The Psychology of Money — Part 2

the psychology of moneyI was recently invited to be a guest on the talk radio show Mastering Your Money with the talented Ed Fulbright. The interview turned out to be some of the most important stuff I’ve ever shared on wealth and enjoying life with more time and freedom.

If you haven’t already read or listened to part 1 The Psychology of Money, you can click here to get started at the beginning.

Enjoy the audio or the text to part 2 below:

Click here to listen to the audio interview

Ed:           Welcome back to Mastering Your Money.  I’m Ed Fulbright, CPA, PFS.  We’ve been discussing eliminate your money worries with Chuck Rylant. 

He’s the author of How to be Rich: The Couple’s Guide to a Rich Life without Worrying about Money, and in the first half we talked about some very important items.

The first thing is that you need to come up with your own definition of rich. You need to avoid being so focused on earning money, but instead on what is really important, getting the right mindset to be able to get what you really want out of life, and for some people, it’s just having the freedom to do what you want to do when you want to do it, and that can be very hard.

And hopefully, for people that you’re able to have a very fulfilling life; you have somebody to share it with.

And when you have a spouse that can start to create additional stress on the finances because you have somebody else’s feelings to be concerned with, and whatever their emotional drivers are, you have to start to focus on that. 

Now, Chuck, I wanted to bring you back in here because before the commercial break, you were starting to tell us the story of how you and your wife were working through one of your challenging times.

You had started this business with a gym. It was maybe larger than what you should’ve done at the time. Can you take it from there? 

Chuck:     Yeah, perfect. So, we started with 35 employees in this business, and so we were juggling a lot of things simultaneously. That was more employees than we were used to dealing with at the time and then all of the other factors with a new business all simultaneously.

So, long story short was it was extremely stressful for us, and when we’re both in a stressful state dealing with the business, and then you bring that home, and then pretty soon your whole life revolves around this business.  

And what I really learned about it – what I think we both learned from it—is in the end, your peace of mind is worth more than anything. Having the ability to focus on the things that are going to eliminate stress and keep your marriage solid, in the end, that’s the most important lesson that I learned. 

It’s more important than any amount of money, any kind of career success or anything. That was probably the biggest lesson. And to bring that back to your original question of what’s important to my wife and I as far as money –

Ed:           Yes.

Chuck:     – and that’s peace of mind.

Ed:           Peace of mind.

Chuck:     Peace of mind.

Ed:           And that makes a lot of sense that doing that business which you and your wife are avid exercisers, and you want to, you know, do – you thought it was a great idea, but then after you started getting into it, it wasn’t as great as you thought, and at least –

Chuck:     Right.

Ed:           – at least you were brave enough to be able to say, “Hey, we need to change this and do something slightly different because this isn’t working for us, and we don’t like what it’s doing to our lifestyle,” and all of that.

Chuck:     Good point, perfect, yeah.

Ed:           The one thing that people say about money is that it is the number 1 or number 2 reason why people get divorced.  So, why do couples fight over money?

Chuck:     You know, if you ask any of them, they’re definitely going to point at the opposite spouse, right?

Ed:           Sure. Yeah, I mean, “It’s not my problem. It’s Johnny’s. He spends too much,” or, “well, it’s Suzie’s cause Suzie buys too many shoes.” 

Chuck:     That’s it.  That’s it.

Ed:           [Laughter]

Chuck:     It’s too easy to blame somebody else, right?

Ed:           Right.

Chuck:     And on the surface, there are all these little reasons that we fight, and it seems like it’s those little surface things, but it really never is those things.  It comes down to two different things. 

We all are raised with different emotional beliefs about money. So, we get our beliefs and perspectives about money from all of these different things from our childhood and so forth, and what that comes down to is that we do not understand each other’s perspective or emotional beliefs about money. 

So, it’s very difficult for me to see the same things that my wife sees and vice versa, because we weren’t raised in the same environment. 

So, the key is to – I don’t want to say the key, but the more you can put yourself in each other’s shoes and try to understand your spouse’s perspective, you’ll do a lot better. So, really, it comes down to a communication issue.

Ed:           Sure.

Chuck:     That’s number 1 challenge of communicating each other’s needs. Number 2, and this is not just for spouses, but everyone in general, but particularly for spouses, is having unclear priorities. 

It’s very rare that spouses, unless they work with financial advisor, will actually openly discuss their financial goals. So when there’s no discussion, inevitably, both people are working in different directions.

Ed:           Right.

Chuck:     And so, if one person is heading left and the other person is heading right, there’s obviously going to be a conflict and frustration when they are going in two different directions.

Ed:           Okay. And that makes sense that they have to have clear priorities. They’ve gotta communicate. Is there anything else that we should be concerned with?

Chuck:     Yeah, I mean, the first thing is getting the priorities clear because if you don’t have the right direction, then all of the other stuff doesn’t matter, right? 

Ed:           Right

Chuck:     All the investments and taxes, none of that stuff matters if you’re both not clearly heading in the right direction.

Ed:           Sure, sure, sure. If you’re not clear on what y’all want to get out of the relationship, where y’all want to go as a unit. That, you know, hey, guess what? It’s gonna be – that’s gonna be a problem. 

Chuck:     Sure.

Ed:           You know, I just know it’s gonna be a problem, and I can tell you.

Chuck:     Yeah.

