letting you know my mom is coming to your bank to send a check to someone in Africa. She does not know anyone in Africa. She’s an Asian woman. She does not know anyone in Africa. Please block this.”

[00:57:39] And so because they blocked it, she closed the bank account with them, and then she opened another one somewhere else. So all that money that she had, she could have moved back to Vietnam. She could have been totally covered. She could have been fine. Instead she just decided to give all of this money away. I think she’s probably given about maybe $60,000 to this person.

[00:58:03] Ramit: Oh my God.

[00:58:05] Rachel: Maybe even more. I don’t know. It’s gone on for years.

[00:58:09] Ramit: I’m so sorry.

[00:58:10] Pierre: Could have paid my debt.

[00:58:12] Rachel: She could have paid his debt. Honestly. It’s crazy.

[00:58:16] Ramit: I’m so sorry. I know people personally whose parents, often moms, are in the midst of being scammed, and it is so difficult. It’s almost like no matter what you show them, it doesn’t matter. They are just captured. How does that make you feel about money, Rachel?

[00:58:41] Rachel: Frustrated. Just really, really frustrated. For the longest time, the money relationship I have with my dad is very different than the money relationship I have with my mom.

[00:59:02] Ramit: Mm-hmm.

[00:59:03] Rachel: I say that because growing up my mom always told me, “Oh, just ask your dad for money.”

[00:59:11] Ramit: Mm-hmm.

[00:59:11] Rachel: Because my mom would just always get monthly checks from my dad. And I never, ever felt comfortable asking my dad for money, never even for an allowance. Even to this day, I don’t ask my dad for money.

[00:59:27] Ramit: Why?

[00:59:29] Rachel: I think it’s because when my parents got divorced, my mom really pitted me against him. And I think for so many years I really held a grudge against him. And she made him seem like such a bad guy. I don’t know. I never felt comfortable asking my dad for anything. I remember he would always try to make up for it by buying me things.

[01:00:06] And that’s never really what I wanted from him. My dad, I think his love language is gift giving because he doesn’t really know how to communicate in other ways. Especially when it comes to– I think what I really want with him is quality time, but he doesn’t know how to do that. So for me–

[01:00:30] Ramit: Where’s your dad from?

[01:00:32] Rachel: He’s from Israel.

[01:00:33] Ramit: Okay, okay, okay. So the love language you wanted to receive was not gifts. It was quality time with your dad.

[01:00:43] Rachel: I think so. Yeah.

[01:00:44] Ramit: Okay. You mentioned that you never asked him for things. Even today, you still don’t ask him for things.

[01:00:51] Rachel: Yeah.

[01:00:52] Ramit: Do you ever ask Pierre for things?

[01:00:55] Rachel: No, I don’t think so.

[01:00:57] Ramit: Mm-hmm. Do you think it’s the same reason?

[01:01:02] Rachel: Yeah.

[01:01:03] Ramit: Mm-hmm. Have you ever asked him clearly and concisely, directly, to pay off his debt?

[01:01:15] Rachel: I don’t think clearly and concisely, no.

[01:01:20] Ramit: Okay. Pierre, any surprises hearing Rachel talk about her history with money?

[01:01:28] Pierre: Really the only one is that she was– the last point that you brought up that she never asked me directly to pay off the debt. As you said that, my thought was, what’s the benefit of paying off at this point? How does it benefit paying it off? Because it’s still going to be on my credit report for X amount of years. And the financial advisor said they could renew if they sue me. So don’t draw attention to yourself.

[01:01:59] Ramit: We’ll get to the financial part of it. Can I ask you something, Pierre? What do you do for a living?

[01:02:05] Pierre: I’m a director at a phone office.

[01:02:06] Ramit: Okay. First of all, Rachel has not even asked you even after I pointed it out to pay off your debt. So that’s not anything she’s asking. We should be very clear about that. But what’s interesting is when you started to explore that concept in your head, your first reaction was what?

[01:02:25] Pierre: What’s the benefit?

[01:02:27] Ramit: What’s the benefit? To retreat to logic and dollars and ROI, which I find ironic for two reasons. Number one, I’m not sure you’re particularly good at it. Then the second thing is you are retreating to the comfort of what some financial advisor told you, but you’re ignoring the very person who’s 1,000 times more important than Chet. Who is that person?

