0:00 Download the Conscious Spending Plan so you can use your money GUILT-FREE: iwt.com/csp-youtube Please remember: These are real people who had the courage to come on my podcast and ask for help. Would you be willing to come on this podcast and share every detail of your financial life? Feel free to leave comments based on what you think, but remember that we are here to help in a supportive way, not to demean and criticize.
Brad stated that when it was good, it equated to being righteous, and when it was more lean month or year, it means you are not righteous enough was triggering. I felt that statement because growing up, that was measured if I was Christian enough.
Which is sad cause to what not Jesus/the Bible says.. These preachers gotta teach better. Sorry you went through that God loves you no matter what’s in the bank
100%. You hit the nail on the head. As someone that has been living on less than 30% of my income for the last decade, your comment resonates with me. I wish everyone reads your comment and take it very seriously
I’ve noticed a pattern in these interviews: When the wife doesn’t bring in the money, she feels like she’s not contributing so to overcompensate she creates complicated budgets that gives her a false sense of control but the family ends up stressed. We’ve got to value stay at home moms to avoid this vicious cycle. And also learn that budgeting can be simple.
Valuing a SAH mom is too relative, she still may not feel valued enough. You have to tackle the problem in front of you. As a man, learning how to budget and manage money effectively. Because just as often I see her screaming out in her heart for him to just take over and handle business so she can relax and trust him.
@@SwaeTechok but if he is the sole breadwinner, feels like a more fair division of labor for her to take the lead on everything else, including the family finances.
How does Sandra seemingly manage most of the financial decisions in the family with a tight budget, but allow Brad to invest nearly 100% their net worth into one private investment? It was either a joint decision or Brad has much more financial decision making power than this conversation let’s on. If Sandra budgets in excruciating detail, but can’t veto investing a million dollars into a risky project, then the family financial check and balances needs addressing.
@@ST-rj8iu It is the worst of both tracking and budgeting. She has a fixed budget that we'll spend under $500 on groceries this month. Then at the end of the month, she sees if she "got a good grade" or not. If she was budgeting, she'd say "We have $500 to spend on groceries this month" and that's based on reality, such as her average spent, to make sure they don't go too far over. Then each of the transactions are entered every week they buy groceries and they know they have $x left to spend. Doing it after the fact is not good. It's also not a "good grade", that's a very unhealthy mindset that equates spending money to "being bad", which people say pretty lightly but isn't a good mindset. People do the same thing with food -- "I was bad, I had a piece of cake at the party". There's this moralizing around consumption in America, that budgets and diets are restrictive and morally good and eating "junk food" (a loaded term) and mindless shopping or buying luxury goods is morally bad (a sinful indulgence).
For all her faults, I'd be just as scared as Sandra is if I'm telling my spouse that expenses were greater than income and they are telling me "trust me". Brad playing the "net worth game" and not caring at all about montly expenses when basically all of that net worth is tied up in a super risky investment is WILD.
It doesn’t help that Sandra tells him that they’re out of money when she really means everything is budgeted. With 80+ budget categories, it’s no surprise that this happens nearly every month
@@dylanjonesSD Their total expenses have exceeded their income for the past few month. So yeah, agreed with the premise that she has too many budget line items... but she very likely still calculates the sum. Also, I don't count the 20k per month from the oil investment because that's likely a ponzi scheme and there's a high chance that the ponzi collapses or that the scammers ghost the guy. That money needs to be treated like it's their retirement so they have SOMETHING left if this "investment" goes south.
I’ve lived in Oklahoma for 30 years. I’ve seen boom and bust cycles bankrupt not just individuals but institutions multiple times. If he had a a large portfolio which included some investment in oil, fine. But to put all of his family’s future into two oil operations is playing with fire. He’s like a gambler that tells himself that he’ll make it big if he rolls the right combination of dice just one more time. The whole religious view that if you are wealthy it is because you are a righteous Christian and God is blessing you is such a warped view of what Jesus taught, and it’s not helping them any. That plus the expectation that she shouldn’t have to work be because it’s his job to make the money is not helpful. You are in this together. Your kids are no longer little-it’s the time in your life to work outside the home to help provide some financial security for your family. Plus, working and bringing in some money on your own will make you feel less vulnerable financially.
Agreed, on the years when they only had $11-18k income, what else was he doing with his time? If work was shit in those years I’d be looking for something else to supplement. Maybe he did and it wasn’t mentioned. She would’ve had 4 young kids to care for so certainly don’t expect her to make money. I’m just curious what their deeper picture is. The religious ties to money isn’t helping at all, I sense a lot of resentment between them and their comparison to others is keeping them from seeing the opportunity they had. $800k and it was all spent?!?! I can’t comprehend that. Really curious what their advisor was doing for them to only have 3% growth in 20+ years. They should have educated themselves too instead of just going with whatever they felt.
Agreed. I remember the Aubrey McClendon saga. A story quite similar. Believing that you have a sky high risk appetite, and despite being a risky industry those dividends will surely match the predicted optimism. Then the chickens come home to roost. Hope he gets lucky, cause it's a sad story otherwise.
@@elisedesignss came here for this. I guess it goes to show that when we think about greed and doing things at the expense of others, it is spurred (sometimes) by fear, founded or unfounded. Anyways, that sucked to hear.
You mentioned in a cut away that people always say "I'm not good at money" I also hear "they don't tech personal finance in school". I don't disagree with the school thing but at a certain point you gotta stop using that as a crutch and I've started to respond to that with, that's true but google is free, the info is out there you just have to seek it out. We have to stop blaming the adults who were responsible for us as kids for what we lack as adults, now you're responsible for you.
Woah "I'm playing the networth game" then invests it all in one scheme...what happens if that doesn't pan out and the networth goes negative??? Playing with fire! No wonder she's so anxious about money! Yikes! 😱😵💫🤯
“People who live a story, love to talk about their story.” GOLD! The true strength of a marriage is how you pull together or drift apart when times are difficult. Besides working on money, couples must make their marriage priority. Thank you, Ramit and thank you to Brad and Sandra for your courageous discussion. You’re willingness to be vulnerable is helping more people than you’ll ever know.❤❤
I guess my question on the investments is if Brad spend 2 years following this company and crunching the numbers and really thinking it through, how did 24 years go by without an annual (or once a decade?) review of the retirement accounts? I can't wait to see their numbers. I hope Sandra will see that she doesn't need 82 categories to have control over the money.
@@verb0ze It's clear that he wants to catch up, and he's doing it the way he knows how: business investment. My question is why didn't they as a couple or him alone use the same skill set to evaluate their retirement investments with the same intensity he used to invest in the fracking company. Even if you check the balance once a year, you'd imagine that after 10 years of poor performance, you'd insist on making changes. It just seems like 20+ years of not paying attention to the retirement accounts is too much given his business background and her constant worries about money.
So many weird red flags in this episode. Ramit made a comment about how the mortgage business booms and busts and it is kind of shrugged off, but spending that on ATVs instead of saving for your nest egg seems irresponsible. Seems like luck masquerading as skill
They can put the non annual categories into one and divide by 12. We call ours the STS - short term savings - fund for auto registration, insurances, etc.
There is a significant story there that is very telling. In particular, they are viewing God as a transactional relationship and not as a friend that Jesus teaches us. It's a very natural way to understand the world but I'd encourage anyone reading this to work their best to shed this belief as it's a false one. Giving does not protect us from bad things and doing the right thing doesn't promise us no problems.
I think Brad is being reckless. Slapping your entire future into oil fracking is a major mistake. Fracking is likely to be more tightly regulated in the future as well as likely to get more and more expensive as water runs short. That's quite apart from the horrible environmental damage.
OMG, oil wells have no word. Investing all your assets in an oil well is a gamble. He has no experience in the oil industry. He is repeating the same mistake he made with his previous financial advisor. For me, this is a bad idea. To much risk. Also, even if he is successful in his gamble. What is the point? You can tell that their struggle can't be solved by any quantity of money. Hope they can make it work.
No, investing $1M into this is not a good idea. If it works like he says, and does get 50% returns, he will look for the next big adventure to prove himself. He will continue this until it all disappears!
If you paid attention, you would have noticed those high years were not from mortgages, they were from some kind of event that they do. Also, they only ever made that money for a short period of time. That’s what happens with risky ventures. You win big and lose big sometimes
Brad investing in one project was based on emotion, angry from the years of other wasted investment. I hope it does work out for them. All the life savings?! So so risky and selfish.
err what? he spent a LONG time thinking about the investment. This wasnt a decision made on emotion and impulse. He had been looking at investing into the fracking business for years and ran all the numbers and angles long before pulling the trigger. The chance to make up for lost time is one of many decisions. He likely wouldnt have invested the money if he thought the risk of loss was too high. Im willing to give Brad credit here. To most, this sounds like an insane decision to make with that much money. But he saw gold while others saw it as gambling. He understood what exactly he would be getting into, what the returns could be, and what the risks are. Ramit doesnt understand completely so his initial thoughts were that of complete insanity. But Ramit doesnt see the numbers that Brad does, so he has to trust Brad made a smart financial decision and isnt gambling millions away on hopes and dreams.
