Latest / The Curve / RTC97: Getting out of 100,000 worth of debt with Liz Gillette.

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RTC97: Getting out of 100,000 worth of debt with Liz Gillette. · The Curve

0:00
Welcome to Raising the Curve, a podcast designed to teach you everything you need to know
0:05
to be better with your money.
0:07
And the wise words of Amy Shurma were slipping carrots into the brownie recipe.
0:12
I don't really get the saying.
0:14
It's kind of like eating vegetables that actually taste good.
0:17
You know, I like to stand up when you're new.
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Are you on the script?
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It's basically like saying infesting in finance can be boring but it totally doesn't
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need to be here.
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OK, OK, so we're making it fun by putting the carrot.
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OK, the vegetables are just good for you.
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It's the brownie recipe.
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OK, we got there, we got there.
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OK, OK.
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Well, you've really got a finance mate.
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Yeah, one of us has to.
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This is a joke.
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OK, come and learn alongside me from Vick Harris, ex-fun manager.
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Well, I'm going to ask all the questions that you wish you could.
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And I'm going to be eating all the brownie you wish you could.
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No, it's so not the joke, Vick.
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OK, just come and talk and learn and laugh with us
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because together we really can raise the curve.
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Wow, this episode, we actually are going to do a follow-up one
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because we didn't even get through half of the questions that we wanted.
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Like, such a fascinating story.
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And I don't know, it seems very odd to be talking to a financial advisor
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who has had so many debt issues, but I think it's also really comforting
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and nice to know that we all go through shit.
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We all have our own financial journey.
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And Liz Gillette, who we're out to talk to, has the most heartwarming, sad,
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inspiring, amazing story.
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And she was $125,000 worth of US dollar debt.
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Yeah.
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And yeah, she talks about her child, her, she talks about how she ended up
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in so much debt, she talks about where she is now
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and her perception of money and building wealth.
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And I loved the bit when we talked about relationship dynamics
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and how to navigate with your partner, how you talk about money
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and navigate that together.
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I found that part really fascinating.
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And she could have gone either way with all that debt, you know.
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And I think it's quite amazing and hats off to her that she's chosen
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this pathway to become a financial advisor
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and help other people not get in the situations that she was in.
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So without further ado, Liz Gillette.
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OK, Liz, we would like to ask you how much debt were you in
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and what was the compilation of that debt?
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Yes, I had $110,000 worth of debt here in US dollars.
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90,000 of it was student loans from getting my undergraduate degree,
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my four year university degree.
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5,000 was medical bills from my injuries as a volleyball player
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when I was in college.
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But I didn't know about it.
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And then 15,000 was a car loan.
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So that I could get my first car right out of school.
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That's just wild.
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Honestly, yeah, I was going to say, what sort of degree do you do
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for 90,000 US dollars?
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Like are you a pilot slash lawyer slash doctor?
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What's going on with all of the above?
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All of them.
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I'm very skilled.
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No, it's just a business degree, a marketing business degree.
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I just I went to a very expensive private school
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and that even included having scholarships, both academic and athletic.
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So it's just how much I walked out with.
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And so that's pretty kind of, I guess, average level of debt
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for a pretty typical degree.
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How does anyone fund that without going into debt to that amount
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as either scholarships or your parents pay
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is that effectively the turning options?
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Yes, that's the idea is that, right?
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So I've got a couple kids.
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And so I certainly would be approaching it in a different manner.
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I went to a very expensive private school and I wouldn't take any of it back.
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It got me a fantastic degree.
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I met my husband.
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I got great friends.
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You know, lots of positive things to come out of it.
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But ultimately it was just not enough aid.
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Like not they they believed that my parents could support
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much more than they could.
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So all the student loans fell on to me rather than a mix of like cash
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flowing, some of it mixed with student loans, mixed with scholarship.
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It just ended up being primarily debt after those four years.
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So unfair that to get educated or to go and get a degree.
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Which I mean, you don't need now.
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I know everyone has different opinions on that.
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But the fact that just to get a degree,
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you're going into nearly $100,000 worth of,
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which can take years to go.
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Your whole life for some people.
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Also, can we just skip sideways to the unknown medical bills?
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How do you not know about $5,000 US dollars of medical bills?
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Yeah, so that doesn't happen as often for other people.
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I'm just very lucky.
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Yeah.
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Yeah, you make a post.
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Yeah.
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So great.
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So I didn't know what a debt collector was until I'm getting angry phone calls
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of UOS this money.
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So I sustained an injury, a shoulder injury.
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I was a hitter in college.
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And those bills went unpaid and then they racked up fees and then they,
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you know, my parents were dealing with their own financial dress.
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So it was overwhelming for them.
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So they were both hypothetically and literally stuffed into a drawer
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opened those bills.
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So then they didn't go to the hospital and then all of a sudden,
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a collection agency picked it up and said,
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you owe three times more of that amount.
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And so I had no idea until I received the first phone call.
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And then I had to inquire with my parents and say,
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what is this?
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And I had to learn that world of like, well, what debts do you pay first?
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Right?
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What happens if I don't pay this?
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My car, if I would not pay my car loan, then they've got something they can take.
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They could take my actual car and they needed it for my job.
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So, you know, I had to decide.
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I guess.
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Yeah.
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I mean, well, did you feel mad at your parents?
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How did that whole conversation go?
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Because I feel like I'd be quite annoyed.
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I know that, of course, you're going to be mad at your parents.
