Season 3, Episode 3: Are you swimming in a money river or drowning in a shame-saving pond?

Why mental accounting might set you up for self-shaming, and how you’re supposed to spend money on things that make you you

Dave Ramsey and Suze Orman are the elephants in our podcasting Zoom room on this one. Also the trad wife Insta influencers that might con you into thinking buying chicken farming supplies instead of Thai takeout makes you a better person.

Guest star Kacie Swartz from Blackbarn Financial has a money mindset water feature metaphor that splashes Caitlin right out of the…water feature. And Sara falls right into Kacie’s trap and Caitlin bravely shares how many money hidey holes she currently maintains against medical Kacie’s advice.

Most importantly, Kacie points out how much shame we all carry around with us in our money decisions, and how taking all moral and “good person” judgements out of this realm can help us figure out how to use our money the way we want to to make us happy.

We also take on capitalism, the patriarchy, deprivation and the exhaustion of financial decision-making in daily life! Women deserve nice things!

FYI: Here is the What kind of insurance do I need? episode we did last season, in case you want to learn more about what types of insurance are recommended, and which are not (according to Kacie).

Ask us your dumb investing and finance questions for Season 3 on our Ask Us page!

We have the social medias!! Here’s our Instagram and Facebook and LinkedIn.

This episode was edited by our co-producer Kelly West. Music by Bad Bad Hats and Devmo.

 Transcript for Season 3, Episode 3: Are you swimming in a money river or drowning in a shame-saving pond?

Caitlin [00:00:07] Welcome to women on the verge of a Financial Breakthrough, a podcast where we're figuring out finance. One dumb question at a time. I'm the dummy. Caitlin Meredith, a coach and mediator based in the Bay area.

Sara [00:00:20] And I'm Sara Glakas. I'm an investor, advisor and founder of Blackburn Financial and the Austin Women's Investing Group, which can be found on Meetup and Facebook.

Sara [00:00:31] Before we start, do you know a woman who might be on the verge of a financial breakthrough? Will you text her a link to our show? Also, if you can, please leave us a review. This helps other women on the verge find us, and we read all of them and they make us happy. Cry like this one from a listener who said big concepts. Understandable language. Love it. Highly recommend these ladies take the shame out of asking the dumb questions and just break it down into understandable chunks. Thank you so much for leaving such a wonderful review. Now let's get started.

Caitlin [00:01:08] We're back with Kacie Swartz, who works at Blackburn, as a. Tell us the letters behind your name.

Kacie [00:01:15] Kacie Schwartz is a certified financial planner and a certified investment management analyst.

Caitlin [00:01:21] Oh, that's the CIMA part. Okay, good. Okay, so she's back by her popular popular demand for a topic that's close to her heart and close to mine. And as we were just saying, I have a lot of strong opinions about it, but none of them are informed, which never stops me. And I'll I'll hold forth. But since Kacie might have a little bit more insight in this, we wanted to talk about our money mindsets and specifically the kind of money mindsets that are not like the one we're trying to promote here, which is like, figure out your financial future, get empowered, learn the vocabulary, build a community, build your skill set. But the one that reinforces the shame and the fear and the intimidation of the financial world. And I think sometimes for me, it's even hard to see that how those concepts are embedded in my own thinking. And I don't even see them as that, but that I might hold shame about them. I'm not a Starbucks person, but I can imagine for someone who is like every time getting a Starbucks and just being like, filled with shame that I'm doing this thing, that it's like a no no for the financial gurus. And so I would love to hear Kacie. We would love to hear sorry, Sara. Sara's also here. Say hi, Sara.

Sara [00:02:37] I'm here too. I'm just here to listen. Is here she's.

Caitlin [00:02:42] Allowed to speak. We've we've decided the last five minutes. Eric and Zeke.

Sara [00:02:46] Long time listener. First time caller.

Caitlin [00:02:49] So, Kacie, hold forth. What does money mindset you serve? It's like a huge passion in your work. What is the bad part of it? Where do you want it to go from here?

Kacie [00:03:01] All right. So I'm going to start with a question. Sara. When I ask Sara Lake is the person, not the money manager, but the person. What does having money represent to you?

Sara [00:03:17] Security and options.

Kacie [00:03:18] Caitlin, what about you?

Caitlin [00:03:20] Yeah, security and options. And like a relief of anxiety, which is the same thing as security. But I really think, like, a foundation so that I can, like, follow all of the creative pursuits that I want to do.