[01:02:55] Pierre: Rachel.

[01:02:56] Ramit: Yeah. I’ve made decisions about our family finances that I wouldn’t do myself. Financially speaking, I don’t think they were the perfect move. And yet my wife wanted to do them. And I was like, I’m hearing her. She wants to do something in a way that I wouldn’t do. But sometimes there are bigger, more important virtues than ROI.

[01:03:27] And I think, Pierre, in your situation where you’ve mentioned you want to get married, and Rachel for the first time today has said, I will not get married unless there is a clear plan for that debt, a plan, I think that might be a higher virtue to start thinking about than pure ROI. How does that strike you?

[01:03:45] Pierre: Makes sense. I get it.

[01:03:48] Ramit: Okay. All right. Rachel, what patterns do you see in how you handle money today based on your family upbringing?

[01:03:57] Rachel: I don’t ask. I don’t ask Pierre for things because I don’t ask my dad for things.

[01:04:04] Ramit: Yes. What else? What’s your greatest fear with money?

[01:04:10] Rachel: Greatest fear. I was in a situation before where I didn’t have any savings, I didn’t have a job, and I almost didn’t have a place to live. So I think my greatest fear is getting back to that.

[01:04:31] Ramit: Mm-hmm, mm-hmm.

[01:04:33] Rachel: Which is why I don’t think I’ll ever get back to that spot, but that was definitely the lowest point in my life.

[01:04:44] Ramit: It must be scary to entertain the idea of getting married to somebody who seems quite lackadaisical with tens of thousands of dollars of debt.

[01:04:55] Rachel: Yeah.

[01:04:58] Ramit: If that debt grows, if it accumulates interest, or if something were to happen similar in the future, that could put you in the position of your greatest fear. I don’t know. I’m thinking out loud. What do you think?

[01:05:12] Rachel: Yeah.

[Narration]

[01:05:13] Ramit: Isn’t it amazing how you can almost draw a straight line between how we treat money today and what we saw growing up? I am always fascinated by these parallels. We saw it with Pierre, and now hearing Rachel’s backstory, we see it again. Her dad was careful, deliberate with money. He even opened up a Roth IRA for her in high school, and that’s where her methodical approach comes from.

[01:05:37] But then she watched her mom get swindled out of tens of thousands of dollars. No wonder she is totally averse to debt. One lesson that she took away seems to be you can stay safe by never relying on anyone else. Maybe that’s why she’s never asked her dad for money. Not even today.

[01:05:56] With Pierre, she’s never directly said, “I want you to pay off this debt.” She’s hinted. She hoped he’d get the message, but she’s never actually made a clear ask. But we have to be very honest that when you don’t set clear expectations, can’t really be surprised when they’re not met.

[01:06:13] A Rich Life is more than money in the bank. It’s about being honest with yourself and the people around you, what you want and what you need. Rachel hasn’t done that. When I point this out, Pierre retreats into his comfort zone, numbers, ROI, some financial advisor’s opinion. Okay. That’s safer than facing the emotional truth that the person he calls his number one priority is telling him as clearly as she can that she feels unsafe with his debt.

[01:06:45] Rachel avoids asking for what she wants. Pierre doesn’t allow himself to truly hear what she’s saying. And until they break that pattern, they are stuck. If you have ever struggled to talk about money with your partner, sometimes it turns into a fight or just a dead end, I want that to change. I got a free guide for you. You can download it at iwt.com/partner. Now, I’m going to see if we can get them to create a new dynamic. But before we go on, if you were me right now, what would you do with Rachel and Pierre?

[Interview]

[01:07:16] Ramit: Can you imagine a relationship where you were crystal clear about your expectations? Like in my relationship, this is what I expect. My wife once told me– not once. She told me this multiple times. My wife said, “When we are out in public, I expect that we support each other. We are not rolling our eyes. We’re not jabbing at each other. We are always having each other’s back.” She said it point blank. That is my expectation.

[01:07:48] I was like, “God damn, I love that.” It’s so direct. It’s so honest. It’s just setting, here’s my standard. It’s up here, and this is what I expect. Rachel, what would it feel like to be so clear about your expectations in a relationship that you just said them? No caveats. No equivocation. No minimization. Just simply, “This is what I expect in our relationship.”

