WEBVTT 00:00:09.900 --> 00:00:13.660 Welcome back to another Sci -Fi episode where 00:00:13.660 --> 00:00:17.160 psychology and finances collide. We'll continue 00:00:17.160 --> 00:00:20.420 to examine how we think, feel, and behave with 00:00:20.420 --> 00:00:23.519 money as it pertains to the Happy Money book 00:00:23.519 --> 00:00:28.579 written by Elizabeth Dunn and Michael Norton. 00:00:28.640 --> 00:00:33.000 Their subtitle is The Science of Happier Spending. 00:00:33.179 --> 00:00:37.960 And I love what one of the reviewers stated about 00:00:37.960 --> 00:00:40.880 this book. If your money isn't making you happy, 00:00:41.000 --> 00:00:45.840 then you're just spending it wrong. What a great 00:00:45.840 --> 00:00:48.979 way to look at your money, right? So you'll have 00:00:48.979 --> 00:00:52.159 seen different episodes within this podcast about 00:00:52.159 --> 00:00:56.060 how money cannot buy happiness. And in and of 00:00:56.060 --> 00:01:00.000 itself, it's true. Money does not buy you happiness. 00:01:00.020 --> 00:01:04.459 It's not the thing. that buys happiness. It's 00:01:04.459 --> 00:01:11.040 how you spend your money. It's how you consume 00:01:11.040 --> 00:01:14.739 rather than how you try to pressure yourself 00:01:14.739 --> 00:01:18.599 or continue to climb that ladder to make more 00:01:18.599 --> 00:01:21.079 money. It's using the resources that you have 00:01:21.079 --> 00:01:26.819 more. wisely to create a stronger sense of subjective 00:01:26.819 --> 00:01:30.280 well -being and that's all we're discussing when 00:01:30.280 --> 00:01:32.620 we're discussing this book when we're discussing 00:01:32.620 --> 00:01:35.280 the financial symposium which in the financial 00:01:35.280 --> 00:01:37.459 symposium that we did here at redstone arsenal 00:01:37.459 --> 00:01:42.599 on the 25th of march 2025 i created the entire 00:01:42.599 --> 00:01:48.269 class on this book And you've already listened 00:01:48.269 --> 00:01:52.909 to the author's first couple of paragraphs within 00:01:52.909 --> 00:01:58.250 the book, one on buying experiences, making it 00:01:58.250 --> 00:02:03.700 a treat, and buying time. Paying now, consuming 00:02:03.700 --> 00:02:06.099 later. We're going to spend more time on that 00:02:06.099 --> 00:02:09.360 pay now, consume later concept. But I'm going 00:02:09.360 --> 00:02:12.280 to take a pause here and just note some of the 00:02:12.280 --> 00:02:15.240 feedback from the financial symposium. Because 00:02:15.240 --> 00:02:18.539 now that you've listened to these first two episodes 00:02:18.539 --> 00:02:21.860 on this happy money book review, I thought this 00:02:21.860 --> 00:02:25.280 would be a great time to bring in the barriers 00:02:25.280 --> 00:02:29.819 that people consistently cite in these classes 00:02:29.819 --> 00:02:32.449 that I offer, these symposiums. that I offer 00:02:32.449 --> 00:02:37.050 year after year. And the actual title of the 00:02:37.050 --> 00:02:40.909 symposium this year was called Building Your 00:02:40.909 --> 00:02:44.050 Financial Ecosystem, The Science of Spending, 00:02:44.129 --> 00:02:47.770 Saving, and Giving. So I asked the question in 00:02:47.770 --> 00:02:50.030 the survey, what are your perceived barriers 00:02:50.030 --> 00:02:52.789 when it comes to optimizing your financial ecosystem? 00:02:53.610 --> 00:02:55.849 And so here are the things, and I highlight, 00:02:55.949 --> 00:02:59.710 I went through, I had 80 responses from the 420 00:02:59.710 --> 00:03:03.750 that actually attended. And here are some of 00:03:03.750 --> 00:03:06.449 the barriers that I highlighted that I consistently 00:03:06.449 --> 00:03:10.879 get. Time. Okay, well, we talked a lot about 00:03:10.879 --> 00:03:13.520 time. But this respondent is saying, you know 00:03:13.520 --> 00:03:15.840 what, a barrier for me is I just don't have the 00:03:15.840 --> 00:03:18.900 time to do this. And I saw this in several other 00:03:18.900 --> 00:03:22.560 entries, dedicating time to it. That was another 00:03:22.560 --> 00:03:25.219 one. Let's see, there was another one on the 00:03:25.219 --> 00:03:29.879 back here, or even tied to time, lack of expertise. 00:03:30.560 --> 00:03:33.680 I don't even know where to start, let alone how 00:03:33.680 --> 00:03:37.159 much time do I need to invest in this. Someone 00:03:37.159 --> 00:03:39.620 even used the term overwhelming. This is overwhelming 00:03:39.620 --> 00:03:44.300 for me. Another person stated only one income. 