Kacie [00:03:36] I love it. Thank you both for falling into my trap. That's exactly what I wanted Judith to say. Can I redo my answer? Yes. No, no, because it supports exactly how I wanted this to go. Which is because I already know you guys. I kind of would have expected those answers. The only thing that surprises me is that Sara said security first. And the reason I ask about this is because when we think about money and we think about like, what is the point of money when we actually like, stop and think about this imaginary concept that the whole world agrees exists? It's either freedom or security or, of course, a compromise of those two things. And for the folks that see it as freedom, it's the folks who see it as options. That, to me is a place of that's a positive place to start in that it gives you the money, gives you expansive opportunities that can certainly go, that can certainly go wrong if you're a person that spends too much. Again, people who are choosing to listen to women on the verge of a financial breakthrough are probably not necessarily in that boat. I think that your audience would probably lean more towards the secure side. And when we think of money as security, it brings up so many things about we cannot let it go. We can't let it go down. It's going to disappear. We're going to be homeless. We're going to be destitute. Oh my God. If I stop working, I will have nothing like that. Kind of fear comes to us when we think of money as security, because it doesn't give. It doesn't give enough weight to the fact that money is a flow. It's a river. It's not a pond.

Caitlin [00:05:35] Yeah. Oh. I think let's just take a couple weeks to think about that concept and we'll come back. I am not.

Sara [00:05:44] In season four. Women on the verge of a Financial breakthrough. We'll continue this conversation.

Caitlin [00:05:49] It's a river, not a pond.

Kacie [00:05:52] Yeah, I didn't make that one up, but I can't remember where I found it either.

Caitlin [00:05:56] Okay. I love this idea because there's a lot more forgiveness in it, too, because there's the expectation that we'll keep having more opportunities to mess up and do things right. That there isn't just this monumental pond that, like, shows at all. And it's either small because we fucked up and there's no way back, or it's big because we are just, like, amazing and made all the right choices.

Kacie [00:06:19] Yeah. Which also takes a lot of the value judgments out of money that some folks have a lot of money because they work so hard and they deserve it. Sometimes that's true, and sometimes it's not right and the same on the opposite side. Some people don't have money because they didn't try or they fiddled it away. Or maybe they don't have money because of like institutional issues. So there's separating the value judgments from the money is, in my opinion, step one, especially for those of us kind of in the middle of the road. Right. We have money. We're working hard. We want to we want to optimize the money we do have. If we get caught up in some of the shame based considerations. We don't allow ourselves to take on a rational level of risk with that money.

Caitlin [00:07:12] Because clinging to what we have then becomes so important that actually taking natural risks to grow it and to have new experiences will be too threatening.

Kacie [00:07:25] Right, exactly. Now those can be things like the big vacation that's going to open your mindset, and then you come back to your regular job and you just now understand and appreciate other cultures. There's a lot of value in that, but also the things that can truly impact your long term future. The things like clinging to a job that mildly sucks because it's a certain amount of money and you don't know what's around the corner. Or clinging to a relationship that minor or majorly sucks because you don't know what you would do if you didn't have that partner. Providing income like these are the things that slow us down or when it comes to our investments, which is the kind of thing that I have a lot more control over. For folks coaching people through their their outlook on their finances and on their saving strategies and on their asset allocation, helps people hold on during market dips and stick to their their disciplined savings strategy because the difference between. A financial planner who is trying to make a holistic difference in your life versus the person that you meet with. Once that builds an investment portfolio and you never see again, is that I and people who do the kind of work that that we do. We want you to have somewhere to turn when things get hard, and we want to have lots of fail safes built in where there's a cash emergency fund. There is a there is a less aggressive part of your portfolio. There is the types of insurance that you personally need to have so that if something goes wrong, you don't have to liquidate your portfolio because of like not necessarily short term issues, but like things in your life that might resolve over time. Right. So so that's kind of like how the investment and the and the savings strategy gets like threaded into this bigger self-help concept of what does money mean to me, and how does that play out in my choices?

Caitlin [00:09:48] Okay, the first thing I want to say is we recorded an episode with you last season about insurance, and I wish I knew that number. I'll look it up and I'll put it in the show notes, just so people, you know, you said that and I think it's a huge piece of this. And so I want people to know we have a resource for that. Listen to that episode. The second one is it makes me curious, what are you looking at for the most sources of shame? Like, what are what are you reacting to now when you're talking about all these things that you want for people, that your clients are for all of our listeners, what what is the pushback you're imagining in your head?

Kacie [00:10:24] So it varies based on life stage. But one of the biggest things that I run into is people who feel like they don't deserve nice things because they didn't work hard, or they received it because of the death of a loved one or because of, their company got bought out by a bigger company or whatever it might be, these windfall events. Right. Well, you know, I just want to be a good steward of this money, and I want to leave it for my kids. And so I'm going to eat cat food, and I'm never going to leave the house because I want to leave all this money for my kids. That's not there. Your kids don't want that. If they're good, if they're good kids, they don't want that. They want you to enjoy your life. And they want you to, like, spend your money. Right? And maybe it's. They want you to enjoy your life and take them with you. Sure. That's like, that's a lovely compromise. That's a lovely compromise. Right? But, like, just never doing anything because you're not the one that earned it with your own blood, sweat and tears. That's shame based. That's not. That's not real in my opinion. The second one is folks who do the mental accounting. This is a Google term, guys. Mental accounting. Mental accounting will mess you up if in your mental accounting. And this is those folks who have a whole bunch of bank accounts because once the vacation fund, once the new car fund, once the winter coat fund, I don't know, whatever you got.