Hey Ramit ~ it’s super cool how you have that red “progress bar” at the bottom during ads and intro. Great feature I wish more creators would use. Cheers to your rich life!
I watch these on my phone and I totally thought the red progress bar (which shows right above youtube’s video progress bar) was a new youtube feature for ads 😂 But it’s just a well-placed progress bar on Ramit’s videos 🙌
Yep his ad sponsored don’t need to know if people actually watched the ads in the video 😂😂😂 he can keep that watch data to himself and not tell them. Other creators timestamp different portions of their videos sometimes showing you exactly where ads end
Thank you Sandra and Brad for sharing your story. Overall, after watching this episode I felt like a lot of their issues had to with how they viewed money (their money scripts), control issues, religious values, and communication with each other. Honestly, I was getting a little overwhelmed from the lack of empathy towards one another. I am almost wondering if it is time to discuss their role expectations in their marriage and learn how to empathize with each another. Overall talk more positively about each other (stop the comparison jabs) and money.
That’s a job in itself - way too many categories! Why not lump all car stuff into one category (registration, maintenance, gas) and have one category for all kids extracurricular activities.
I'd have to count mine but I am probably not that far off. I've been on YNAB for a decade and I split my grocery receipt. Food : Vegetables : "Broccoli (1.87lb @ $2.48/lb)" : $4.64 I started when I made very little money and I wanted to know where all that grocery money was going, because it was my single largest expense. I also did comparison shopping and checked to see what was a good deal and shopped for different things at different stores. I still vaguely buy some things at this store or that to save a few dollars. But now that groceries are under 5% of my net income budget, it is perhaps a little pointless. But I've been doing it for 10 years so it's hard to stop. Even if I stopped having separate categories, I'd still want to split food from toilet paper, so I can track the "Bathroom (Consumable)" category.
First, props to Ramit at keeping composure at the word “fracking”! I don’t think the oil investment was a good idea. The things that Brad said about the investment seem to come from a media kit. Did they run this opportunity by their own tax professional or conduct any due diligence? And with more shifts to renewable energy, it would’ve been better to put the $ in n index fund.
I was surprised that Ramit didn't mention renewable energy, but then I thought why. Given that they're religious Christian family, it's quite likely that they're Republican, too, and given that the fossil fuel industry has paid off most Republican politicians, I wouldn't be surprised if Brad and Sandra thought that climate change was a hoax. So, Ramit wanted to avoid focusing on politics by not specifically mentioning the energy transition as a huge potential risk. Turning the conversation to politics could've turned nasty. Well played, Ramit.
I think it’s so reckless and irresponsible to make this type of macho gamble with his family’s money. I would never allow my husband to do that with our money.
As an investment, I don't think they were in a situation to have invested $1M in a fracking venture. Usually people should have the foundational investments taken care of before they think about speculative investing, and even then, it shouldn't be a high percentage of their net worth. The actual investment in fracking itself is unethical, as well. It poisons groundwater and ruins ecosystems. The desert is still an ecosystem that depends on nutrients in the ground to thrive. Their kids have to live here when they're gone, so it's a poor legacy investment financially and practically.
@@Dan16673 Accepting reality while looking for alternatives vs _actively_ investing in poisoning resources we need to live are two very different things
@@Dan16673 Silly argument. As individuals, we live in a system that we want to change. We need the government and large companies to take responsibility for providing new ways for us to get around (well funded public transit, EVs). In the meantime, yes we all have places we need to drive sometimes. That doesn't preclude us from wanting a better society that runs on something other than dirty energy. Especially when it involves poisoning our water supply through fracking.
Great couple. I appreciate how open Sandra and Brad are to talking about their problems. Ramit did great at setting the stage and helping them tell their story. Can't wait for next week.
Brad’s a classic grifter running “events” and trying to make money off people. This oil thing, teaching finance (lol), and coming on this show is probably part of the same grift trying to get new “students” he can “educate” to learn how they TOO can invest in this no brainer oil adventure.
Tithing really angers me. 😡 Some churches are taking 10% of income -from their members who are struggling financially. They use guilt to extort money. These churches are worth billions and their $ is tax free! Some of them charge their members a lot of $ to go on missions and recruit new members! Ramit is too nice to give an opinion about tithing.
Oh please stop with your fake indignation. We give our money to God its OUR choice. I love giving to God because He js always faithful. Plus most money collected by churches goes to the community, helping others and church growth. Its our decision as gwon individuals. Go be angry at your spending habits instead.
You know nothing. It is for committed members. God has stretched our 90 percent leftover. We have no debt and low costs, assets, Savings , private school, vacations. Mostly frugal. On a middle and now low income. Also , a good church has strong accountability and there is a lot of sharing and helping each other .
So tithing is like our current tipping culture? If so, it's simple: train yourself to ignore the guilt. NEVER tip for pickup orders or at those terminals asking you for a tip. DO tip at the end if they provide good service. Don't tithe if there's no transparency and you don't see the money helping others (i.e. televangelists buying mansions, private jets, various extravagances). Do tithe if the church is transparent and you see contributions helping your local community.
This guy invested for 2 years back in the late 90's (before the tech bubble, mind you) and has pretty abysmal returns. And we are blaming a financial advisor? You really think this guy let his investment sit and didn't touch it through market ups and downs over 25 years? The guy that just put all of his net worth into a fracking operation? Ramit is giving him way too much benefit of the doubt.
100%. You don’t go from passively letting an advisor run your investments for 25 years to investing in highly speculative, niche assets nearly overnight. This guy had his fingers all over those previous investments. Probably bought high and sold low many times. Unfortunately, old habits die hard and now he’s literally gambling the house.
Brad, Brad, Brad.....you are a "Get Rich Quick" guy, aren't you? I guarantee if you had put your money in the S&P or Total Stock Market, you'd have millions by now. This whole episode turned on it's head when you said you put all your eggs in one basket. Good thing you are 48 and not 58.
He was making 80k a month so yeah he was used to easy money. He just messed up with the money they did make. He should have been set if they had even done well with half that money
Even if his investment pays off, he's shown his wife that he's willing to gamble away the entire family's life savings. Either way, because of the stress and potential financial ruin he's put on his wife's shoulders, it was the wrong decision.
Reminds me of a few weeks back, the guy who bought rentals without consulting his wife, while his wife ‘watched her kids’ even though they were his kids, and was 10 meters away. What an outrageous thing to do.
Why do people feel they need to spend “every month” on wants. We are raised in a consumer world. Example Clothes last years as a grown adult why would someone “need” to buy clothes; I think people are told things are needs, when they are really wants. I stepped back and really looked to define needs and wants so now we don’t frivolously spend “every month” - living below my means created so much more freedom. So much more money now! It takes a while to change your mindset- but can be done! My rich life is I can go to the grocery store and “technically” not looking/worrying about prices! Feels so freeing to know I can afford the cart always.
By "wants" people also mean "maintenance wants" like hair/nails or miscellaneous subscriptions. If they can afford it and they are already saving and investing, why not?
This! My husband and I buy clothes maybe 2-3 times a year. And it's not like we go on shopping hauls either... We buy a couple of good quality clothes that are versatile and will last us years. I'm not rich enough to buy cheap clothes that I have to replace every year, or worst yet after only a couple of washes.
Well that sucks the joy out of life, doesn't it? Whole point of this show is a RICH life. I think having a few percent of your budget each month like Ramit suggests to spend how you want to if that's within your means is totally fine. You don't have to spend it at Restoration Hardware tho, just spend within your means. Example: I get "new" clothes as part of my RICH life (ok, and tax write off sometimes, I'm a musician, we have pressure to look good, esp as a woman and when I'm a frontperson) and I can only afford it if I buy at thrift, so that's what I do and I enjoy it.
Thank you for your insistance of not doing a line item budget! I spent all my time doing that for a few years, got burned out and did nothing for a few years, and now I am in the middle of automating our money and finally meeting our savings goal and feeling good about things i used to never allowed us to spend money on (things to improve our home, husbands interests) while being confident we are set up for long term success!
Came over from the podcast bc of audio issues. But so great to see this couple work with Ramit! (They also look like the it couple from a late 90s early 00s teen drama!)
I’m always shocked how many people are duped by the fairy tale of god and to get blessings you need to pay money. I’m sure the church desperately needs more money. God is wearing hand me downs up there eating reduced lunch.
I don't fault them their beliefs, but if they are Christian, believing that they are rewarded beyond basic needs for righteousness goes directly against their source book...
