That’s fair: I know did that once with a store card maybe 15 years ago (lol I’m SO old) so that makes more sense.
3 Likes
I’m just guessing this based on my own experience knowing lots of typical consumers and keeping in mind that the people on this site are not typical consumers, even if some of us have store cards. Most people I know who have store cards have lots of them, like 10+ cards, just like the people on the podcast. They sign up on the spot with no forethought just for the one time discounts, which are usually pretty small. Then, they either never use it again or they shop at the store even more because “it’s a good deal” because of the card.
I have a friend who has upwards of 15 store cards. She thinks it’s a great deal because she pays a minimum balance on all of them and she “made money” on them by signing up. I’m pretty sure that’s why he recommends against it because my friend also does lots of the same stuff as the couple in that episode. Two brand new cars financed with a $115k household income, they pay $1300 in payments, but it was a “good deal” because “the interest rate they offered us for new cars was cheaper than for used cars”. I pointed out that while the interest rate might be lower (which I doubt anyway but I just went with it) the total cost of each car was so much higher that the monthly amounts as well as the total amount paid over time was astronomically higher, but that was kind of beyond her thinking. She considers herself to be smart with money, net worth is about -$100k, no retirement savings at all between the two of them. She also loves those fast food apps where you pre-load money on them in advance for a small discount, then after when she goes to Starbuck’s she says it’s “free” or that she’s actually making money on it.
I think that thinking is actually pretty typical for most consumers, so if you’re dealing with someone like that I think it’s a decent line to just say NO STORE CARDS EVER! Takes it off the table completely.
11 Likes
Not the point of your post but that’s one of the reasons I appreciate this space: in real life I am a frugal weirdo, but here I am a devil-may-care big spender. I love it!
This paragraph stressed me out so much I had to click away multiple times before I could read it! AHH
10 Likes
Haha, yeah you’re balling out big with your store card! 
Her entire life is an explosion of chaos. It makes me sad because she worked her way up from literally nothing and makes a great income, especially since she lives in a super cheap area. Poverty mindset though. I’ve tried for years to help whenever she asks for advice but there’s always a “but” reason she can’t do what I’m telling her. She works 70+ hours a week on her feet and is going deeper in the red every month. I wish there was something I could do.
9 Likes
Oh man big same. FIFTEEN. Wow. I too feel like a big spender compared to this forum crowd lol.
4 Likes
I love it too!!
4 Likes
Also from his podcast: just like debt is contagious I feel like frugality can be too! Look at all of us savers who found eachother from the big broad internet to make eachother better people!
13 Likes
Yes! Even in my IRL friend group if someone was splashing out on a fancy car and a high end apartment and expensive restaurants and and and … they wouldn’t really get the validation back that others would expect. Like, if it makes you happy then cool but I’m not going to be making a big deal out of something because you got a brand name thing.
3 Likes
This whole episode was hard!
Ugh. I knew a lot of people like this growing up. Buy new trucks, have a dozen credit cards, go on vacations, and then I’d go to my friend’s houses and realize that they didn’t have money for basic groceries.
The shift from thinking about monthly payments or one-time signup gimmicks to thinking about long term cost overall is a big leap.
6 Likes
It’s hard to watch, isn’t it? I used to think it was 100% an issue of education; I feel like that’s the commonly held belief among a lot of upper middle class people and it’s true for populations who literally don’t have adequate processing power at their disposal. But there’s so much willful ignorance, too. Like, my friend is totally capable of learning and was able to get an education. She’s also read the Dave Ramsay books, which I think are a fantastic start for a lot of people (and much more palatable than FIRE stuff for most people, culturally). I also introduced her to Gail Vaz Oxlade, and she loved her shows on YouTube and fully understood them. She’s completely capable, but it doesn’t seem to matter because (like Ramit says) it’s not really about money. Her identity is very centered around being poor and not getting her due. She also has almost no ability to delay gratification and is totally unwilling to do even basic things, like give up manicures or starbucks. I used to empathize more but it’s harder for me to listen to all the “woe is me, it is what it is, shittin’ on the little guy” talk now that her household income is higher than mine. IDK man…
8 Likes
Yeah, it’s rough. I’m from a strongly tourist-centric town where a lot of people worked double shifts for half the year. (Heck, they used to turn the traffic lights off in winter!) So things were always extra precarious. And long term planning was paradoxically more important and more difficult.
5 Likes
Oof, that’s an extra tough circumstance! I’ve always thought it was unfair that people who work salary jobs get paid twice a month but then people on welfare/SNAP only get paid once a month. Like…why should they have to be even better at long term planning than most white collar workers could manage?
8 Likes
Sounds like she should go on Ramit’s podcast!
6 Likes
ugh this episode was hard for me to listen to. some of you may remember that my marriage almost broke up a couple of years ago when my husband sprung 5 figures of surprise credit card debt on me, after me supporting him through 2 years of unemployment. and i honestly never understood how he made it to middle age without ever thinking about his own retirement or the future? idk.
we reunited and our finances work differently now and we have a lot more transparency but man none of that would have happened without a lot of hard work and THERAPY. why does ramit never tell these people to go to actual, conducted-by-trained-professionals therapy? most of these issues are not really about money – they certainly weren’t for us.