Caitlin [00:11:54] Do you have my account open on your books?

Speaker 4 [00:11:58] What is going on here? Are you going to do the dog?

Caitlin [00:12:01] One note. Two. Okay.

Kacie [00:12:04] There's a special bank account for the dog meds. Yes. Yeah. Okay. That mental accounting is the kind of thing that views. Your usage of those dollars as more important than like the tax consequence of where you put those dollars, for example. So. If you use a, budgeting software, like, you need a budget or any of the millions.

Caitlin [00:12:36] That's me again. I'm really getting suspicious. You're looking at my desktop. Okay.

Kacie [00:12:41] Do you have you need a budget? I do, yeah. I absolutely love it. Yeah, I love it. Well, if you've done any of their trainings, they tell you don't do that.

Caitlin [00:12:49] I know.

Speaker 4 [00:12:55] I know. I didn't know we were going to have y nab in the house here. I wouldn't have I wouldn't have said it so openly.

Kacie [00:13:01] I wouldn't have opened the door. No. But seriously, the point is that, you know, when when we put money in these, like, in these little piles or in, yeah, or whatever your your personal practice, that money is stale. That money is stagnant like the pond, right? It can't be used for anything else. And it assumes that there is no inflow. It reverses the the river idea. We're in the pond. Whereas if you see the pool of money as this is my bank account money, it's different than my 401 K money, it's different than my Roth IRA money, but my bank account money all has the same tax treatment. And therefore I know what I need to use it for. And I am a trustworthy adult who can spend it on dog meds. And then I can also buy a winter coat, and then I can also go on vacation next year, like whatever it is, right? Then when you are doing your savings, you can also be a little more thoughtful or a little more open to the idea that if I increase my 401 K cover or up for A1K contribution, if I'm in a high tax bracket, then when I put that money away and it's less this year, it's $23,000. As a person under age 50 with a corporate job, I put 23,000 towards this for A1K. I've also reduced my federal taxes. I have also saved this money for the future, and I did it on the front end of my paycheck. So now when I get my net income on my paycheck, I can spend it on whatever I want because that particular goal has been checked marked right.

Caitlin [00:14:44] Okay, I need to I need to break this out. Sara, do you have a question before I break it down so I can understand it better?

Sara [00:14:50] No, I think you guys just need to launch into this wide, maybe budgeting mindset area.

Caitlin [00:14:56] Okay, I want to just I want to make sure I understand what you're saying. So, for instance, one of my little side accounts on my credit union was for a new laptop. I knew I'd need one and I didn't know exactly when, and so I just needed to know that I had that money right there ready so I wouldn't delay it or something. So the day that my 2011 laptop broke down, I would say, but so I put it in a separate account. So untouchable. You're where it's at for a year. So. But what you're saying is. And I have many versions of that up and down the, you know, as many as labeled savings accounts as they'll let me have. If I had put all that money on the front end into my 401, in my case of solo for A1K, I would have reduced how much taxes I would have paid, so I'd still have the money. Essentially in my income coming down the pike, I would have lowered how much income taxes I was paying by putting it to use in my 401 K, rather than a savings account that's not earning any money.

Kacie [00:16:02] Yeah, another way to look at mental accounting to me, and this is one of the analogies I will use frequently in a meaning, is, does everybody love Blues Traveler as much as I love Blues Traveler?

Speaker 4 [00:16:15] I don't know that you can assume that.

Kacie [00:16:19] And or does anyone remember Blues Traveler? Because I am aging.

Speaker 4 [00:16:23] I hear a harmonica when I. You know, I know.

Kacie [00:16:26] Yeah, yeah. So I might have to come up with a new one. But basically, if you can picture John Popper's harmonica vest and there are like 40 different harmonicas on there, right? And they all have their own pocket. That's, that's how to look at your money. Right. Like if you have all your money in different pockets and they all have different tax treatments and different jobs, you're still only holding one vest like you're still one person, one one tax file, one person's retirement, one person's need to replace windows. Like whatever it is, you're still one person. So all of those harmonica pockets need to be working towards a a holistic, intertwined goal. And if you isolate them and you see it as like, I only need the C major, then that's not really looking at it from a holistic point of view. Right? That's the mental accounting. So if you put your appropriate level, let's say, of contributions towards retirement based on what you actually need for the future, what you've already saved and what you and your financial person have worked out, let's just say it's 23,000, for example, because it's easy math. Then that's done and that's for the future. And yes, it's reducing your federal taxes because that's a tax deduction. Right. Then number two is okay. Well then I also need to save all this money because I know that my car insurance is coming due. And I know that the dog, has his annual vet visit in August, and I'm good God, it's getting so expensive because he's getting old and yada yada, yada yada. All of that money should if it's sitting in your credit union micro savings account number one, it's not collectively the same amount. So it may not be getting like whatever break point you were going to get. Number two, if the credit union that break point is not going to be anything anyway. Whereas if you chunk it all together and you put it in a high yield savings account at ally, so fi dealer's choice doesn't matter, you're getting a much better return on it. And then you, as the responsible adult, can, like, break off a little piece every time you need it for all of these different needs.