[01:08:13] Rachel: It would be great.

[01:08:15] Ramit: What if you did that for your financial situation? What would that look like?

[01:08:20] Rachel: I think it would clear things up a lot. I think it would be better for where we are now and for future conversations surrounding money.

[01:08:35] Ramit: Okay. You are both dating. You’re both living together, and you both mentioned that you would like to get married. What is the timeline on that decision?

[01:08:48] Pierre: Soon.

[01:08:49] Rachel: That’s a great question.

[01:08:50] Ramit: Are we talking six months, two years. What are we talking about here?

[01:08:56] Pierre: I would like to be married within the next couple of years, for sure.

[01:09:04] Ramit: Okay, so that means engaged within a year, married a year after that, right?

[01:09:10] Pierre: Yeah.

[01:09:11] Ramit: Not to hold you guys to some date, but I’m just trying to get a sense for what’s the universe we’re talking about here. Pierre, do you think that Rachel’s concerns about your debt are valid?

[01:09:23] Pierre: Yes. But at the same time, I feel that, I guess I’m not afraid of it being too much of a negative impact because I look at it as it’s our money. Money that we could spend in other ways.

[01:09:42] Ramit: Okay. What about it’s Pierre’s debt, and if you got married, it would be both of your debts?

[01:09:53] Pierre: If I needed to, I could take a loan out and pay it off tomorrow.

[01:10:00] Ramit: Okay.

[01:10:01] Pierre: But for me is, is that money well spent? Aside from making her feel better. And that’s number one thing. I want her to be happy.

[01:10:11] Ramit: Mm. Is that true? I don’t think so.

[01:10:16] Pierre: I do.

[01:10:17] Ramit: I believe that you want her to be happy. I believe you guys have a pretty healthy relationship. It is pretty obvious. But money is a big part of a healthy relationship. And while I’m not trying to argue that you should pay off your debt all today– I’m not arguing that. We haven’t even gotten to that.

[01:10:33] Pierre: Yeah.

[01:10:34] Ramit: But I don’t think your financial behaviors are matching up with the concept of, I want Rachel to be happy. I don’t think you’ve actually had one substantive conversation about this debt. I think your conversations, Pierre, have basically been you figuratively crossing your arms and just answering her questions.

[01:10:53] Pierre: I think a big part of that has to do with most of my life, having to figure things out myself. And I haven’t had too much help with finding answers a lot. Part of that is probably I grew up not asking for help. It was the man thing to do, figure it out. Figure it out.

[01:11:23] Ramit: Keep going.

[01:11:24] Pierre: So in this situation, it’s figure out. I’ve always been, all right, this is my plan. Execute it.

[01:11:32] Ramit: Do you think you have figured out the solution to your debt?

[01:11:37] Pierre: No.

[01:11:37] Ramit: Okay. I agree. And Rachel is saying, “I don’t feel you’ve figured it out either.” So Pierre, I think that your strategy of trying to figure it out on your own is not working effectively.

[01:11:50] Pierre: Oh, that’s why I reached out to employee assistance program and see what we can do. And I’m going to be meeting someone to talk about the insurance.

[01:12:00] Ramit: Who was the financial advisor who you reached out to that gave you this advice?

[01:12:05] Pierre: So it was a employee assistance program. I get on a phone call and ask whatever questions that I have.

[01:12:13] Ramit: Mm-hmm. And what did they tell you specifically?

[01:12:16] Pierre: The main line he said was time is your friend, because I’m five years into it already, and it comes off of my credit report in seven years.

[01:12:27] Ramit: When you talked to this person, two questions for you. Number one, did you tell them that you have a judgment against you from your Amex card?

[01:12:36] Pierre: Yes.

[01:12:38] Ramit: And did they talk about statute of limitations

[01:12:42] Pierre: He said 10 years. 10 years to go.

[01:12:45] Ramit: What happens after the 10 years?

[01:12:47] Pierre: They have to take me back to court and sue me again.

[01:12:52] Ramit: Yes. And the second question, I want to ask about this conversation. Did you get it in writing?

