180. "We have $30k in cc debt but insist on sending our son to private school"

Olivia and Alexis face significant communication hurdles when it comes to discussing their finances, with their different approaches leading to a sense of isolation and frustration within their relationship.

Olivia and Alexis struggle to have open and productive conversations about money in their relationship.

Olivia wants to frequently discuss and plan their finances, aspiring to hold a "money meeting" once a month. However, Alexis often avoids or shuts down these discussions, preferring to bury her head in the sand regarding financial matters. Olivia feels alone and frustrated by Alexis' reluctance, as she finds herself eager to talk about money, but Alexis does not want to engage.

Alexis not only avoids these discussions but has also kept certain financial activities secretive, such as her paycheck going into a separate account and possessing undisclosed credit cards. This behavior stems from a deep discomfort around money talks, especially with Olivia, who she perceives as a "spreadsheet person."

Olivia and Alexis have not meaningfully discussed their finances in over 17 years, despite being a long-term couple with shared financial goals.

Olivia feels the burden of managing or thinking about finances solely rests on her. She attempts to involve Alexis by bringing a journal to dinner, hoping to progress their financial understanding, but admits to not being receptive in past attempts of discussing their finances. Despite Olivia's attempts, Alexis admits to avoiding financial discussions due to a dynamic of inequality rooted in earnings and the associated judgment that comes with financial decisions.

Alexis has a history of secrecy and protectiveness around money stemming from past negative experiences.

Olivia and Alexis's divergent approaches to money are punctuated by a deep-seated protectiveness that Alexis harbors over her finances. Alexis recounts past experiences of feeling financially exploited, which has led to her secretive behavior. Her formative years involved supporting her family and dealing with partners who spent excessively without consideration for shared financial responsibility. These experiences have left Alexis feeling secretive and protective; she only recently disclosed her secret bank account and credit card to Olivia.

Despite this, Alexis acknowledges the importance of the podcast opportunity to help address these issues and is open to change. She invites Olivia to challenge her if she reverts to her old habits of avoidance. This recognition of the podcast's potential indicates that discussing finances has been a substantial issue for both of them, and the podcast represents a chance to address it.

Olivia feels alone and frustrated by Alexis' reluctance to engage w ...

Olivia and Alexis are facing a financial conundrum due to their high-spending lifestyle that significantly exceeds their monthly income of $17,000. Their fixed costs, along with their discretionary spending, leave them with little room for savings and investments, which is concerning given their substantial net worth of $3.1 million.

Olivia and Alexis maintain an extremely high-spending lifestyle, significantly exceeding their monthly income.

They spend lavishly on their son's private school, activities, and other discretionary expenses like eating out and entertainment.

Olivia and Alexis allocate significant funds toward their son's education and extracurricular activities. They are spending $2,500 per month on private school and tutoring and an additional $800 per month on various activities. Additionally, they spend around $1,000 per month on eating out and $800 per month on miscellaneous activities such as Topgolf. Their decision to send their son to a private school and sleepaway camp costing $10,000, coupled with a school fee of $30,000, reflects their aspiration to provide the very best experiences for their child. These expenses are influenced by their own aspirations as well as concerns about safety and well-being.

Their fixed costs consume 88% of their monthly income, leaving little room for saving and investment.

Despite a high income and significant net worth, Olivia and Alexis find themselves losing money each month due to their spending habits. Their fixed costs alone account for 88% of their monthly income, which only leaves 13% for savings and absolutely nothing for investments. This imbalance is evident as they have been carrying credit card debt for years without adjusting to income fluctuations.

Olivia and Alexis lack a clear, intentional approach to their spending and budget management.

They make impulsive purchases and fail to align their spending with their long-term financial goals.

Olivia and Alexis are confronted with their excessive spending when their financial advisor, Ramit Sethi, points out that they live as though they are making $500,000 a year, despite actually earning $204,000. They lack discipline in spending and often indulge in impulsive purchases. For example, they spend $800 per month on "random stuff" and have multiple entertainment streaming subscriptions, even planning to budget $1,000 per month for renovations. They are not strategic about their costs, and as Sethi sugg ...

The case of Olivia and Alexis serves as a compelling illustration of how significant wealth can often be attributed to fortunate circumstances rather than strictly disciplined financial habits and deliberate planning.

The majority of Olivia and Alexis' substantial net worth is the result of lucky circumstances, rather than diligent saving and investing.

It is evident that luck has played a substantial role in the accumulation of Olivia and Alexis' wealth.

Alexis' retirement account has grown primarily due to the strong performance of Costco stock, rather than her own contributions.

Alexis' 401k, containing $1.2 million, saw remarkable growth largely due to the increase in value of Costco stock. While Alexis contributed around $10 to $11 thousand per year, with the employer's contributions being accounted for as well, the overwhelming growth of the account—$985,000 of the total $1.2 million—came from stock gains rather than these contributions.

Olivia received a significant inheritance from her mother, which has been a major source of their accumulated wealth.

Olivia's financial situation was greatly impacted by the inheritance from her deceased mother, amounting to approximately $736,000. This inheritance has been critical in covering the couple's overspending of $30,000 to $40,000 more than their annual income.

Olivia and Alexis have not engaged in active, intentional financial planning and wealth-building strategies.

Despite their substantial net worth, Olivia and Alexis lack the financial acumen necessary for proactive management of their funds.

They lack the financial skills and discipline to effectively manage their resources and align their spending with their long-term ...