Caitlin [00:18:42] I get that, I think for me, I'm wondering if this is will you remind me the term mental accounting? Yes. I my goal in life is to not pay credit card interest. And so I the way that I'm thinking about it is I want to be prepared with cash for something that I don't want to put on a credit card in the future, that I can't pay off completely because I'll be paying off 27% interest for them. So that's what's top of mind for me, rather than the tax savings I could get by putting that same amount in a 401 K.

Kacie [00:19:23] So let's put, let's, let's walk that a different direction. Same issue. But let's come at it from another angle, which is you're assuming that whatever this make believe horrible event is going to be, you're going to have cash on hand for it, right?

Caitlin [00:19:36] Yeah.

Kacie [00:19:37] So if you have that cash on hand, in theory, you also have a credit card, which in the modern world of 2024, you can set the settings to pay off in full each month. So that interest never hits that credit card.

Caitlin [00:19:51] Oh yeah yeah yeah. No that. But not if I don't have the cash to pay it off like a $2,500 laptop that I didn't expect to have to buy one month, I might not have enough in my checking account to pay off my credit card that month. And so it would if I didn't have it in its own little hidey hole.

Kacie [00:20:10] I think there's a certain element where you're correct there has to be a certain level of emergency fund, but keeping it in its own little hidey hole, separate from the money for the dog and the money for the vacation. Yeah. That part. Like if you were telling me that you would reduce your 400 and K contribution. Instead of spending from the vacation hidey hole. Oh, simply because the laptop hidey hole was empty. That doesn't make sense.

Caitlin [00:20:38] Okay, okay, that I get that I got. Okay. What do you think about hidey hole, Sara?

Sara [00:20:45] I am generally for whatever system people have in place. That makes them able to, like, get through their day, right. And focus on longer term big picture stuff. I don't do the hidey hole thing because. And now that I'm listening to Kacie describe this, I'm wondering if. I mean, I can see how there is a mindset there. If you don't have the money squirreled away in the hidey hole. You are not going to have enough resources at your disposal in the future when you need it. Which I do think is like constraining as far as this idea that we are smart and capable and have a lot of tools at our disposal. And so the extra effort that we put into to having all of the accounts that all have their special snowflake purpose, is distracting a little bit from this idea that whenever things pop up, we are going to figure out how to handle it. And if we have, if we have a track record of doing that over long periods of time, that we can rely on our own resources to do that. I would say, like where that doesn't work is like, do you have a track record of carrying high credit card balances? If you have, that's your track record, then you do need to come up with some system to break that habit. Right, of just running the credit card balances. But I don't ever remember that. I don't remember that ever. Coming up, Caitlin, with you having like a track record in the past, like a scarring past of running up balances?

Caitlin [00:22:26] No, but I have a I mean, this, again, isn't supposed to be about me. I really want to know the money mindset, but I am thinking, like, I come from I made $16,000 a year as an aid worker. And so, like, I didn't have faith that I would always have money for whatever came up. Like I knew there was a finite amount of money coming in. And so it really made me feel much more secure to be like, that's taken care of, that I can see it with my eyes here at this stuff is taken care of, so that I wasn't worried in my day to day spending. I didn't have to track that as much, knowing for sure that I had these like allocated areas. But I think as I made more, I'm not sure how much I adjusted and updated my mental mindset around money. So that's what I'm really curious about. This not so much of defending what I'm doing, but how what are the tools I need to update the way that I think about money now that I'm making $18,000? We've talked about like lifestyle creep, like you do have to think about, okay, well, am I making enough money to now, get takeout once a week? Okay, I am, that's totally fine. Okay. But now I'm getting take out four times a week. Like I do find that that monitoring, I have to do it to be aware, but it seems like you're pushing back. But that's shame based. And so I'm trying to figure out where the line is between what my worry is and your passion.