[01:13:00] Pierre: No, it was a phone call

[01:13:02] Ramit: Okay. Knowing those two things, put yourself in Rachel’s position. How do you think Rachel feels about your research about debt?

[01:13:13] Pierre: That I should have gotten more something in writing or some type of–

[01:13:21] Ramit: Don’t tell me what you should have done. Just answer the question about how do you think Rachel feels about your relationship with this debt and your proposed solution?

[01:13:30] Pierre: She hates it, and she thinks I’m too nonchalant about it.

[01:13:33] Ramit: Yes. Rachel, would you like to add anything?

[01:13:36] Rachel: That pretty much covers it. Yeah.

[01:13:38] Ramit: Okay. Pierre, if I were Rachel, I would be super frustrated because it feels like you have avoided it. Actually, why am I saying it feels like. You have avoided the debt. You’re not on top of it. When Rachel asked you to come up with a plan, your plan was halfhearted, if we’re honest. You called up some random person through your employer. We don’t know if they’re qualified or not.

[01:14:09] And you told them the situation, and they did give you some advice that’s good, but also some of the advice is a little bit incomplete, and none of it’s in writing. So it’s like, how do we even know how reliable of a narrator you are? Did they share some nuance that you are not capturing here?

[01:14:26] Do you have all the explicit plans of if this happens, then I’m going to do this. If that happens, I’m going to do that. Or is it just like, “Hey, they told me it was cool, so just let’s chill for five, 10 years. In the meantime, let’s get married.” Do you see how she might not be comfortable accepting that?

[01:14:47] Pierre: Yeah.

[01:14:48] Ramit: I wouldn’t. I would find that totally unacceptable, completely. And the fact is, in the state of New York, yeah, there is a statute of limitations on some of your debt. But since you have a judgment, that changes everything. You got the mention of it from this advisor. We have, it’s enforceable for 20 years, as 10 plus the next 10, which they’re probably going to come after you. Interest can accrue, and it’s a lot of interest, especially on a balance like this.

[01:15:20] I don’t know how likely or unlikely it is that it’s going to get wiped off, but they can come after you, and they can take money from you. As Rachel, how could I walk into a financial situation with that much risk, especially knowing that we might have kids? We might move housing. How could I go into it knowing that there’s this tens of thousands of dollars looming over our head with no real plan to take care of it?

[01:15:46] Pierre: That wouldn’t be fair.

[01:15:49] Ramit: Especially when you consider Rachel’s financial history. It’s just way too much risk. It’s scary. People don’t talk in terms of risk. They just say it’s scary. And sometimes people can’t articulate their fears, but they’re just like, “Something doesn’t feel right.” And that’s what Rachel has been trying to say. Rachel, would you agree?

[01:16:11] Rachel: Yeah.

[01:16:11] Ramit: It’s one thing if you have a bunch of debt. Okay. It’s another thing if you are like, “Hey, [Bleep], I don’t know what to do about all this, but I’m going to go make a plan, and Rachel, I would actually like for you to come to these conversations because I need your help to try to figure out what’s the right decision to make.”

[01:16:29] That would be great. But making a random phone call and then just playing telephone and sharing what this rando told you, and the conclusion is basically like, just chill. Don’t do anything, and just wait. It doesn’t make anybody, including me, feel comforted. Pierre, what’s your take?

[01:16:49] Pierre: It makes complete sense.

[01:16:53] Ramit: What do you want to do?

[01:16:54] Pierre: Start trying to at least knock off this big Amex debt.

[01:16:59] Ramit: Maybe, maybe. Before that, I think there are some steps. We want to come up with a plan before you start just randomly paying the debt off. So I think there are steps before that. But what’s the first step in your relationship? It involves Rachel.

[01:17:22] Pierre: Yeah.

[01:17:24] Rachel: I am right here.

[01:17:24] Pierre: How are we going to do this, babe?

[01:17:28] Rachel: I’ve been waiting for you to ask me. You have no idea.

[01:17:31] Ramit: Wait, wait. What the [Bleep]? What is not going to happen is Pierre delegating the strategy to Rachel. And Rachel’s ready to pick up the thing and go, “Oh, I got a [Bleep] plan. I’ve been looking on ChatGPT.” That’s not going to happen. This is Pierre’s debt. Pierre will take the lead on it. So Pierre, I love how you tried to toss the ball to Rachel. Rachel, go ahead and toss it right back to him. Go ahead.