If the oil venture was a guaranteed thing they wouldn’t need all of these other investors. They are using “other people’s money” to take 100% of the risk until they are paid back and then taking 30% of the profit after the initial investment. The real winners are those running the operation. If the venture fails to produce or to return all of the invested capital they have 0 skin in the game. I’m not saying it can’t work out for this guy and it might indeed be a winning hand but he is taking a tremendous risk. The even bigger risk will be if he succeeds and tries to double down on the next venture without preserving the majority of his investments into something safe. Like the scene in “The Gambler” when John Goodman tells him, “If you get up, you get out.”
This is so weird to me. My partner and I are exactly the same age as these two, we've never made anywhere close to $70K in a month, and we probably have a slightly higher net worth than they do, all from doing the boring 401K/IRA route. I'd be really curious to know what went so horribly wrong with their investing over the past 25 years that they got such terrible returns. It sounds like maybe they panicked and sold at exactly the wrong time - several times in a row.
he explains in the video that they had invested with a financial advisor that averaged about 3% returns per year and were charging 1% in fees. So they were overcharging and underperforming. and that was going on for over 20+ years. it was something that went way way way too long.
@@kingsgold But a 1% fee would not knock their average return from 8-10% down to 3%. There must have been something else going on. They were paying through the nose for an adviser, and the "advice" they were getting was worse than worthless.
@@johannamiller527 they werent getting 8%, the advisor was getting half of that for 20+ years. they werent even meeting the market. the market was outpacing the advisor. and overcharging for it. that's the core issue.
Easy answer is they didn’t invest the difference. Pay for whatever you want, when you want, and private school tuition for 4(plus extra curriculars) can eat up even insane income in no time
I can relate to her so much. So much financial stress, failing every test. Money all gone half way through the month. Except we actually don’t have 1.3 mil in assets or that income. But I can relate as a perfectionist, being discontent. It’s a constant battle to be satisfied.
This oil fracking investment carries a high level of risk, particularly considering the expected return rate. Given the inherent uncertainties, one would anticipate a significantly higher return rate to justify such a high risk investment. Over the past decade, the NASDAQ has yielded an annualized return of 13.54%, the S&P 500 has achieved 12.03%, and the TSX has delivered 9.03%. When you look at these figures, the risk-reward ratio of this venture doesn't seems very appealing. I hope it all works out for them and I wish them well.
Sandra shouldn't confront her husband about finances at bed time. That's unfair! You are both tired and it's not a good time. You can change your mindset about finances. Most people are living way beyond their means. Supporting your husband in a positive way will get much better results.
I think the risk Brad is taking with the oil investment is too much. Dumping your money into a private investment opportunity like that is quite risky in their particular financial situation. Based on what was said earlier in the convo, Brad said they have 1 million or so in assets. They put 1 million into this private investment. That is playing with fire if that money starts returning less than what they expect. I'm sure it's not easy to get their capital back on top of that. I would only do what he did if i had significant assets on top of that.
100% It sounds like a great move when you have plenty of "FU money". .... but they have everything in this basket which makes it crazy risky. I'm nervous just thinking about it!
I think it basically boiled down to, if we don’t take this risk, we can’t retire. I doubt he would have done this if his 401k and IRAs had been in the S&P500 with no 1% AUM fee.
Bad idea…also fracking is like one of the LEAST “generous” acts someone could do to a community. It actively harms people and the environment. Sure, investing in the S&P 500 involves fossil fuels and other ethically questionable things, but it would be really difficult for me to justify investing 100% in fracking considering how harmful it is. (Disclaimer: I invest in the S&P 500 lol)
Are you fracking kidding me? Sorry for the bad joke, actually it’s not very funny. With respect to this couple who are asking for your help, investing in fracking is not just a gamble with their money - the practice has serious environmental implications. It involves pumping huge levels of toxic chemicals into the ground, and breaking apart rocks to find oil. This can cause groundwater contamination, pollute the environment and endanger wildlands. Residents near fracking sites have complained about groundwater contamination, air pollution, earthquakes, and noise pollution. Further, fracking uses carcinogenic chemicals to do the work - and the humans living close to these fracking sites are typically those who cannot afford to live in areas that are not at high risk for the health hazards close to these sites, or they are not aware. Brad and Sandra, please consider where you are investing your $ with a broader perspective. I get that in a mutual fund it is often hard to know or control every company that is a part, but this one is easy: pull the frack out!
Are you really about to try to make the argument that using a smartphone invalidates everything they just said? Please, please do it.@@williamsullivan8544
As a Christian woman, it is disappointing that these believers think scripture states that we are rewarded for being righteous…that is not true. At all. Reading the book of Job alone would make that clear. I hope they realize the Lord’s favor is not something to be earned…if it worked that way, and we could “prove” we are good enough for grace…it would never happen.
I haven’t gotten through the whole episode yet, but I believe these people are not Christian’s, they’re Mormon. I know Mormons consider themselves Christians but their doctrine is very different.
Every time the issue of a financial advisor charging somebody one percent comes up I get both sad and angry when I remember that my parents pay a financial advisor one percent and they are relatively good with money. They are financial advisor has convinced them that he offers more value than his one percent fee. 😡😠
Can't you chart his performance vs. an index fund over the past few decades and show that he most likely hasn't even matched the stability or growth of the index funds even if he didn't charge a 1% flat fee on their investment each year? If they're that confident in his work, they shouldn't be opposed to showing how great his returns have been for them, right?
@@CliftonHamilton I’ve tried this all they respond with is that they read somewhere that financial advisors make more than their fee, and that he does their taxes for him, so why not stick with them (proceeds to flip table in my mind)
With the husband's narrow-minded ideas on investing and complete lack of diversification (Investing 101), I *REALLY* hope she has some money put aside just for her. I get the feeling from what he said that the husband is too comfortable with the word divorce.
This is why I will always have my own money. I have seen my husband do risky things when it comes to investments...oil being one... and this just range too true for me.
The oil investment made my head want to explode 😤 I worked in oil and gas exploration and after spending $100 MILLION AND finding oil, the project was deemed not economical and shut down. And this was with experienced geologists and engineers. WTF is this guy thinking throwing away his family's money??
Woahhh I can’t wait to see the 2nd part of this one. Also, side note- I miss your thumbnails that featured the couples in some way. When I go back to reference an episode, I’m having a hard time figuring out which is which, even with the title. Just a thought!
Brad's body language is oddly self conscious - is he in sales? I've seen similar mannerisms in especially "slick" salespeople Edit: Ah. Mortgage and event planning.
He reminds me of the manager I had when I worked in a call center a couple decades ago. The stress induced by that job made his ticks worse. Heck even my eyes twitched out of control after cold calling sales for a while. I think the stress of being on the podcast and looking at his decisions through another lens was making things worse or he was angry and trying to hold it together.
As a guy who works in the O&G industry. Shale comes with a decline man, initial payback is always associated with an initial peak-type curve. Then u tell me, the dividend model changes after the initial pay back, man this game is against you if the commodity price crashing which happens all the time.
Would love to provide a wake up call as someone who lives on a fixed income due to health issues. I can't imagine being stressed and making 70k-100k a month. Perhaps it is time to reevaluate what you value and see how your expenditures align. Budget ahead of time. Make your budget easier. Sell things you don't need. Get rid of the 25k bedroom set. Her definition of broke is excruciating to hear. Not luxurious lifestyle or expenditures? They need to have a discussion about financial goals, expenses, make a plan to pay off debt, etc. They need to be on the same page. Seems like a lot of loaded gender roles here. It seems clear that Brad is struggling and perhaps a bit burned out but then the bombshell about the oil decision...what!?? Talk about a huge risk. Part of her stress seems more appropriate than reflected earlier on.
First, I really appreciate how open the couple tells about their life, big respect. His last investment decision appears way to risky for me. But there seems to be a reason for this. This is not only the bad investment advisor, but I guess much more important the nagging wife over decades. She permanently puts so much pressure on him, is never satisfied with his enormous income, is never satisfied with herself. I guess, her behaviour plays a big role for his decision for the oil well. I honestly wonder if they are really happy as a couple and if they are really good for each other. And if they were still a couple not having kids... And both are big spenders, although they seem to think, they are not. She takes care of her budget every month in her extreme way, but at the same time, when they have a high income, they spend everything like there is no tomorrow.
No, I do not think that this is a good idea. Brad and Sandra are risking their entire family's savings on a couple investments. The concerning part is that it happened more than once. An investor can take a big swing and hit a home run once, twice, maybe three times. Eventually everything regresses to the mean and when that happens, it will happen harder for people who have developed a mentality of swinging big. Sandra's reactions suggests that she feels this decision was all Brad's but in reality it is both of theirs. Sandra distancing herself from income decisions and delegating that work to Brad and then not being happy with the decisions that he is making is not helping.
Made like 800k a year for 2 years, but still barely has anything. No blessing can help them. If she really did so cautiously budget, that would have never happened.
Why do these people want SO much? It’s weird. I don’t wish these 2 harm but they need to get a grip. I think if they had 3 million in retirement funds they would think they were poor.