00:03:44.639 --> 00:03:47.580 And it's always interesting when folks cite this 00:03:47.580 --> 00:03:50.060 as a barrier because if anything, if you are 00:03:50.060 --> 00:03:54.139 operating and surviving off of one income, boy, 00:03:54.300 --> 00:03:57.919 what kind of a joy would it be if your spouse 00:03:57.919 --> 00:04:01.419 ever acquired a second income? You could continue 00:04:01.419 --> 00:04:05.680 to live off the one income. And then buy experiences 00:04:05.680 --> 00:04:09.960 and buy time and other things with the other 00:04:09.960 --> 00:04:12.879 income and also live in such a way to where if 00:04:12.879 --> 00:04:17.060 one of you lost your job, it wouldn't be completely 00:04:17.060 --> 00:04:20.259 stressful. So there are advantages of only having 00:04:20.259 --> 00:04:24.800 one income as well. It can teach you how to live 00:04:24.800 --> 00:04:28.899 in such a way to where you don't need that additional 00:04:28.899 --> 00:04:31.600 income. But if it does happen, boy, what a treat 00:04:31.600 --> 00:04:36.480 when that does occur. Another respondent stated 00:04:36.480 --> 00:04:40.240 FOBO, fear of better offer for those that are 00:04:40.240 --> 00:04:43.560 not familiar with that acronym. He says, FOBO, 00:04:43.560 --> 00:04:48.100 and how I've been groomed as a kid in this consumption 00:04:48.100 --> 00:04:51.019 culture and also the different views on money 00:04:51.019 --> 00:04:56.300 that myself and my wife share. I highlighted 00:04:56.300 --> 00:05:01.829 this one because it speaks about Financial socialization. 00:05:01.870 --> 00:05:06.009 How I was groomed as a kid. How I learned to 00:05:06.009 --> 00:05:11.170 spend money as a kid. And what money did not 00:05:11.170 --> 00:05:14.790 provide me as a kid. What money is not providing 00:05:14.790 --> 00:05:18.449 me now. What this culture has told me that I 00:05:18.449 --> 00:05:21.769 must do to be happy, but it is incorrect and 00:05:21.769 --> 00:05:24.410 I want to break up with this culture kind of 00:05:24.410 --> 00:05:30.410 attitude. And also, this... also brings in the 00:05:30.410 --> 00:05:33.689 different views that spouses often share about 00:05:33.689 --> 00:05:36.550 money. That's a delicate topic, but for those 00:05:36.550 --> 00:05:39.829 listening, in the sci -fi lineup for virtual 00:05:39.829 --> 00:05:43.350 classes this year, there will be a class in October 00:05:43.350 --> 00:05:48.449 2025 on financial intimacy. And so we definitely 00:05:48.449 --> 00:05:51.230 understand how difficult it is for spouses to 00:05:51.230 --> 00:05:55.569 get on the same page with money. So another one 00:05:55.569 --> 00:05:58.560 here, just getting motivated. to get started. 00:05:58.720 --> 00:06:02.100 So motivation is one I constantly see as a barrier. 00:06:03.160 --> 00:06:06.300 Fear of not having enough information to make 00:06:06.300 --> 00:06:10.459 the perfect decision for my future. So let's 00:06:10.459 --> 00:06:12.899 dissect that word perfect. We are not looking 00:06:12.899 --> 00:06:15.040 for perfection. We're just looking for a try. 00:06:15.439 --> 00:06:18.680 We're just looking for you to do something different. 00:06:18.740 --> 00:06:22.699 And remember, it only takes one small difference 00:06:22.699 --> 00:06:27.100 to make a big change. And here's the other one 00:06:27.100 --> 00:06:29.339 that I was looking for, dedicating time to it. 00:06:29.660 --> 00:06:34.740 So this one I find extremely interesting. Cost 00:06:34.740 --> 00:06:39.180 and lack of knowledge. I see this one on so many 00:06:39.180 --> 00:06:41.639 of the surveys after I've completed a class. 00:06:42.660 --> 00:06:44.600 So here's something I want you to think about, 00:06:44.699 --> 00:06:46.579 and this is what the authors of Happy Money are 00:06:46.579 --> 00:06:48.980 trying to get you to think about as well. They're 00:06:48.980 --> 00:06:51.060 trying to get you to think beyond your income. 00:06:51.550 --> 00:06:54.050 They're trying to get you to think beyond your 00:06:54.050 --> 00:06:59.310 experience, your knowledge of money, or how much 00:06:59.310 --> 00:07:01.629 it might even cost for you to pay a professional. 00:07:02.269 --> 00:07:04.750 They're trying to get you in the habit of thinking 00:07:04.750 --> 00:07:07.850 of what you could do differently with the resources 00:07:07.850 --> 00:07:11.089 that you currently have. So if I could, I want 00:07:11.089 --> 00:07:14.550 to challenge the audience. There are so many 00:07:14.550 --> 00:07:17.470 people that I see. in the financial counseling 00:07:17.470 --> 00:07:20.870 session, who are paying upwards of $200 a month 00:07:20.870 --> 00:07:27.790 for yard service. So we're paying a professional 00:07:27.790 --> 00:07:33.689 to tend our yard, but we balk at paying a professional 00:07:33.689 --> 00:07:39.569 to look at our finances. $200 a month times 12 00:07:39.569 --> 00:07:43.029 months. Anybody want to take a stab at the math? 00:07:44.779 --> 00:07:49.339 That's a lot of cash. And you wouldn't even pay 00:07:49.339 --> 00:07:53.579 half of that to speak to a certified financial 00:07:53.579 --> 00:07:56.680 planner, a fiduciary certified financial planner, 00:07:56.800 --> 00:08:00.560 just to go over some things with you. And by 00:08:00.560 --> 00:08:02.920 the way, my services are free. If you're here 00:08:02.920 --> 00:08:06.060 at Redstone Arsenal and you fit the eligibility 00:08:06.060 --> 00:08:10.120 to come in, my services are free. So we have 00:08:10.120 --> 00:08:15.060 to think beyond cost and think. Start moving 00:08:15.060 --> 00:08:19.180 towards what am I willing to sacrifice temporarily? 