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And also you needed that as your injury.
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But you're also a kid.
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So it's kind of also their responsibility.
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Like, how did that play out for you emotionally and with your dynamic,
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with your parents?
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So it was really interesting.
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I certainly knew we were in financial dress.
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Like, we experienced a lot right before I headed off to school.
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We were evicted from our home and I'm one of five kids.
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And so at that stage in my life, my heart broke for them.
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And what they were experiencing, I was so much more focused on right now that I got my degree.
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How can I get my job?
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How can I start making money?
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And how can I send it home to help my family?
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So there was certainly a portion of me that was so frustrated that like, but wait,
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I wanted to start with a clean slate.
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And this is like anything but a clean slate.
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And I had so much, yeah, sadness and empathy for what they were going through that it got squashed.
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The frustration got squashed by just the, oh God, they're dealing with this too.
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They're doing the best that they can.
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So it was through many years of therapy that I kind of fell in a little bit of a middle ground.
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Like, well, wait a second.
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There were things that should not have happened.
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They were certainly doing their best.
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And I feel like with parents, you know, most parents,
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that would be the last result of being not paying their child's medical bills.
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It must have been, must have been hard for them as well.
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But it hits off for you for getting through that.
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And so having five kids, did everyone come to the party?
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Was all five kids like, all right, how can we help our parents get out of debt?
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Was everyone sort of like head down, bum up?
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Let's all try and pay this off.
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Yeah, so we had a wide range.
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At that point, I had two brothers in college.
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So a lot of my parents ability to be able to take on loans.
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And then I got a third brother in college.
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I'm the fourth kid.
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So there was nothing left even loans for them to be able to help me.
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Right, by the time that I got there.
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So it was a very interesting mix.
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My younger sister was 11.
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So she's living in the house and feeling everything that is occurring.
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And then the three older brothers, two of them were like graduated and doing their own things.
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So it was an interesting mix.
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But we often say that we experience very different childhoods.
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Me and my younger sister versus the three boys.
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So I was trying to get an athletic scholarship, which was part of mine,
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so that I could go to college knowing that there weren't many resources left.
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You know, by the time I was trying to get there.
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You've obviously done a huge amount of therapy.
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And you're now helping people to not be in that situation.
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But I'm wondering if initially was that a quite a toxic relationship that you had with money
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and the idea of having a family?
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And yeah, I guess how bad was it and how did it affect you?
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Yeah, it was a major component of me, of the way that I saw the world.
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So when I worked through my debt, at that point money was the scariest thing in the world to me.
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And all I knew was that I will make every sacrifice known to man to make this happen.
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So I cut out every membership, every perk, everything I could do.
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I remember there is a day that I moved like two dollars and 28 cents in my bank account
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so that I'd pay off the debt sooner.
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I mean, I was obsessed.
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And that's what worked for me was like it was very fear driven.
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Right? Like very fear driven just to get myself out of it.
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And that worked.
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But certainly I knew I didn't want to live in that space forever.
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So growing up and for a lot of people, money and security, a home is a place you can always come back to.
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Not one day you're told we need to pack up our stuff in one hour.
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We're we need to leave.
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We're being kicked out.
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We can't come back.
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Right?
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So at the time as a kid, I think there's a lot of things that can be considered traumatic.
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No matter how big or small they are, because as a kid you can't process your own emotions.
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You don't really understand what's going on and you can't even really compare your situation to other people.
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Because you've got such a limited, you're in an echo chamber of people that you know,
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I can't imagine dealing with that such a young age.
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I'm sending like love and hugs to little lives because that would have been really hard.
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And that's also for you for like addressing it and working on it and trying to reframe that narrative around money is, you know,
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not a scary thing, but actually like a really empowering thing and everything you're doing now.
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It's almost like you could run in the opposite direction and totally rack up debt for your entire life.
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Because that's all you've ever been taught.
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It's amazing that you've stepped sideways.
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Sorry, let's go back.
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So you got to a point where you were basically having to leave your house.
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Yeah.
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When I was 17 years old, we'd been getting notices on our door, right?
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Like you need to be able to pay your mortgage or else or else we'd get statements in the mail.
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And that was from the bank, those overdraft statements over and over.
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We had had a car repossessed in the middle of the night.
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It was 3 a.m.
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And I heard this noise and they were pulling off our family car.
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And so I was trying to understand as much as I could from 14, 15 and 16, I would say is when it was really rough to the point that when we got evicted at 17,
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I'm thinking there's nowhere to go but up right at this point because so many things have been taken from us and water had been shut off.
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And they were just trying to keep ahead and debt is ultimately what got them down.
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My dad was out of work and mom is a Catholic school teacher with five kids.
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It's just the math.
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Didn't make sense, right?
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And so I had been watching it and observing it.
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But I was at school one day and my mom was a teacher at my high school.
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And she pulled me into her back room.
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She was a math teacher.
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And she said we have to go to her own act.
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Uh-huh.
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Yeah.
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My dad's masters and is an economics and my mom is a math teacher.
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I know that's why money is so fascinating.
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It's not about not knowing what to do.
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It's about actually doing it.
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So she pulled me into this back room and she said we have to go home.
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They're taking the house.
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And she was crying.
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And I knew that I instantly had to rise to the occasion and I said it's going to be okay.
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Let's get back there.
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And so we drove back together in silence like from the high school way to leave during the day.
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And there was just people all throughout the house like my entire childhood house.
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And they are just grabbing things and talking.