They dont truly understand the principles of the Bible, God blesses the righteous, but when they righteous are destitute...it doesnt mean they are not blessed, it means he is teaching them faith and dependence on Him fully. You are not to feel guilty for having money nor feel not blessed for not having money.
Despite how good or legit any investment looks its not a good idea to go all in all of your money ,that was more of emotional move because you have clearly convinced yourself that nothing is going to go wrong ,it was gamble .Fingers crossed ,i hope he recoups his initial investment before any issues beyond his control
Yeah, that's why portfolios are rebalanced even when things are going good, because you don't want all your gets in one or few baskets. He should know this as someone who teaches finance. But there's always do m the "do as I say, not do mentality"
Just, wow. While I have so many questions, the most important one is this. He did all the research and made this incredibly high risk move with essentially all of their net worth. How much did they discuss this first? Did she know? Did she agree? If she agreed, why?
The last 10 minutes were wild. There are so many people who are getting close to retirement and panic and decide they need twice as much as they have, so they step up to the roulette wheel and put it all on black to see if they get double or nothing. It's *wild*. But I've heard it from so many people. Sometimes it's "I have a buddy looking for investors", sometimes it's a single rental property they think will provide cash flow (but don't calculate the cost of maintenance, repairs, sitting empty, squatters, etc.). People spend decades saving up and then think they can double it in a few years. They can in 10 years (Rule of 72 for 7%). No wonder she is terrified every time she looks at the budget and is trying so hard to hold on to stability. She's trying to make sure her kids can eat while her husband gambles away their life savings on a hot tip.
wow huge thanks to sandra and brad for having the immense balls to come here and be honest and vulnerable like that, really interesting episode for sure craziest last 15 minutes ever LMFAOOO absolutely bonkers. you talked a lot about "the story you tell yourself" with Sandra but ngl the "story Brad told himself" was crazyyyyyy. i definitely empathize with brad and the "rat race" stories and it really sucks what happened to him for the story to hit deeper, but also i am 26 with 0 kids w super low expenses, my risk profile is basically at the lowest it can be and it def sounds like a hell of a risky move to have done that right after a big liquidity event idk about the "nagging wife" comments, my mom's definitely similarly nagging but much less communicative than sandra i think (for a lot of reasons), and while her marriage def isn't something i look forward to repeating I think in the economical sense there was some inherent trust that was respected. i think their "failure" there is more in the division of tasks to not cause internal resentments. for example, who's taking the blame for not being "financially educated"? is it the one who is "managing the money"? is it the one who's literally teaching personal finance? who's distrusting who? i think the "net worth" vs "income" discussion is interesting and it does feel like this scarcity mindset with a 1.3M net worth is, but with the current risk allocation and lifestyle it's certainly understandable my read is that maybe it's a topic where they haven't had enough conversations. she expects a provider of regular income who can meet expectations (and the expectation is certainly "growth" in a maybe too undefined way); he expects a "strong queen" for their business entrepeneurship "kingdom" who can handle tough times and be a wise safe counterpoint but who also believes in the potential and is along for the ride, but who doesn't seem to communicate what the realization of said potential is and what the plan is if shit hits the fan and the kingdom crumbles
My ex wife once told me (after taking our checking account to negative): “The problem here is that you don’t make enough money , $100K for a family of 3 is not enough “ Mind you this was in 2017, our mortgage was less than $1300. Surprise; we divorced
I know a guy who didn't pay the rent for 6 months. When the landlord came knocking. The wife was livid at him. He told her they needed a bigger house. She took the children's college fund and paid the landlord. They got divorced. 🙂
@@DataTranslator correlation between your ex saying you didn't make enough money and the guy who says they needed a bigger house when he didn't pay the rent. People blaming the situation rather than their spending habits. It's not a reflection on you just them.
I respect all the due diligence he’s done around the investment, but the decision to do it seems more gambling logic than solid personal finance principles. I hope it works out for him. It’s a lot of financial stress for both of them to take on in their late 40s.
I can't imagine making $70,000-$100,000 per month! Of course life would be fun and great. For the oil well, my boyfriend wanted to invest in oil wells for years. We finally agreed that he could do it. He wired thousands to the company and only months later they said the well didn’t produce and he lost it all. So stressful.
25 years of frustration pushed him to lash out and do everything that conventional financial wisdom teaches you not to do. It’s a risky, hail Mary play that promises outsized returns to make up for years of lost compounding growth. For their sake and financial future, I really hope it pans out
Bizarre he would use the funds to invest vs buying another home given the did really well from that… The thing he doesn’t go into is the decline rate of production from the oil well, a lot of these fracking wells keep producing for 20 years but peak in year 1 and quickly drop off in production 85-90% by year 3, so even if the well is a success they might make back their original investment by year 2-3 but then be getting very low returns after.. So despite all the risk of failure, could end up getting less than a S&P500 index fund over time
I’m good at admit here that I only watch this for about five minutes because it just seems like it was such a roller coaster ride that’s it was either feast or famine and why would you not expect a famine why would you spend like there was no tomorrow and tomorrow wouldn’t be hard? They just seem to make so many decisions that were so bad.
Definitely a bit concerned about that oil-well deal though. Why couldn’t they get traditional funding for it? They could’ve invested the million in ETFs and probably hit coast FIRE.
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Please remember: These are real people who had the courage to come on my podcast and ask for help. Would you be willing to come on this podcast and share every detail of your financial life? Feel free to leave comments based on what you think, but remember that we are here to help in a supportive way, not to demean and criticize.
where can I find a link to the second part of this?
@@angies7906 it's next week
Brad stated that when it was good, it equated to being righteous, and when it was more lean month or year, it means you are not righteous enough was triggering. I felt that statement because growing up, that was measured if I was Christian enough.
Which is sad cause to what not Jesus/the Bible says.. These preachers gotta teach better. Sorry you went through that God loves you no matter what’s in the bank
That's prosperity gospel
@@markgordon6717 its baked pretty firmly into Protestantism generally.
This video just reminds me that no matter how much you make, if you don’t live with in your means you will always have money problems.
100%. You hit the nail on the head. As someone that has been living on less than 30% of my income for the last decade, your comment resonates with me. I wish everyone reads your comment and take it very seriously
@@dialac1 U are obviously not married and no kids
I’ve noticed a pattern in these interviews: When the wife doesn’t bring in the money, she feels like she’s not contributing so to overcompensate she creates complicated budgets that gives her a false sense of control but the family ends up stressed. We’ve got to value stay at home moms to avoid this vicious cycle. And also learn that budgeting can be simple.
Yes!
Valuing a SAH mom is too relative, she still may not feel valued enough. You have to tackle the problem in front of you. As a man, learning how to budget and manage money effectively. Because just as often I see her screaming out in her heart for him to just take over and handle business so she can relax and trust him.
@@SwaeTech Both very good points
@@SwaeTechok but if he is the sole breadwinner, feels like a more fair division of labor for her to take the lead on everything else, including the family finances.
Invest in HIGH RISK $1M ONLY IF YOU HAVE $6M to start with ( rule of Las Vegas)
How does Sandra seemingly manage most of the financial decisions in the family with a tight budget, but allow Brad to invest nearly 100% their net worth into one private investment?
It was either a joint decision or Brad has much more financial decision making power than this conversation let’s on.
If Sandra budgets in excruciating detail, but can’t veto investing a million dollars into a risky project, then the family financial check and balances needs addressing.
Is she really budgeting or tracking? It does seem like a waste of time because they have made zero decision to do something different.
Their religion dictates he makes the decisions. They may have prayed on it, but he's getting the word from God on what to do.
@@JKRBWwhat? Nobody ever said that. Don’t assume.
@@ST-rj8iu It is the worst of both tracking and budgeting. She has a fixed budget that we'll spend under $500 on groceries this month. Then at the end of the month, she sees if she "got a good grade" or not.
If she was budgeting, she'd say "We have $500 to spend on groceries this month" and that's based on reality, such as her average spent, to make sure they don't go too far over. Then each of the transactions are entered every week they buy groceries and they know they have $x left to spend. Doing it after the fact is not good.
It's also not a "good grade", that's a very unhealthy mindset that equates spending money to "being bad", which people say pretty lightly but isn't a good mindset. People do the same thing with food -- "I was bad, I had a piece of cake at the party". There's this moralizing around consumption in America, that budgets and diets are restrictive and morally good and eating "junk food" (a loaded term) and mindless shopping or buying luxury goods is morally bad (a sinful indulgence).
@@JKRBWWeird comment.
1. get a job
2. stop the kids extracurriculars
3. downsize your life completely
It takes 2 people to sustain a life.
100000 %
For all her faults, I'd be just as scared as Sandra is if I'm telling my spouse that expenses were greater than income and they are telling me "trust me".
Brad playing the "net worth game" and not caring at all about montly expenses when basically all of that net worth is tied up in a super risky investment is WILD.
It doesn’t help that Sandra tells him that they’re out of money when she really means everything is budgeted. With 80+ budget categories, it’s no surprise that this happens nearly every month
@@dylanjonesSD Their total expenses have exceeded their income for the past few month. So yeah, agreed with the premise that she has too many budget line items... but she very likely still calculates the sum.