00:08:19.819 --> 00:08:23.240 Maybe I cut my own grass this month so that I 00:08:23.240 --> 00:08:28.560 can go and see a financial professional. So here's 00:08:28.560 --> 00:08:30.740 another one that's going to fit this episode 00:08:30.740 --> 00:08:37.259 so well. Okay, this is too hard. I need a change 00:08:37.259 --> 00:08:42.559 of mindset, especially telling myself or my kid. 00:08:45.019 --> 00:08:48.039 No. Wow. I just want to give this person a gold 00:08:48.039 --> 00:08:51.179 star. And lastly, here's what I'm going to talk 00:08:51.179 --> 00:08:54.019 about in today's episode as well. And this barrier 00:08:54.019 --> 00:08:56.759 goes right with it. This respondent said one 00:08:56.759 --> 00:09:01.539 of their barriers was that the concept of retiring 00:09:01.539 --> 00:09:05.519 is too abstract for me. And we're going to get 00:09:05.519 --> 00:09:07.860 into the future self, and we're going to talk 00:09:07.860 --> 00:09:11.919 about how delayed gratification, deferred consumption, 00:09:12.080 --> 00:09:16.840 which is on the same lines of that pay now, consume 00:09:16.840 --> 00:09:19.039 later that the authors are talking about, can 00:09:19.039 --> 00:09:22.580 help us actually save already for our retirement. 00:09:23.059 --> 00:09:27.080 Okay, so jumping right in. Benefits of delayed 00:09:27.080 --> 00:09:30.480 gratification. So first we need to understand 00:09:30.480 --> 00:09:34.740 that our brains are wired. to find pleasure in 00:09:34.740 --> 00:09:40.259 imagining positive future events. And sure, cultivating 00:09:40.259 --> 00:09:43.460 this skill is linked to better mental health. 00:09:43.720 --> 00:09:47.860 But on the flip side, dwelling on uncertainty 00:09:47.860 --> 00:09:52.019 can intensify both those positive and negative 00:09:52.019 --> 00:09:56.240 emotions, making a desired experience even more 00:09:56.240 --> 00:10:01.450 enjoyable when it's finally realized. So let 00:10:01.450 --> 00:10:04.750 me take your brain right now to retirement. So 00:10:04.750 --> 00:10:08.230 we like to imagine that positive future event 00:10:08.230 --> 00:10:11.610 of retirement. And a lot of us have that opportunity 00:10:11.610 --> 00:10:15.210 to, for a second time, at least for DOD civilians, 00:10:15.450 --> 00:10:18.649 to take the deferred resignation program offer, 00:10:18.830 --> 00:10:23.450 which is basically a very, I guess, nice severance 00:10:23.450 --> 00:10:25.990 package if you wanted to leave the government 00:10:25.990 --> 00:10:28.230 early. And now they're offering the voluntary 00:10:28.230 --> 00:10:33.289 early retirement authority. So folks are thinking 00:10:33.289 --> 00:10:35.370 about that. They're drooling over it, right? 00:10:35.549 --> 00:10:37.809 And this is what the authors want us to do, that 00:10:37.809 --> 00:10:40.990 drool factor, to get us excited about something 00:10:40.990 --> 00:10:43.590 that causes us to take a level of action that 00:10:43.590 --> 00:10:49.200 is needed. So by doing that, we do improve our 00:10:49.200 --> 00:10:52.159 overall subjective well -being. It enhances our 00:10:52.159 --> 00:10:56.960 mental health. But dwelling on that uncertainty 00:10:56.960 --> 00:11:01.139 and creating those positive and negative emotions 00:11:01.139 --> 00:11:05.179 surrounding retirement, it will make retirement 00:11:05.179 --> 00:11:07.500 even more enjoyable when it is finally realized, 00:11:07.679 --> 00:11:10.240 wow, the time that I took to finally pay that 00:11:10.240 --> 00:11:13.059 professional, the time that I took to finally... 