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And one of my most core memories is I don't know if you guys do that here.
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But where you have height charts on the wall where you show us like kids get taller.
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And there was someone just taking a fresh roller with white paint and just painting over our memories in like one quick dash.
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And it just meant nothing to them.
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And to us, that was everything.
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That was like our life.
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And someone else is running through and they're like, this place is a mess.
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We're going to have to get it fixed up.
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I mean, the way they were treating how challenging it was for us was just absolutely horrible.
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And my mom was very put together strong, never let anyone see her sweat.
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And this is when I got to see her just crumble as you would.
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And I had to pick up my 11 year old sister from school and explain that we can't go home.
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And she's just sobbing and screaming and doesn't understand it.
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I didn't have an answer of where we're going.
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I saw the cycle of debt and what it could do to people.
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And I certainly didn't want to repeat that for myself.
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And then it kind of got to a place where I said, okay, this is my control.
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You know, I can do this if I work hard, if I make the right decisions.
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So yeah, it was that empowerment journey that led me to realize I want to help other people.
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No matter how dark it is at that time, like hang in there.
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If you're willing to do the work, you can get to the other side.
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So that's that's what kind of got me into this field 10 years.
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Wow.
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Wow.
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I'm cat divided.
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I know.
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I get looking to see if it's crying.
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I say, I know.
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She's getting closer.
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Wow.
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I just it just makes me think you never know what people are going through financially.
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You know, there could have been people at your school scene.
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You get taken out of class and just being like, oh, she's just gone home for the afternoon.
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You know, you just you just have no idea people's situations are going through
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and what they're having to live through day to day.
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I don't know.
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Yeah.
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It's just fascinating.
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Everyone's financial journey is so different and stems from so many aspects of their life,
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whether it's their upbringing, what they've been through in their lives, their parents.
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It's just so many facets of it.
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Yeah.
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It's crazy.
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I was actually thinking the main thing that came up for me when you were explaining was,
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I think I'm quite judgmental of people that have ended up in lots of debt.
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And it's a really subconscious thing, which it sounds so nasty to even vocalize this
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when you've just been so honest about such a heartbreaking situation.
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But I don't think I realized the judgment that I held because I haven't seen that debt cycle
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firsthand, touch wood.
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I hope I'm never in that situation.
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And as you say, your parents were trying their best.
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It wasn't as though they were being out there taking themselves on holidays
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to Fiji and being really frivolous with their money.
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So from someone that's seen that and who obviously works with people to help them get out of debt,
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can you explain for those who might also be judgmental of debt,
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how it works and how it's such a slippery slope?
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Because I would have thought the same as well with Liz.
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It's like, oh, well, you got yourself into debt, you know,
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from spending fluently or whatever.
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I can judge really quite badly for the answer.
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Yeah.
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Yeah.
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I appreciate your guys' honesty.
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I've been in that exact place, right?
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That's why I said it was a journey with my parents.
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So at first, I'm just pitting and empathizing.
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And then as I worked through the journey, I realized like,
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I should have been able to be the kid.
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I shouldn't have had to feel like the grown-up, right?
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And I went through that journey with them.
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And there was a point where I was like, you know, people just weren't willing to sacrifice.
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And I would explain to my mom, cancel the movie channel.
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You know, I had all the answers.
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Yeah.
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For my family, it was the expenses went to supporting growing a family that large.
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And five kids and my dad was a banker, again, the irony.
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And my mom was this math teacher and an outstanding both in colleges and in high schools and everything.
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And then when the banking crisis happened, my dad was out of work.
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And it was like truly on and off for about three years.
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And he was our breadwinner.
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And so mom picked up a second job and a third job.
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And it's just like, we were hitting those phases, kids entering college.
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And we weren't in any fancy private school.
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Like it really wasn't that.
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It was just truly a matter of like, you know, your emergency fund only takes you so far, right?
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There has to be that spot.
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And then that's trying to get additional work and depression kicks in.
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And he's upset and he's out of work.
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And so like you don't ever, I don't know many households that could absorb someone being out of work.
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They're primary breadwinner for about three years.
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So there just was so much there that mom was working hard to kind of get him back on his feet.
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And obviously if you can get yourself, if you can invest in yourself or in your company, right?
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And take out debt because on the other end, you're going to get this like additional reward.
16:15
Absolutely.
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It's a good thing to do.
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But certainly debt just allows people to play along with money that they don't have.
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And I'll tell you, you can play that game for years before you get made credit card debt.
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When I see clients like that, when you get into that where you don't realize you're actually in the red every month,
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that's where I think the average person kind of gets stuck is,
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it's not an immediate like, oops, three months later, I realized I have a problem.
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We're talking like three years later.
16:40
So did they basically extend credit cards for three years and not pay back because they couldn't afford to?
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So it was almost like, okay, we're going to try and maintain the kid's school and food and a roof over our head, etc.
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And then when we get a job, we have that.
16:56
Is that kind of what happened?
16:58
Yes.
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Yeah, all of it, any 401k savings that they had were drained, they went through everything.
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And the reason why the house was taken is they had gotten a second mortgage, right?
17:09
So there was equity in the house.
17:11
And so any place where they had money, they were trying to take from.
17:15
So get your car loan, you have a loan on it and you're trying to decide,
17:18
should you keep the water running or should you pay for the car?
17:21
You keep the water running and then they end up taking the car.
17:24
So yes, that was it.
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All the credit cards were maxed out.
17:27
There was literally no available place to go for additional funds.