Also, I don't count the 20k per month from the oil investment because that's likely a ponzi scheme and there's a high chance that the ponzi collapses or that the scammers ghost the guy. That money needs to be treated like it's their retirement so they have SOMETHING left if this "investment" goes south.
I’ve lived in Oklahoma for 30 years. I’ve seen boom and bust cycles bankrupt not just individuals but institutions multiple times. If he had a a large portfolio which included some investment in oil, fine. But to put all of his family’s future into two oil operations is playing with fire. He’s like a gambler that tells himself that he’ll make it big if he rolls the right combination of dice just one more time. The whole religious view that if you are wealthy it is because you are a righteous Christian and God is blessing you is such a warped view of what Jesus taught, and it’s not helping them any. That plus the expectation that she shouldn’t have to work be because it’s his job to make the money is not helpful. You are in this together. Your kids are no longer little-it’s the time in your life to work outside the home to help provide some financial security for your family. Plus, working and bringing in some money on your own will make you feel less vulnerable financially.
Agreed, on the years when they only had $11-18k income, what else was he doing with his time? If work was shit in those years I’d be looking for something else to supplement. Maybe he did and it wasn’t mentioned. She would’ve had 4 young kids to care for so certainly don’t expect her to make money. I’m just curious what their deeper picture is. The religious ties to money isn’t helping at all, I sense a lot of resentment between them and their comparison to others is keeping them from seeing the opportunity they had. $800k and it was all spent?!?! I can’t comprehend that. Really curious what their advisor was doing for them to only have 3% growth in 20+ years. They should have educated themselves too instead of just going with whatever they felt.
Agreed. I remember the Aubrey McClendon saga. A story quite similar. Believing that you have a sky high risk appetite, and despite being a risky industry those dividends will surely match the predicted optimism. Then the chickens come home to roost. Hope he gets lucky, cause it's a sad story otherwise.
I’m trying to be compassionate but it is so hard with some of these people.
Digging there own financial grave
They lost me at fracking.
SRSLY right? cry me a fucking river
@@elisedesignss came here for this. I guess it goes to show that when we think about greed and doing things at the expense of others, it is spurred (sometimes) by fear, founded or unfounded. Anyways, that sucked to hear.
I'm always so grateful to the couples who are being interviewed and to Ramit for his contributions.
Am I the only one wondering what Brad is teaching as a financial educator/advisor/teacher?
No, you are not the only one!
Probably teaching them to join in on his oil investments
Probably some MLM adjacent thing where he gets $ for “teaching” new “investors” in the fracking
@@todd5192 I would hope it's something like that and not the high school personal finance classes that everyone apparently thinks we should have.
I hope those students get their money back.
You mentioned in a cut away that people always say "I'm not good at money" I also hear "they don't tech personal finance in school". I don't disagree with the school thing but at a certain point you gotta stop using that as a crutch and I've started to respond to that with, that's true but google is free, the info is out there you just have to seek it out. We have to stop blaming the adults who were responsible for us as kids for what we lack as adults, now you're responsible for you.
Exactly there's absolutely no reason people can't educate themselves on this. It's never been easier to teach yourself or be able to invest than now.
Yes, we are devout Christians. Yes, all of our money is in oil destined to destroy gods planet.
👏👏👏👏👏👏
Woah "I'm playing the networth game" then invests it all in one scheme...what happens if that doesn't pan out and the networth goes negative??? Playing with fire! No wonder she's so anxious about money! Yikes! 😱😵💫🤯
Very scary
Faith doesnt pay the bills funnily enough and his unfounded faith that things will always be better is wild
“People who live a story, love to talk about their story.” GOLD! The true strength of a marriage is how you pull together or drift apart when times are difficult. Besides working on money, couples must make their marriage priority. Thank you, Ramit and thank you to Brad and Sandra for your courageous discussion. You’re willingness to be vulnerable is helping more people than you’ll ever know.❤❤
I guess my question on the investments is if Brad spend 2 years following this company and crunching the numbers and really thinking it through, how did 24 years go by without an annual (or once a decade?) review of the retirement accounts?
I can't wait to see their numbers. I hope Sandra will see that she doesn't need 82 categories to have control over the money.
It's what Ramit said, he feels they're behind, so he's a bit more vigilant now, trying to play catch-up
@@verb0ze It's clear that he wants to catch up, and he's doing it the way he knows how: business investment. My question is why didn't they as a couple or him alone use the same skill set to evaluate their retirement investments with the same intensity he used to invest in the fracking company. Even if you check the balance once a year, you'd imagine that after 10 years of poor performance, you'd insist on making changes. It just seems like 20+ years of not paying attention to the retirement accounts is too much given his business background and her constant worries about money.
I promise you he was putting in and pulling out on the regular and ended up destroying his returns over those 24 years.
So many weird red flags in this episode. Ramit made a comment about how the mortgage business booms and busts and it is kind of shrugged off, but spending that on ATVs instead of saving for your nest egg seems irresponsible. Seems like luck masquerading as skill
They can put the non annual categories into one and divide by 12. We call ours the STS - short term savings - fund for auto registration, insurances, etc.
I budget for the annual expenses monthly. Car insurance, etc. All just gets divided up.
There is a significant story there that is very telling. In particular, they are viewing God as a transactional relationship and not as a friend that Jesus teaches us. It's a very natural way to understand the world but I'd encourage anyone reading this to work their best to shed this belief as it's a false one. Giving does not protect us from bad things and doing the right thing doesn't promise us no problems.
I think Brad is being reckless. Slapping your entire future into oil fracking is a major mistake. Fracking is likely to be more tightly regulated in the future as well as likely to get more and more expensive as water runs short. That's quite apart from the horrible environmental damage.
When it comes to your retirement you just pick the s&p 500. It is not worth the risk. If you have side money and want to do riskier stocks fine
It's worked out well for him now with Donny Trump
OMG, oil wells have no word. Investing all your assets in an oil well is a gamble. He has no experience in the oil industry. He is repeating the same mistake he made with his previous financial advisor. For me, this is a bad idea. To much risk. Also, even if he is successful in his gamble. What is the point? You can tell that their struggle can't be solved by any quantity of money. Hope they can make it work.
"i don't have as much in the GAME as others".......
No, investing $1M into this is not a good idea. If it works like he says, and does get 50% returns, he will look for the next big adventure to prove himself. He will continue this until it all disappears!
Anyone else watch this and think there is no way the mortgage industry should be making that kind of money. Good lawd
Usually around 1-1.75% of the loan amount.
If you paid attention, you would have noticed those high years were not from mortgages, they were from some kind of event that they do. Also, they only ever made that money for a short period of time. That’s what happens with risky ventures. You win big and lose big sometimes
@@mitchberning1595 I absolutely did listen and caught all that. Even too much in the boom years.
Brad investing in one project was based on emotion, angry from the years of other wasted investment. I hope it does work out for them. All the life savings?! So so risky and selfish.
Selfish?
err what? he spent a LONG time thinking about the investment. This wasnt a decision made on emotion and impulse. He had been looking at investing into the fracking business for years and ran all the numbers and angles long before pulling the trigger. The chance to make up for lost time is one of many decisions. He likely wouldnt have invested the money if he thought the risk of loss was too high.
Im willing to give Brad credit here. To most, this sounds like an insane decision to make with that much money. But he saw gold while others saw it as gambling. He understood what exactly he would be getting into, what the returns could be, and what the risks are. Ramit doesnt understand completely so his initial thoughts were that of complete insanity. But Ramit doesnt see the numbers that Brad does, so he has to trust Brad made a smart financial decision and isnt gambling millions away on hopes and dreams.
Looking at the history of oil investments, even recently, it was a wild gamble for his financial situation. It's get-rich-quick.
@mithicash1444 Yes, selfish .... if he takes too much risk and puts the FAMILY $$ at risk on ONE investment.
the "bold" gamble is to appease his ego. It may go well or may go tits up - too much risk for their new worth, it's wreckless IMO
Hey Ramit ~ it’s super cool how you have that red “progress bar” at the bottom during ads and intro. Great feature I wish more creators would use. Cheers to your rich life!
I watch these on my phone and I totally thought the red progress bar (which shows right above youtube’s video progress bar) was a new youtube feature for ads 😂
But it’s just a well-placed progress bar on Ramit’s videos 🙌
Agreed!
Yep his ad sponsored don’t need to know if people actually watched the ads in the video 😂😂😂 he can keep that watch data to himself and not tell them. Other creators timestamp different portions of their videos sometimes showing you exactly where ads end
Thank you Sandra and Brad for sharing your story. Overall, after watching this episode I felt like a lot of their issues had to with how they viewed money (their money scripts), control issues, religious values, and communication with each other. Honestly, I was getting a little overwhelmed from the lack of empathy towards one another. I am almost wondering if it is time to discuss their role expectations in their marriage and learn how to empathize with each another. Overall talk more positively about each other (stop the comparison jabs) and money.