00:11:13.610 --> 00:11:16.309 organize my finances and get that done, that 00:11:16.309 --> 00:11:19.190 is one of those benefits, right? And so delayed 00:11:19.190 --> 00:11:23.610 gratification, whether it's savoring the wait 00:11:23.610 --> 00:11:27.529 or saving, I mean, right? We save ourselves for 00:11:27.529 --> 00:11:30.149 so many things in life, and I'm sure your imagination 00:11:30.149 --> 00:11:34.450 can run wild with that. But when we're savoring 00:11:34.450 --> 00:11:37.149 the wait for a special purchase or a special 00:11:37.149 --> 00:11:41.309 occasion or retirement, and embracing the mystery 00:11:41.309 --> 00:11:46.059 of a surprise, we can amplify. our overall happiness 00:11:46.059 --> 00:11:50.480 by tapping into that power of anticipation. So 00:11:50.480 --> 00:11:53.639 some folks that I talk to, they'll come in and 00:11:53.639 --> 00:11:56.379 they'll say, oh, I just get so depressed thinking 00:11:56.379 --> 00:11:59.600 about how many years left I have to work. Well, 00:11:59.620 --> 00:12:01.559 maybe you're not in the right line of work then. 00:12:01.620 --> 00:12:04.960 Maybe I need to refer you to a different professional 00:12:04.960 --> 00:12:08.399 for that area, because we certainly don't want 00:12:08.399 --> 00:12:12.799 you spending another 20 years miserable just 00:12:12.799 --> 00:12:16.990 while Paying down for your retirement for those 00:12:16.990 --> 00:12:20.450 last 20 years, right? We want you to find some 00:12:20.450 --> 00:12:23.750 level of happiness in that. So here's a quote 00:12:23.750 --> 00:12:27.090 from the Happy Money book. Anticipating good 00:12:27.090 --> 00:12:30.830 things produces a distinct pattern of neural 00:12:30.830 --> 00:12:34.649 activation in the nucleus accumbens, a region 00:12:34.649 --> 00:12:36.830 of the brain linked to the experience of pleasure 00:12:36.830 --> 00:12:39.169 and reward. We talked about that last episode. 00:12:40.029 --> 00:12:42.740 Continuing with the quote. And training ourselves 00:12:42.740 --> 00:12:47.559 to envision a fantastic future has real benefits, 00:12:47.879 --> 00:12:51.120 end quote. So what the authors are saying, if 00:12:51.120 --> 00:12:55.440 we can train our brains to start looking at retirement 00:12:55.440 --> 00:13:02.299 and envision retirement as a long lasting reward. 00:13:03.789 --> 00:13:07.289 that increases our pleasure and reward center 00:13:07.289 --> 00:13:10.250 of our brain, and even the neurochemical dopamine 00:13:10.250 --> 00:13:15.509 that goes with it, boy, that can assist us in 00:13:15.509 --> 00:13:19.649 saving more for retirement. They have a little 00:13:19.649 --> 00:13:22.809 section in the book, Making the Mojito Taste 00:13:22.809 --> 00:13:26.370 Free, and they offer a story about folks that 00:13:26.370 --> 00:13:30.960 prepaid for a destination wedding. and so they 00:13:30.960 --> 00:13:33.539 pay up front they go see their friends get married 00:13:33.539 --> 00:13:35.279 and by the way if you ever do that there's a 00:13:35.279 --> 00:13:38.659 famous comedian that says the gift is you being 00:13:38.659 --> 00:13:42.360 there because you've paid your way and you've 00:13:42.360 --> 00:13:45.940 gone right their gift is you being there and 00:13:45.940 --> 00:13:48.539 don't feel guilty if that's what you do so anyway 00:13:48.539 --> 00:13:50.659 you've already paid for this destination wedding 00:13:50.659 --> 00:13:55.039 they give this example in the book and so Isn't 00:13:55.039 --> 00:13:57.899 it great that when you're sitting there and you're 00:13:57.899 --> 00:14:01.440 enjoying the time with friends and family and 00:14:01.440 --> 00:14:04.919 all of a sudden the bartender asks what you'd 00:14:04.919 --> 00:14:07.860 like to drink and you remember, I've already 00:14:07.860 --> 00:14:12.220 paid for this and I can consume however many 00:14:12.220 --> 00:14:15.159 mojitos I desire because I've already paid for 00:14:15.159 --> 00:14:18.580 this. It's a wonderful feeling and we want that 00:14:18.580 --> 00:14:24.120 same effect. for your retirement. So like we 00:14:24.120 --> 00:14:27.019 want that mojito to taste free, we want that 00:14:27.019 --> 00:14:31.360 retirement in the end to also taste free. But 00:14:31.360 --> 00:14:34.220 we also want to increase that drool factor to 00:14:34.220 --> 00:14:37.299 also increase, and listen, I'm stumbling on my 00:14:37.299 --> 00:14:38.980 words because my brain's trying to get ready 00:14:38.980 --> 00:14:43.080 to say the French word, se rejouir. We want to 00:14:43.080 --> 00:14:46.860 increase that joy of anticipation with our retirement 00:14:46.860 --> 00:14:49.799 as well. So when it comes to the benefits of 00:14:49.799 --> 00:14:53.340 delayed gratification, the biggest bang is when 00:14:53.340 --> 00:14:55.759 it provides opportunities for detail hunting 00:14:55.759 --> 00:14:59.919 to promote positive expectation. And one of those 00:14:59.919 --> 00:15:03.259 is hunting those details with your spouse. What 00:15:03.259 --> 00:15:07.500 do we want to do in retirement? Can we also start 00:15:07.500 --> 00:15:14.200 doing those things now so that We, it doesn't 00:15:14.200 --> 00:15:16.379 feel like