17:31
Yeah, money struggles are, they are nothing to take lightly and the way that they impact you,
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both as an adult and a child.
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What would have been the alternative though?
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That's what I was thinking like how did they?
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There's really no alternative, apart from going into debt and having the expectation that, okay,
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when I do get employed or I have enough income, I'll start paying it back.
17:52
Well, I mean, as a financial advisor, like looking at that situation as horrible,
17:56
as it might be to say out loud, if you had seen the situation when it was unfolding,
18:01
what advice would you have given your parents?
18:03
Oh God, I've thought about that question a million times, a couple things.
18:07
Communication wise, it was really challenging going through that and yet we weren't allowed to talk about it.
18:12
Now, buying to our generation is a lot more open to that,
18:15
but I was craving for like a tiny Tim household where the family gathers and says,
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like, here's the deal.
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Dad's out of work.
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We're all going to make it work.
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We're going to do this.
18:23
Like, it just, it was happening under the surface and it was bubbling.
18:26
And when you would ask a question as a kid,
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if like, isn't that bad that our bank account has not enough money,
18:31
but like, don't worry about it.
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Don't worry about it.
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I got it.
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So I'd say from that side, communication and honesty and transparency,
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to the point that I think I drilled into my kids so bad,
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I'm pretty sure I'm overcorrecting in that category of talking about money.
18:48
Have you always had the best of intelligence to start investing,
18:50
but you just can't seem to find the money at the end of each month,
18:54
or perhaps you've listened to this podcast for a while,
18:56
but you just haven't managed to actually invest yet.
18:59
This might be due to a lack of confidence,
19:01
but our guess is that you just don't know how much to invest or what to invest in.
19:06
So if you don't have a plan or handle of you every day finances,
19:09
it's really, really hard to invest regularly,
19:11
which is why we've created the money increase set,
19:14
which is a chance for you to get all your ducks in a row
19:17
so that you can be in a place where you can invest regularly.
19:20
For more information on how you can reset your finances for 2024,
19:24
head to the link in our show notes or the curve platform.com.
19:31
Do you talk to your kids about money and about financial situations
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and everything?
19:35
Because I think that would be quite hard as a parent.
19:36
Well, that's what I was about to say.
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I mean, protecting them, but also,
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and also wanting to be like,
19:40
I've got this sorted, you shouldn't have to worry or a child.
19:42
Yeah, that's kind of what I was about to say.
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Do you think that that would have almost been worse
19:46
in terms of the worry that you would be bearing
19:48
and the weight on your shoulders as a 14-year-old,
19:51
if you knew that your parents were struggling that much?
19:53
I knew they were struggling.
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It was just more painful that we couldn't talk about it.
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It was right there.
19:58
It was right there.
19:59
And that's a great question because I've been thinking about that with my kids.
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Like, you guys, I have to tell you this literally happened yesterday
20:06
and then I promise we can get on track.
20:07
My daughter comes home with this self-portrait from school
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and the prompt was,
20:11
I am special because, okay?
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And she shows this to me,
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and my jaw drops on the ground
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because it says,
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I am special because I have a lot of money.
20:21
You're like,
20:23
oh gosh, not what I intended, not what I intended.
20:26
And I couldn't even smile.
20:29
And she's like, what's wrong?
20:30
And I'm like,
20:31
and all I can think is,
20:32
well done honey.
20:33
Well done honey.
20:34
Well done honey.
20:35
On my top three things of people I can't tolerate.
20:38
It's entitled people.
20:40
So I'm just like stumbling over my words.
20:42
And I was like, I don't understand.
20:43
Can you tell me she's six years old?
20:45
What happened?
20:46
What did the teacher say?
20:47
And she said, well, our teacher said to us,
20:49
what's something that makes you unique?
20:51
And mom, not a lot of people have money.
20:53
Bless her little heart.
20:54
But it's also blessed that like the kids don't know that money's true.
20:58
Something you don't talk about.
20:59
They're like, what are we doing?
21:00
We do have lots of money.
21:01
So mom talks about money.
21:02
You know, it's just like,
21:03
so matter of fact, kids.
21:05
Like I love their emotional regulation
21:07
or like awareness for what isn't as inappropriate.
21:10
PC just goes out the window.
21:12
Like I've got money.
21:13
I'm special.
21:14
Yeah.
21:15
You go girl.
21:16
So can we go back to your advice that you would give your parents?
21:21
So say they'd been in that situation.
21:23
The first thing that you would recommend would be communication.
21:26
What would be some of the other ways that they could have dealt with it better,
21:30
for lack of a better word?
21:32
I probably would have drawn down in a different order.
21:34
As an advisor recognizing where do you pull from first before you go into
21:38
debt?
21:39
Should you look at your 401k?
21:41
The only change that I've ever been able to identify is
21:45
downsizing our house.
21:47
Maybe there was a portion of them was trying to keep up with the Joneses
21:50
or keep appearances, right?
21:51
Because that's very hard to manage that socially when all that's going on for your family.
21:55
But that's the only thing I've ever been able to identify.
21:58
But I mean, they if a lender was willing to offer it to them if a family or a friend.
22:03
I mean, they were pulling at anything they could.
22:05
So sooner rather than later, downsizing the house, so you have that equity,
22:10
so you have that control instead of it being taken from you because you couldn't
22:14
keep up with those mortgage payments.
22:16
So that would have been the only thing as an advisor that I could have seen.