82 budget categories???!!! If that doesn’t scream “I don’t feel safe” to her gambling husband idk what does lol
That’s a job in itself - way too many categories! Why not lump all car stuff into one category (registration, maintenance, gas) and have one category for all kids extracurricular activities.
82 columns in Excel but all their net worth into an oil operation is the definition of penny-wise, pound-foolish.
I'd have to count mine but I am probably not that far off. I've been on YNAB for a decade and I split my grocery receipt.
Food : Vegetables : "Broccoli (1.87lb @ $2.48/lb)" : $4.64
I started when I made very little money and I wanted to know where all that grocery money was going, because it was my single largest expense. I also did comparison shopping and checked to see what was a good deal and shopped for different things at different stores.
I still vaguely buy some things at this store or that to save a few dollars. But now that groceries are under 5% of my net income budget, it is perhaps a little pointless. But I've been doing it for 10 years so it's hard to stop. Even if I stopped having separate categories, I'd still want to split food from toilet paper, so I can track the "Bathroom (Consumable)" category.
@@asongfromunderthefloorboards Agreed, as a YNABer 82 categories doesn't sound so crazy at all :D
@@lisasachse778 But copying and pasting every transaction into 2 spreadsheets and manually doing everything IS too much! She needs YNAB asap!
First, props to Ramit at keeping composure at the word “fracking”!
I don’t think the oil investment was a good idea. The things that Brad said about the investment seem to come from a media kit. Did they run this opportunity by their own tax professional or conduct any due diligence? And with more shifts to renewable energy, it would’ve been better to put the $ in n index fund.
I saw his subtle deep breath 😅
I was surprised that Ramit didn't mention renewable energy, but then I thought why. Given that they're religious Christian family, it's quite likely that they're Republican, too, and given that the fossil fuel industry has paid off most Republican politicians, I wouldn't be surprised if Brad and Sandra thought that climate change was a hoax. So, Ramit wanted to avoid focusing on politics by not specifically mentioning the energy transition as a huge potential risk. Turning the conversation to politics could've turned nasty. Well played, Ramit.
I think it’s so reckless and irresponsible to make this type of macho gamble with his family’s money. I would never allow my husband to do that with our money.
As an investment, I don't think they were in a situation to have invested $1M in a fracking venture. Usually people should have the foundational investments taken care of before they think about speculative investing, and even then, it shouldn't be a high percentage of their net worth.
The actual investment in fracking itself is unethical, as well. It poisons groundwater and ruins ecosystems. The desert is still an ecosystem that depends on nutrients in the ground to thrive.
Their kids have to live here when they're gone, so it's a poor legacy investment financially and practically.
Or you could be happy you can drive your car or have things shipped to you
I wouldn’t be happy if my husband made this investment, unless our net worth was 5 million or more.
@@Dan16673 Accepting reality while looking for alternatives vs _actively_ investing in poisoning resources we need to live are two very different things
@@Dan16673 Silly argument. As individuals, we live in a system that we want to change. We need the government and large companies to take responsibility for providing new ways for us to get around (well funded public transit, EVs). In the meantime, yes we all have places we need to drive sometimes. That doesn't preclude us from wanting a better society that runs on something other than dirty energy. Especially when it involves poisoning our water supply through fracking.
Great couple. I appreciate how open Sandra and Brad are to talking about their problems. Ramit did great at setting the stage and helping them tell their story. Can't wait for next week.
Brad’s a classic grifter running “events” and trying to make money off people.
This oil thing, teaching finance (lol), and coming on this show is probably part of the same grift trying to get new “students” he can “educate” to learn how they TOO can invest in this no brainer oil adventure.
This episode is nothing short of a movie. Had to be my favorite
Tithing really angers me. 😡 Some churches are taking 10% of income -from their members who are struggling financially. They use guilt to extort money. These churches are worth billions and their $ is tax free! Some of them charge their members a lot of $ to go on missions and recruit new members! Ramit is too nice to give an opinion about tithing.
Oh please stop with your fake indignation. We give our money to God its OUR choice. I love giving to God because He js always faithful. Plus most money collected by churches goes to the community, helping others and church growth. Its our decision as gwon individuals. Go be angry at your spending habits instead.
@chibibumblebee3190 Your $$ does not go to God. It goes to a human being running your church. Wake up.
You know nothing. It is for committed members. God has stretched our 90 percent leftover. We have no debt and low costs, assets, Savings , private school, vacations. Mostly frugal. On a middle and now low income.
Also , a good church has strong accountability and there is a lot of sharing and helping each other .
They pay money to their teammates in Asia to convert them into Christianity.
So tithing is like our current tipping culture? If so, it's simple: train yourself to ignore the guilt. NEVER tip for pickup orders or at those terminals asking you for a tip. DO tip at the end if they provide good service. Don't tithe if there's no transparency and you don't see the money helping others (i.e. televangelists buying mansions, private jets, various extravagances). Do tithe if the church is transparent and you see contributions helping your local community.
This guy invested for 2 years back in the late 90's (before the tech bubble, mind you) and has pretty abysmal returns. And we are blaming a financial advisor? You really think this guy let his investment sit and didn't touch it through market ups and downs over 25 years? The guy that just put all of his net worth into a fracking operation? Ramit is giving him way too much benefit of the doubt.
100%. You don’t go from passively letting an advisor run your investments for 25 years to investing in highly speculative, niche assets nearly overnight.
This guy had his fingers all over those previous investments. Probably bought high and sold low many times. Unfortunately, old habits die hard and now he’s literally gambling the house.
Brad, Brad, Brad.....you are a "Get Rich Quick" guy, aren't you? I guarantee if you had put your money in the S&P or Total Stock Market, you'd have millions by now. This whole episode turned on it's head when you said you put all your eggs in one basket. Good thing you are 48 and not 58.
YEP. Drop that 1 Million into some high yield ETFs and you're set.
@@Adman-p4j Is it even possible to pull out of this fracking investment? Sounds like a joint venture contract, not like shares on a stock exchange.
Waiting for Ramit's "believer" rant!!
He was making 80k a month so yeah he was used to easy money. He just messed up with the money they did make. He should have been set if they had even done well with half that money
Even if his investment pays off, he's shown his wife that he's willing to gamble away the entire family's life savings. Either way, because of the stress and potential financial ruin he's put on his wife's shoulders, it was the wrong decision.
Reminds me of a few weeks back, the guy who bought rentals without consulting his wife, while his wife ‘watched her kids’ even though they were his kids, and was 10 meters away.
What an outrageous thing to do.
Why do people feel they need to spend “every month” on wants. We are raised in a consumer world. Example Clothes last years as a grown adult why would someone “need” to buy clothes; I think people are told things are needs, when they are really wants. I stepped back and really looked to define needs and wants so now we don’t frivolously spend “every month” - living below my means created so much more freedom. So much more money now! It takes a while to change your mindset- but can be done! My rich life is I can go to the grocery store and “technically” not looking/worrying about prices! Feels so freeing to know I can afford the cart always.
By "wants" people also mean "maintenance wants" like hair/nails or miscellaneous subscriptions. If they can afford it and they are already saving and investing, why not?
This! My husband and I buy clothes maybe 2-3 times a year. And it's not like we go on shopping hauls either... We buy a couple of good quality clothes that are versatile and will last us years. I'm not rich enough to buy cheap clothes that I have to replace every year, or worst yet after only a couple of washes.
Well that sucks the joy out of life, doesn't it? Whole point of this show is a RICH life. I think having a few percent of your budget each month like Ramit suggests to spend how you want to if that's within your means is totally fine. You don't have to spend it at Restoration Hardware tho, just spend within your means.
Example: I get "new" clothes as part of my RICH life (ok, and tax write off sometimes, I'm a musician, we have pressure to look good, esp as a woman and when I'm a frontperson) and I can only afford it if I buy at thrift, so that's what I do and I enjoy it.
I feel the need to spend some money on wants. What is wrong with that? Should we all just work and live like slaves?
Please do a follow up with this family next year
I would love follow ups with lots of these couples!
That would be awesome to do an episode that recaps several couples story and gives an update.
They'll be another episode out after a week aka tomorrow
Thank you for your insistance of not doing a line item budget! I spent all my time doing that for a few years, got burned out and did nothing for a few years, and now I am in the middle of automating our money and finally meeting our savings goal and feeling good about things i used to never allowed us to spend money on (things to improve our home, husbands interests) while being confident we are set up for long term success!
Came over from the podcast bc of audio issues. But so great to see this couple work with Ramit! (They also look like the it couple from a late 90s early 00s teen drama!)
Yeah
3% rate of return over the last 24 years ?!!! Picked some really bad funds.
Probably filtered for higher-risk funds thinking "high risk=high reward." Maybe for the outliers, but for the individual risk is just risk.