we have 20 years to go before we can 00:15:16.379 --> 00:15:19.580 do it. We can increase our drool factor by even 00:15:19.580 --> 00:15:22.980 experiencing just a small taste of it every once 00:15:22.980 --> 00:15:24.440 in a while, whether it's through a vacation, 00:15:24.759 --> 00:15:28.120 whether it's through different things that you've 00:15:28.120 --> 00:15:31.500 wanted to do when you retire, maybe taking that 00:15:31.500 --> 00:15:35.600 Spanish class for a semester and getting a taste 00:15:35.600 --> 00:15:37.990 of what that's going to be like. We've already 00:15:37.990 --> 00:15:40.690 talked about soul rejouir. We've already talked 00:15:40.690 --> 00:15:42.870 about the drool factor. And we've also talked 00:15:42.870 --> 00:15:45.669 about engendering that sense of pleasure beyond 00:15:45.669 --> 00:15:48.710 the experience itself, that transcendent strawberry. 00:15:49.549 --> 00:15:54.629 So that helps us with delayed gratification. 00:15:54.990 --> 00:15:58.730 Delayed gratification in and of itself, delaying 00:15:58.730 --> 00:16:02.629 the time between when we get paid and when we 00:16:02.629 --> 00:16:06.470 spend the money has great... benefit. That's 00:16:06.470 --> 00:16:10.429 what these authors are saying. So I will also 00:16:10.429 --> 00:16:14.549 touch on when we're not practicing delayed gratification 00:16:14.549 --> 00:16:18.750 and that's when we're spending even before we 00:16:18.750 --> 00:16:22.129 have the money, i .e. through the buy now pay 00:16:22.129 --> 00:16:25.769 later apps or through a credit card or whatever 00:16:25.769 --> 00:16:29.090 way or method you have in paying for that before 00:16:29.090 --> 00:16:31.809 you actually have the cash. Research shows a 00:16:31.809 --> 00:16:37.370 strong link between debt and unhappiness. And 00:16:37.370 --> 00:16:40.929 I can be the first one to vouch for that. There's 00:16:40.929 --> 00:16:45.129 a difference between theory and practice. And 00:16:45.129 --> 00:16:48.809 sure, the Happy Money book is not just based 00:16:48.809 --> 00:16:51.549 on theory because they put some of the theories 00:16:51.549 --> 00:16:53.649 to the test with their own research, but a lot 00:16:53.649 --> 00:16:56.490 of it is theoretical. But this gives you the 00:16:56.490 --> 00:17:00.450 opportunity to experience through your own experiments 00:17:00.450 --> 00:17:03.090 with your money, how is it going to work with 00:17:03.090 --> 00:17:05.589 you? What do you need to tweak? But I will tell 00:17:05.589 --> 00:17:07.950 you, when it comes to practice, when it comes 00:17:07.950 --> 00:17:11.069 to the real world, and when it comes to me sitting 00:17:11.069 --> 00:17:15.069 with people who have debt, I can be the first 00:17:15.069 --> 00:17:17.720 one to say that that is a true statement. We're 00:17:17.720 --> 00:17:20.680 talking stress. We're talking anxiety. We're 00:17:20.680 --> 00:17:24.079 talking potential for losing a security clearance, 00:17:24.279 --> 00:17:29.559 i .e. losing your job, i .e. losing your identity. 00:17:30.019 --> 00:17:33.920 So this is something that does not need to be 00:17:33.920 --> 00:17:36.900 glossed over. Here's another point. Debit cards, 00:17:37.099 --> 00:17:41.640 which require immediate payment, is associated 00:17:41.640 --> 00:17:45.670 with significantly less... unsecured debt by 00:17:45.670 --> 00:17:50.789 400 % even after filtering variables of income 00:17:50.789 --> 00:17:53.609 and credit history. I like this little research 00:17:53.609 --> 00:17:57.410 project that they pointed to in this book. So 00:17:57.410 --> 00:18:00.250 for those that use debit cards where the money 00:18:00.250 --> 00:18:04.890 is currently available, where the delayed gratification 00:18:04.890 --> 00:18:09.589 already occurred, where they allowed that account 00:18:09.589 --> 00:18:15.450 to build up enough cash to now spend, they are 00:18:15.450 --> 00:18:21.289 actually spending less on unsecured debt by 400%. 00:18:21.289 --> 00:18:25.970 I think that's just an amazing thing. Pay with 00:18:25.970 --> 00:18:28.950 your debit card. Now be careful if you're not 00:18:28.950 --> 00:18:30.710 in the habit of that and you're not tracking 00:18:30.710 --> 00:18:33.369 your money correctly like those softballs. You're 00:18:33.369 --> 00:18:37.019 not watching where it goes. Because money is 00:18:37.019 --> 00:18:40.319 scarce, just like that softball story that I 00:18:40.319 --> 00:18:43.019 gave you. If you're not tracking that money closely, 00:18:43.160 --> 00:18:46.640 then you're going to have some fees, and we don't 00:18:46.640 --> 00:18:48.700 want you to rack up those fees. We want you to 00:18:48.700 --> 00:18:52.680 use your debit card