22:19
I've got a controversial question.
22:21
Oh, here she goes.
22:22
Do you think there's a level of responsibility and awareness that we need
22:28
more so than we currently have and society as a whole around how many kids
22:33
can you realistically afford?
22:35
Controversial.
22:36
Listening to you guys learn about this,
22:38
you are literally walking the journey that I walked experiencing it.
22:42
So if I had a dollar free time, I was like, why did they have five kids?
22:45
So like, yes, I think your bigger question of like,
22:49
is it reasonable to consider and make these decisions about growing our family
22:54
based off of the amount of financial resources we have?
22:57
I wasn't willing to walk down the aisle until I was debt free.
23:00
So you're talking to the right person.
23:01
It's like, don't make these decisions unless you have the money.
23:04
So yeah, I think it's a really challenging one.
23:07
I do.
23:08
I think especially in the world of growing your family and so many people
23:11
are met with challenges and getting those families to happen and unexpected
23:16
babies and twins and you know, all of these things.
23:19
Yeah, I think that even back then,
23:22
even when it was a little more common
23:24
at the primary breadwinner and the, you know, the woman primarily
23:27
making significantly less, trying to send all five of us to college,
23:31
I don't think that math was ever really going to make sense from the beginning.
23:35
And there are quite a few like private schools mixed in and all of that.
23:39
So yeah, I think it's a reasonable thing for someone as they grow their family
23:43
to just think about how that lifestyle changes with each child that you add assuming
23:47
it's a lifestyle change and not like a foundational,
23:50
we are truly running out of money, right?
23:53
Most, for most people who have a better handle of their finances,
23:56
it would be, okay, are we willing to make this lifestyle shift down
24:00
as we bring a new member into the family?
24:02
That's kind of how I've thought about it with each kid that I've added to mine.
24:05
Yeah, I guess it's more about financial planning as well.
24:08
And being like, can we financially afford this extra child yet
24:11
and still have that life that we want?
24:13
I've been doing my budget recently, which I've seen Victoria.
24:15
She's not got back to me on yet.
24:17
But I'm sorry.
24:19
It's fine, I'm sorry.
24:20
This will take this offline.
24:21
Part of me is like, I need to do my own budget girl.
24:24
Because I just cannot understand how I keep fucking it up, excuse the language.
24:30
But it is just, I'm so optimistic.
24:33
I'm like, I know.
24:34
No, I can make it work.
24:35
But I think when it comes to having kids or when there's other people involved,
24:39
it's a different level of planning and awareness that you need to have with your money
24:42
because you're not actually, this isn't just you that's suffering from the stress
24:46
of the finances of running out of your weekly pay.
24:49
You have actual humans relying on you to put food on the table,
24:54
to keep the lights on, to have running water and a roof over their head.
24:58
There's also a lot of unknowns with having a child and how much they're going to cost
25:03
and what expenses you're going to have.
25:05
You know, when it is just yourself or you and your partner,
25:08
you kind of know your spending habits.
25:10
But when you throw in a curveball of a child, you know,
25:13
you could plan till the cows come home and still not have it right.
25:17
Totally.
25:18
I work with clients in their 30s and 40s.
25:20
It is one of the most fascinating challenges.
25:22
That's why I love it because it's always changing, right?
25:25
Typically financial planning and wealth management has been for retirees
25:29
and they come in and they're going to stop working.
25:31
How can I pay myself out of the buckets of money that I've saved?
25:33
You know, that's typically where it's landed.
25:36
The real challenge is like, I changed my job and then she's pregnant
25:40
and then we bought a new house and what's happening?
25:42
Oh, I mean, this really stressful job and I make good money.
25:45
But we have deep conversations about money and we say,
25:48
you know what, what would it take for you to take a lower paying job
25:51
and have more time with your family?
25:53
You know, what do you want to do?
25:54
What are you not achieving?
25:55
And so, yeah, it's a huge challenge because we all have competing priorities.
25:59
Very few of us have unlimited resources.
26:01
Certainly myself included.
26:03
So it's just, where do you put them?
26:04
Where do you put them and how do you feel really satisfied
26:07
getting the most that you can, you know, out of your dollars?
26:09
That's what keeps me coming back.
26:11
I want to jump back to what you were talking about around communication
26:14
and communication and the relationship scenes.
26:16
Especially if you work with lots of couples.
26:18
That is it.
26:19
Yeah.
26:20
Yeah.
26:21
And just like how important those conversations are when you should have them,
26:24
you know, how to make them not awkward and all of that.
26:27
Because financial compatibility is something we've talked about a lot.
26:30
Not only within friendships, but also in romantic relationships.
26:33
How do you encourage clients to approach those conversations?
26:37
And at what point of the relationship?
26:39
I mean, can we dive into that?
26:41
Because I know there's a huge amount of audience who probably either haven't had those conversations
26:45
or maybe they haven't gone very well.
26:47
So the biggest thing I would say a lot of people come in with the question,
26:50
should we blend our bank accounts?
26:52
Should we have them separate?
26:53
Should we have them together?
26:54
Should we see each other spending?
26:57
And they say, I don't like seeing each other spending.
26:59
Because then when they get me a Christmas gift, I know that they got the Christmas gift.
27:02
And you know, they like their sense of independence and all of that.
27:05
So what I would say is I've seen when couples do it well,
27:09
it actually, those formalities don't matter whether you are sharing a bank account
27:14
or whether you're not sharing a bank account.