I’m always shocked how many people are duped by the fairy tale of god and to get blessings you need to pay money. I’m sure the church desperately needs more money. God is wearing hand me downs up there eating reduced lunch.
I like George Carlin's take: "God loves you! And he needs money!"
They say in one breath to be righteous and not flaunt. Then they get some money and buy $25k bedroom sets, ATV’s and invest in big oil.
The last I saw her, she was doing pretty well. If she was wearing hand me downs, I couldn’t tell. She has a great sense of style /snark
I don't fault them their beliefs, but if they are Christian, believing that they are rewarded beyond basic needs for righteousness goes directly against their source book...
If the oil venture was a guaranteed thing they wouldn’t need all of these other investors.
They are using “other people’s money” to take 100% of the risk until they are paid back and then taking 30% of the profit after the initial investment.
The real winners are those running the operation. If the venture fails to produce or to return all of the invested capital they have 0 skin in the game.
I’m not saying it can’t work out for this guy and it might indeed be a winning hand but he is taking a tremendous risk. The even bigger risk will be if he succeeds and tries to double down on the next venture without preserving the majority of his investments into something safe.
Like the scene in “The Gambler” when John Goodman tells him, “If you get up, you get out.”
This is so weird to me. My partner and I are exactly the same age as these two, we've never made anywhere close to $70K in a month, and we probably have a slightly higher net worth than they do, all from doing the boring 401K/IRA route. I'd be really curious to know what went so horribly wrong with their investing over the past 25 years that they got such terrible returns. It sounds like maybe they panicked and sold at exactly the wrong time - several times in a row.
he explains in the video that they had invested with a financial advisor that averaged about 3% returns per year and were charging 1% in fees. So they were overcharging and underperforming. and that was going on for over 20+ years. it was something that went way way way too long.
@@kingsgold But a 1% fee would not knock their average return from 8-10% down to 3%. There must have been something else going on. They were paying through the nose for an adviser, and the "advice" they were getting was worse than worthless.
@@johannamiller527 they werent getting 8%, the advisor was getting half of that for 20+ years. they werent even meeting the market. the market was outpacing the advisor. and overcharging for it. that's the core issue.
Easy answer is they didn’t invest the difference.
Pay for whatever you want, when you want, and private school tuition for 4(plus extra curriculars) can eat up even insane income in no time
Do you have children?
A positive net worth doesn't mean much if they have to put monthly expenses on a credit card.
Wtf 3% a year. Thats like a savings account
I can relate to her so much. So much financial stress, failing every test. Money all gone half way through the month. Except we actually don’t have 1.3 mil in assets or that income. But I can relate as a perfectionist, being discontent. It’s a constant battle to be satisfied.
Same here.
This oil fracking investment carries a high level of risk, particularly considering the expected return rate. Given the inherent uncertainties, one would anticipate a significantly higher return rate to justify such a high risk investment. Over the past decade, the NASDAQ has yielded an annualized return of 13.54%, the S&P 500 has achieved 12.03%, and the TSX has delivered 9.03%. When you look at these figures, the risk-reward ratio of this venture doesn't seems very appealing. I hope it all works out for them and I wish them well.
The best time to invest into the s&p or the nasdaq is yesterday the second best time is whenever it’s down.
Sandra shouldn't confront her husband about finances at bed time. That's unfair! You are both tired and it's not a good time. You can change your mindset about finances. Most people are living way beyond their means. Supporting your husband in a positive way will get much better results.
I think the risk Brad is taking with the oil investment is too much. Dumping your money into a private investment opportunity like that is quite risky in their particular financial situation. Based on what was said earlier in the convo, Brad said they have 1 million or so in assets. They put 1 million into this private investment. That is playing with fire if that money starts returning less than what they expect. I'm sure it's not easy to get their capital back on top of that. I would only do what he did if i had significant assets on top of that.
Agreed.
100% It sounds like a great move when you have plenty of "FU money". .... but they have everything in this basket which makes it crazy risky. I'm nervous just thinking about it!
I think it basically boiled down to, if we don’t take this risk, we can’t retire. I doubt he would have done this if his 401k and IRAs had been in the S&P500 with no 1% AUM fee.
Wow the psychology in this one that Ramit addresses about past/the stories we create is profound
Ready, addicted to this podcast!
Bad idea…also fracking is like one of the LEAST “generous” acts someone could do to a community. It actively harms people and the environment. Sure, investing in the S&P 500 involves fossil fuels and other ethically questionable things, but it would be really difficult for me to justify investing 100% in fracking considering how harmful it is. (Disclaimer: I invest in the S&P 500 lol)
Great point! It seems like they have never heard any of the problems with fracking... Really strange attitude.
Are you fracking kidding me? Sorry for the bad joke, actually it’s not very funny. With respect to this couple who are asking for your help, investing in fracking is not just a gamble with their money - the practice has serious environmental implications. It involves pumping huge levels of toxic chemicals into the ground, and breaking apart rocks to find oil. This can cause groundwater contamination, pollute the environment and endanger wildlands. Residents near fracking sites have complained about groundwater contamination, air pollution, earthquakes, and noise pollution. Further, fracking uses carcinogenic chemicals to do the work - and the humans living close to these fracking sites are typically those who cannot afford to live in areas that are not at high risk for the health hazards close to these sites, or they are not aware. Brad and Sandra, please consider where you are investing your $ with a broader perspective. I get that in a mutual fund it is often hard to know or control every company that is a part, but this one is easy: pull the frack out!
Are you making this comment from a smartphone?
Are you really about to try to make the argument that using a smartphone invalidates everything they just said? Please, please do it.@@williamsullivan8544
Oh the BELIEVERS of the world… 😅 can’t wait for part 2
As a Christian woman, it is disappointing that these believers think scripture states that we are rewarded for being righteous…that is not true. At all. Reading the book of Job alone would make that clear. I hope they realize the Lord’s favor is not something to be earned…if it worked that way, and we could “prove” we are good enough for grace…it would never happen.
I haven’t gotten through the whole episode yet, but I believe these people are not Christian’s, they’re Mormon. I know Mormons consider themselves Christians but their doctrine is very different.
Every time the issue of a financial advisor charging somebody one percent comes up I get both sad and angry when I remember that my parents pay a financial advisor one percent and they are relatively good with money. They are financial advisor has convinced them that he offers more value than his one percent fee.
😡😠
Can't you chart his performance vs. an index fund over the past few decades and show that he most likely hasn't even matched the stability or growth of the index funds even if he didn't charge a 1% flat fee on their investment each year?
If they're that confident in his work, they shouldn't be opposed to showing how great his returns have been for them, right?
@@CliftonHamilton I’ve tried this all they respond with is that they read somewhere that financial advisors make more than their fee, and that he does their taxes for him, so why not stick with them (proceeds to flip table in my mind)
The show gets even better every week. Thx
where is the link?
1:10:05 man hellllllll no this sounds like a ponzi scheme, who else is “invested” ?
Loving these Dr PhilRamit episodes! 💪😂
No, I believe it is far too risky. It may work out this time but what about the next time? If there is an exit plan then I’d be much more comfortable.
Why is their Costco membership so expensive? The normal membership is $60.00. Where does $193.00 come from?
One Gold Star/Business ($60) and one Executive ($120)? (plus taxes)
With the husband's narrow-minded ideas on investing and complete lack of diversification (Investing 101), I *REALLY* hope she has some money put aside just for her. I get the feeling from what he said that the husband is too comfortable with the word divorce.
This is why I will always have my own money. I have seen my husband do risky things when it comes to investments...oil being one... and this just range too true for me.
He literally said they were well diversified for 24 years. That's not an excuse for investing everything in oil, but don't misrepresent the facts.
The oil investment made my head want to explode 😤 I worked in oil and gas exploration and after spending $100 MILLION AND finding oil, the project was deemed not economical and shut down. And this was with experienced geologists and engineers. WTF is this guy thinking throwing away his family's money??
Greed.
Thanks for another fascinating conversation Ramit. I'm so curious what they are doing with the monthly payout from the oil projects?!
My dad always told me that you are only good has the last thing you did. Doesn't matter about all your contributions or collective wins.
I loooved that you brought religion into the money conversation… amazing!
Such a great episode!
Is there a part 2 to this because i want to see the numbers
We are so quick to judge, but the courage it takes to come on this show is admirable. I know I couldn't do it.
Woahhh I can’t wait to see the 2nd part of this one. Also, side note- I miss your thumbnails that featured the couples in some way. When I go back to reference an episode, I’m having a hard time figuring out which is which, even with the title. Just a thought!
Uh all he had to do was use an index fund. Wtf.
Brad's body language is oddly self conscious - is he in sales? I've seen similar mannerisms in especially "slick" salespeople
Edit: Ah. Mortgage and event planning.
I picked up on that just through listening to the podcast. I thought for sure he was a finance bro.
I think he has a tick. Totally out of his control, not a mannerism.