responsibly. So in a nutshell, 00:18:52.859 --> 00:18:54.599 they're just saying the convenience of credit 00:18:54.599 --> 00:18:58.119 comes at a cost. When you're not delaying gratification, 00:18:58.319 --> 00:19:02.160 it comes at a cost. By obscuring the immediacy 00:19:02.160 --> 00:19:07.430 of payment. It encourages overspending and undermines 00:19:07.430 --> 00:19:13.369 our financial well -being. So I had a picture 00:19:13.369 --> 00:19:16.990 of a man fishing with his grandson, and I used 00:19:16.990 --> 00:19:20.829 that as a visual for what the Happy Money book 00:19:20.829 --> 00:19:23.849 talks about with the joy of anticipation, the 00:19:23.849 --> 00:19:26.430 anticipation of an experience or a purchase that 00:19:26.430 --> 00:19:30.549 often brings more joy. than the experience itself. 00:19:30.990 --> 00:19:33.490 And I know that there have been plenty of folks, 00:19:33.529 --> 00:19:36.509 I'm sure, even in the audience who have just 00:19:36.509 --> 00:19:40.450 anticipated being with a loved one or anticipated 00:19:40.450 --> 00:19:43.430 a purchase, and finally it comes, and wow, this 00:19:43.430 --> 00:19:47.109 is nice. But here's what the authors say about 00:19:47.109 --> 00:19:53.420 what joy can do. And several... Psychologists 00:19:53.420 --> 00:19:55.759 have backed this up in other research papers 00:19:55.759 --> 00:19:59.299 and in journals of psychology, journals of epidemiology. 00:19:59.559 --> 00:20:03.859 They talk about suicide rates. And a lot of times 00:20:03.859 --> 00:20:07.720 what the ingredients that are missing in someone 00:20:07.720 --> 00:20:11.160 who has completed suicide is hope, connection, 00:20:11.559 --> 00:20:15.559 joy, right? So the joy of anticipation, here's 00:20:15.559 --> 00:20:17.259 what they say about it in their book. And I quote, 00:20:17.420 --> 00:20:20.839 the ability to generate pleasant thoughts about 00:20:20.839 --> 00:20:40.670 the future. So building that hope, building that 00:20:40.670 --> 00:20:45.130 connection, it creates those positive... expectations 00:20:45.130 --> 00:20:49.009 and that joy of anticipation that fuels a desire 00:20:49.009 --> 00:20:51.630 to get out of bed every morning and to look forward 00:20:51.630 --> 00:20:54.170 to something. We talked about in the financial 00:20:54.170 --> 00:20:57.450 symposium, again, about this making retirement 00:20:57.450 --> 00:21:00.970 taste free. The authors talked about a Hershey 00:21:00.970 --> 00:21:04.720 Kiss experiment with college students. And so 00:21:04.720 --> 00:21:08.200 I did the same thing. I mean, I don't have all 00:21:08.200 --> 00:21:11.720 the variables within the research design. I didn't 00:21:11.720 --> 00:21:14.460 look all that up and I didn't fully recreate 00:21:14.460 --> 00:21:17.599 it. Wouldn't be able to do that with a symposium. 00:21:18.490 --> 00:21:21.230 But I at least did a half -cocked version of 00:21:21.230 --> 00:21:24.369 the Hershey experiment. And so what I did is 00:21:24.369 --> 00:21:28.509 before the break, which would be exactly 30 minutes 00:21:28.509 --> 00:21:32.329 before I would provide this level of information 00:21:32.329 --> 00:21:35.509 to them, I simply let them know, grab your Hershey 00:21:35.509 --> 00:21:38.630 experiment, excuse me, your Hershey kiss right 00:21:38.630 --> 00:21:41.670 before you leave for the break. You have the 00:21:41.670 --> 00:21:45.269 option of eating it now or saving it for a discussion. 00:21:46.190 --> 00:21:49.210 in a little while. I did not give the time frame. 00:21:49.849 --> 00:21:53.289 It just said in a little while. So they had no 00:21:53.289 --> 00:21:56.190 idea that it was 30 minutes. They didn't know 00:21:56.190 --> 00:21:58.990 it was only 30 minutes. Some of them may have 00:21:58.990 --> 00:22:01.130 eaten it right then because maybe they thought 00:22:01.130 --> 00:22:03.150 it was a four -hour class. So maybe some of them 00:22:03.150 --> 00:22:05.549 thought, I may not get this for two hours. It's 00:22:05.549 --> 00:22:07.490 going to melt in my pocket or for whatever reason. 