27:16
And here's why sometimes I have couples where they have their separate accounts.
27:19
But like monthly, they sit down and they talk about their finances
27:23
and they talk about their goals and they work with an advisor
27:26
and they get on the same page.
27:28
And so if that's going to happen,
27:30
then it really doesn't matter whether you're sharing accounts.
27:33
And then I have couples where everything is joint.
27:35
They can see each other's money,
27:37
but the one person doesn't even know how to log in.
27:39
That sounds like us.
27:44
What's the password if you change it again?
27:46
And then I go log in and it's like,
27:48
oh, you've passed, it's been locked out.
27:50
You've tried too many times.
27:51
I'm like, oh, I would slow people right.
27:53
I'm like, gosh.
27:54
I am going to be the reason you go, Gray.
27:57
I think.
27:58
Or an am.
28:01
Oh, my God.
28:02
So I think it's interesting.
28:03
Like at the end of the day, it's just,
28:05
I think it's about transparency.
28:06
So for me and my husband, we share our accounts
28:09
and he likes to spend it in a very different way, right?
28:11
Like on the fun money, he spends it in a very different way than me.
28:14
I hate golf.
28:15
And the thing is actually about to say does he spend it on golf?
28:18
That's so funny.
28:19
It would grind my guess.
28:20
I almost wouldn't want to share a bank account because I'd be able to say
28:22
you'll just like golf, golf, golf.
28:23
Yeah.
28:24
Yeah.
28:25
Yeah.
28:26
So I would say it's really helpful when couples have like a certain number where you say,
28:31
hey, if either of us is going to spend over $X,
28:34
we should consult the other.
28:35
And like that's a really helpful thing for couples to do, right?
28:38
Again, I don't care whether you're married or not married.
28:41
But if you're making joint financial decisions together and creating like a joint plan together,
28:46
then it's really helpful to say if that trigger amount is $200, you know,
28:49
anytime someone's going to spend over $200, bounce it by your partner.
28:52
So there's no questions and concerns.
28:54
I'd be getting ticks from me all day.
28:56
Hi.
28:57
Can I send five dollars on some new stations?
28:59
Hi.
29:00
Could I please spend $55 on a new?
29:02
No.
29:03
No.
29:04
Yeah.
29:05
It was always me and I'd just be like, you do whatever because they just totally trust you.
29:09
It's like, I'm the problem child in the relationship.
29:13
Well, it's funny.
29:14
You know, it used to be about like, are you a spender or a saver as if there's only two batteries.
29:18
Oh, yeah.
29:19
And, and you know, when you guys alluded to it earlier, like when it comes to money,
29:22
there's way more there.
29:24
There's like people's relationship of someone gets down and they start spending,
29:28
spending, spending, spending.
29:29
And then, you know, the other person finds themselves like falling at late night Amazon,
29:34
like, you're a light shopper.
29:36
I know, you're a light night.
29:39
Like, oh, just sign up to age plus.
29:41
Like, it's so true.
29:42
Look, we both have our voices.
29:44
Yes.
29:45
Yeah, we're not perfect.
29:46
Yeah.
29:47
Yeah.
29:48
So it's really, it's interesting.
29:49
So I guess my advice for couples would be talk early and often, right?
29:52
About it.
29:53
Because, and to that point of like, when in the relationship, day, I'm, that's hard to give feedback on.
29:57
You know, it's like, when you guys are really starting to second, I mean,
30:01
that could go when I reckon should be like, right, I'm committing to these conversations early.
30:05
And she's like, no, let's date one high.
30:07
And I don't know why I don't get date two.
30:10
But what about when they start to split their finances?
30:13
Do you think maybe when they start sharing the costs of dinner or sharing bills or moving in together,
30:18
even if they're not paying a fuel overlapping with payments?
30:22
And it's not just like, I'll get it, you get it.
30:24
Maybe that's a time to start talking about it.
30:26
So if you're, if you're, if you're talking about joining cars.
30:28
Yeah.
30:29
Like, if you're starting to go on holidays together and you're spending money together a lot.
30:33
And of course, you should be encouraging these conversations early in terms of,
30:38
what do you value spending money on?
30:40
Where do you want to be?
30:41
What do you want to do?
30:42
What if you, what debt do you have?
30:43
All those kinds of things, I think you do need to know about when you go.
30:46
Because imagine if someone's in 500,000 dollars with a debt and you don't know.
30:50
But is there a general role of thumb?
30:52
Like, okay, at this point, make sure you're having these conversations?
30:56
Yeah, I would say as the relationships progressing and when you're planning out your future together,
31:02
most of my couples really appreciate starting with the fun stuff.
31:05
Like you said, like, we're taking a trip together, you know,
31:08
and instead of vent mowing each other back and forth eight million times.
31:12
Maybe this is a good time to, you know, set up like a joint account that we both have money out of our paycheck each month.
31:18
And it goes into this joint account for us to do our spending.
31:21
Because that happens before you're even living together, right?
31:23
And then living together is a natural another point where people say,
31:27
okay, even if we want to have our stuff separate, we very much need to have another,
31:31
like, joint bank account where we can throw money in and pay rent out of that.
31:35
And so, yeah, what it typically looks like is a commitment to even if your money is separate,
31:40
you've got this one joint account that each of you contribute equally to.
31:44
And that helps.
31:45
And then some couples come in, right?
31:46
So if you fast forward and they've been together for a bit,
31:48
and you've got someone who makes significantly more than the other,
31:52
they will come in at ratios and be like,
31:54
okay, well, I want to put 70% towards the rent.