14 Likes
Ok, I just listened to today’s episode. My first thought was to laugh at not knowing what a shed was and what you put in a shed. Especially since yesterday I finally went ahead and bought a shed that we’ve been discussing since September, just to store our strollers in! 
It was only $600 though after tax, not $2k.
He also said something toward the beginning that really rubbed me the wrong way. He said that when he walks into the house of someone with a lot of debt it is usually full of stuff, but when he walks into the homes of people with higher incomes they aren’t full of stuff like that. I get what he was saying, but I took argument with using debt and high income as if they are mutually exclusive. There are lots of high income people with tons of debt too and low net worth (and there are also lots of high income, high debt people with tons of stuff packed to the gills in their houses). I think he really meant high debt/low debt or low net worth/high net worth. I think income is somewhat irrelevant.
Anyway, continuing my thoughts on the episode, I could actually see my husband being like the husband on the show. Not in regards to not trusting, but in regards to his spending patterns. When we started dating my husband was living off disability and he had no savings at all and a lot of credit card debt. He was slowly chipping away at the debt, which was mostly accrued as travel expenses associated with his athlete career/paralympic stuff. He grew up low income and his overall mindset toward purchases was:
- See something he likes and wants to buy. Checks to see how much it costs
2a. If he has enough money in his checking account, he goes ahead and buys it
2b. If he doesn’t have enough in checking, then sees how far off he is. If it seems like a small/reasonable amount then he put it on a credit card
2c. If it seemed like a lot of money (thousands) then he just assumed he would never be able to afford it and put it out of his mind.
He also grew up in with friends and family for whom credit cards are just a way of life. He also frittered away a TON of money on things like gas station sodas. When we moved in together I started to take a little control of the finances, especially since I was paying for most of our living expenses. When we got married I paid off his credit card debt and we fully combined finances and I took control of managing them, with his input and trust. We have monthly and bi-weekly budget meetings and we set goals together and work towards them together but he trusts me to help guide us in the right direction. He is fully on board with not buying things until we have the money saved to pay for it, even with big things like cars. (And he is totally one of those guys who wants a truck just because it is “cool” even if he can’t drive it!). He also sees now that we can save up for big, expensive purchases. When we started dating he was 31 and even at that point in time, he could not imagine ever having $20k in a savings account. That seemed like “rich person” savings to him. When we bought our house in September we had over $50k in savings ready to throw at the house for renovations, plus retirement money, savings for other stuff, etc. He made a comment then that never in a million years would he have thought that was possible, 10 years prior.
12 Likes
I’m sorry, that sounds like a really rough situation. I’m glad that therapy helped you guys through it!
4 Likes
thanks. it was rough there for a while, and ending up being the inciting event that forced me to start to deal with the ridiculous amount of chaos and trauma i experienced as a child, which i assumed was not really impacting me because i was smart and functional and “fine” hahahahahhaa oh sweet summer child!
it was 3.5 years ago and the growth both of us have experienced in that time has been amazing and painful and wow, i cried so many deferred tears. but it’s better now. more vulnerable and real.
i felt really bad for the wife in this episode, because clearly she and her husband have a lot of love in their marriage. but sometimes there’s just stuff you can’t live with. for me that was secret debt (tbh any debt at all is a non-starter for me these days). i hope the couple in the podcast can figure out a new approach before she has to make the choice between booting him or living a life that she can’t stand. in my case, it was incredibly painful and we didn’t even have kids or property to worry about.
8 Likes
In my experience the difference is that rich people have storage solutions and more space, but just as much crap.
9 Likes
Well, exactly. The house is still full of stuff, it is just organized better. And they probably have cleaners that clean the house and they can throw more money at a larger house with more closets and more organizing things.
6 Likes
Same here! My husband was of the school of thought that “everyone dies with debt”. He never made big purchases but he frittered away his money on little stuff: coffee, cigarettes, candy, sandwiches. He was convinced it was “only $2-$3” but it was $2-$3 like 10 times a day every single day and he made minimum wage! When he turned 18 his mom advised him to take out a personal loan to buy a brand new van (to build credit of course!) which he did. He would also buy the cheapest versions of everything else, which resulted in spending more overall since the quality was so poor.
Just like with you guys, we moved in together and I immediately took over finances (and packing his lunches, lol). He did not believe we made enough to live on without credit cards, let alone save. I asked him to give me his trust for one year and he did, at the end of the year I’d paid off all the debt and we had $6,000, which was the most money he’d ever seen in a bank account. But yeah, pre-me he believed that some people are just born rich, everyone else is poor, college is for snobby suckers, and that’s how it is and nothing can be done about it so might as well just enjoy the day.
I feel so fortunate that he’s continued to trust me with our finances. Now he’s so responsible! I’m not sure why he did trust me so early on? But I’m glad he got on board considering we had such opposite approaches.
ETA: Oh and his dream car is totally a ford ranger, lol.
10 Likes