00:22:08.049 --> 00:22:11.609 So anyway, what we did is when it came time to 00:22:11.609 --> 00:22:14.210 talk about this experiment, I asked how many 00:22:14.210 --> 00:22:16.829 folks had already eaten it. And we probably had 00:22:16.829 --> 00:22:19.809 about five people that raised their hands. And 00:22:19.809 --> 00:22:23.309 I asked them to share some of the reasons why 00:22:23.309 --> 00:22:26.430 they ate it. And one simply said, well, I just 00:22:26.430 --> 00:22:30.430 wanted it. It's a Hershey Kiss. And it wasn't 00:22:30.430 --> 00:22:32.630 quite lunchtime yet. Even though we had plenty 00:22:32.630 --> 00:22:36.109 of snacks available out in the foyer, they still 00:22:36.109 --> 00:22:38.750 chose to eat it. And then I asked the audience 00:22:38.750 --> 00:22:42.190 how many folks decided to wait. And of course, 00:22:42.190 --> 00:22:44.910 most of their hands went up. And I asked. wanted 00:22:44.910 --> 00:22:48.569 them to share why she didn't eat it. And, you 00:22:48.569 --> 00:22:51.670 know, there were several examples given as to 00:22:51.670 --> 00:22:54.230 why it wasn't eaten, but I think one of them 00:22:54.230 --> 00:22:56.890 was curiosity. Just want to see what was going 00:22:56.890 --> 00:22:59.950 to happen with this, right? I went into talking 00:22:59.950 --> 00:23:04.930 about how we could make our retirement taste 00:23:04.930 --> 00:23:08.950 free, and I read the following on page 16 in 00:23:08.950 --> 00:23:13.630 Happy Money. Here's the quote in the book, page 00:23:13.630 --> 00:23:18.029 16. This idea is not lost, or excuse me, to sell 00:23:18.029 --> 00:23:21.509 tickets for its upcoming space flights, Virgin 00:23:21.509 --> 00:23:24.650 Galactic filled a beautiful brochure with striking 00:23:24.650 --> 00:23:27.369 photos of the Earth from space and futuristic 00:23:27.369 --> 00:23:32.210 images of suborbital travel. In contrast, the 00:23:32.210 --> 00:23:35.349 cover is a simple gray, splashed with the words 00:23:35.349 --> 00:23:38.089 of Mark Twain. 20 years from now, you will be 00:23:38.089 --> 00:23:40.650 more disappointed by the things that you didn't 00:23:40.650 --> 00:23:44.230 do than by the ones you did do. This marketing 00:23:44.230 --> 00:23:47.049 strategy is clever. If you want people to put 00:23:47.049 --> 00:23:50.630 down a $20 ,000 deposit for something that doesn't 00:23:50.630 --> 00:23:54.809 exist yet, you better convince them that they 00:23:54.809 --> 00:23:58.549 won't regret it. But it also turns out to be 00:23:58.549 --> 00:24:02.549 true. Looking back on their past decisions about 00:24:02.549 --> 00:24:06.339 whether to purchase experiences, 83 % of people 00:24:06.339 --> 00:24:09.380 sided with Mark Twain, reporting that their biggest 00:24:09.380 --> 00:24:12.920 single regret was one of inaction, of passing 00:24:12.920 --> 00:24:15.779 up the chance to buy an experience when the opportunity 00:24:15.779 --> 00:24:19.000 came along. The opposite was true for material 00:24:19.000 --> 00:24:22.059 goods. Most people's biggest regret was buying 00:24:22.059 --> 00:24:26.059 something that they wish they hadn't. Let me 00:24:26.059 --> 00:24:29.720 read a part of this again. If you want people 00:24:29.720 --> 00:24:33.759 to put down a $20 ,000 deposit for something 00:24:33.759 --> 00:24:37.579 that doesn't exist yet, you better convince them 00:24:37.579 --> 00:24:43.059 that they won't regret it. Can we not view retirement 00:24:43.059 --> 00:24:50.960 as an experience? And how do I get audience members? 00:24:52.140 --> 00:24:55.519 to get excited about something that doesn't exist 00:24:55.519 --> 00:24:58.819 yet? How do I get you to put a $20 ,000 deposit 00:24:58.819 --> 00:25:02.839 down on your retirement by saving throughout 00:25:02.839 --> 00:25:06.119 the year, by putting money away in your 401k 00:25:06.119 --> 00:25:10.119 every month, by maximizing your contributions, 00:25:10.140 --> 00:25:15.480 or even at least getting to 100 % match, right? 00:25:15.579 --> 00:25:18.819 How do I bring that across? So I did that through 00:25:18.819 --> 00:25:23.220 this experiment. For those that did not eat their 00:25:23.220 --> 00:25:25.920 Hershey Kiss, I asked them to explain to me what 00:25:25.920 --> 00:25:28.960 happened in their mind when they finally got 00:25:28.960 --> 00:25:34.140 to eat it. And one of the folks said they enjoyed 00:25:34.140 --> 00:25:41.039 it more. Let me repeat that. That person said 00:25:41.039 --> 00:25:46.900 that they enjoyed it more. And they wanted to 00:25:46.900 --> 00:25:50.450 go out. And now get more Hershey Kisses. And 00:25:50.450 --> 00:25:52.970 that's exactly what happened in the experiment 00:25:52.970 --> 00:25:56.349 with the folks that are mentioned in the Happy 00:25:56.349 --> 00:25:59.930 Money book, the college students. They were actually 00:25:59.930 --> 00:26:02.930 going to go out and buy more Hershey Kisses because 00:26:02.930 --> 00:26:06.069 they just didn't consume it quickly. They waited. 00:26:06.130 --> 00:26:09.250 And because of that drool factor, the joy of 00:26:09.250 --> 00:26:12.660 anticipation. And by the time they got to eat 00:26:12.660 --> 00:26:15.420 it, it was more satisfying than had they just 00:26:15.420 --> 00:26:18.059 consumed it as soon as it was handed to them. 00:26:18.180 --> 00:26:21.259 And that's the same thing with retirement. Retirement 00:26:21.259 --> 00:26:25.839 does not come free. Retirement requires sacrifice. 