31:57
They don't say that, the 30% person said,
32:00
I want to put 30% towards the rent because I make 30% of this household income.
32:04
And the other one says, great, I'll do 70.
32:06
So, you know, it really, that's what's interesting as long as you're talking about it.
32:10
But yes, I would say once you are planning joint things together,
32:13
it's a great way to, if you're told in the water of like,
32:16
let's both put money towards this.
32:18
Well, what advice would you give for couples,
32:20
never getting conversations around like, I guess, lifestyle creep.
32:24
And also, if you are in a relationship where there's quite a disperency in incomes,
32:30
you know, having different lifestyles and different choices, I think.
32:34
Yeah, I see it for a friend.
32:36
No, but like, those conversations must guess.
32:41
No, it's hard. They get it.
32:43
Fast straighting or like, for both parties,
32:45
to be like, I kind of forward this and then be with someone that's like,
32:47
oh, they can then reform this. I don't know.
32:49
It's just like money kind of permeates through all parts of relationships
32:53
in terms of where you go on holiday, you know, what car you hire when you're on holiday.
32:58
We had a minor dispute on a joint holiday where I wanted the tiny shitty Honda
33:03
that, you know, it was like the lowest budget.
33:05
In fact, there's a convertible out there.
33:08
I was like, don't even think about it.
33:10
Like, we're definitely not going there.
33:12
Unless you're shouting the difference.
33:14
I guess that's probably the answer then.
33:16
But you selfish bitch.
33:18
Like, so she's like, my partner wants to go to McDonald's and I want to go to a Michelin star.
33:23
So like, he's going to go to McDonald's, but I'll go Michelin.
33:25
No, I don't mean to.
33:27
No, I'd pay for the Michelin.
33:29
That's my main.
33:30
I think that's the middle ground we've going to come.
33:32
I mean, sorry, let's ask the advisor.
33:34
Liz, could you please wait in here before this gets any more heated?
33:37
You know, friendship or romantic.
33:39
How do you deal with that?
33:41
So first, I would say to your point earlier, like reminding yourself not to come from a judgey place.
33:47
I'm telling you I did it for many, many years.
33:49
Again, if clients weren't willing to sacrifice the way I was willing to sacrifice.
33:53
I had thoughts on it.
33:55
I would place judgment on it.
33:56
And so what I've really got into with a place with people is that classic you guys know it.
34:01
And I've listened to your podcast that like put your money where your values are.
34:05
Yeah.
34:06
So that's the biggest thing is like respecting your partner.
34:08
Now I roll my eyes every time I see golf.
34:10
But I technically am respecting them.
34:12
Not to like step in and be like, that's inappropriate.
34:17
Yeah.
34:18
So I would say definitely like doing your damn best not to come in with judgment.
34:22
Because again, it is not spender versus saver.
34:25
It is so much more nuance than that.
34:27
Honestly, my other piece of advice.
34:29
I don't care if you're talking to a financial advisor.
34:31
You're asking a third person to be in the room.
34:35
But just it's really nice to have someone just like hear both sides, right?
34:40
There are people who are like financial therapists and all of that.
34:43
It's like, I recognize that with my clients that I think they appreciate that I can be there and be in the middle.
34:49
And here this matters to this partner, this matters to this partner.
34:54
I can just make sure neither of the voices get squashed.
34:57
Like that part is really important to me is there's often a more dominant voice in a relationship.
35:01
I just have to make sure that both of them are getting it met.
35:04
And then I get to be the bad guy.
35:06
It stops their argument.
35:07
Right.
35:08
I think it stops their argument.
35:09
So that's again, whether it's a financial advisor just having someone like listen and hear and kind of dissect
35:16
because everyone's coming in with the emotions hidden.
35:18
Yeah.
35:19
Typically when you're talking about money, here's what I will say that I could scream from a mount and top a million times.
35:24
I don't care if one person is making more the other person staying at home, anything in between.
35:29
When you see a lack of respect for the other person based off of the amount of money that they are bringing in,
35:35
that to me is where you get in trouble.
35:38
There's been periods of my life with my husband where I'm the breadwinner.
35:41
He's the breadwinner.
35:42
This back and forth.
35:43
And at no point did either of us use it as a weapon or treat each other like, well, I'm making the decision.
35:48
I have the final call.
35:50
So when I see that and a couple is sitting across from me and it is like this unspoken language that one person thinks they have an upper hand.
35:59
On the entire family or the two of them, their finances, just because they bring in more.
36:04
I'm actually a big advocate for both voices matter just as much or both in the relationship.
36:09
So that's always scary to me when I see that.
36:12
I love that.
36:13
I know, but can I ask though, you know, in your dynamic, you're saying you swap between breadwinner and not the breadwinner, one of the opposite of that is.
36:21
So there's probably respect there in the fact that you can earn more than that.
36:27
This is again quite controversial, but I think there's an inherent and underlying belief that the ability to earn money means you are successful.
36:36
You are better. You are more than that.
36:38
That exists.
36:39
And I know that we all pretend that it doesn't, but it does.
36:42
So how do you then keep the respect and equal if that breadwinner is always the same person?
36:49
How does that not become imbalanced or, you know, a power play?
36:53
Particularly with females who often have to stay home or doing a lot of non-monetary work in the household.
37:02
Or maybe they have kids early and therefore they don't have a chance to build up the capacity to earn more because they take that time out.