[01:17:55] Rachel: Actually, I’m so glad you asked for my help, but I would really appreciate if you took the lead on this.

[01:18:02] Ramit: Beautiful. Round of applause. Okay, great. Go ahead, Pierre. Pick the ball back up and give us your overview.

[01:18:10] Pierre: I guess the first step I can take is to see what lawyer I can get through my job to reach out to Amex to figure out some type of payment or a plan to tackle this debt.

[01:18:38] Ramit: Why does this feel so awkward? What the [Bleep] is going on right now? You know why? Because Pierre, you’re not driving this decision. You’re waiting for her to give you commentary, but you’re not even asking her a question. Let’s do that again. Do it again. Just think about what you want to say before.

[01:18:56] Pierre: So babe, I think my first plan is to reach out to a lawyer and have them see if they can reach out to Amex and come to some type of settlement or payment plan. What do you think about that?

[01:19:19] Rachel: Okay. I think that would be a good start. I’m trying to think of– so that would just be for the big Amex one.

[01:19:30] Pierre: Yes.

[01:19:31] Ramit: Stop taking the ball.

[01:19:34] Rachel: Okay. What’s next?

[01:19:36] Ramit: Great.

[01:19:40] Pierre: For the other debt that is in collections, my plan is to just wait for it to come off of my credit report. what do you think about that?

[01:19:53] Rachel: I think it’d be interesting to see how much time is left, but I’m not mad at that. Is there anything else that you would want to look into?

[01:20:07] Pierre: I’m not sure. What else would there be to look into? Or are you talking about off that debt as well?

[01:20:18] Rachel: I think the most important thing would be to see what the lawyer would say first about Amex, since that’s probably the most important and biggest payment at the moment. And then maybe we can go from there.

[01:20:37] Pierre: I can go with that.

[01:20:40] Ramit: Okay. I love this. This is good stuff. I just want to give you a little tool that you can use. So Rachel, let’s see what happens if you ask a hypothetical. Say, “Pierre, let’s assume that the attorney says we should do this for one loan and we should wait for another but one loan, you should pay it off as quickly as possible. And just to make up a artificial number, the loan’s going to be $10,000. What would you do?” Go ahead, Rachel. Ask the question.

[01:21:14] Rachel: Okay. Babe, what if the lawyer says that you have to pay off one loan as soon as possible and the amount would be $10,000?

[01:21:26] Pierre: I would sell some stocks and tap into my savings and pay that 10 grand.

[01:21:35] Ramit: Don’t you make a ton of money? You make $100,000. Right, Pierre?

[01:21:40] Pierre: Close.

[01:21:41] Ramit: All right.

[01:21:42] Pierre: 85.

[01:21:43] Ramit: $85,000, and combine the two, you make $183,500. I’m sure if you need to pay off, let’s say 10 grand in a year or two, you could find the money for that. What do you say?

[01:21:55] Pierre: Yeah, I can do that.

[01:21:56] Ramit: All right. What if it meant you couldn’t go on one of the trips you were going to take?

[01:22:01] Pierre: Yeah, we’ll just take a cheaper trip.

[01:22:04] Ramit: Or no trip?

[01:22:05] Pierre: Sure.

[01:22:07] Ramit: What’s happening right now? I feel like we’re on different dimensions. Pierre, have you ever not done something you want to because of debt?

[01:22:19] Pierre: I don’t spend more than what I have.

[01:22:22] Ramit: Well, you have $60,000 in debt, so that’s not true.

[01:22:25] Pierre: Yeah. I could pay it off. I have enough to pay it off.

[01:22:31] Ramit: All right. Where’s the money that you have to pay it off? In your investments?

[01:22:36] Pierre: Yeah.

[01:22:37] Ramit: Okay. What do you think of this, Rachel?

[01:22:41] Rachel: I think selling off investments is probably not the best choice.

[01:22:45] Pierre: If I could not take one trip and cover my debt, for sure.

[01:22:52] Ramit: Wait a minute. That’s the first time I’ve heard you say that. That’s actually awesome. That’s how savvy people think about it. Sometimes even the savviest of people can get into a debt situation. Business flops, medical expense, etc. Everybody’s going to go through some type of crisis in their life.