Kacie [00:23:59] Yeah, I, I hear two different topics that we can cover there. And, and I'll take the most recent one first where you're like, it went from one time a week to four times a week in the make believe world where you're getting this take out. If you are already making your full contributions to your tax deferred and tax free savings accounts, you and your financial planner have looked at your future and you're on a good track record and you still are are sitting at home and you're like, I just don't want to go out and eat. I want to get takeout for the fourth time this week. Go with God, I don't care. That's the whole point of financial security, right? More k so more frequently. I don't I don't want people to deny themselves from nice things because there is a make believe should hanging over their head about what is or is not appropriate. That leads me to number one, which is those of us who were born or raised or come from a, background of scarcity and or implied scarcity, because it was simply the depression era thing to do, even if it was 1985. We do not view our current financial picture with the same efficient eye, so that people who might come from a background of abundance are viewing it from. Yeah, in that it is not being a good custodian of your current income. If you used to make 16,000 and now you make 100,000 and you're still squirreling money away in cash in the sock drawer because you're worried about your rent, you're not being a good financial steward for future Caitlin. Future Caitlin need you to take care of her. And like, making these cheap choices is not doing it.

Caitlin [00:26:03] Yeah, I think it's that transition. Like when you talk about the person who. Who's, like, already maxed out. You know, 25 at $28,000 in there are like, they're doing all the stuff that's at one end. And then this the aid worker or whoever making 16,000, like you have so few choices. You do what you can first. You can't you can't afford to think about the future. You're just a it's the middle areas.

Kacie [00:26:28] That are it's the middle and in the middle. It's where sometimes you just have to have a get a grip moment where you look at the way you're running your finances and you're saying, am I running my finances like this because it serves me best? Where am I running my finances like this? Because this is what I was taught. And if it's what you were taught, take a look at it, because it may be right, but it may not be and it may not be appropriate for you.

Caitlin [00:26:54] So the elephant in the room here, I believe his name, the elephant name is Dave Ramsey.

Kacie [00:27:02] I never met that elephant.

Caitlin [00:27:04] And as I told Sara and Cassie, I have a lot of uninformed, negative opinions about Dave Ramsey and the idea that, like, I just have this idea of being in a room and people yelling at you for, like, taking out a loan if you needed it or whatever. So I'm curious how you think that connects to it, the shame based sort of financial management model, where there's a lot of ways to fuck up and not be the type of person that, like, deserves to have wealth because you're such a dumb thinker about it.

Kacie [00:27:38] Yeah, that is definitely a cocktail conversation to have offline about like different financial influencers. Either old school like the Dave Ramsey and Suzy Oremans of our world or the new folks that are, you know, the trad wife moms on TikTok that are like putting money into their their chicken farm and like, not worrying about other things. I don't necessarily have specific things to say about any of these individuals, but what I will say is that any system that prioritizes their ideology before your own individual needs, which everybody is individual. Dave Ramsey does not know your own personal choices, right, or what you're coming up against. You could just discard it because those things are a blanket, right? Those things are like for the masses. They are a rule of thumb. They are not real. For you in particular, I know a lot of people that have gone through like Peace University or whatever it was called, and there's a lot of value to getting out of debt for for some folks. But also, I do not want people to try and pay off an entire Austin, Texas $800,000 house before they allow themselves to save for retirement or allow themselves to go on a vacation that's not San Marcos, which for those who are not familiar with it, is a lovely town about 30 minutes south of Austin. So like, you know, you kind of have to compromise. You can't be black and white about money because money is not black and white.

Caitlin [00:29:22] So you're saying to cut yourself a break, like have a plan, have priorities, but not no purist ideology is going to rescue you, or maybe even make life worth living.

Kacie [00:29:38] Girl, when you get to retirement, you don't get a gold star for doing work right? And like having the most unlike paid off debt. Like nobody is monitoring that. Nobody is giving you rewards for being the best little puritan saver. You get rewards through your own experiences and through like having the safety net for yourself and your loved ones, and being able to pay for the things that you in particular prioritize. Is that the fact that I hate eating lunch at my desk and I will go out for lunch every day? Or is it the fact that, like, I love, vacations on a catamaran off the coast of San Diego? Like, whatever your deal is, you prioritize based on what's important to you?

Sara [00:30:31] Yeah, I mean, I, you know, I agree with with this this idea of like, the peace of mind, right, like Peace University or whatever, like that get out of debt thing is, has helped a lot of people, because I don't know, I think like getting out of debt, like. To some extent is it's like a math problem. Right. And so you if you have a strategy to turn the math the other direction and then you get out of debt, you end up with a much more peace of mind. But I don't think you can take that system and then apply it in a very judgmental fashion to the rest of your financial areas. And then the way that, Dave Ramsey, Suzy Orman, like some of these, like, financial influencers, you know, how they do like those rapid fire like, call in parts of the show where it's like, you call in and you ask the person if you can afford this. That is awful, right? It's like taking like you take an entire person's financial snapshot and you distill it down to 30s, and it makes everybody feel like someone else has the ability to judge whether or not what you are doing is right or wrong. Instead of figuring out figuring that out for yourself.