37:08
And then when they go back, they never able to earn more than their partners.
37:12
I just would love to know your thoughts on that.
37:14
Yeah, it's all about contribution.
37:16
So you need both members of the couple to recognize that you bring financial resources to the table.
37:23
Here she brings the ability to keep the household running and make sure that your social calendars are managed and this and this is the whole unpaid labor, fair play, like all of that, right?
37:35
Which I'm sure all of us are pretty passionate about.
37:37
So if they don't see that vision of like your contribution matters, this is what you bring to either our relationship or our family.
37:45
Then even if someday that person goes out and gets a job and starts making more, they're still going to be that dynamic of like, well, it doesn't matter because I have this, you know, some of money I bring this in.
37:57
And some of my couples, it's like that there won't be flip flopping between breadwinner and not breadwinner.
38:01
I get pretty feisty in those meetings when I see someone talking down to someone else based off of how much they bring to the table.
38:08
I like those sessions because it's an opportunity for me to, you know, politely point out all of the other things that that person's doing to make sure that they can be in that higher paying job, right?
38:20
Sometimes someone's in a career, they're following their heart and it's in the nonprofit sector and they're making a huge difference.
38:25
And the other person went more of the corporate route and they're bringing in the big dollars.
38:29
And if you look at it as like, I'm not going to do as many dishes or I'm not going to help with the kids as much because this is happening.
38:35
Yeah, they don't last in my office very long because I make my opinion very, very well known there.
38:41
So yeah, I think just recognize the contribution in whatever way it shows up.
38:45
It's also an interesting shift, I think, that you have to make consciously because if you had a, for example, if we thought of you, and you stayed in funds management and you were earning more than to be honest,
38:58
probably a lot of partners, unless they worked in similar spaces, you know, it is one of the higher paying jobs.
39:03
And so you would have to actively really, really value them as a person and what they're bringing.
39:10
And I do think that it's something you have to consciously think about.
39:13
I think for me, the number one thing would be it's easy to fob off all cleaning and looking after kids is cheap.
39:21
By the way, I'm not saying I believe that.
39:23
But the real beauty of having your partner stay at home is the idea that your kids are being infused with the person that you love the most energy day and day out.
39:34
They're patients, they're teachings, they're, they're pouring themselves as a person into that tiny surprise, which is priceless.
39:42
It's not like, I would like to pay a babysitter $14 an hour. It's like, well, how would your kids turn out?
39:48
So it's, it is something that I don't think has been totally deconstructed and away for both sides, regardless of who's at home and who's the breadwinner.
39:55
So I think that's a really amazing thing for people to think about in relationship.
40:00
Yeah, yeah, absolutely. I mean, it's the most important job you could ever have, right?
40:04
Like, yeah, I've been a working mom through, through my whole career.
40:09
And I look at it and women when they excel at home. And that's where they're at their best.
40:14
And they're bringing everything that can to their family and they're feeling satisfied.
40:18
Instead of burnt out, yeah, I think it's way more often that we see women not getting the credit they deserve when they're at home.
40:23
And they're with, you know, the screaming kids all day, and managing it all.
40:27
So yeah, that is exactly well said. So that it's like their partner should look at that and go, thank God, like they're around you.
40:34
They're getting every bit of your being, every bit of your energy.
40:37
And that's where the partner doesn't come home and be like, well, I worked all day.
40:40
I'm going to sit down on the couch. It's like, she worked all day.
40:44
Yeah, it's easy to get in that spiral of like, not tip for tech, but like, well, I've done this and you've done that.
40:50
And it's, you could easily get in that spiral, especially when you're both absolutely exhausted.
40:55
I just think the whole splitting of the housework when, when after work is, yeah, it's something such an interesting one.
41:02
And I've seen a lot of dynamics with friends and relationships where it's kind of surprised me to be honest like the imbalance.
41:08
And it's, as you get older and you start going into relationships with different life experience and seeing friends in different dynamics,
41:17
it definitely makes me realize if I end up in a relationship where we're like enough to have kids,
41:23
that would be an absolute deal breaker for me if someone wasn't coming to the party with equal cooking, cleaning, helping around the house.
41:32
I turn into a new skin of you.
41:35
I'm so aware of the time and like, we could honestly sit here and talk to you for so long.
41:41
I was wondering if maybe we could chat you because a lot of the questions that we prepared that we would love to ask around managing your personal finances,
41:48
how they get out of debt, how to avoid getting into that in the first place.
41:52
Like, there's so many technical things that I think would be really helpful for people.
41:56
Can we arrange a time to get you on again another time because I feel like this is a two part.
42:01
Yeah, this is a two part.
42:02
But thank you so much for being so open about it because I think it doesn't matter how much therapy you do on things that are traumatic
42:07
and you grow up as an adult to offload and talk to them again with strangers.
42:12
Yeah, you kind of forget how much that brings up, so thank you for sharing.
42:16
Oh, you guys at the pleasure of mine.
42:18
Thanks so much. I look forward to the next conversation.
42:21
Thank you so much for listening to Raising the Curve.
42:24
These conversations are designed to teach you everything that you need to know to be better with your money,
42:28
from saving, to investing, to talking to your friends about your salaries.
42:32
And if you liked what you heard, we would love it.
42:35
If you could hit subscribe button, please.
42:37
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42:38
Leave a review.
42:39
It'll only take five seconds and it would really make our week, our year, our month.
42:44
Okay, lots of love. See you soon. Bye.