[01:23:11] I don’t blame them for that. What is important is to be able to adapt. And for most people, they have not had to turn down something they want in order to pay off debt that they hate. You hate this debt, Pierre. You’re resentful of it. You told me that. And so it feels even more painful to not do the things you want to do, like take a trip.

[01:23:32] So what I’m trying to show you is there’s a psychological element here. It’s not just math. Like yeah, you have money to pay for it, and yet you haven’t paid for your debt in years. And what I’m trying to get at, and what I think we’re starting to crack the code on is if you could make a huge dent in some of the debt that you owe by not taking a trip or two, or eating out less, maybe you’d be willing to do it. Is that true or not?

[01:23:57] Pierre: Yeah, I have no problem with it.

[01:24:00] Ramit: Okay. Awesome. That’s a breakthrough. Round of applause. That’s big. That’s really big. That’s awesome. Rachel, how do you feel about that?

[01:24:07] Rachel: I think that great.

[Narration]

[01:24:08] Ramit: Pierre started this conversation by handing the ball over to Rachel over and over again. What do you think about that? Is there anything else you’d want to look into? It sounds polite, like he’s including her, but it’s actually a way of him avoiding responsibility.

[01:24:23] I’m going to be really blunt. When you are the one with $60,000 of debt, you need to be the one leading the conversation, not waiting for your partner to do it for you. And every time you hand off the decision making, you’re essentially telling them, “This is your problem too.” No, that’s not how it works.

[01:24:43] But fortunately, we have a breakthrough because by the end, Pierre stopped tossing the ball back and he kept it for himself. He started driving. He came up with the ideas. He acknowledged Rachel’s frustration. For the first time he said he would give something up that he wants in order to make progress on the debt.

[01:25:01] That’s the shift I look for, from avoidance to ownership. That kind of shift is something I can work with. So now that Pierre is finally taking ownership, I’m going to get really direct about what I think he should do next and exactly how to show Rachel that he’s serious about it.

[Interview]

[01:25:17] Ramit: All right. Can I be very crisp with what I think you should do about this debt? I just want to be a little bit directive here. Do not pay a single cent until you talk to a debt settlement attorney. When you go to this debt settlement attorney, which you will find– you can look through your workplace, but you might just want to find somebody else.

[01:25:35] In general, I don’t like going to attorneys through my workplace. They have a lot of heavy workload and it’s unclear the incentive structure and all kinds of stuff. You have money to pay for a debt settlement attorney. Find one. Interview two or three. I always interview five vendors whenever I’m looking for somebody important. Five.

[01:25:58] And Pierre, I think this is an awesome opportunity for you to begin showing Rachel how seriously you are taking it. I would set up a spreadsheet. I would tell Rachel my first step is to find a debt settlement attorney. Here’s the link to my spreadsheet. I’m going to be tracking my calls. And by the end of, next Friday I’m going to pick somebody who I’m then going to hire and engage. Now, how do you think Rachel will feel about you making a plan and starting to execute on that within a matter of days, Pierre?

[01:26:28] Pierre: She would probably pop on a knee and propose to me.

[01:26:35] Ramit: Very good. Listen up, all you freaking nerds listening to this podcast. Logistics are a big turn on. I don’t care what anybody says. You heard it here first. Okay, so make it a plan and executing, great. Next, you get the debt settlement attorney. You hire them. You call them. And instead of doing what y’all started to do, y’all started to self-diagnose.

[01:26:55] Well, we only really need to talk to them about the Amex debt. How do you know? You’re not a debt settlement attorney? So don’t try to do their job for them. Just come prepared with your entire spreadsheet. This is the interest. This is when it started. This is the balance. All the relevant information on one page.

[01:27:11] Make their job easy because you’re paying them probably by the hour or whatever engagement. Make it easy. And let them tell you what to do. Don’t do their job for them. I remember when I was taking driver’s ed in like 10th, 11th grade, and they were like, “If you have some pinging on your car, don’t go into the freaking car guy and tell them like, oh, I think it’s my carburetor.”