Caitlin [00:31:47] It's like the Judge Judy of like, can I afford this? Or just like, know what?

Sara [00:31:52] Right? And what I, what I feel like most people do is internalize that I am not worthy of this part of it and take that farther and farther and farther until, like, I have the same people I have, you know, people with plenty of money who have bag lady syndrome. Right? Because they think that if they spent money on themselves, that is the first step in a series of unstoppable events where they spend all of their money and then they are old and they are despised and they are abandoned by everyone they love. And it's that first step that they took by going out for lunch four times that one week, and then they just kept doing that until they had no money left, and everybody abandoned them, and they were hated. And their bag lady living under a bridge. Right. And so it's it's easier to be like, I don't deserve this. Like, this is wrong. Right?

Kacie [00:32:53] Okay, guys, like, how often is this the the answer to like, every institutional problem. But this is also a symptom of the patriarchy in that women in particular are supposed to feel shame if you spend money, if that money especially is being spent on you and your needs, and not even if you are a single person, well, why do you have all that money? You should be giving it to the poor. You should be giving it to someone else. You shouldn't be prioritizing yourself. God forbid. Like this. The shame. This is some this is some deep, deep stuff that that financial counselors can help you with. But also like straight up therapy. You guys, sometimes that's what it takes. But just like the very idea that you have to deprive yourself to be worthy of retirement, to be worthy of the new car, to be worthy of getting your nails done once a month, like whatever level or or scope of your own happiness is like, you don't have to earn it.

Caitlin [00:34:07] I'm I'm kind of shocked. I'm thinking about like, I feel like I've been part of the national audience of the like, who's in credit card debt, like a huge judgmental thing. And then of course, we have the good debt, like, oh, well, it was for medical bills. And like, so I'm really I absolutely believe in a government health system. But all these things that are like, oh, well, they couldn't help that. But these are the exceptions. They should have never done that. Like, I'm, I feel very bandwagon when I think about that idea of like credit card debt and all that. Even though when I think about an individual, I rarely have those judgments and I understand they're spending in a different way. And also, it's none of my freaking business doesn't affect me. It doesn't matter. But I it's is are you saying that spend within our means is like, a relic, a throwback idea, or are you saying people don't even know what their means are. And so they are reacting to cues from society instead of their own financial picture?

Sara [00:35:15] I think that sometimes people think that their means are what their parents means were 30 years ago, or however long like. So. You learn that the first place you learn it is as a child from the people that you were living with. And so that becomes your frame of reference. Well, like when I think about it, I'm like, we we never ate out. We only ate at home. And like, fast forward to today, like, I don't I don't cook, I don't I don't cook at home very often. We don't eat at home that often. We eat out. But. There is like an underlying shame about that, right? That like, well, why aren't you canning those tomatoes like we have we have these we have the days when we can things because then we use them in the winter. Right. And we store them in the canning cellar because that's just how we do things. So there is, like, very much like a wasteful privilege, like, do you think you're better than me type of shame that comes along with it that I know that, like, my parents don't think that they don't ever like that. That is not the message I'm getting from anyone other tonight. It's internal, right? It's the internal. And I think everyone starts from there. Right. What is what is that? That we learned the things that we should be like or shouldn't be like, and then kind of translate it either directly or indirectly to money.

Kacie [00:36:37] And I think it also is a thought about. When when we're saying, you know this, live within your means conversation has the individual who is listening to this right now done the pen and paper work to figure out what are those means and how can they be more efficient? You know, with the things like in maximize your your pretax contributions so that you therefore have more take home income with which to do the things you need to do using the snowball method, for example, where you pay off the the highest interest rate debt, like that's a that's a great takeaway. I love that one. Honestly, it's pretty intuitive. I'm not going to give anybody really credit for that.

Sara [00:37:21] But I will give Dave Ramsey credit for that. I don't think it's intuitive and I think it's I think it's good to popularize, but sorry. Proceed.

Kacie [00:37:32] I agree it's good to popularize, but also like if you've got a 30% debt on a credit card versus a 2% debt on your car. Note come on guys, we can all do that math. But then anyway, my point is that, like, you know, getting out of those kinds of debt, yes, that's highly important. But if you organize these things and you get efficient with the places that you're doing your savings and you're maximizing their returns on really low risk things like a high yield savings account instead of sitting clients that I know who have 300 grand sitting at the credit union earning 0.01. And I'm just like.

Caitlin [00:38:10] No, I know you don't see my desktop.

Caitlin [00:38:13] I don't have $300,000 in my hidey holes.