00:26:27.099 --> 00:26:30.640 Retirement requires kind of like a layaway plan. 00:26:30.720 --> 00:26:32.859 I've been referring to retirement as a layaway 00:26:32.859 --> 00:26:38.299 plan for a long time. But what keeps us from... 00:26:39.090 --> 00:26:41.630 Saving towards retirement, as the authors state, 00:26:41.710 --> 00:26:44.650 is the power of now. We overvalue the present 00:26:44.650 --> 00:26:47.309 moment. We're making it hard to resist immediate 00:26:47.309 --> 00:26:51.210 pleasure and appreciate the potential of delayed 00:26:51.210 --> 00:26:54.950 gratification. We discount the future. We tend 00:26:54.950 --> 00:26:57.190 to care less about future selves than our present 00:26:57.190 --> 00:27:00.930 selves, leading us to undervalue future benefits. 00:27:01.170 --> 00:27:04.460 And if you want to hear two great... Episodes 00:27:04.460 --> 00:27:08.019 on connecting with your future self, go back 00:27:08.019 --> 00:27:11.319 to season two and listen to episodes five and 00:27:11.319 --> 00:27:14.940 six. And it will even give you exercises to reconnect 00:27:14.940 --> 00:27:18.720 with your future self. And the pain of paying. 00:27:19.019 --> 00:27:22.279 The act of paying now creates an immediate psychological 00:27:22.279 --> 00:27:26.059 cost that we're wired to avoid, pushing us towards 00:27:26.059 --> 00:27:29.480 instant gratification, even if it means sacrificing 00:27:29.480 --> 00:27:34.380 future enjoyment. So what I did here is even 00:27:34.380 --> 00:27:38.579 though the authors, they talk about paying now, 00:27:38.660 --> 00:27:42.359 consuming later as a spending practice, I turned 00:27:42.359 --> 00:27:45.880 it into a saving practice and just called it 00:27:45.880 --> 00:27:49.480 deferred consumption because that is exactly 00:27:49.480 --> 00:27:53.859 what retirement is. If we can increase the drool 00:27:53.859 --> 00:28:01.099 factor, and decrease the pain of paying, not 00:28:01.099 --> 00:28:03.500 get caught up in the power of now and to actually 00:28:03.500 --> 00:28:07.779 connect with our future selves, then we get rid 00:28:07.779 --> 00:28:11.160 of that disconnect. And now we can start making 00:28:11.160 --> 00:28:14.099 choices that will benefit our future selves. 00:28:14.500 --> 00:28:17.420 Here's a quote out of the book. People view the 00:28:17.420 --> 00:28:20.240 distant future abstractly, just like, and just 00:28:20.240 --> 00:28:24.019 to interrupt the quote, just like this respondent 00:28:24.019 --> 00:28:29.400 on the survey said, one of his barriers was that 00:28:29.960 --> 00:28:32.920 The concept of retiring was just too abstract 00:28:32.920 --> 00:28:36.559 for him. So again, back to the quote. People 00:28:36.559 --> 00:28:39.279 view the distant future abstractly, prompting 00:28:39.279 --> 00:28:41.460 them to think about how desirable a particular 00:28:41.460 --> 00:28:44.420 course of action would be. They tend to focus 00:28:44.420 --> 00:28:49.599 more on feasibility when contemplating the immediate 00:28:49.599 --> 00:28:52.079 future. So a lot of folks, when they think about 00:28:52.079 --> 00:28:56.410 feasibility, They're also thinking, do I have 00:28:56.410 --> 00:29:00.210 the means to do this? Is it feasible to put this 00:29:00.210 --> 00:29:04.309 much in savings? But if we were, and I love how 00:29:04.309 --> 00:29:07.630 an author put it before, if we took a 20 % pay 00:29:07.630 --> 00:29:11.089 cut, we would find a way to live and to survive. 00:29:11.369 --> 00:29:15.579 And it's the same with savings. we can find a 00:29:15.579 --> 00:29:19.900 way to put that 20%, 10 % in our daily savings 00:29:19.900 --> 00:29:22.539 and then the 10 % into our retirement savings, 00:29:22.759 --> 00:29:25.079 right? So there are so many things that we can 00:29:25.079 --> 00:29:28.319 do short -term and long -term with our savings 00:29:28.319 --> 00:29:30.599 and investing. So I'll wrap up this episode. 00:29:30.640 --> 00:29:33.259 We didn't get into the happy money subject of 00:29:33.259 --> 00:29:37.220 giving, but it is a good read. And what I like 00:29:37.220 --> 00:29:40.140 what the author talks about is how we can learn 00:29:40.140 --> 00:29:42.920 how to audit. are giving. Give intentionally 00:29:42.920 --> 00:29:47.099 and give with a purpose. I would encourage you, 00:29:47.160 --> 00:29:50.759 if you have found this information helpful, to 00:29:50.759 --> 00:29:55.000 please rate and review the pod on whatever platform 00:29:55.000 --> 00:29:58.240 you listen on. We greatly appreciate your time 00:29:58.240 --> 00:30:01.740 and attention, and I wish you happy.