He reminds me of the manager I had when I worked in a call center a couple decades ago. The stress induced by that job made his ticks worse. Heck even my eyes twitched out of control after cold calling sales for a while. I think the stress of being on the podcast and looking at his decisions through another lens was making things worse or he was angry and trying to hold it together.
As a guy who works in the O&G industry. Shale comes with a decline man, initial payback is always associated with an initial peak-type curve. Then u tell me, the dividend model changes after the initial pay back, man this game is against you if the commodity price crashing which happens all the time.
Would love to provide a wake up call as someone who lives on a fixed income due to health issues. I can't imagine being stressed and making 70k-100k a month. Perhaps it is time to reevaluate what you value and see how your expenditures align. Budget ahead of time. Make your budget easier. Sell things you don't need. Get rid of the 25k bedroom set. Her definition of broke is excruciating to hear. Not luxurious lifestyle or expenditures? They need to have a discussion about financial goals, expenses, make a plan to pay off debt, etc. They need to be on the same page. Seems like a lot of loaded gender roles here. It seems clear that Brad is struggling and perhaps a bit burned out but then the bombshell about the oil decision...what!?? Talk about a huge risk. Part of her stress seems more appropriate than reflected earlier on.
First, I really appreciate how open the couple tells about their life, big respect. His last investment decision appears way to risky for me. But there seems to be a reason for this. This is not only the bad investment advisor, but I guess much more important the nagging wife over decades. She permanently puts so much pressure on him, is never satisfied with his enormous income, is never satisfied with herself. I guess, her behaviour plays a big role for his decision for the oil well. I honestly wonder if they are really happy as a couple and if they are really good for each other. And if they were still a couple not having kids... And both are big spenders, although they seem to think, they are not. She takes care of her budget every month in her extreme way, but at the same time, when they have a high income, they spend everything like there is no tomorrow.
No, I do not think that this is a good idea. Brad and Sandra are risking their entire family's savings on a couple investments. The concerning part is that it happened more than once. An investor can take a big swing and hit a home run once, twice, maybe three times. Eventually everything regresses to the mean and when that happens, it will happen harder for people who have developed a mentality of swinging big.
Sandra's reactions suggests that she feels this decision was all Brad's but in reality it is both of theirs. Sandra distancing herself from income decisions and delegating that work to Brad and then not being happy with the decisions that he is making is not helping.
It’s pretty hilarious that they say they’re religious people and then they look down at other people they personally know. 😂 Horrible characters.
Made like 800k a year for 2 years, but still barely has anything. No blessing can help them.
If she really did so cautiously budget, that would have never happened.
@@a012345 from her words they made 800k for 2 years and she still wasn’t happy and find something to complain about.
I've never rooted for a couple to fail.... but.... 😳
Why do these people want SO much? It’s weird. I don’t wish these 2 harm but they need to get a grip. I think if they had 3 million in retirement funds they would think they were poor.
Great conversation Ramit!
They dont truly understand the principles of the Bible, God blesses the righteous, but when they righteous are destitute...it doesnt mean they are not blessed, it means he is teaching them faith and dependence on Him fully. You are not to feel guilty for having money nor feel not blessed for not having money.
She should use a budget app!
Despite how good or legit any investment looks its not a good idea to go all in all of your money ,that was more of emotional move because you have clearly convinced yourself that nothing is going to go wrong ,it was gamble .Fingers crossed ,i hope he recoups his initial investment before any issues beyond his control
Yeah, that's why portfolios are rebalanced even when things are going good, because you don't want all your gets in one or few baskets. He should know this as someone who teaches finance. But there's always do m the "do as I say, not do mentality"
Just, wow. While I have so many questions, the most important one is this. He did all the research and made this incredibly high risk move with essentially all of their net worth. How much did they discuss this first? Did she know? Did she agree? If she agreed, why?
She did know, and she allowed it against her better judgement. I would have said HELL NO.
The last 10 minutes were wild.
There are so many people who are getting close to retirement and panic and decide they need twice as much as they have, so they step up to the roulette wheel and put it all on black to see if they get double or nothing.
It's *wild*. But I've heard it from so many people. Sometimes it's "I have a buddy looking for investors", sometimes it's a single rental property they think will provide cash flow (but don't calculate the cost of maintenance, repairs, sitting empty, squatters, etc.).
People spend decades saving up and then think they can double it in a few years. They can in 10 years (Rule of 72 for 7%).
No wonder she is terrified every time she looks at the budget and is trying so hard to hold on to stability. She's trying to make sure her kids can eat while her husband gambles away their life savings on a hot tip.
wow huge thanks to sandra and brad for having the immense balls to come here and be honest and vulnerable like that, really interesting episode for sure
craziest last 15 minutes ever LMFAOOO absolutely bonkers. you talked a lot about "the story you tell yourself" with Sandra but ngl the "story Brad told himself" was crazyyyyyy. i definitely empathize with brad and the "rat race" stories and it really sucks what happened to him for the story to hit deeper, but also i am 26 with 0 kids w super low expenses, my risk profile is basically at the lowest it can be and it def sounds like a hell of a risky move to have done that right after a big liquidity event
idk about the "nagging wife" comments, my mom's definitely similarly nagging but much less communicative than sandra i think (for a lot of reasons), and while her marriage def isn't something i look forward to repeating I think in the economical sense there was some inherent trust that was respected. i think their "failure" there is more in the division of tasks to not cause internal resentments. for example, who's taking the blame for not being "financially educated"? is it the one who is "managing the money"? is it the one who's literally teaching personal finance? who's distrusting who?
i think the "net worth" vs "income" discussion is interesting and it does feel like this scarcity mindset with a 1.3M net worth is, but with the current risk allocation and lifestyle it's certainly understandable
my read is that maybe it's a topic where they haven't had enough conversations. she expects a provider of regular income who can meet expectations (and the expectation is certainly "growth" in a maybe too undefined way); he expects a "strong queen" for their business entrepeneurship "kingdom" who can handle tough times and be a wise safe counterpoint but who also believes in the potential and is along for the ride, but who doesn't seem to communicate what the realization of said potential is and what the plan is if shit hits the fan and the kingdom crumbles
My ex wife once told me (after taking our checking account to negative):
“The problem here is that you don’t make enough money , $100K for a family of 3 is not enough “
Mind you this was in 2017, our mortgage was less than $1300.
Surprise; we divorced
I know a guy who didn't pay the rent for 6 months. When the landlord came knocking. The wife was livid at him. He told her they needed a bigger house.
She took the children's college fund and paid the landlord.
They got divorced. 🙂
@@eileenwatt8283 , I have no idea what you are implying.
@@DataTranslator correlation between your ex saying you didn't make enough money and the guy who says they needed a bigger house when he didn't pay the rent. People blaming the situation rather than their spending habits. It's not a reflection on you just them.
👍🏾👍🏾
I respect all the due diligence he’s done around the investment, but the decision to do it seems more gambling logic than solid personal finance principles. I hope it works out for him. It’s a lot of financial stress for both of them to take on in their late 40s.
I can't imagine making $70,000-$100,000 per month! Of course life would be fun and great.
For the oil well, my boyfriend wanted to invest in oil wells for years. We finally agreed that he could do it. He wired thousands to the company and only months later they said the well didn’t produce and he lost it all. So stressful.
this particular couple to me looks like professional actors
It seemed that way to me as well.
I'm 2 minutes in, and I feel like she's a Christian mommy blogger.
Look like or are acting like? Not sure what you meant.
Which mortgage broker earns that level on income? Here in the UK, you'd be lucky get 50k a year!
How is Sandra so young and healthy with all the stress 😂
True I noticed her skin is glowing and she look younger than her age
Money makes you young
Husband taking all the actual stress of earning money 😅
I started watching the IWT last week; it's so informative... BUT so hard to locate the next part.
This 'Investment' is going to end in tears. (obviously I hope that he makes lots of money and they succeed)
25 years of frustration pushed him to lash out and do everything that conventional financial wisdom teaches you not to do. It’s a risky, hail Mary play that promises outsized returns to make up for years of lost compounding growth. For their sake and financial future, I really hope it pans out
Bizarre he would use the funds to invest vs buying another home given the did really well from that…
The thing he doesn’t go into is the decline rate of production from the oil well, a lot of these fracking wells keep producing for 20 years but peak in year 1 and quickly drop off in production 85-90% by year 3, so even if the well is a success they might make back their original investment by year 2-3 but then be getting very low returns after.. So despite all the risk of failure, could end up getting less than a S&P500 index fund over time
I’m good at admit here that I only watch this for about five minutes because it just seems like it was such a roller coaster ride that’s it was either feast or famine and why would you not expect a famine why would you spend like there was no tomorrow and tomorrow wouldn’t be hard? They just seem to make so many decisions that were so bad.
Definitely a bit concerned about that oil-well deal though. Why couldn’t they get traditional funding for it? They could’ve invested the million in ETFs and probably hit coast FIRE.
Exactly... Why is an oil company looking for individual investors 😮