Caitlin [00:38:18] Okay. I wglakasant to introduce a, a complicating factor that I find in my own life and that I resonated when I think it was you, Sara said. Like, if I have lunch out this week, then it's a slippery slope and I'll do it forever. Living in the times of capitalism, social media, the exposure to goods that we should buy that will make our lives amazing is full on. And so I find it's easier when I go through times where I'm like, am not buying any new clothes, I'm just not going to do it. That's just an easy I don't have to think about it all where because once you open the possibility, you are inundated from the moment you open your eyes. If you're on any type of social media, we don't even go to stores anymore. We don't have to. And that that decision fatigue about what do I need versus no, I deserve this. But you know what? I already have three of those. Or but this one is yes, I'm allowed to have something new for this season versus like that is wasteful capital. That's the patriarchy telling women they have to have. Nice thing. It is exhausting. And so I also think that like living within your means, even when you do know what your means are, it's really hard to figure out what ethical spending is, what is true to ourselves, even if it's from our childhood or not. Because of the inundation we have about buying click, it's so easy to click on stuff and think that it's going to be better.

Sara [00:39:56] Yeah, I mean, I, I mean, I, I agree and I think it's also a process and you can course correct at any point in time. I always kind of use credit card balances as the red flag, like, you know, like Kacie said, like if you're contributing to your retirement account and you're doing like most, if you're doing the right things, like in terms of like saving some money for an emergency, funding your retirement, and then you start seeing yourself racking up credit card debt, that's the red flag. Like I'm over consuming. I'm outside of my means. I can see the balance. The balance is telling me that if you are not running out the credit card balance and you're just kind of waffling back and forth between like, okay, I'm going to do one of those zero waste years where I make zero waste for one year. Yeah. And like, oh my gosh, I'm going to spend it. All right. Like yeah, that's we all do that, right? Like we all kind of go through the feast and famine of like revenge buying and then like, you know, doing a consumption diet. Right. And all of those things. I think that's just like, that's just what life is, right? Like none of us are ever going to be perfectly balanced. And if we can recognize when we're getting overly stimulated by capitalism and consumption ism and all of those things, I mean, we can just do something else, right? When it starts affecting us.

Caitlin [00:41:21] Like, no. So light on your feet. Yeah, I, I agree in principle. And I also know I'm really trying to investigate this idea for myself of this mental accounting, and I really take on that. It comes with a lot of shame and self-judgment and things that are not helpful when it comes to like. Expansiveness and thinking about it and getting excited about my future. But I'm recognizing that, like the decision to say I'm not going to sweat, I'm not going to sweat all this stuff so much is easier said than done because of the ample opportunities that are just everywhere, where we look of another place we could spend.

Kacie [00:42:06] So here is where I well, I will circle back on. That is let's take it back up one level where we're talking about the social construct of deserving new things and or the constant pressure from capitalism to buy new things. Those are very real issues, and I completely agree. I will say though, what I run across more in my practice here in my, 12th, 12th year as a personal financial planner, dealing directly with clients who have incomes varied from all different levels, is that I don't run into folks who are racking up too much debt that often s and again, that's going to tie back to the fact that the people who are listening to this kind of podcast are generally not people who are overspending with no concept of Y. For those people that have done the work to really look at their finances, look at their needs and their income, and they have taken care of all of those fundamentals the savings account, the life insurance, the car insurance, their kids doctor bills are paid for, like whatever. Once those things are all done, tie in shame to the fact that you love team. Who is patriarchy?

Caitlin [00:43:31] What's your chemo?

Kacie [00:43:32] It's one of those websites where you can buy cheap stuff on the internet.

Caitlin [00:43:36] Oh. Oh, okay. Yeah, yeah.

Kacie [00:43:38] It's like advertised all the time on different, you know.

Caitlin [00:43:41] Okay.

Kacie [00:43:42] Games and stuff.

Caitlin [00:43:43] Well, don't tell me any more about it. Now. My phone. I'll start now. Oh.

Kacie [00:43:47] I know now your phone's probably listening, but like, the fact that we're tying shame to. Yeah, to your silly purchases. If you have done all of the legwork to make your life stable, that's borrowing shame for no good reason.

Caitlin [00:44:00] Yeah, okay.

Kacie [00:44:01] And all of us do it. And it's just not productive. And it's not good for your mental health.

Caitlin [00:44:07] Yeah. No, I see that it's a huge like bugs people down and it's like the opposite of what money is supposed to give to us, which is options and expand and opportunities and experiences and enjoyment and that we don't we're not good at turning off the vigilance, even when we can. And I think maybe a whole other episode is figuring out, like, you have a very simple math equation for turning the vigilant, like when you're allowed to turn the vigilance off. And maybe it's a psychologist. We need to talk to you about the tools that people need to actually make that intentional transition from like, I'm okay now get away from that. Maybe Brené Brown, the scarcity mindset.

Kacie [00:44:55] Oh my God, that'd be amazing. Can we have Rene talk about shame? Because that is like the only self-help book I've all I've ever read all the way through. Because shining a light on anything you're ashamed of just fixes it. It's just amazing. Once you take that, that plunge. There you go.