[01:27:30] Just shut the [Bleep] up. Go in there and say, “There’s pinging in my car.” And let them diagnose it. Don’t do it yourself. Same thing with working with an attorney. Tell them what you know. Ask them what you should do. Follow their advice. How do you feel about that?

[01:27:45] Pierre: Yeah, sounds about right.

[01:27:47] Ramit: All right. Rachel, how do you feel about that?

[01:27:49] Rachel: Sounds good.

[01:27:51] Ramit: All right. Can we look at the CSP and take a look at some of the numbers?

[01:27:56] Rachel: Sure.

[01:27:56] Ramit: So currently you have $134,000 in investments. You have $35,000 in savings, which is about seven months of savings. $60,000 in debt, as we discussed. As a reminder, you make $183,500, and your fixed costs are low, 48%, which is allowing you extra money that you currently have focused by investing.

[01:28:26] So you’re investing about $1,461 a month. And you’re saving 11% or $1,125 a month. You’re also spending 2,627 or 26% on guilt-free spending. So in general, things look pretty good. I don’t really have any comments on your fixed costs since they’re at 48%. I do want to ask, can we just set some money aside proactively for the debt? Can we just find some money? Because I assume you’re going to have to pay off some of this debt.

[01:29:02] Pierre: Yeah.

[01:29:02] Ramit: So where would the money come from?

[01:29:05] Pierre: It’d be from my guilt-free spending.

[01:29:07] Ramit: Okay. That would be you currently, Pierre, spend $1,196 a month on guilt-free spending.

[01:29:15] Pierre: Mm-hmm.

[01:29:15] Ramit: What do you want to do?

[01:29:18] Pierre: I could put an additional 300, 400.

[01:29:21] Ramit: Yeah. So we’ll take you down to 796. 796 here. And for debt, we would take you up to 400. It’s not bad. What do you think?

[01:29:41] Pierre: How much can I put it for my wedding?

[01:29:45] Ramit: Okay, you tell me.

[01:29:46] Pierre: I’ll take one less vacation.

[01:29:51] Ramit: All right. So what do we drop this 250 a month on vacations to?

[01:29:55] Pierre: We can do 150.

[01:29:59] Ramit: Okay, so you’re dropping it by 100 bucks. That’s perfect. That takes you right down to 100 bucks towards the wedding. Nice work. Great. And then these gifts, I know you like to be generous. Just ask yourself, is it part of your invisible script that you have to be giving gifts, or is there another place you might rather put that money? Or do you just want to keep doing it? It’s totally up to you.

[01:30:29] Pierre: I’d still have to give gifts. I can’t give no gifts.

[01:30:32] Ramit: Okay. So you tell me. Right now you are giving $125 a month in gifts.

[01:30:40] Pierre: Over the course of a year, that’s what?

[01:30:42] Ramit: 1,500.

[01:30:44] Pierre: Yeah, I could be less generous with the gifts.

[01:30:47] Ramit: Or let’s put it another way. I could be more responsible with my immediate family’s finances. See the difference? Profound different positioning. Very important.

[01:31:01] Pierre: I could do 75 a month. So that comes down to 900 a year.

[01:31:09] Ramit: Yeah. Love it. That’s great. We’re talking about relatively small numbers, but it’s important. What I’m seeing is you, Pierre, putting your immediate family, that is Rachel, first. And you can still be generous with your extended family, with your mom. You can still be generous with others, your nieces. Yes, of course. But what I’m starting to see you naturally doing here is to actually prioritize your relationship first. And to me, that is awesome. How do you feel about it?

[01:31:44] Pierre: Okay, great.

[01:31:45] Ramit: Awesome. Okay. 75 bucks. What do you want to do with the remainder of that money?

[01:31:51] Pierre: Split it between wedding and debt.

[01:31:55] Ramit: Nice. Good answer. So I’m going to put 125 towards the wedding. Pierre is now exceeding Rachel in contributions on a monthly basis. That’s pretty cool. Even though we know Rachel’s been doing this quietly for a while. I appreciate both. I like that. And then debt payments now at $425 a month.

[01:32:16] That’s pretty good. That’s pretty good. That’s very impressive. We’re talking 5,000 bucks a year in debt payments. And if you needed to, you could increase that number. Let’s see here. It’s possible you could contribute a little less to post-tax retirement. I wouldn’t necessarily start there because I love seeing you get aggressive now about your retirement.