Ed:           And people don’t realize that, and you know, I can tell very quickly whether a couple is gonna make it or not is really a matter of whether or not they are willing to make the changes, and all of it’s a matter of change on both parts.

Let’s talk a little bit about how children start to change your money reality because that’s, you know, that’s an important part of a relationship, but it starts to change your money dynamics. You know, there’s daycare. There’s, you know, college you’ve gotta pay for, and kids always want stuff. 

Chuck:     Mm‐hmm.

Ed:           [Laughter] So, can you talk about that?

Chuck:     It’s a good question. You know, my first child is almost five years old, and I’ll tell you from experience that children, they change everything. I mean, everything changes with kids, and if you look at it, kids are really a bad investment. They’re not a good investment, but – 

[Laughter]

– it’s worth every penny of it; there’s no doubt about that.

Ed:           Sure, sure.

Chuck:     Before you have children, we basically run around life completely selfish. You know, we’re doing our own thing, and when we have money it’s pretty much focused on our own thing.

But when we have kids we have to start balancing our own selfish desires, and everything becomes this constant balance between you and your family and your children, and it’s difficult when we haven’t even mastered money ourselves to now try to give good values to our kids. It’s difficult for ourselves, let alone to help instill that in somebody else.

And I’ll tell you a little, personal example. So, my little boy, he loves these little Lego toys, right?

Ed:           Yes.

Chuck:     And the Legos, they’re not cheap, and so he wants a new set of Legos every day, and that’s, you know, 50 or 100 bucks. It’s a balancing act for me where I have much more money than I did when I was his age, and so I want to give him more of the things that I wasn’t able to have. 

And so, when that kid wants Legos, I love showing up with a new, little set of Legos because of the smile on his face, but I have to constantly balance between, you know, if I give him every single thing that he asks for eventually, we would go broke, no doubt about it, ‘cause there’s a never ending list.

[Laughter]

Ed:           Sure, it’s never ending.

Chuck:     But secondly, I have to realize that some of my drive and ambition is because I did without. And so, that’s a very challenging balance, and I think just having that at the top of your mind, you know, being aware that that balance is important is a definite benefit.

Ed:           That makes a lot of sense. If you’re clear on what drives you, it seems like you’re saying what your weaknesses are because, you know, your weakness is because you were deprived as a child.

You want to make sure your children have the best of everything, but you may have to kinda control that because that can actually take you away from what your real priorities are.

And if people say they want more time and more freedom, then you going out and buying more stuff for your kid or not being able to spend more time with him.

That can create challenges for you that doesn’t make you happy, and you know, yeah, your kid might be happy for a while, but eventually, your kid’s gonna not want those Legos anymore, and that’s gonna kinda go to the side, you know?  May be happy for a year, but after a while –

Chuck:     A couple days, Ed – not a year, a couple days.  [Laughter]

Ed:           Okay. Well, that’s true. That’s true. That’s true. It’s like the old saying, you know, at Christmastime you buy your kids all these elaborate toys and everything, and they end up playing with the box.  [Laughter] And so –

Chuck:     Right, right, right. It’s so true. It’s so true.

Ed:           And so, you know, there’s a big question that families are wrestling with is how do you keep their family or their spouse’s family out of their business?  ‘Cause, you know, everybody likes to tell you how to live.

Chuck:     Yeah, yeah, especially your parents, right?

Ed:           Yes.

Chuck:     Your parents and your –

Ed:           That, and they like to tell you when to have kids, and none of them want to help you pay for any of that stuff.

[Laughter]

Chuck:     Yes. We kind of talked about this earlier and that is we’re living – you know, trying to keep up with what other people want.

And that’s the same with your family, and really, unless your parents have just fantastic financial advice, and that’s sometimes, it’s often, in my opinion, wise to keep your parents, your friends, your family, everybody, out of your personal finances because they’re not always living your life. 

 Ed:           Chuck, I need for you to go ahead and tell us, in closing, what you want us to remember. We’ve got about a minute.

Chuck:     I think that in summary of all of this is that with our money and investments and all this complicated stuff with taxes and insurance, it can be overwhelming. 

And so, the temptation when people are overwhelmed is to do nothing, and I think that imperfect action is usually better than no action at all. 

So, in summary, I think the greatest takeaway from our whole talk is to get crystal clear about what it is that you want and then to start taking action.

Ed:           Well, Chuck, I can tell you taking action is the first step, and I’d like to thank you for taking your time and sharing your information with us. You have a website called NoMoneyWorry.com

And for our listeners, our discussion today can be summarized into four thoughts:  one, take responsibility for where you are at the moment because your best thoughts have gotten you to where you are. 

Two, you must be willing to change to get different results in your life, and three, create a great vision for yourself and become persistent in your pursuit of this vision.

Don’t let the first roadblock stop your vision, and fourth, and finally, create your own happiness.  Life is too short to not live it being happy.  Remember, your money and your life are terrible things to waste. 

If you enjoyed this, you’ll love reading “How to be Rich: The Couple’s Guide to a Rich Life Without Worrying About Money” available at Amazon and other fine book stores.

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0 Replies to “The Psychology of Money — Part 2”

  1. Thinking about all the things that could go wrong doesn’t make life any more predictable. You may feel safer when you’re worrying, but it’s just an illusion. Focusing on worst‐case scenarios won’t keep bad things from happening. It will only keep you from enjoying the good things you have in the present. So if you want to stop worrying, start by tackling your need for certainty and immediate answers.

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