Caitlin [00:45:14] Yeah. And I think also talking about the shame that people have, because I don't want to have this equation that like, you have to have shame until you're paying off your, your retirement accounts every year and you have everything from financial help, like, I think getting working on the shame way before you get to that point of total financial security is also very, very necessary. And it's part of the reason behind the podcast is so that we can bring it out into the open and talk about this stuff and figure out what, what are our true beliefs and our values for ourselves. Because it's. Yeah, messy too.

Kacie [00:45:54] Yeah. And I think that my underlying theme of my practice in my. I know this is a little absurd, but like, my message to the world is that money should be about freedom. And if money can be used to create a cushion so that you can leave a bad relationship, leave a bad job, leave a situation that is for something better, or have the confidence that you have a cash cushion so that you can take that year off and try and write a novel. And if it doesn't work, it doesn't matter. You don't have that same pressure that you would if you are tied to an I is on the ground mindset, I just have to keep working until I'm old and then I'll just die. No, that's not that's not fun.

Caitlin [00:46:47] It's not fun. And if you're privileged enough to not have to live that way, it's really would be great if you could take advantage of that and not suffer for no reason.

Kacie [00:47:01] Well, and that loops us back around. I'm telling you, these things are a tapestry that loops us back around to where shame stops us from investigating. What is the most efficient way to look at my money? Yeah. When people are ashamed, they don't want to look at it. They don't want to rip that Band-Aid off and see how grimy is it. Because frankly, most of the time it's not that bad. It's not that bad. We can fix it. You can recover from this or that. Oh, you got a little bit of debt. How long is that going to take us to? To pay it off? Okay. If you can't pay it all off this month. Well, how much is that in interest? It's $45. Okay, well, we'll pay it off next month.

Caitlin [00:47:37] Yeah, yeah. Big deal. No, we can make things much bigger in our heads, and especially the longer we avoid them, obviously.

Kacie [00:47:46] Yeah. So the commercial is going to be find an accountability partner that you feel comfortable with. If that's a girlfriend, if that's a financial planner, if that's your pastor I don't know. It's probably not a financial influencer. But whoever it is, hold their hand and look at the realities of your actual finances. Yeah. It's like it's not it's usually not that bad.

Caitlin [00:48:11] Yeah.

Kacie [00:48:12] And you'll and amazing.

Caitlin [00:48:14] I also I have clients that I work with as a divorce coach who I have really avoid looking at their debt also. And part of the conversations we have are about like, you know, postpartum depression is a real thing. And you went through a real high spending peak after your second child was born. Like, that didn't come out of nowhere. That's not because you're a bad person. Whatever. Like, let's look at it with the open eyes about the context that this debt happened in, and you have a story to tell about it. And it's a story that will connect you with a lot of other people, too, who've been there and might not be brave enough to tell their story. So, like, I get very excited when people are open about it, because I know for every one person who's really open, there's ten people that feel like they would die. If anyone ever found out that they spent like that for a year or whatever, and that there's so many people with hard stories that have done the best they could with what they had.

Kacie [00:49:16] Yeah. And I think that, again, that ties back to how this is a little bit complicated with psychology and therapy and all of those things. But one of the best things that I have learned in therapy is that my personal self-worth is not it's not completely aligned with things that have happened to me in the past or things that I've chosen to do. Those are just events. Those are not in.

Caitlin [00:49:40] You are the river, not the pond.

Kacie [00:49:43] Amen. Man, it's a river, not a pond.

Caitlin [00:49:45] I love this, I going to think about that a lot. Thank you so much, Kacie.

Kacie [00:49:50] You are very welcome. It's always a pleasure.

Music transition by Bad Bad Hats

Sara Did you have a question about finance or investing? Send it to us in an email or voice memo on our website. Womenontheverge.com.

Caitlin Hey, we want our listeners to know that economic abuse can be subtle, but it's a serious form of control. Watch out for partners who limit your access to money. Sabotage your job or rack up debt in your name. If this sounds familiar, know you're not alone and there's help available. Please learn more at the hotline.org or call 800 799 safe.

Sara This episode was edited by our co-producer Kelly West, with music by Bad Bad Hats and Devmo.

 Music outro by Devmo

Devmo I know the first thing you notice is that I'm covered in gold, the flick of the wrist it could turn a hot bitch cold, to get what you want in life girl you gotta be bold. Now Imma die rich, and I know...

Sara This podcast contains general information that is not suitable for everyone. The information contained herein should not be construed as personalized investment advice. Past performance is no guarantee of future results. There is no guarantee that the views and opinions expressed in this podcast will come to pass. Investing in the stock market involves gains and losses and may not be suitable for all investors. Information presented herein is subject to change without notice and should not be considered as a solicitation to buy or sell any security.