[01:32:41] And then we have some other stuff. Like we have subscriptions. You could drop a little bit clothes. You could probably drop a little bit– I’m not going to tell you to cut back on your mom if you want to, but you could if you had to. It’s important to know. So you basically have cards to play, and of course, you can always work on the upside.

[01:33:03] In Earnable, our business program, we always teach people how to earn more money. So there’s lots of different ways you can play it. Pierre, do you feel fairly equipped to be able to speak to that debt settlement attorney, to be able to find out about whole life insurance, and then to make some moves, financially speaking, to bring you closer together with Rachel?

[01:33:20] Pierre: Yes.

[01:33:20] Ramit: Okay. Awesome. That plan, again, is not just a plan about debt. It’s actually a plan about how the two of you work together with money. It’s like that first year of engagement that my wife and I planned. We really sent a signal to ourselves. This is how we tackle big projects together.

[01:33:38] And gosh, I’m so glad we did it with a positive attitude together. Because that sets the precedent for the rest of our lives together. I have a lot of confidence in you two. Keep me updated, and I can’t wait to hear what decisions you make.

[Narration]

[01:33:51] Ramit: When we started this conversation, Pierre basically shrugged at his $60,000 debt. He had no urgency, no plan. It was like to him, the debt didn’t really exist. Rachel, on the other hand, comes from a childhood filled with mixed money messages and high stakes mistakes from her parents. She wants stability, but she also never directly asked for what she wants Pierre to do with that debt.

[01:34:17] But did you notice by the end of our talk something had shifted? Pierre went from defensive and detached to engaged and proactive. He admitted he’d been avoiding it. He acknowledged the effect on Rachel. And for the first time, he said he would be willing to cut back, even skip a trip to start paying it down.

[01:34:36] So I gave him a clear plan. Step one, do not pay a cent until you talk to a qualified debt settlement attorney, not some random guy on the phone. I want him to interview a few and get real advice. Step two, gather every detail of the debt in one place so you can actually make good decisions. Step three, adjust your spending to show Rachel that your shared future comes first.

[01:34:58] Yes, the debt needs to be paid down, but Rachel also needs to know that she’s not the only one carrying the responsibility. If they can follow through on this plan, they won’t just have a debt strategy. They will have a much stronger foundation for the next chapter of their relationship, one that is built on clarity and accountability and mutual respect. Now, what do you say we take a look at their follow-ups?

[01:35:23] Rachel: Hi, Ramit. So since our conversation, one of the biggest surprises was how emotional I am with money. No surprise there. Definitely the relationships that I had with my dad, my mom, and my last relationship was really eye-opening for me, and I definitely don’t want that to affect my current relationship and definitely how I pass that down to my kids. So that’s definitely one of the biggest surprises for me.

[01:35:56] One of the takeaways is me definitely being more straightforward in conversations with money and being more direct with Pierre, and just asking for what I need from him when it comes to money, because I’m able to ask him for anything else that I need from him. So it’s just getting used to that.

[01:36:21] And any changes that I plan on making is definitely just honing in on what I’d like our Rich Life to be. We were actually able to do that this past week with our grocery bill. We were able to cut down a little bit for our Costco bill since that was something that we didn’t necessarily really care about, and that way we can actually put more money towards vacations since that’s more of a priority to us. So looking forward to more updates in the future. Thanks.

[01:36:56] Pierre: Hi, Ramit, the biggest surprise from the conversation was that me and my dad had very similar challenges despite having different stories. He got bad credit and got into debt trying to help his family. I got into debt, got bad credit, trying to help my family.

[01:37:27] The takeaway from that I found is that we learn a lot from our parents, good and bad– how they handle debt, how they show love, and how that really impacts us without knowing. Another way I took away was that in order to live a Rich Life, you really need to treat your finances like work. Not homework, but actual work work. If I don’t do that, or if you don’t do that, then it’s really a lose-lose situation.

[01:38:01] Since our conversation, I have found five lawyers. I’m going to reach out to this week. I also have a script with a bunch of questions to ask them, thanks to ChatGPT. And so I will be letting you know by the end of the week where we’re at.